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WEDNESDAY EDITION
❘ DECEMBER 6, 2017
Siuslaw News
P.O. Box 10
Florence, OR 97439
NED HICKSON , EDITOR
Opinion
Cutting Medicare: Prelude or paranoia?
D
espite
President
Trump’s “no touch”
promise regarding
Medicare, the GOP’s recently
passed tax cuts — and result-
ing predicted deficits — build
in significant threats of imme-
diate major reductions to
Medicare.
Currently, 57 million
enrollees and families are at
risk of program cuts of $25
billion just for 2018, and more
than $250 billion through
2027.
The potential impact to
Medicare, and many other
federal programs, results from
the projected $1.5 trillion
deficit size increase. Large
deficits over a five- or 10-year
period automatically trigger a
mandatory “sequestration”
process that shrinks federal
program spending across
wide parts of the federal
budget to cover or “match”
the new deficit amounts.
Such spending “sequestra-
tion” is decreed by a statutory
process known as “Pay-Go.”
The first statutory “Pay-Go”
version originated in 1990.
The Bush tax cuts of 2003,
passed after the “Pay-Go”
process, lapsed in 2002, with
the current “Pay-Go” process
being reestablished in 2007.
To avoid Pay-Go spending
sequestrations, Congress may
take specific steps to avoid or
“waive” them. Such waivers
require a majority of the
House and a Senate 60-vote
supermajority. To date, the
GOP has demonstrated no
such efforts — with the
remaining time to do that run-
ning extremely short.
According to the nonparti-
san Congressional Budget
Office (CBO), if Congress
fails to provide express waiv-
er of Pay-Go before the ses-
sion ends this month, other
federal officials “would be
required to issue a ‘sequestra-
tion’ order within 15 days of
the end of the session of
Congress to reduce federal
spending in fiscal year 2018.”
For 2018 alone, that
amounts to $136 billion dol-
lars in federal spending reduc-
tions.
Such fee cuts dispropor-
tionately impact rural areas
having sizeable Medicare
populations, but which lack
multiple health facilities or
many providers.
Providers leave or close.
This last Friday, until the
last moment for appeasing
hold-out Republican Senators
was at hand, GOP leaders had
avoided
discussion
of
Medicare. They then issued
the following joint statement:
“ ...Critics of tax reform are
claiming the legislation would
GUEST VIEWPOINT
B Y R AND D AWSON
R ETIRED INSURANCE LITIGATION ATTORNEY
Authority to determine
whether sequestration is
required (and how to make the
necessary cuts) rests solely
with President Trump’s Office
of Management and Budget
(OMB).
But the Pay-Go process
exempts certain federal pro-
grams. Medicare program
cuts are limited to 4 percent
annually, which amount to
$25 billion a year.
Direct individual Medicare
benefits are exempt from
sequestration.
This leaves $25 billion of
other potential necessary
Medicare program cuts. These
could possibly including
reduction in fee payment to
providers, such as hospitals
and physicians. New 4 per-
cent fee cuts would follow a
reduction of 2 percent, imple-
mented in 2013, by Congress.
lead to massive, across-the-
board spending cuts in vital
programs — including a 4
percent reduction in Medicare
— due to the Pay-Go law
enacted in 2010. This will not
happen ...”
However, no other details
were provided.
But something will happen.
Pay-Go requires a decision
before December’s end, and
the GOP faithful are staking
out
positions.
Last
Wednesday, Republican Sen.
Mark Rubio (Fla.) stated, “We
have to ... institut[e] structural
changes to ... Medicare for the
future.”
Will the pharmaceutical
industry accept “structural
changes” to Medicare Part D
drug programs that account
for $90 billion in annual pay-
ments? Negotiating drugs —
such as the V.A. does and
which Medicare is prevented
from doing — easily provides
a 30 percent price discount,
paying Medicare’s
sequestered amount of $25
billion.
Raising the Medicare age
from 65 to 67 only makes the
Medicare “risk pool” more
expensive per capita to oper-
ate. As one Portland physician
recently said to me, “Once
Americans join Medicare,
they get access to the great
healthcare they couldn’t
afford while they were
young.”
As David Certner, legisla-
tive counsel for AARP just
stated in voicing concern for
the tax bill impacts on
Medicare: “We create these
large deficits and ... pressure
for cuts to Medicare ... and
everything will be on the
table...”
Or perhaps he should have
said “dart board”
One hopes that game will
not be held behind closed
doors and without a single
committee hearing.
If the earlier tax cut process
was a prelude to more behind-
the-scenes “structural
changes,” and the broader
issue of making America
healthier again, the public will
need to be vigilant.
(Rand Dawson is a Siltcoos
resident with long interest in
health care reform. He is a
retired litigation attorney who
also represented insurance com-
panies.)
Postal Service Reform Act and Medicare
M
ost people get mail
every day, Monday
through Saturday.
