Sunday, December 18, 2011

Weekend Update

The President has signed into law the megabus appropriations bill discussed in Friday's FEHBlog according to this Govexec story.  The Federal Times adds that
The bill gives the U.S. Postal Service another reprieve on a legally required $5.5 billion payment into a retiree health care fund. The payment, which USPS officials say they lack the money to cover, was originally due Sept. 30. Lawmakers however, pushed back that deadline until Friday under the existing continuing resolution. The megabus delays it again until Aug. 1, 2012.
Hopefully this will be enough time for Congress, the Postal Service, and the Postal Unions to straighten out this problem.

On Friday, the Senate approved a two month long tax extenders bill. This bill also would have extended the Medicare Part physician reimbursement patch until February 28, 2012. According to this Wall Street Journal report, the House leadership disclosed today that it wants a conference with the Senate over the year long tax extenders bill that it passed earlier in December. The Washington Post compares the House and Senate bills here.

The Senate leadership has stated that the Senate will not be returning until January 23 so it will be the House's fault if the Social Security tax returns to 6.2% at the end of the current one year reduction. In that event, the 27.4% reduction in Medicare Part B reimbursements to doctors would kick in because CMS usually can only delay the implementation for two weeks. We'll have to wait and see what happens. .

Last week, Standard and Poors announced that
The S&P Healthcare Economic Composite Index indicates that the average per capita cost of healthcare services covered by commercial insurance and Medicare programs increased by 5.11% over the 12-months ending October 2011.
That's quite a leap.
As measured by the S&P Healthcare Economic Commercial Index, healthcare costs covered by commercial insurance increased by 6.91% over the year ending October 2011. This annual rate has rise for a fourth consecutive month. Growth rates in Medicare claim costs rose from its September low of +2.03% to an annual rate of +2.39%, as measured by the S&P Healthcare Economic Medicare Index. The S&P Healthcare Economic Hospital Medicare Index also increased from +0.66% in the year ending September 2011 to +1.12% in October

These indices illustrates the cost shifting from Medicare to the private sector. This Washington Post article about Medicare coverage of hospice care exposes the basic problem with Medicare -- if you build it they will come.

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