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CMS study of the PPACA

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  • Ben Joseph
    Dear Group,   I recently read an unofficial CMS (Center for Medicare and Medicaid Studies) study of the effects of the PPACA (Patient Protection and
    Message 1 of 2 , Aug 1, 2011
      Dear Group,
       
      I recently read an unofficial CMS (Center for Medicare and Medicaid Studies) study of the effects of the PPACA (Patient Protection and Affordable Care Act), what the less-informed tend to call "ObamaCare".  The even less informed are now calling it "ObamneyCare".
       
      Let's keep in mind throughout this letter that the CBO (Congressional Budget Office) has predicted over $100 billion in deficit reduction as a result of the passage of the PPACA through FY 2019.
       
       
       
      The study states: "This article provides an analysis of projected health care spending by sector, payer, and sponsor inclusive of the effects of the Affordable Care Act. Average annual growth in national health spending is expected to be 0.1 percentage point higher (5.8 percent) under current law compared to projected average growth prior to the passage of the Affordable Care Act (5.7 percent) for 2010 through 2020. Simultaneously, by 2020, nearly thirty million Americans are expected to gain health insurance coverage as a result of the Affordable Care Act."
       
       
       
      Me: Before the PPACA, the cost of treatment, including all three factors listed in the study, was rising at 5.8% per year. After the PPACA, it will rise at .1% (a tenth of a single percent) lower at 5.7%.
       
      In 2010, ~$2.6 Trillion of the over $3 trillion budget was spent on health services (i.e., the three subsidized factors aforementioned).
       
      If the cost increase is expected to fall to 5.7%, and .1% of $2.6 trillion is $26 billion, then the total savings predicted by the CMS through FY 2019 is ~$260 billion.  Now, that's just savings.  That doesn't necessarily imply that the totality of the saved ~$260 billion will be applied toward deficit reduction.  I.e., the CMS and the CBO may or may not be suggesting similar deficit reductions and/or similar savings.
       
       
       
      The study continues: "The opinions expressed here are the authors’ and not necessarily those of the Centers for Medicare and Medicaid Services."
       
       
       
      Me: The link;
       
      http://tinyurl.com/3kc9vh9
       
      If you happen to peruse the link, you'll also notice several remarks which seem to imply major boosts to the American medical market as a result of the passage of the PPACA. These boosts will likely increase revenues generated, increase aggregate demand and therefore supply, increase employment in the medical field, and perhaps even generate the demand for medical training required to off-set the lack of health care specialists in the United States. That's all almost pure speculation, though.  With that said, if anything in this paragraph is even remotely true, the potential for deficit reduction through increased revenues and reduced spending will mount and, in their totality, greatly exceed the $100 billion that the CBO is predicting will be shaved from the deficit as a result of the passage of the PPACA.
       
      Oh, and ~30,000,000 Americans will be able to recieve, perhaps life saving, preventative care.
       
      We ought to acknowledge that the estimated 5.7% annual increase in associated health care costs means that the annual increases will still be higher than both projected GDP growth and inflation rates all through 2019.  Let's not even contemplate the contrasted yearly wage rate increases for 80% of Americans.  There's still work to be done.
       
      Let's also note that the PPACA contains some vague language and some "cuts" which may or may not be implemented as written and that the studies conducted by the CBO and CMS are largely, if not exclusively, predicated upon the fact that no austerity measures or other impactful legislation is passed between now and FY 2019.
       
      I.e., if we implement austerity measures as they relate to Medicare and Medicaid, the savings will not be as great and if America invests more greatly in education and health care reform, the savings will probably be even greater.  Also, if some of the proposed cuts to Medicare (i.e., proposed decreases in physician wage rate increases) are not implemented, as some suspect they will not be, then the savings will not be as great.
       
      For those of you who are adamantly opposed to increased government spending, your support for the PPACA ought to be damn-near absolute.
       
      For those of you who still adamantly oppose the PPACA, however, you ought to stick to the constitutional argument as it relates to the individual mandate.  Yeah, it's weak, but it will serve you far better than a discussion of the numbers involved (unless you're a liar and/or your opponent is uninformed).
       
      Sincerely yours,
       
      Ben

      [Non-text portions of this message have been removed]
    • Ben Joseph
      Dear Group,   Major addendum;   .1% of 2.6 trillion should be 2.6 billion, not 26 billion.   That would imply 26 billion in savings through FY 2019, which
      Message 2 of 2 , Aug 1, 2011
        Dear Group,
         
        Major addendum;
         
        .1% of 2.6 trillion should be 2.6 billion, not 26 billion.
         
        That would imply 26 billion in savings through FY 2019, which would make the CMS' estimate lower than the CBO's most recent estimate.
         
