It’s one thing to call for “smaller federal governement” or for “less federal spending” or for “cost savings” as vague, general, feel-good concepts. It’s quite another to see the actual effects of reduced federal spending.

Consider Medicare. Relative to the real cost of medicine, Medicare payments to doctors and hospitals have gone down. Many people cheer these payment reductions as evidence doctors have been making too much and charging too much, and that the government is trying to be frugal in its payments. And isn’t frugality a good thing?

Here are some excerpts from an April 2nd, 2011 article by Ricardo Alonso-Zaldivar, of the Associated Press.

Every year, thousands of people make a deal with their doctor: I’ll pay you a fixed annual fee, whether or not I need your services, and in return you’ll see me the day I call, remember who I am and what ails me, and give me your undivided attention.

But this arrangement potentially poses a big threat to Medicare and to the new world of medical care envisioned under President Barack Obama’s health overhaul.

The spread of “concierge medicine,” where doctors limit their practice to patients who pay a fee of about $1,500 a year, could drive a wedge among the insured. Eventually, people unable to afford the retainer might find themselves stuck on a lower tier, facing less time with doctors and longer waits.

Doctors are people. Nurses are people. They have personal lives. They have families. While there may be a certain amount of altruism associated with being a medical care giver, ultimately people, particularly the best people, drift toward money. So restricting Medicare payments tends, over time, to reduce the number and quality of people willing to be educated and trained in medicine, or willing to practice, particularly in primary care.

Hospitals are businesses. Potentially more lucrative businesses attract more investors than do less lucrative businesses. So restricting Medicare payments reduces the number of hospitals, and reduces the sophistication of equipment and systems in the remaining hospitals.

Medicare recipients, who account for a big share of patients in doctors’ offices, are the most vulnerable. The program’s financial troubles are causing doctors to reassess their participation. But the impact could be broader because primary care doctors are in short supply and the health law will bring in more than 30 million newly insured patients.
If concierge medicine goes beyond just a thriving niche, it could lead to a kind of insurance caste system.

“What we are looking at is the prospect of a more explicitly tiered system where people with money have a different kind of insurance relationship than most of the middle class, and where Medicare is no longer as universal as we would like it to be,” said John Rother, policy director for AARP.”

As Tea (formerly Republican) Party Patriot member dance about, hoisting their signs, Medicare slowly shows signs of distress. Doctors have begun to opt out of a system they feel is uneconomical and even unfair.

The trend caught the eye of MedPAC, a commission created by Congress that advises lawmakers on Medicare and watches for problems with access. It hired consultants to investigate. Their report, delivered last fall, found listings for 756 concierge doctors nationally, a five-fold increase from the number identified in a 2005 survey by the Government Accountability Office.

The transcript of a meeting last September at which the report was discussed reveals concerns among commission members that Medicare beneficiaries could face sharply reduced access if the trend accelerates. “My worst fear — and I don’t know how realistic it is — is that this is a harbinger of our approaching a tipping point,” said MedPAC chairman Glenn Hackbarth, noting that “there’s too much money” for doctors to pass up. Hackbarth continued: “The nightmare I have — and, again, I don’t know how realistic it is — is that a couple of these things come together, and you could have a quite dramatic erosion in access in a very short time.”

Another commissioner at the meeting, Robert Berenson, called concierge medicine a “canary in the coal mine.” . . . MedPAC’s Hackbarth declined to be interviewed. But Berenson, a physician and policy expert, said “the fact that excellent doctors are doing this suggests we’ve got a problem. The lesson is, if we don’t attend to what is now a relatively small phenomenon, it’s going to blow up.”
When a primary care doctor switches to concierge practice, it means several hundred Medicare beneficiaries must find another provider.

And why is an excellent concept like Medicare being dismantled? Because of the false beliefs our Monetary Sovereign federal government “can’t afford” to support universal health care, or the government is “too big,” or people should learn to “take care of themselves.”

The next time you hear a Tea (formerly Republican) Party Patriot (ironic, isn’t it?) scream their latest chant, “Cut it or shut it,” understand you are witness to the tolling of the Medicare bell – as well as the bell for so many other valuable federal projects. These people might as well be screaming, “Cut the American life style. Make us third world.”

My prediction: Rather than fund Medicare properly, as a Monetarily Sovereign nation easily could do, Congress will attempt to outlaw concierge doctors or add a tax to medical services provided by these doctors. This will exacerbate the problem, as fewer people will enter and remain in the medical profession, but addressing a bad law with a worse law often is Congress’s knee-jerk approach.

Rodger Malcolm Mitchell
http://www.rodgermitchell.com

No nation can tax itself into prosperity, nor grow without money growth.