Health Daily News

Yesterday, the National Commission on fiscal responsibility and the reform released a proposal to reduce the national debt. The full report can be found here and is based on five fundamental pillars. These are:

Enact discretionary spending caps resistant and provide $ 200 billion in domestic economy and illustrative defence in 2015. Pass tax reform that dramatically reduces rates, simplifies the code extends the base and reduces deficit. Address the doc "Fix" not through the deficit, but through economy payment reforms, cost sharing and malpractice reform and long-term measures to health care cost growth control. Achieve compulsory savings of agricultural subsidies, military and social security solvency of functionalist retirement. Ensure for the next 75 years while reducing poverty among the elderly.

I will review the following topics in turn.  

 To cut costs, the Commission proposes discretionary spending cigarettes back to levels of FY2010 to FY2012 and requiring a 1% reduction in discretionary budget authority FY2013 although 2015 annually.This includes $ 100 billion in discretionary spending such as military: military pay freeze in noncombat 2011 levels for modernization of 3 years, reducing the harvest 15%, and reduce the TRICARE overseas bases by a third. others $ 100 billion in goes to non-military spending.  Some of these pieces include: Federal wage freeze in non-defense agencies for three years, federal workers cut by 10%, eliminate 250000 service non-defense and personal augmentee contractors, slowing growth of external aid and eliminating all earmarks.  All these suggestions are entirely reasonable.

The tax reform is based on eliminating spending tax reducing marginal tax rates. the overall effect is an increase in tax rates, especially for the richest and poorest who receive parts larger tax expenditure.  However, the simplification of the tax code is one of the major benefits.  The main aspects of the plan include:

 Consolidate the tax code in three individual rates and a rateEliminate corporate AMT, Pease and PEPEliminate all $ 1.1 trillion expendituresDedicate a portion of tax savings for deficit reduction and apply the rest to reduce all marginal tax rates

Proposal to be hacked key tax expenditures include: interest mortgage, health insurance, retirement savings, state & local tax deduction, the child tax credit and the EITC.  Furthermore, the proposal would deal with capital gains and dividends as ordinary income, revoke the alternative minimum tax (AMT). These fiscal expenditure, would keep the child tax credit and EITC as deduction, but would eliminate the tax deductibility of interest mortgage, State and local taxes, health insurance and 401 (k)/IRA contributions.  

 The Commission also gradually increase national gas taxes by $ 0.15 to finance transport costs.I agree with this tax increase as it will encourage citizens to reduce their gas consumption and thus will decrease pollution.

Pay doctors and other providers of least, improve efficiency and quality of reward for accelerate payment reforms and lawyers rebatesPay drugs increasingly less and reduce the cost of defensive medicine, adopting comprehensive offence reformExpand cost sharing in public health to promote the consumer informed health choices and spendingExpand successful cost containment demonstrationsStrengthen payment independent Advisory Council (IPAB)

Currently, the rate of sustainable growth, because it is on the books would decrease physician compensation of public health in about 25% if he hadn't repealed by Congress.This is obviously a very steep discount.The Commission proposes sensible replace cuts required by SGR by 2015 with modest reductions. However, reduce the global medical expenditure is not the answer; doctors who spend time visiting patients aren't compensated with generosity.Doctors who perform procedures, however, receive compensation profitable.Thus, not only is reducing compensation necessary medical, but also change the distribution of the way doctors are paid. cuts could reduce the quality of medical care or provide the number of doctors who accept Medicare coverage. Enabling the levying of balance would doctors earn more money and would allow the beneficiaries to choose between the high quality and low cost.

The authors also require greater Medicare cost-sharing. in particular, they call "overriding rules of cost sharing existing with universal deductible, coinsurance rate single and catastrophic cap health part a and part b." Increased cost sharing will help lessen the problem of moral hazard, while the catastrophic CAP ensures that individuals are not very sick bankrupted by their diseases.

Lawyers pay less and leveling punitive damages and non-economic may sound like a good idea, but (as I mention here), this provision will probably have little impact on the costs of health care in General.

In the longer term, the Commission also calls for Congress to contain growth in total spending to GDP federal health + 1% after 2020, establishing a process to regularly evaluate the cost growth. If spending growth of healthcare exceeds GDP + 1% during the five previous years, the Commission invites for options such as: increasing premiums (or further enhance cost-sharing), renew the service rate system, develop a system of premium support for Medicare. undoubtedly, if public health costs continue to climb, something must be done.

Compulsory savings provisions include:

Changing the chain weighted CPI for all programs indexed to quantify substiution bias to cheaper products to reduce agricultural subsidies for $ 3 billion per year, military savings and retirement of civil servants (e.g. asking workers contribute – rather than 50% of the cost of retirement incidentally 7%;) Eliminate interest subsidies in school for student loans; index of all flat rates of $ user to inflation; andEnd payments to States and tribes to abandoned mines (who knew they were making these payments?!?!).

All these measures saving all seem reasonable to me.

Reforming social security, in the eyes of the Commission, does not involve simply cut benefits. benefits for the poorest Americans really increase in your plan as a special benefit would be established minimum. additional details are as follows:

Overall social security benefits would be indexed to CPI chained, but the Special minimum benefit would be indexed to the plane of wages. The welfare benefits would make even more progressive than are now effectively slashing benefits to richer Bu The retirement age would also be indexed to longevity. Thus, the retirement age would probably be 68 until 2050 and 69 by 2075. broaden the tax base, gradually increasing the maximum taxable

As the basis of raising taxes and benefits are cut for employees more sophisticated, social security will work more as a benefit guaranteed flat than – is seen by many retirement account today – a.

This entry was posted on November 12, 2010 at 6: 53 pm and is filed under health. follow any responses to this post through RSS 2.0. you can leave a response or trackback from your own site.

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