The Great and Powerful Oz may want us to think that the health-care industry’s promise to reduce health-care spending by $2 trillion over ten years is a “game-changer” and that health-care reform is now inevitable. But take a look behind the curtain.
The basic math of universal coverage is this: It will cost a minimum of $120 billion per year to cover the uninsured. Over ten years, it could easily cost $2 trillion.
When Obama proposes raising that $2 trillion by cutting payments to health-care providers and insurers, the providers and insurers squeal.
When Obama proposes raising the money with higher taxes, Democrats squeal.
Senate Finance Committee chairman Max Baucus (D., Mont.) thinks that certain health-care reforms will reduce spending over the long haul. But the Congressional Budget Office won’t recognize those assumed savings.
So it may be that the industry’s overture is actually an effort to cook the books by ganging up on the CBO: “See, you silly number-crunchers? Even the industry believes these reforms will reduce spending.”
What’s in it for the industry? Universal coverage gives them a huge revenue boost in the short term — and then every lobbyist at today’s White House media event will fight those spending reductions over the long term.
The industry isn’t negotiating its surrender — they’re negotiating the surrender of even more of our money.