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Comments on the Cost of Health Care Bill (expanded 9/14)

Sep 13, 2009

President Obama vowed not to sign a health care bill that "adds one dime" to the existing budget. It will be paid for, he said, in two ways: (1) 90% by stopping "waste and fraud" in the existing Medicare system, and (2) by raising taxes on those making over $300,000 per year.

That sounds great . . . but I have a question.

First, Medicare has been around for decades. There has always been "waste and fraud" (mostly fraud) in the system. This is where the government gets overcharged for treatment or billed for treatments not given. I have no doubt that this occurs all the time. In fact, it sounds like the government has a precise figure on how much "waste and fraud" is happening yearly, since they plan to put a stop to it and apply the savings directly to the new health care costs in the bill.

My question is HOW they intend to stop the waste and fraud. If they had the ability to stop it, it would have been done a long time ago. It is not as easy to stop the fraud as it may seem. How do we know? Because after trying for decades, they have yet to put a stop to it. If they cannot stop it, then how can they apply these funds to the new costs of this Health Care Bill?

It is obvious that the President is counting on money that the government has NEVER been able to get its hands on for decades. And by the way, this is also why opponents of the bill say that the money for this bill will be taken out of Medicare. If the bill passes, we will see if Medicare gets robbed to make up for the government's inability to recover money paid out fraudulently. More than likely, the Fed will just print up new money to cover the shortfall. It's the easiest way to get their hands on money they don't have.

Can we count on the higher tax rate for those making over $300,000? He says that this will add about $9.00 per month to their tax bill. Certainly, few people would begrudge the government $9.00 per month so that we can have universal health care!

Of course, with every raise in taxes--especially on the "wealthy"--more of them will figure out how to set up Trusts and Foundations to divert more money into tax-free organizations which they can control without owning the funds personally. Secondly, the really wealthy (as well as most multinational corporations) are already hiding most of their assets offshore in order to avoid taxes on them.

So I wonder how much money would actually be collected in taxes to pay for this new bill.

Finally, no one can prove that all this new revenue will actually flow into the government's coffers until AFTER the bill is actually passed. Once passed, the entire point will become moot, because the President will sign it before a single dime has been collected. If he is proven to be wrong in the end, will he repeal the bill? I challenge the President to vow to repeal the bill if it adds a single dime to the existing budget.

The bottom line is that we are being lured into supporting a bill whose funding is questionable and unprovable. Is it, in fact, a bear trap? Will it be like the war in Iraq? (easy to get in; not so easy to get out)

So the Republican opposition claims that the new health care bill will be paid for out of Medicare. In fact, it will simply take over and expand Medicare and Medicaid to include everyone. Medicare and Medicaid are already lesser forms of universal health care, so they will be replaced by the new health care bill. That means also that any funds allocated toward Medicare and Medicaid will simply be transferred to the new system. The transition, however, may keep them technically separate, but they will function as mere departments of a larger bureaucracy.

Funding for Medicare and Medicaid is much like Social Security funding. They were all supposed to pay for themselves. But when the government "borrowed" the funds and replaced them with IOU's, those funds became dependent upon the government repaying its loans. Meanwhile, the government uses those funds to reduce its own deficit, so that it looks like the monthly deficit is less than it really is. Repaying the S.S. fund is not reported on the official deficit figures.

With the new takeover of Medicare and Medicaid, the government's IOU's will never have to be repaid. Medicare and Medicaid made bad loans to the government, and so the government is now taking over bankrupt corporations so that it never has to repay its loans or admit to its IOU's. So how will the government REALLY pay for universal health care? It will default on the debt to Medicare and Medicaid and hope to start fresh with the income already allocated to those programs. The President says that the shortfall will be erased by eliminating "waste and fraud," and we are supposed to believe that he will succeed where every other administration has failed (to eliminate this "waste and fraud.")

Once Medicaid and Medicare are fully integrated into the new and bigger system, the "facts on the ground" will make it impossible to separate them ever again. Universal health care will become permanent, regardless of whether or not it costs us "one dime extra."

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Category: Commentary

Dr. Stephen Jones

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