But what happens when the
mail comes later than we
expect?
We found out a few years
ago, when the Postmaster
General had to take away
overnight First-Class and
Periodicals mail from most of
the nation. That caused a
problem for a lot of con-
sumers and businesses. Now,
we may be facing a new slow-
down if something isn’t done
by Congress very soon.
Who needs the mail when
we have the Internet now?
In addition to mail being
the backbone for about $1.3
trillion in jobs, products and
services, there is the personal
impact of mail in our lives.
Many people count on the
mail for medicines. A missed
or delayed dosage can mean a
trip to the hospital.
Small businesses count on
the day’s mail to bring in cash
from customers. A few days’
delay can mean a trip to the
bank for a loan. Loans cost
money and put pressure on the
business to raise prices.
And lets face it: Some
things just can’t be emailed. It
is hard to send your grand-
kid’s birthday cake overnight
by the Internet.
Some farm supply houses
use the mail to deliver small
animals quickly.
What about legal docu-
ments that have to arrive by
certified mail? Also, many
newspapers, particularly in
small towns and rural com-
munities, rely on the mail for
delivery to their readers.
Newspapers delivered by mail
that is delayed can mean pub-
lic events and sales coupons
arrive too late.
We are at another crunch
point. The United States
Postal Service (USPS) has a
$57 billion deficiency on its
balance sheet, most of it
caused by Congress. Fixing it
may require the Postmaster
General to close more post
offices and mail sorting
plants, eliminate mail-hauling
truck routes and ground the
airmail.
That could mean slowing
down or reducing mail servic-
es even further.
The USPS last received a
major overhaul by Congress
buy postage cannot afford big
increases and will simply find
alternatives if the rates are
raised too much; at the same
time, consumers cannot afford
to pay more for slower mail.
And the USPS wants to
protect jobs for its workers.
Keep in mind that the
USPS is not supported by tax
dollars, but by postage rev-
enue.
And no tax-payer money
should be needed unless
Congress lets the system dete-
riorate further.
There is a better choice.
A bill was sent to House
GUEST VIEWPOINT
B Y M ATTHEW P AXTON IV
P RESIDENT OF THE N ATIONAL N EWSPAPER A SSOCIATION
in 2006. The following year,
Steve Jobs appeared on a
stage with a new gadget called
an iPhone.
Since then, Congress and
the Postmaster General have
been grappling with the tough
problem of collecting enough
postage for a system that must
reach an ever increasing num-
ber of mailing addresses in
America, but with less mail
— and postage revenue — to
pay for the service.
So far, Congress has done
nothing but tinker.
This is nothing new.
Since the birth of the
nation, Congress has bogged
down many times in finding
resources for this essential
economic backbone — and a
service actually included
within the U.S. Constitution.
The choices are tough, and
Congress is never good at
tough choices. Businesses that
Ways and Means Committee
last March by the House com-
mittee responsible for over-
seeing the USPS. The bill, HR
756, is now sponsored by
Republican
Rep.
Mark
Meadows of North Carolina,
and three Democrats: Reps.
Elijah
Cummings
of
Maryland; Gerald Connolly
of Virginia; and Stephen
Lynch of Massachusetts.
All are experts on postal
matters. That this group, who
agree on little else, could
come up with a solution
together says a lot about this
bill.
However, the proposed leg-
islation would require about
77,000 retired postal workers
who currently draw benefits
from a federal benefits health
fund to use Medicare instead.
Medicare taxes were
already paid for these work-
ers; the Medicare fund owes
these retirees their benefits
anyway.
It is just that this group has
chosen a different benefit for
themselves, which they were
allowed to do. Now it is time
for them to follow the practice
of most private sector workers
and draw their earned benefits
from Medicare instead.
Commercial mailers would
have to accept a small postage
increase to pay most of the
additional cost to Medicare.
But the benefits to the federal
budget and to USPS would be
substantial.
Overall, the federal deficit
would be $6 billion less if the
bill passes.
And the USPS would save
about $30 billion over 10
years. The rest of its red ink
would have to be balanced
through new efficiencies, and
many steps have already been
taken to find those — without
creating slower or reduced
mail services.
All that needs to happen is
for House Speaker Paul Ryan
to put the bill up for a suc-
cessful vote before it is too
late.
For anyone concerned
about losing more mail serv-
ice, particularly in rural
America, the way to protect it
is to contact your state
Representatives and voice
your support for HR 756.
Visit Congress.www.house
.gov, where you can leave a
message for your state
Representtives in support of
this important bill.
(Matthew Paxton IV is pub-
lisher of The News-Gazette in
Lexington, Va., and President
of the National Newspaper
Association)
❘ 541-902-3520 ❘
NHICKSON @ THESIUSLAWNEWS . COM
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redress of grievances.
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Salem, OR 97301
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900 Court St. NE
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@state.or.us
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541-682-4203
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