Cynical Synapse

Tue, 24 Nov 2009

Healthcare Reform is Just a Shell Game

Filed under: Budget, Citizen rights, Congress, Economy, Government, Legal, Medicine, Michigan, Politics — cynicalsynapse @ 1:08 pm

Evil shell game

Yesterday, Health and Human Services Secretary Kathleen Sebelius announced the release of extensive studies she says detail the local benefits of healthcare reform. Healthcare reform is vital to Detroit, Sebelius said during a conference call. She added the region has too many people without health insurance or with costly premiums. In a sort of stick-and-carrot approach, she added “So doing nothing would just…I would suggest…continue to increase what is already a very dramatic gap in who has insurance coverage and who doesn’t.” According to her, Michigan’s uninsured would jump to 1.6 million without reform.

The carrot Sebelius is offering is healthcare coverage for Michigan’s 1.3 million uninsured. She claims thousands in Michigan will benefit from coverage, lower premiums orpremium subsidies, and better coverage. Her implication is by avoiding growth in the rate of the uninsured, we’ll save money. And here’s where the shell game comes into play. A majority of the newly insured will fall under an expanded Medicaid program.


First, we are already paying for the uninsured, either through taxes or the insurance premiums we pay now. Shifting the cost entirely to the taxpayers doesn’t really change anything. A rose is a rose no matter what you call it. Next, supporters of healthcare reform say 94-96% of the population will have coverage. Let’s split the difference, so 95% of Michigan’s 10 million people will enjoy health insurance. That’s 9.5 million compared to today’s 8.7 million. An additional 800,000 will be covered. That still leaves .5 million without coverage of any kind. So, healthcare reform will only fix less than 62% of today’s uninsured.

About those Medicaid costs. If you didn’t know, Medicaid is a joint Federal-State program. Anyone see a problem here, especially Michigan’s current economic morass? In 2006, nearly 1.5 Michiganians participated in Medicaid at a per capita cost of $5,482. The Feds match 58.1% of that, meaning Michigan has to come up with 49.1%, or $3.4 billion.

Healthcare reform will add about 800,000 people to Michigan’s Medicaid rolls. Under the Senate plan, the Feds would cover the additional cost, including the state’s share, for 3 years. After that, the Medicaid balloon payment comes due. Assuming no change in the Federal match, Michigan will need an extra $1.8 billion for Medicaid annually beginning in year 4. Sounds like an unfunded mandate to me. And the Congressional Budget Office states the costs of unfunded mandates on the private sector exceed those allowed in the Unfunded Mandates Reform Act.

So, let’s see if I’ve got this straight. Beyond the dubious constitutionality of healthcare reform, the bill violates the Unfunded Mandates Reform Act. How can anyone vote in favor of a bill that breaks the law? I think that’s how the Nazis used to legalize their behavior. In fact, the healthcare reform bill doesn’t even manage to contain skyrocketing costs. In short, it’s a failure all the way around.

All of that leads me to wonder. Has anyone read the bill?

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