CMS Drops the Ball on Medicare Advantage Cuts

The Centers for Medicare and Medicaid Services was supposed to, under ObamaCare, reduce payments to insurance companies that offer coverage through Medicare Advantage by 2.3%. Unsurprisingly, they changed their mind. Not only are they not going to reduce payments, they’re going to increase them by 3.3%.

Medicare needs some serious reform. That’s just a fact. If it’s not, it will be bankrupt in just a few years. So why the delay? There are a few reasons. The first is that no politician wants to be labeled as the one that “kills” Medicare. It’s long been the third rail (along with Social Security, of course) of politics – touch it and your career is over. Another reason is lobbyists. According to Philip Klein at the Washington Examiner:

In February, as CMS announced plans to cut payment rates in 2014, it triggered an intense lobbying effort from insurers, who got 160 members of Congress from both parties to send letters asking the administration to back off. The insurance industry’s lobbying group, America’s Health Insurance Plans, celebrated the about face by the administration: “CMS has taken an important step to help stabilize Medicare Advantage at a time when the program is facing significant challenges.”

So we have politicians that are already wary of messing with Medicare, and then we have a lot of money on the line for some powerful lobbying groups. It’s the perfect recipe for disaster. What makes people think that the rest of the Medicare cuts will go through? There are supposed to be $700 billion in Medicare cuts. If they’re not made, ObamaCare will absolutely add billions of dollars to the deficit.

This isn’t a surprising development, but it is a serious one. The Obama Administration is very set on their rhetoric that ObamaCare won’t push us further into debt, but it’s very clear that it will.

Something needs to be done, and soon. Get on it, Congress.


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