THE BLOG
08/16/2009 05:12 am ET | Updated May 25, 2011

Slashing Medicare to Pay For Health Care Reform Is An Ugly Shell Game

President Barack Obama has, by words and action, made it abundantly clear that he wants to make monumental health care reform one of the defining achievements of his young administration. To this, I say, "Bravo."

As a former senior staff member to U.S. Sen. Edward M. Kennedy (D-MA), nothing would please me more. I consider myself one of the many early toilers in this endeavor, and this dream has been shared and chased by many for more than 30 years.

Unfortunately, some of the mechanisms the President has proposed to "pay for" expanding insurance to the 50 million who deserve it, are likely to tarnish his legacy --- and leave millions of older Americans without quality long-term care.

Much of President Obama's health-care reform policy is to be funded by extreme cuts from Medicare and Medicaid, which provide care for the oldest Americans and our most vulnerable citizens, including those in nursing homes. These cuts could not come at a worse time.

In fact, the U.S. Census Bureau just warned of a drastic jump in the median age of American citizens. Residents who are 65 and older currently make up 13 percent of the population, but that will double to 88.5 million by mid-century. The baby boomer bulge will continue padding the senior population year after year, growing to 1 in 5 U.S. residents by 2030.

Median age issues in Pennsylvania are even worse. Our commonwealth ranks third nationally by percentage of population age 65 or older, behind Florida and West Virginia, and fourth in the number of residents age 85 or older. Right now, more than 2 million of our 12 million state residents are age 65 or older. By 2020, that number will increase 50 percent.

These demographics pose significant care and funding challenges for families, caregivers and government agencies whose charge it is to provide safe, quality care.

Compounding matters: Reports indicate that Social Security could run dry by 2037, and Medicare by 2017. President Obama has even conceded that the unemployment rate will rise past 10 percent within a year, cutting down on paid employees contributing to the fund, which will in turn speed up the money-draining process. Moreover, one-third of those entering nursing homes as self-paying individuals "spend down" their resources and eventually qualify for Medicaid. With the stock market collapse eating up nest eggs, people have far fewer dollars to spend andare depending on Medicaid much earlier.

More people relying on Medicaid and Medicare, fewer people paying into it, mortgaging social programs to pay for other health-care proposals --- it's a formula we can't afford.

President Obama's proposal for universal health care has undeniable appeal. He has earned high marks, and rightfully so, for fighting to expand health care and ensure that all citizens have access to the coverage they need to lead healthier lives. But at what cost? And to whom?

If the cost is covered by cutting Medicaid and Medicare, then taxpayers are in for a rude awakening when millions will retire without money to pay for their health care. Ransoming seniors' long-term care for immediate, large-scale health reform is more politically beneficial for its supporters in the short term than it is reasonable for everyone in the long run.

In fact, even in the short term, one could argue that taxpayers, including the elderly, are looking at an old fashion 'shell' game from Washington. No sooner was the ink dry on the federal stimulus package, which provided millions of dollars to support care for the elderly in Pennsylvania, before Congress and the administration began to propose major cuts in Medicare to finance health care reform. Because Medicare payments support quality care in our nation's nursing homes, the proposed cuts nationally approaching $50 billion in Medicare payments for the care of the elderly is guaranteed to undercut the quality gains of the past decade. In Pennsylvania, if the proposals currently on the table are enacted, these policies would result in an almost 10 percent reduction in cumulative payments over 10 years...more than $2.1 billion.

None of the questions on health care, Social Security, Medicaid or Medicare are easy. But there is one thing we do know: Our population is growing older, and doing so rapidly. Cutting money from the programs that finance care for Pennsylvania seniors is seriously flawed. There is no simple or single solution. But there is a wrong way, and taking money from the care for American seniors is deeply flawed.

Stuart H. Shapiro, M.D.
President and CEO
Pennsylvania Health Care Association
Email: sshapiro@phca.org