No. of Recommendations: 4
I'm hazy on how that "doc fix" was supposed to work. If it was an arbitrary cut in reimbursement rate, without addressing the "administrative overhead", all it would do would be to shortchange the people who actually care for patients, while the paper shufflers are unscathed. In other words, it was set up to fail. Same thing with the tax on high end plans, and the personal mandate. Nothing touches the administrative overhead.
It was supposed to work the way most single-payer systems keep health care costs under control. The government sets a price for medical services, and medical providers have to meet that price. So in the late 1990's, in order to keep Medicare costs from increasing too much, Congress wrote into the law a provision that said Medicare reimbursement rates couldn't increase by more than X% in a given year. "X%" was the result of a complicated formula, but that's not especially relevant here (and I would be lying if I denied that I was hazy on how the SGR actually was calculated myself).
It would have saved taxpayers a ton of money, but it would have reduced the rate of increase in medical provider reimbursement. So once the SGR caps started to kick in a few years after adoption, Congress would just suspend them. Every single time.
Congress is reluctant to impose heavy economic costs on a discrete group of people in order to finance diffuse and smaller benefits to a very large group of people. Mostly because economically hurting people leads them to call their Congressbeings and complain. No one calls their Congresscritter to complain that a diffuse future benefit that they didn't know about didn't end up materializing. It's a pretty easy choice for an elected official, which is why the status quo is so durable (in lots of scenarios).
