Taking Obamacare Off the Books

by the Editors

You don’t have to be a Washington insider to understand what the Democrats are up to with their last-minute plan to run the “doc fix” — postponing scheduled cuts to doctors’ Medicare payments — on a separate legislative track. It’s all about Obamacare, as is so much this year. The Obama administration and its allies in Congress will do just about anything to get a health-care bill to the president’s desk, and that certainly includes spending whatever amount of taxpayer money they deem necessary — and doing so through a shameless ploy, offloading $247 billion in Obamacare costs onto a separate, standalone, unfinanced piece of legislation. Obama promised not to add “one dime” to the deficit for health care: Democrats now plan to dump $247 billion onto the nation’s already staggering pile of debt, using this piece of accounting trickery to cover their tracks.

The “doc fix” is political shorthand for repeal of the discredited “sustainable growth rate” (SGR) Medicare-payment formula, which determines the annual update of physicians’ fees. A comprehensive failure as a cost-cutting measure, SGR is a prime example of the bureaucratic central planning that Democrats now want to extend across all of American health care. SGR was supposed to keep Medicare spending on doctors’ services in line with economic growth by limiting the annual increases in the prices paid for each particular physician service. The trouble is that Medicare’s total cost is determined by both prices and volume, and the government has no way to control the use of physicians’ services. As fees have been cut, volume has soared — necessitating even deeper cuts to keep spending in line with SGR targets.

The sensible course is a thorough reform of how Medicare operates. So long as the program is dependent on payment schemes devised in Washington, we are doomed to endure SGR-style disasters over and over again...  Read the whole article.