Now the Republicans Want to Raid Medicare
At the State of the Union in February, lawmakers of both parties applauded when President Biden said Medicare is “off the books now” and “not to be touched.” So much for that.
A line from the Congressional Budget Office score of the legislation tells the tale. An expansion of site-neutral payment policies regarding physician-administered drugs would reduce Medicare spending by $3.7 billion in the coming decade.
Site-neutral payment is a worthy reform. Medical providers should receive the same amount of money for a service regardless of where it is done—in this case, a hospital outpatient department or a doctor’s office. But because Medicare often pays more for services done in certain settings, hospitals have been buying physicians’ practices and converting them to off-campus “hospital outpatient departments.”
These practices cost Medicare more in reimbursement payments, and Medicare beneficiaries more in out-of-pocket costs. They also encourage consolidation within the health care sector, which tends to raise prices when hospitals have more leverage to demand higher rates from insurers.
Many lawmakers in both parties say Congress should take an even more aggressive tack, and that Medicare can and should save far more than $3.7 billion by expanding site-neutral payment policies in areas beyond physician-administered drugs.
But the $3.7 billion in lower Medicare spending from this change won’t go to preserving Medicare’s solvency. Instead, it will help pay for more than $15 billion in new spending the bill allocates elsewhere in health care.
Yes, this sounds familiar. More than a dozen years ago, Democrats raided more than $716 billion from Medicare to pay for Obamacare. Much of the current bill’s new spending comes from extending programs created by Obamacare, community health centers and the National Health Service Corps. Republicans went from wanting to repeal Obamacare to wanting to extend it, and are doing so by the same means Democrats used in 2010—raiding Medicare.
Republicans devoted the midterm elections to attacking Democrats—rightly—for raiding Medicare by more than $100 billion in last summer’s Inflation Reduction Act. Why would they attempt to divert funds from Medicare so soon after Democrats used the program to fund everything from Tesla subsidies to new Internal Revenue Service agents?
One answer lies in the swampy ways that Washington works. While Mr. Biden and congressional Republicans made a big show of “protecting” Medicare and Social Security in front of the cameras in February, they act differently when they think no one is looking.
But the American people need a break from Washington games. Medicare is already functionally insolvent, and it faces even bigger shortfalls in coming years. The program and its beneficiaries deserve better than to have swampy lawmakers raid the program to fund more government spending.
This post was originally published at The Wall Street Journal.