Econ and Politics--Budget Cuts!

‘Potentially Devastating’

The president of the American Hospital Association discusses how Bush’s proposed budget cuts could hurt the nation’s medical facilities.

By Eve Conant
Newsweek
Updated: 6:03 p.m. CT Feb 5, 2007

Feb. 5, 2007 - More money for the military, but less for medical care—that’s the gist of George W. Bush’s $2.9 trillion new budget handed to Congress today. While the president urged the Democrat-controlled Congress to “listen to a budget that which says no tax increase” and one “that can be balanced in five years,” Democrats remained unconvinced. “[The budget is] “filled with debt and deception, disconnected from reality and continues to move America in the wrong direction,” responded Senator Kent Conrad, chairman of the Senate Budget Committee.
Health care workers were especially taken aback by the plan: cuts to Medicare spending would equal about $66 billion over five years and Medicaid would see a similar decline in funds by about $25 billion over the same period.

The American Hospital Association (AHA), a national organization that represents nearly 5,000 hospitals and health-care systems, immediately condemned the cuts. AHA president Rich Umbdenstock described Bush’s plan as singling out children, seniors and the disabled to carry the burden of achieving a balanced budget. The 35-year veteran of health-care management spoke to NEWSWEEK’s Eve Conant about how the proposed cuts could affect an already overtaxed and understaffed hospital system.

Excerpts:
NEWSWEEK:

Were you expecting these cuts?

Umbdenstock: There were clear signals in D.C. that something was coming, and we’ve been hearing rumors all week about what the numbers would look like. Let’s just say the most aggressive rumors have been realized. These cuts are the deepest we thought could possibly come about. The magnitude of these cuts is hard to understand.

What do you think would happen if these cuts go through?

Cuts of this magnitude would undercut hospitals’ ability to sustain services for the poor, for children, for the elderly—we’re talking about huge and potentially devastating effects. This proposed budget talks about curbing payments to providers but says nothing about costs of caring for patients, which continues to increase. For every dollar that hospitals spend toward Medicaid or Medicare treatment they already get only 92 cents for Medicare payments and an average of 87 cents for Medicaid patients.
Given the needs of the poor and the elderly, these cuts go in a direction that's simply inappropriate. These cuts are significant, to say the least. Hospitals are already losing money.

There is something to be said for balancing the budget, though. Is there some aspect of this plan that holds some merit?
I leave it to the administration to spell out their reasoning here. I understand they are trying to balance the budget and that it’s a priority, but to do it in this way jeopardizes the most vulnerable [and] is impossible to support.




I found the above article on MSN's news website today. I was actually searching in regards to the the wars we are fighting as a follow up on a topic we discussed in Government Honors today. Congress and Senate have both recently said even if they do not support Bush's plan to send more troops, they will NEVER leave the soliders without money. Where is this billions of dollars coming from? My first guess, and the obvious answer, no where. Our debt is growing by enormous proportions. This I realized, but I wondered what our government's plan was to get us out of debt. That is when I stumbled upon this lovely article.

Medicare and Medicaid are a few of the governmental assistance programs I actually believe in. They have a purpose, to ensure that even the poor and underprivileged can get proper health care. My grandmother, a nurse/supervisor of 40 years, has opened my eyes to the way Hospitals are run. They are businesses too, which means they need to pay their employees like every other business. Currently, when a Medicare/Medicaid patient comes in the Government assists in payments, but the Hospital supplies the rest of the money. "For every dollar that hospitals spend towards Medicaid or Medicare treatment they already get only $.92 for Medicare payments and an average of $.87 on average for Medicaid patients." Now lets think about this for a second, the hospital should not be loosing any money for providing care...they should be getting paid for it. The government has not fully stepped up to begin with, and now we are going to make budget cuts in the area of health care??

I don't know about you, but I would almost prefer an increase in taxes. Yes, easy for me to say...I really don't pay them. BUT if we start with health care whats next? America's fear of raising taxes plus a never ending war, puts our government in a tough position. Budget cuts or raising taxes? Maybe a little of both? How are we supposed to get our country into a better position economically? Our country has a limited amount of money and resources, which are being used overseas...now we are in a tough position and will continue to be through the war and even many years after. How do we make it better? Can we?