Back to Basics

How much will the H.R. 3200 cost?  Historically, the cost estimates of every medical program implemented by government has cost more, often significantly more.  Massachusetts passed a universal-coverage plan in 2006, which required all residents to have health coverage and gave subsidies for lower-income uninsured families.  Sounds like the plan the government wants to pass for the country.  The plan was estimated at $472 million for 2008, yet the actual figures for that year were $628 million.  They made some assumptions that proved incorrect.  They assumed that as more people joined the system the premiums would go down across the board.  They further assumed that as more people became insured the number of people visiting the emergency room would drop dramatically.  They assumed this would save them money.  It backfired!  None of these things happened and the health care reform that was supposed to save money has cost more money than expected!

Similar budgetary problems have been seen in Federally run programs.

When Medicare, Part A was established in 1965, covering the hospital insurance portion of the program, the cost was estimated at $9 billion annually by 1990.  The actual spending in 1990 for Part A was $67 billion.

In 1967 the new Medicare program was estimated at $12 billion for 1990.  The actual Medicare spending for the program in 1990 was $110 billion.

A universal entitlement to kidney dialysis was enacted in 1972 at a cost of $100 million for 1974 and actual spending was $229 million for that year.

The DSH program established in 1987 which states use to provide relief to hospitals serving large numbers of Medicaid and uninsured patients was estimated at a cost of less than $1 billion in 1992.  The actual cost for that year was $17 billion.

When Medicare’s home care benefit was changed in 1988 the projected cost for 1993 was $4 billion.  The actual cost in 1993 was $10 billion.

In 1988 a catastrophic coverage benefit was added to Medicare to become effective in 1990.  The cost estimates for this program were initially $5.7 billion and then raised to $11.8 billion, and even the revised number they estimated might be too low.  The program was repealed before it could take effect, largely due to the cost estimates.

The State Children’s Insurance Program in 1997 appropriated $40 billion to states over 10 years, with estimates of $5 billion a year once it was implemented.  By 2006 all unspent reserves were nearly exhausted and Congress appropriated an additional $283 million in 2006 and $650 million in 2007.

Bill H.R. 3200 is estimated at a cost of $1 trillion over the first 10 years and $2.4 trillion over the first 10 years of full implementation.  With the track record of the government grossly underestimating the cost of medical programs, one can only guess what the actual cost will be.  The country already has serious financial problems with spending in the first 8 months of this administration greater than all presidents combined.  The country just cannot afford to invest that amount of money on a program that has been proven in one state not to obtain the desired results at a significant increase in cost.

Under the title of Public Health & Workforce Development are a number of grants, scholarships and other programs, providing training, services and a whole new array of studies relating to health care – a lot of money being spent to support the expansion of government, special interests, illegal immigrants and labor unions, but little to help solve the health care issues.

The first expansion is the establishment of the Public Health Investment Fund, which requires deposits from the revenues of the Treasury in the amount of $88,700,000,000 over 10 years. This money is authorized to be appropriated by the Committee on Appropriations of the House and Senate for carrying out the activities under the designated public health provisions. These areas include Community Health Centers, National Health Service Corps Program, National Health Service Corps Scholarship and Loan Repayment Programs, Primary Care Loan Funds, Primary Care Education Programs, Nursing Workforce Development, The National Center for Health Statistics and the Agency For Healthcare Research and Quality.

To make these programs even more appealing is the stipulation that “Amounts appropriated under this section, and outlays flowing from such appropriations, shall not be taken into account for purposes of any budget enforcement procedures including allocations under section 302(a) and (b) of the Balanced Budget and Emergency Deficit Control Act and budget solutions for fiscal years during which appropriations are made from the fund.” More spending without any concern for balancing the budget or controlling the country’s deficit. We don’t have it, but let’s spend it!

The first program – Community Health Centers – will obtain increased funding in the amount of $38,800,000,000.

The National Health Service Corps is being amended allowing the Secretary to issue waivers to individuals who enter into a contract for obligated service to pay for their education. It further raises the loan repayment amount from $35,000 to $50,000 and will be adjusted thereafter to reflect inflation. Additional appropriated funds for this program are $796,000,000 over the next 10 years. Additional funding is authorized in the amount of $3,171,000,000 over 10 years to cover the National Health Corps Scholarship and Loan Repayment Programs.

The Frontline Health Providers Loan Repayment Program will be established to address unmet health care needs in certain areas, populations, or facilities as designated by the Secretary. Individuals participating in this program must agree to serve for a period of 2 years in a health professional needs area specified in the program. This program has a clause that if there are an insufficient number of applicants for the program, then all excess funds from the program will be transferred to the National Health Service Corps to recruit more people to take advantage of this fund.

The Secretary shall establish a primary care training and capacity building program consisting of grants and contracts to plan, develop, operate or participate in accredited professional training in the field of family medicine, general internal medicine, general pediatrics or geriatrics. Funds for this program are from the Public Health Investment Fund in the amount of $3,023,000,000 for 10 years and will include the following:

• Capacity Building in Primary Care – grants to specialties of family medicine, general internal medicine, general pediatrics or geriatrics, with preference given to entities that train individuals who are from underrepresented minority groups or disadvantaged backgrounds.
• Training of Medical Residents in Community-Based Setting – a program established for the training of medical residents in community-based settings, with preferences given to entities that support teaching programs addressing the health care needs of vulnerable populations or are a Federally qualified health center or rural health clinic, as well as preference to those training individuals from underrepresented minority groups or disadvantaged background.

• Training for General, Pediatric or Public Health Dentists and Dental Hygienists – grants and contracts to plan, develop, operate or participate in an accredited professional training program or oral health professionals, with preference given to individuals who are from underrepresented minority groups or disadvantaged backgrounds.

Grants for Health Professionals Education – Advanced Education Nursing Grants is being amended, including increases in dollar amounts for the Nurse Faculty Loan Program. Funding for this program is $1, 450,000,000 over 10 years.

The Public Health Workforce Corps is being amended and expanded by the following: Creating the Public Health Workforce Scholarship Program, Public Health Workforce Loan Repayment Program, Enhancing the Public Health Workforce, and Preventive Medicine and Public Health Training Grant Program. Appropriations for these programs total $642,000,000 over 10 years. The Enhancing the Public Health Workforce even includes provisions for veterinary medicine! I’m not sure how veterinarians will provide quality health care to people or decrease health care costs, but it’s nice to see even our animals will be included in the grant programs.

Under the Subtitle “Adapting Workforce to Evolving Health System Needs” there are a number of grants and programs including:

• Health Professionals Training for Diversity, which includes scholarships for disadvantaged students, loan repayments and fellowships regarding faculty positions, and educational assistant in health professions regarding individuals from disadvantaged background.

• The Nursing Workforce Diversity Grants is being amended and adding the Coordination of Diversity and Cultural Competency Programs.

• The Secretary will establish a cultural and linguistic competency training program for health care professionals, including nurses, consisting of grants and contracts to develop and implement models of cultural and linguistic competency training. Preference will be given to entities that address cultural and linguistic needs of the population and health disparities, and placing health professionals in regions experiencing significant changes in the cultural and linguistic demographics of populations, including communities along the United States-Mexico border. Obviously this program will benefit all the illegal immigrants coming from Mexico to obtain free health care.

Appropriations for these programs total $1,138,000,000 over 10 years.

Grants and contracts are given to develop training programs to promote the delivery of health services through interdisciplinary and team-based models, with preferences given to entities that demonstrated training to the greatest number of health professionals who serve in underserved communities.