Tag Archives: Budget

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Is Medicare in a debt crisis? Does Medicare need to be reformed?

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Medicare is a social program that pays for the health care and prescription drugs of seniors. Forbes magazine explains the basic facts of the Medicare funding situation.

First, the facts:

Often lost in the campaign rhetoric and obscured by the opinionated news dominating the television and print media are the following background facts about Medicare, America’s most burdensome entitlement program given both the demographics and the growth expected in health care costs:

• Medicare is a taxpayer funded, government-run insurance program that is financially unsustainable in its current form. By all estimates, Medicare is spiraling into bankruptcy, with an unfunded liability of almost $38 trillion and a hospital insurance trust fund that will become insolvent in 2024, according to the 2012 Medicare Trustees Report.

• Medicare was already the single insurance program most likely to reject a claim, compared to all of the eight comparable private insurance plans studied in the AMA 2008 National Health Insurance Report Card. This rejection rate was double that of the private insurers’ average – those very same insurance companies vilified by President Obama as denying coverage to Americans.

• An increasing proportion of doctors are already not accepting Medicare patients. A 2008 report by the Medicare Payment Advisory Commission, an independent federal panel, said that 29 percent of its beneficiaries who were looking for a primary care doctor had a problem finding one. A 2008 survey by the Texas Medical Association that found that only 58 percent of the state’s doctors accepted new Medicare patients, and only 38 percent of primary care doctors did, a number shrinking due to government- decreed payment that is lower than cost. In the 2008 HSC national tracking survey, more than 20 percent of primary care doctors accepted no new Medicare patients (only 4.5 percent accepted no new privately insured patients) and about 40 percent of primary care doctors and 20 percent of specialists refused most new Medicare patients.

The rest of the article compares the Obama and Ryan plans for reforming Medicare.

Here’s a snippet:

President Obama’s plan for Medicare will not simply reduce access to doctors. According to the Medicare Trustees, Medicare payment reductions under the new law will cause hospitals, nursing facilities, and home health agencies to operate at a loss – 15 percent lose money by 2019, 25 percent by 2030, and 40 percent by 2050. The Trustees Report concluded the obvious – health care providers “would have to withdraw from serving Medicare beneficiaries, or shift substantial portions of Medicare costs to their non-Medicare, non-Medicaid payers.” Can American families with private insurance who already pay almost $1,800 per year – extra – for the underpayment by Medicare and Medicaid, subsidizing public insurance by more than $88 billion dollars per year, afford to add even more because of the president’s law?

Signed into law by President Obama is another nefarious method of reducing Medicare payments. A wholly unaccountable, government appointed 15-member Independent Payment Advisory Board, the IPAB, does not just “recommend” changes to reimbursements. It has unprecedented power to reduce (but not to increase) payments to doctors that the Secretary of Health and Human Services is required to implement. To be sure, the IPAB acts independently of the people, immune from Congressional oversight, and even beyond control of the judiciary – ensured in language within the law that isolates it from repeal.

The Paul Ryan plan changes nothing about Medicare for Americans 55 and older. Those who are younger than 55 will be given the option of choosing a private plan and then paying for it with a voucher provided by the government.

News

Defense cuts to an already weakened military exposes us to aggression

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Mackenzie Eaglen is a defense policy analyst for the American Enterprise Institute.

Here’s a recent article that she wrote from the Wall Street Journal. (Full text also here on the AEI web site)

Excerpt:

Washington is battling these days over “sequestration,” the $500 billion additional cut to the defense budget looming in January.

[…]In April 2011—long before the near shutdown of the government and the last-minute debt-ceiling deal, which paved the way for sequestration—the president outlined $400 billion in defense cuts he had already approved. He also said that he wanted to “do that again” and find another $400 billion in military spending reductions. All this without any talk of threats, strategy or requirements—just arbitrary budget targets imposed on the military.

Even before sequestration and the possible loss of a half-trillion dollars, the U.S. military has seen three years of budget cuts. The consequences are already here. We have to look all the way back to 1916 to find a year when the Air Force purchased fewer aircraft than are included in Mr. Obama’s 2013 budget request.

Many of the Air Force’s aerial refueling tankers predate human space flight. Training aircraft are twice as old as the students flying them. The F-15 fighter first flew 40 years ago. A-10 ground-attack planes were developed in the Carter years. And all of our B-52 bombers predate the Cuban missile crisis.

Then there’s the Navy, which is the smallest it has been since 1916. At 286 combat and combat-support ships, the Navy today is less than half the size it reached during the Reagan administration. And what about those men and women who have been fighting America’s wars in Afghanistan and Iraq since 2001? They’re losing 100,000 in active duty personnel. Surely some will go from the front lines to unemployment lines as a result.

[…]Military leaders have suggested that taking on Syrian President Bashar al-Assad and his Third World army would be an operation of “many, many months.” The so-called “pivot” to Asia is being mimed with fewer ships on longer deployments and a shrinking, aging air force. We’re ignoring a wholesale Chinese power grab in the South China Sea and watching the nuclearization of Iran.

In another article on AOL Defense, she focuses in on the cuts to the U.S. Air Force. (Full text also here on the AEI web site)

Excerpt:

Between the existing reduction of $487 billion and sequestration’s additional half-trillion dollar cut, the Pentagon faces a very profound strategic turning point — one entirely different than that articulated by Secretary Panetta. Instead of prudently posturing for future successes, America’s armed forces are headed for a crash.

