It is important for employers and every American to understand what it means when the President and other politicians talk about paying for health care and reducing costs. To put it simply they are talking about lowering the net cost to the Federal government for expanding health insurance. The major ways they plan to do this are to lower payments to Medicare and Medicaid providers, and in one form of the other to raise revenue for the Federal government, that means higher taxes or lost tax benefits now in place. The 160 million Americans with employer-based coverage mainly enjoy those benefits.
On the other hand, the various legislative proposals will raise the cost of health insurance and health care. Some of these proposals are necessary to expand coverage to individuals, other changes are not necessary and questionable at best, things like providing certain preventive services with no out of pocket cost. But even without specific legislative language, cutting payments to Medicare providers means cost shifting to the private sector.
So, now you have to ask yourself, how does all this add up? The answer is that it does not add up. Some Americans will gain coverage and have the cost subsidized, but most Americans with coverage, including Medicare, are very likely to pay more for that coverage, have some benefits lessened and see no change in the medical inflation trend which continues to be several times general inflation. Moreover, while all this is going on, the problems of Social Security and Medicare are still with us.
Do you think it all adds up to better health care for America?