Monday, August 24, 2009

Weekly Newsletter: August 24, 2009

Deficit Time Bomb Set to “Explode” Tomorrow

Tomorrow, both the Office of Management and Budget (OMB) and the Congressional Budget Office (CBO) will release their updated deficit projections for both the current fiscal year and the upcoming decade. Press reports released late Friday night indicate that the OMB deficit projections will increase by $2 trillion over ten years when compared to the President’s projections of only six months ago—to a deficit of more than $9 trillion this decade alone. While no such estimates have leaked out of CBO ahead of that non-partisan office’s release of its budget numbers, unemployment has already exceeded CBO’s March projections, as have estimates for long-term Treasury interest rates—suggesting that federal revenues may drop more than expected, even as the federal government’s cost of borrowing continues to grow.

Given these impending reports, many Members may be concerned by Democrat attempts to enact health “reform” that will expand federal entitlement obligations while seemingly ignoring the United States’ capacity to carry its existing fiscal obligations, let alone the impact of any future programs created. Particularly after Treasury Secretary Geithner’s claims of the United States’ fiscal rectitude were publicly mocked by an audience during his recent visit to China, Members may believe that Democrats would be wise to provide much more clarity—and spending restraint—before embarking on a new and costly government takeover of health care.

The Face of Government Rationing

From Oregon comes a story that may represent the face of health care across America under Democrats’ “brave new world.” Barbara Wagner, a patient in the state’s Oregon Health Plan, had a request for a chemotherapy drug denied, only to have the same denial letter inform her that the plan would pay for “physician aid in dying.” While the drug denied by the plan—one which would allow Barbara to treat her cancer and live—costs $4,000 per month, the approved drug—which would cause her to die—costs but $100. When contacted by a local news station about the health plan’s priorities, the chairman of a board that sets priorities for the government plan claimed that, “If we invest thousands and thousands of dollars in one person’s days or weeks, we are taking away those dollars from someone.”

Many Members may be saddened, but not surprised, by the government-run Oregon Health Plan’s misplaced priorities. The plan has a history of rationing access to care, creating a list of priorities and refusing to pay for certain treatments and procedures ranked low on the priority scale. In fact, Oregon’s most recent list of “bureaucrat-approved” treatments gives abortion higher priority than ectopic pregnancies or infections stemming from a miscarriage.

Given these skewed priorities in one state—where a bureaucracy will pay for life-destroying treatments, but not life-sustaining ones—many Members may believe that Democrats’ government takeover of health care could replicate the Oregon model across the United States. In the legislation, a board of bureaucrats will be empowered to require individuals to purchase certain coverage—giving unelected officials significant power over all Americans’ health care. Coupled with its lack of prohibitions on government programs using cost-effectiveness tests to deny access to treatments, the legislation’s high and unsustainable costs could well lead to rationing by federal bureaucrats on the same terms as the Oregon model—where, by denying access to life-saving treatments, government ensures that a life-and-death choice for patients isn’t really a choice at all.