These pressures are perhaps best illustrated within the Air Force. The service absorbed 90 percent of the cuts levied on the Department of Defense in the 2013 budget — $4.8 billion of $5.2 billion. The effects have been immediate and pronounced: nearly 10,000 airmen are being cut; 227 aircraft are being prematurely retired; and critical capability shortfalls are on the rise.

[…]These budget cuts would not present such dire effects if the Air Force had been able to use the past decade to recapitalize its fleet and overarching infrastructure. At the end of World War Two, the Korean War, Vietnam, and the Cold War, the service was able to weather post-war budget downturns precisely because it had reset the majority of its capabilities during wartime.

Circumstances were different this past decade. The Air Force, already stretched thin by the 1990s procurement holiday, actually saw its percentage of the defense budget decline by one-third during the wars in Iraq and Afghanistan. The service canceled or delayed the vast majority of its modernization portfolio to sustain wartime operational demands.

So 20 years of underfunding has given us an Air Force on the brink. Its aircraft average a quarter of a century in age-with many dating back to the Eisenhower Administration. The wings of Carter-era A-10 ground attack airplanes are riddled with structural cracks. Airmen learning to fly are strapping into T-38s over twice their age. B-52s, all of which pre-date the Cuban missile crisis, are spending up to a year in depot-level maintenance. In light of the F-22 shortage, the Air Force is now extending the lifespan of its 28 year-old F-15s to 18,000 hours — more than three times their original design life.

The Air Force also spent the last decade retiring nearly a quarter of its bombers, fighters, and cargo aircraft in an attempt to free up money for immediate priorities. While helpful on a budget spreadsheet in the near-term, this has stretched the remaining tails even thinner. Shrinking the fleet makes little sense when the mission demand is constant. Aircraft availability rates and maintenance statistics clearly illustrate the rising costs associated with this decision.

Obama is also in favor of the complete disarmament of the United States with respect to nuclear weapons.

The Wall Street Journal explains:

The White House and Pentagon are considering several proposals that would deeply cut the nation’s stockpile of nuclear weapons, potentially to as low as 300 warheads under one such plan, according to a U.S. official.

The proposals haven’t been presented to President Barack Obama but are being debated by lower-level officials on the national-security staff and in the Pentagon.

The U.S. official said the government isn’t considering a unilateral cut to the nation’s nuclear arsenal. Instead, the different proposals represent arsenal levels that could be negotiated with Russia in a future round of arms-control talks.

Nonetheless, the prospect of nuclear-arsenal cuts during a hard-fought presidential campaign is certain to stoke political controversy.

Under current treaty obligations, the U.S. must reduce its nuclear arsenal to 1,550 warheads by 2018 from just below 1,800 now. One of the new proposals would cut the arsenal to between 1,000 and 1,100; another proposes an arsenal of between 700 to 800; and the most drastic proposal would cut the arsenal to between 300 and 400, according to the official.

The fact of the matter is that there are hot spots and threats all over the world. If we want to work towards peace and protect the weak, then we need a large, capable military force. This is the doctrine of peace through strength. Talk is cheap, and disarmament only emboldens evildoers to be aggressive. If we want to stop war, we have to make it costly for aggressors and tyrants. They have to know that there is a cost.

News

Obama suffers the most disastrous week of his Presidency

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A must-read re-cap from the Washington Times.

Excerpt:

Consider:

• Last Friday, Mr. Obama wandered into the killing of Trayvon Martin. Aided by his ignorance of the situation, knee-jerk prejudices and tendency toward racial profiling, Mr. Obama played a heavy hand in elevating a tragic situation in which a teenager was killed into a full-blown hot race fight.

Americans, he admonished, need to do some “soul-searching.” And then, utterly inexplicably, he veered off into this bizarre tangent about how he and the poor dead kid look so much alike they could be father and son. It was election-year race-pandering gone horribly wrong.

• By the start of this week, Mr. Obama had fled town and was racing to the other side of the planet just as the Supreme Court was taking up the potentially-embarrassing matter of Obamacare. While in South Korea he was caught on a hidden mic negotiating with the president of our longest-standing rival on how to sell America and her allies down the river once he gets past the next election.

• Meanwhile, back at home, the Supreme Court took up the single most important achievement of Mr. Obama’s presidency and, boy, was it embarrassing. The great constitutional law professor, it turns out, may not quite be the wizard he told us he was.

By most accounts, Mr. Obama and his stuttering lawyers were all but laughed out of the courthouse. They were even stumbling over softball questions lobbed by Mr. Obama’s own hand-picked justices.

• Mr. Obama closed his week pulling off a nearly unimaginable feat: He managed to totally and completely unify the nastily-fighting Democrats and Republicans in Congress. Late Wednesday night, they unanimously voted — 414 to zip — to reject the budget Mr. Obama had presented, leaving him not even a thin lily’s blade to hide behind.

So, in one week, Mr. Obama got caught whispering promises to our enemy, incited a race war, raised serious questions about his understanding of the Constitution, and then got smacked down over his proposed budget that was so wildly reckless that even Democrats in Congress could not support it.

It’s important the Obama’s secular leftism be put on display.