Redistributing Health

Alan Reynolds of the Cato Institute has written the following article which was published in the New York Post on 10/12/09:

http://www.cato.org/pub_display.php?pub_id=10623

Alan Reynolds exposes one of the goals of the current health care legislation:

• The fundamental Proponents of compulsory, government-designed health insurance can't seem to understand why others disagree. Perhaps the public is realizing that these proposals are fundamentally about redistributing health?
• The major proposals, the AARP Bulletin explains, "include around $500 billion in savings carved from future growth in Medicare spending over a 10-year period. "Even in the Obama era, $500 billion is a lot. Yet we're supposed to believe that less is somehow more — that seniors will benefit from these spending cuts. "The Obama administration and congressional leaders," intones a recent New York Times editorial, "are hoping to save hundreds of billions of dollars by slowing the growth of spending in the vast and inefficient Medicare system that serves 45 million older and disabled Americans. The savings would be used to help offset the costs of covering tens of millions of uninsured people."
  
• President Obama, in an Aug. 16 Times op ed, made such redistribution seem easy and painless: "We'll cut hundreds of billions of dollars in waste and inefficiency in federal health programs like Medicare and Medicaid," he said.
  
• Such efforts to appease seniors are not working because they are transparently dishonest.
  First of all, the Congressional Budget Office figures that cutting "waste, fraud and abuse" might save $200 million a year — that's millions, not billions.
  
• Second, the hundreds of billions in "savings" are to be carved out of the hides of Medicare providers and Medicare Advantage benefits, not Medicaid. In the Senate Finance Committee proposal, Medicaid gets $345 billion more money from 2014 to 2019.
  
• The Times claims the cuts should actually make Medicare better "for most beneficiaries," partly by "helping keep Medicare solvent." That is either a hoax or fraud. If "the savings would be used to help offset the costs of covering tens of millions of uninsured people," as the Times says, then the same savings can't also be used to shore up the Medicare trust fund.
  
• The president and his allies in Congress believe they can use deep cuts in Medicare — plus steep new taxes on health insurance, drug and medical device companies — to pay for a vast expansion of Medicaid and new health-insurance subsidies.
  
• These grandiose redistribution schemes are grounded in lethal economics and suicidal politics. Because bad ideas are hard to sell, politicians and journalists have been peddling health redistribution with the rhetorical and statistical equivalent of waste, fraud and abuse.
  
• American voters, particularly seniors, don't like to be lied to. They are just as leery of the political redistribution of health as they are of the redistribution of wealth.