Bowles and Simpson Through The Looking Glass

The Bowles-Simpson deficit-reduction plan proposes to cut two-thirds out of Medicare’s payments for graduate medical education and to reduce Medicare spending through payment reform. Sound familiar? It should. These proposals are right from the Dartmouth-Orszag play-book. They flow from the mythology that, since 30% of health care spending is wasted due to the overuse of supply-sensitive services by unneeded specialists, we need fewer of them but more primary care physicians, and since health care spending is out of control, we need payment incentives that will improve efficiency and reward quality rather than quantity. What is not generally acknowledged is that changes like these penalize the urban-North and rural-South, where too many live in poverty. And the deep cuts proposed for disproportionate share (DSH) payments will harm them more. While more severe than some, these proposals are not new. They have been broadly embraced by many prominent entities engaged in health planning. Get used to it. You’re through the looking glass. The future is the past.

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