Last week the Congressional Budget Office released the “results” of our 2012 fiscal year. To no one’s surprise, we had another trillion dollar deficit. But, there is another troubling number in the analysis, if you are a senior, that is. The growth in Medicare spending was 3%.
So what, you say. That is not unexpected given that the “baby boomers” (those defined as being born between 1946 and 1964) are now becomming 65, and more and more will become eligible for Medicare for many more years to come.
But Obamacare changes the way we look at that. Under Obamacare, the annual growth in Medicare spending cannot exceed our country’s annual growth rate by more than 1%. If it does, than the Independent Payment Advisory Board must make cuts to Medicare spending. This year our country’s annual growth rate is 1.3%. So, if Obamacare were in effect this year, Medicare spending could grow by no more that 2.3%.
IPAB has only two options to achieve it’s Congressional mandate…lower payments to providers, or reduce what Medicare covers. I suppose there is a third option. As our President said, maybe at a certain point, you should just take a pill.
Luckily for you who are either on Medicare, or soon to be on Medicare, under Obamacare, you will not be forced to make that decision for yourself. The IPAB will make it for you.