        'Assuming I've done this right.  Of course, the CMS' estimate didn't bother themselves with including a monetary figure.  To be fair, the study admits that it's an unofficial study, so the matter becomes more and more speculative every time I read about it.  The only consistent piece of information that I have is that the PPACA is going to save America money.  To be frank, it doesn't seem as though anyone knows how much is going to be saved, especially considering the fact that no estimates can predict the legislation to be passed between now and the end of FY 2019.
         
        The rest of the information should be accurate as most of the information contained herein is not predicated upon the specific CMS estimate, but rather that the CMS estimate implies savings at all.  Obviously, a .1% decrease is more of a decrease in cost than a 0% decrease.
         
        Sincerely yours,
         
        Ben

        From: Ben Joseph <rkelly_pleasedontpeeonme@...>
        To: "achristianvsatheistclub@yahoogroups.com" <achristianvsatheistclub@yahoogroups.com>
        Cc: "realabdebate19@yahoogroups.com" <realabdebate19@yahoogroups.com>
        Sent: Monday, August 1, 2011 3:03 AM
        Subject: [A ChristianVsAtheist Club] CMS study of the PPACA


         
        Dear Group,
         
        I recently read an unofficial CMS (Center for Medicare and Medicaid Studies) study of the effects of the PPACA (Patient Protection and Affordable Care Act), what the less-informed tend to call "ObamaCare".  The even less informed are now calling it "ObamneyCare".
         
        Let's keep in mind throughout this letter that the CBO (Congressional Budget Office) has predicted over $100 billion in deficit reduction as a result of the passage of the PPACA through FY 2019.
         
         
         
        The study states: "This article provides an analysis of projected health care spending by sector, payer, and sponsor inclusive of the effects of the Affordable Care Act. Average annual growth in national health spending is expected to be 0.1 percentage point higher (5.8 percent) under current law compared to projected average growth prior to the passage of the Affordable Care Act (5.7 percent) for 2010 through 2020. Simultaneously, by 2020, nearly thirty million Americans are expected to gain health insurance coverage as a result of the Affordable Care Act."
         
         
         
        Me: Before the PPACA, the cost of treatment, including all three factors listed in the study, was rising at 5.8% per year. After the PPACA, it will rise at .1% (a tenth of a single percent) lower at 5.7%.
         
        In 2010, ~$2.6 Trillion of the over $3 trillion budget was spent on health services (i.e., the three subsidized factors aforementioned).
         
        If the cost increase is expected to fall to 5.7%, and .1% of $2.6 trillion is $26 billion, then the total savings predicted by the CMS through FY 2019 is ~$260 billion.  Now, that's just savings.  That doesn't necessarily imply that the totality of the saved ~$260 billion will be applied toward deficit reduction.  I.e., the CMS and the CBO may or may not be suggesting similar deficit reductions and/or similar savings.
         
         
         
        The study continues: "The opinions expressed here are the authors’ and not necessarily those of the Centers for Medicare and Medicaid Services."
         
         
         
        Me: The link;
         
        http://tinyurl.com/3kc9vh9
         
        If you happen to peruse the link, you'll also notice several remarks which seem to imply major boosts to the American medical market as a result of the passage of the PPACA. These boosts will likely increase revenues generated, increase aggregate demand and therefore supply, increase employment in the medical field, and perhaps even generate the demand for medical training required to off-set the lack of health care specialists in the United States. That's all almost pure speculation, though.  With that said, if anything in this paragraph is even remotely true, the potential for deficit reduction through increased revenues and reduced spending will mount and, in their totality, greatly exceed the $100 billion that the CBO is predicting will be shaved from the deficit as a result of the passage of the PPACA.
         
        Oh, and ~30,000,000 Americans will be able to recieve, perhaps life saving, preventative care.
         
        We ought to acknowledge that the estimated 5.7% annual increase in associated health care costs means that the annual increases will still be higher than both projected GDP growth and inflation rates all through 2019.  Let's not even contemplate the contrasted yearly wage rate increases for 80% of Americans.  There's still work to be done.
         
        Let's also note that the PPACA contains some vague language and some "cuts" which may or may not be implemented as written and that the studies conducted by the CBO and CMS are largely, if not exclusively, predicated upon the fact that no austerity measures or other impactful legislation is passed between now and FY 2019.
         
        I.e., if we implement austerity measures as they relate to Medicare and Medicaid, the savings will not be as great and if America invests more greatly in education and health care reform, the savings will probably be even greater.  Also, if some of the proposed cuts to Medicare (i.e., proposed decreases in physician wage rate increases) are not implemented, as some suspect they will not be, then the savings will not be as great.
         
        For those of you who are adamantly opposed to increased government spending, your support for the PPACA ought to be damn-near absolute.
         
        For those of you who still adamantly oppose the PPACA, however, you ought to stick to the constitutional argument as it relates to the individual mandate.  Yeah, it's weak, but it will serve you far better than a discussion of the numbers involved (unless you're a liar and/or your opponent is uninformed).
         
        Sincerely yours,
         
        Ben

        [Non-text portions of this message have been removed]




        [Non-text portions of this message have been removed]
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