The third part of the approach President Obama outlined in his fiscal policy speech on April 13 addressed health care costs. He first contrasted his approach with his characterization of the Republican plan. He said Republicans intended to reduce health care costs in the federal budget by “asking seniors and poor families” to pay the health care costs, whereas his approach would “lower the government’s health care bills by reducing the cost of health care itself.”
How to do so? First, by reducing “wasteful subsidies and erroneous payments,” cutting “spending on prescription drugs by using Medicare’s purchasing power to drive greater efficiency and speed generic brands of medicine onto the market,” and working with governors “to demand more efficiency and accountability from Medicaid.” Next, the government will “change the way we pay for health care” with “new incentives for doctors and hospitals to prevent injuries and improve results.” Finally, “we will slow the growth of Medicare costs by strengthening an independent commission of doctors, nurses, medical experts and consumers who will look at all the evidence and recommend the best ways to reduce unnecessary spending while protecting access to the services that seniors need.” These initiatives, the President said, will save $500 billion over the next 12 years. And if those savings don’t materialize, “then this approach will give the independent commission the authority to make additional savings by further improving Medicare.”
This part of the speech seems completely inconsistent with a prior part of the same speech. The President earlier observed: “So because all this spending is popular with both Republicans and Democrats alike, and because nobody wants to pay higher taxes, politicians are often eager to feed the impression that solving the problem is just a matter of eliminating waste and abuse. You’ll hear that phrase a lot. ‘We just need to eliminate waste and abuse.’ The implication is that tackling the deficit issue won’t require tough choices.”
The clear implication of that passage is that promising savings from eliminating “waste, fraud and abuse” is not a serious approach to solving budget problems. Yet isn’t that all that the President’s health care approach does? Look again at the President’s proposed approach, and you’ll see plans to eliminate “wasteful subsidies and erroneous payments” (end waste), to demand more “efficiency and accountability from Medicaid” (prevent fraud), and to “improve results” while “reducing unnecessary spending” (avoid abuse). It’s as if the two parts of the speech were written by two different speechwriters — or as if President Obama thinks that, just because he is the one making the proposal, the tired “waste, fraud and abuse” mantra has actual validity this time.
So, again, I am left to wonder what this President actually believes. Does he believe that a deficit reduction plan that focuses on eliminating purported “waste, fraud, and abuse” is really no plan at all? Or, does he truly think there is $500 billion in waste, fraud and abuse to be wrung from our health care spending — and if that is the case, why has that waste, fraud, and abuse been allowed to continue unabated during the first two years of his Presidency?
While we are asking questions, another fair question is whether the President honestly thinks that there is any real value in blue-ribbon commissions, when the political landscape is littered with the reports of prior blue-ribbon commissions that have been happily ignored by those in power. And if the President does think such commissions are a powerful answer to problems, why does he hold that belief when he has pretty much ignored the recommendations of the Bowles-Simpson budget commission that he himself appointed?