The federal government is sucking cash out of it's "clients and counterparties" -- state Medicaid programs, providers, etc. to pay for Obamacare leaving near term shortfalls in their wake.
For instance:
State officials told Kaiser Health News earlier this week that they have already negotiated many drug discounts that exceed 15.1 percent so they will lose that money under the new federal rules. Some said millions of dollars could be on the line for individual states, but federal officials said they have not estimated the cost to states.
State officials had hoped the federal government would interpret the law in a way that left their discounts untouched. But in a letter Thursday to state Medicaid officials, the federal Centers for Medicare and Medicaid Services explained, "The amount of the savings resulting from the increases in the rebate percentages … will be remitted to the Federal government."
Cindy Mann, the agency’s director for the Center for Medicaid and State Operations , confirmed in an interview that meant states that already received drugmaker rebates between 15.1 and 23.1 percent would no longer be able to keep that portion of their savings. States and the federal government would continue to share in savings for the portion of the rebates both below and above that range. Many states already have average rebates well above 23 percent.
Mann suggested that state officials could negotiate deeper discounts with drugmakers to try to "recapture that dollar."
In otherwords, you are on your own.
In turn, the federal government will use that cash to finance small business tax credits -- that evaporate in 6 years -- for insurance coverage that, because of the legislation -- was estimated by CBO be 13 percent higher. So Obamacare is draining Medicaid to pay for tax credits to reduce the increased cost of healthcare insurance triggered by the bill:
"The credits are available in full to firms with 10 or fewer employees who offer an average wage of $25,000 or less. The credit is reduced for employers who have as many as 25 employees and average wages of up to $50,000 annually. Employers with more employees or higher average wages don't get the credit at all.
In addition, the credits are only available for six years, further complicating long-term efforts to help small businesses afford providing health insurance for their employees, said Amanda Austin, director of federal public policy for the NFIB, which opposed the Democrats’ health reform efforts and the new law.
The tax credit is emerging as a flashpoint in the ongoing debate about how the reform will affect costs and insurance affordability.
Austin, who spoke Monday at a U.S. Chamber of Commerce forum on what health reform may mean for businesses, said that although some small businesses’ efforts to provide their employees with coverage might be helped by the tax credit, businesses don't want to continue to return to Congress every few years to ask for the program to be extended.
"What we want is the market to drop its costs down long term," she said, adding that individual and small group markets for health insurance could see premiums increase by as much as 13 percent in the coming years. In the meantime, she and others are spending a lot of time waiting to see what the Department of Health and Human Services will do as the rulemaking process for the health law begins to gain momentum."
www.kaiserhealthnews.org/Stories/2010/April/27/small-businesses-health-tax-credit.aspx
Meanwhile, the Obama administration and HHS Secretary Sebilius are disavowing the estimates of Medicare actuary showing a financial meltdown of Obamacare in the decade ahead, with same estimates showing a collapse of healthcare service delivery in Medicaid -- where most people receiving "insurance coverage" will go... At the same time, the bill provides incentives for people to wait until they are sick instead of obtaining coverage, driving costs up. As the report states: “existing providers resources and could lead to price increases, cost-shifting, and/or changes in providers’ willingness to treat patients with low-reimbursement health coverage.”
tinyurl.com/24pgepa
What did Goldman Sachs call the less than healthy assets it was trying to sell? Something about Obamacare's financing of healthcare has the same smell.
