Administration officials can always be counted on to praise President Obama's health care law. But Rick Foster, the chief actuary of Medicare, offers an unvarnished assessment of how the new law affects 47 million Medicare recipients, as well as the federal deficit.The insanity of micro-managing the entire healthcare sector can be seen by the bogus productivity gains the Obama Administration has factored into its plan. No business in the world creates a budget by starting with the premise that they will cut 15% off our budget and make it up on unamed productivity gains. A business may cut IF they know exactly how they are going to improve productivity, but assumed blanket productivity gain projections would be laughed at in the private sector.
"There is a strong likelihood that the cost projections in the new trustees report under current law understate the actual future cost that Medicare will face. A strong likelihood," he says. "I've gone so far as to say that I don't think it's a reasonable projection of what will really happen." Rick Foster made a rare public appearance at the American Enterprise Institute Friday to discuss the latest projections of Medicare which are required by law.
The single greatest uncertainty in the projections are the cuts to Medicare that the administration is counting on to pay for new benefits.The Obama plan assumes health care can accomplish the same kinds of increased efficiency, or productivity improvements, usually seen on production lines -- like manufacturing cars. But few analysts believe that is possible. Joe Antos, a scholar at AEI, says, "they're productivity improvements if productivity happens. If productivity doesn't happen, they're still cuts."
And Foster adds that, "every single expert we talked [to] has told us they did not think these productivity adjustments were viable. They thought they just would not work."
The Medicare cuts are coming, but it will all about slashing coverage for the elderly. The decline in American life expectancy is about to began.
(ViaGregMankiw)
A principal drag on the life expectancy in developing countries is infant mortality. A human that is born and doesn't make it to one year old really brings down the average. Countries like Cuba get around this by simply not attempting to save nearly as many premature babies as the US does--miscarriages do not affect longevity statistics. Accordingly, in keeping with the tradition of backwards government statistics, the actual percentage of people over 60 who make it to 80 might decline, but the drop off from neglect at the opposite end of the life spectrum could actually maintain or increase the overall life expectancy average.
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