Robbing Peter to pay Paul

John McCain’s top aide says that they will make significant cuts into the Medicaid and Medicare programs in order to pay for McCain’s health plan. McCain’s plan is to tax employee health benefits, and offer tax credits of $2,500 for individuals and $5,000 for families. Actual cost of health insurance? More than twice each of these numbers. Obama calls this a “shell game”.  This Wall Street Journal article is a good discussion of this.

McCain’s plan does have some positive points, such as opening the market for health insurance to cross state lines. On the other hand, regulation is an issue, but Republicans are very much anti-regulation. Cutting Medicaid and Medicare, just in time for aging and retiring baby boomers to be entering these programs, is delusional. The only way for that to happen is to cut payments (and physicians will – again – be target one) and/or to reduce an already limited scope of services. This will not be a good thing for physicians. I suspect that will actually happen is that physicians will bolt from Medicare and Medicaid, and retail prices will rise as demand squeezes a supply line of physicians that is squeezed today.

In reality, this plan will not get through Congress. Physicians must be vigilant and speak out for your own self –interest, as well as the interests of your patients. No one is talking about a national health system or socialized medicine – if anything, some sort of national financing mechanism.

Meanwhile – run lean, trim carefully, and keep moving forward, for we will emerge from this recession. FORTUNE magazine was founded four months after the 1929 stock market crash.