06 May 2010

If We Ignore It, Maybe It Will Go Away ...

This little story about the increasing estimates of health care reform costs blew right by, didn't it? Parts of the health care reform plan are already facing insolvency. Expect more stories like this, and expect them to be largely ignored.

Report says health care will cover more, cost more

President Barack Obama's health care overhaul law is getting a mixed verdict in the first comprehensive look by neutral experts: More Americans will be covered, but costs are also going up.

Economic experts at the Health and Human Services Department concluded in a report issued Thursday that the health care remake will achieve Obama's aim of expanding health insurance — adding 34 million to the coverage rolls.

But the analysis also found that the law falls short of the president's twin goal of controlling runaway costs, raising projected spending by about 1 percent over 10 years. That increase could get bigger, since Medicare cuts in the law may be unrealistic and unsustainable, the report warned.

The report projected that Medicare cuts could drive about 15 percent of hospitals and other institutional providers into the red, "possibly jeopardizing access" to care for seniors.

The report's most sober assessments concerned Medicare.

In addition to flagging provider cuts as potentially unsustainable, the report projected that reductions in payments to private Medicare Advantage plans would trigger an exodus from the popular alternative. Enrollment would plummet by about 50 percent. Seniors leaving the private plans would still have health insurance under traditional Medicare, but many might face higher out-of-pocket costs.

In another flashing yellow light, the report warned that a new voluntary long-term care insurance program created under the law faces "a very serious risk" of insolvency.

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