The October surprise will be postponed until 2013, safely after the election. Seniors on Medicare Advantage will not know until after the election that their program is being cut. Originally the cuts were scheduled to go into effect in October of this year but by wasting $8.3 billion HHS and the Obama administration hopes the impending cuts will go unnoticed. Whether Obama and his supporter admit it or not the plain fact is the old and the young are financing much of Obamacare through very deceitful measures. The young and healthy will be forced to buy expensive coverage they do not want or need. Forget the the idiotic spiel about the young person without health insurance who ends up in a hospital emergency room following an automobile accident. First, if that person receives treatment he will be billed for it and must honor the debt like any other debt. Admittedly the hospital lacks the leverage that some creditors have as say, a landlord who can evict deadbeat occupants but nevertheless they will be billed. Second, most of the cost of a medical emergency could be covered by a high deductible policy but under Obamacare such a policy could not be issued. The young people will be forced to buy outlandish policies they neither want or need, loaded down with mandated coverage for substance abuse treatment, family planning, and no pay "preventive" procedures that don't fit the younger demographic.
The elderly will finance Obamacare through reduced coverage. Obamacare cuts Medicare spending by $517 billion over 10 years. This will result in less care for the elderly who will find it increasingly difficult to find a doctor who will treat them. The Independent Payment Advisory Board (IPAB), an integral part of Obamacare, has the power to decide what service will be provided to whom. This is the "death panel" Sarah Palin warned about. For a vivid and brutal example of how effective these independent medical panels can be, please read this Daily Mail post. The National Health Institute is charged by a critic, a Professor Patrick Pullicino of annually euthanizing 130,000 elderly Brits just to free up hospital beds.
Back to the Medicare Advantage cuts, Democrats have never liked this plan simply because it uses private insurers but nearly 25 percent of all Medicare enrollees are on MA, and the vast majority of these seniors chose the program because of its low co-pays and comprehensive benefits. There is an interesting story about the carve out for AARP's Medigap plan in exchange for its endorsement of Obamacare but that's a subject for another post. Obama, as is every senator who voted for Obamacare, very mindful of the popularity of MA but as he tells George Stephanopoulos he would rather spend the money elsewhere such as closing the donut hole. It will cost Medicare about $25 billion over 10 years to fix the donut hole but it will save $137 billion by cutting MA.
Right, seniors, as Obama says, change is tough unless you want contraceptives or food stamps. It is not the case as Obama implies, that the insurance companies just bank the $14 billion in Medicare subsidies but rather they offer coverage not covered by standard Medicare. No, there is no competitive bidding since the insurance companies answer to their customers not the government, another sore point for Obama and the Democrats. I bet this video will play real well in Florida when they realize Senator Nelson caved on his amendment but the same is true of Senators Brown, Casey and Stabenow and every Democrat who voted for this bill.
Someone in the Obama administration had the political savvy to know that cutting MA just prior to election was not a winning proposition so a nefarious scheme was hatched. By using $8.3 billion in the Obamacare implementation (slush) fund HHS created what they called a demonstration project or an experiment. The idea is to simply to fund MA for a few additional months until after the election when Obama will "have more flexibility". The General Accounting Office has called out the administration on this gimmick noting that no demonstration project has ever spent billions.
The Heritage Foundation has funded a study on the impact of the MA cuts on seniors. It is lengthy and somewhat arcane but it concluded that seniors will suffer about $3,700 annually in reduced benefits or about $44,000 over their retirement. Remember that Medicare is not means tested so the cuts will fall on everyone regardless of income. Please take the time to listen to Senator Brasso explain this chicanery in the video below.