The Deficit Deal Defined

Is Medicare really safe?

Presidential advisor Valerie Jarrett chatted with Andrea Mitchell on MSNBC yesterday as part of a sales job for the deficit deal that smacked of the White House marketing campaign after health reform passed. “I think we are going to see a great deal of support” for the bill once the details are fully explained to lawmakers and the public, she said. Obama was able to save the safety net programs he prioritizes, she told Mitchell.

Save the safety net? Save Medicare and Medicaid? We know that the president bent over backwards to soothe the GOP, but to cloak what he did in Luntzian language about saving Medicare was really going overboard. The reality is something quite different, and that brings me to a fine blog post this morning by Robert Laszewski, who has returned to writing at Health Care Policy and Marketplace Review. During the health reform debate, you could always count on Laszewski to cut through the crap. His post on the debt deal does the same, laying out clearly what has happened and what will happen.

There “really isn’t an agreement on what cuts will be made,” Laszewski wrote. “Just the process that will be used to make them.” And that process includes the work of an uber-committee composed of six Dems and six Republicans who will decide the fate of Medicare, Medicaid, and Social Security. Obama, who you may recall was fond of saying we had to stop kicking the health care can down the road and act, has done just that when it comes to entitlements. Only the day of reckoning isn’t far off. The committee must act by November 23. Congress must accept its recommendations, or, as Laszewski put it, “face the consequences of the automatic $1.2 trillion fallback cuts.”

“All federal health care spending is on the table—Medicare, Medicaid, the new law, benefits, and provider payments,” he says.

Laszewski brings up a matter that the press overlooked in the theatrics leading up to Sunday night’s deal—what it will mean for paying the doctors and hospitals, who have arguably caused the health care inflation that Medicare has never been able to adequately tame. And that circles back to a point my colleague Greg Marx made about the missing discussion of these costs and their role in the deficit. “The real potential for cuts will be to provider reimbursement,” Laszewski argued.

The docs signed on to health reform thinking they were going to get a permanent reprieve from the cuts in Medicare reimbursement Congress mandated more than a decade ago when it was on another tear about reducing the federal budget. Through a bunch of temporary fixes, the doctors were off the hook. They may not be off the hook this time, Laszewski says. Doctors who face a 29.5 percent cut in their fee schedule come January 1 “need to be really worried.” The debt deal presumes that those fee cuts are in effect, and the super committee will start chopping from there.

“Given how reluctant Congress has been to cut the docs in past years, just how the heck are they going to accomplish net Medicare cuts and take care of the docs this time?” Laszewski asked. The hospitals are none too happy either, and have quickly resurrected their tried and true “scare the hell out of patients” spiel. The not-for-profit boys at the American Hospital Association say patient “access to care could be curtailed by further cuts to Medicare funding for hospital care.” Chip Kahn, who lobbies for the for-profit Federation of American Hospitals, says the deal “sets in motion billions of dollars in arbitrary Medicare funding cuts.”

Laszewski’s blog gives fodder to journos who want to dig behind that malarkey about saving Medicare. This story, guys, has all the elements we crave, if we just do the leg work. There will be strong lobbying by providers and attempts to use us by local doctors and hospitals—getting us to write scare stories about patients who won’t get care. The docs have done this in the past. There will be billions at stake, and—as Laszewski pointed out—what will happen when the docs and hospitals make up for lost revenue and shove their costs on to—you guessed it—their patients? What could make a better story?

For more from Trudy Lieberman on Medicare coverage, click here.

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Trudy Lieberman is a longtime contributing editor to the Columbia Journalism Review. She is the lead writer for The Second Opinion, CJR's healthcare desk, which is part of our United States Project on the coverage of politics and policy. She also blogs for Health News Review. Follow her on Twitter @Trudy_Lieberman. Tags: , , , , , ,