The Center for Medicare &Medicaid Services (CMS) November 2024 Financial Report

I Did Finally Read This Thing

A document that is definite reinforcement for not taking a government job. I almost had myself committed trying to digest this monstrosity. 1.5-1.77 trillion dollars in 2024 was allocated for funding the Center for Medicare & Medicare Services. That is 22% of our total Government Budget! More by far than our defense budget. Up from 14% in 2023 of government outlays. Knowing (as demonstrated in a past post) that hospitals get all of Part A and 45% of part B Medicare dollars, this has been an absolute boondoggle for our 6,100 US hospital systems. Recall my last post on the $1,300 dollar wrist x-ray.

Where Does One Begin?

They Have Us Coming And They Have Us Going

One obvious lesson from reviewing this CMS financial report is that, over time, the government has abandoned fiscal discipline and strapped on more and more “services” and costs onto the Medicare program. By doing this, the system is actually removing innovation and service delivery potential to the general health care market. Most providers are following the payment pie and following the government’s lead for services rendered.

The way the system works, any wage earner pays a Medicare tax with each payroll check. So do their employers. Self-employed business owners pay equally as an employee and employer. It is 1.45% of wages for each or 2.9% for the self-employed business owner. If you and your spouse’s combined wages exceed $250,000, tack on another 0.9 % to all wages above the threshold.

To help explain this to the mathematically challenged, this means the more you earn the more you pay in. This means it is a graded and means tested tax- funding the program. It isn’t voluntary and the cost keeps going up. Noting this taxing process, the present system doesn’t collect based upon individual consumption. This is socialized health care, front and center in America. The idea is if you earn more, you add more to the wagon to cover the collective. Work and earn more and you get to pay more than your fair share.

Turns out in around 2003, our congress (responsible for budgetary discipline), decided to spend more than the program was saving for. That is when they decided to start collecting additional money from the retired Medicare citizens. These people already paid for the program prior to retiring. Now, retirees are getting to pay a second time despite not working for wages. Their savings are being extracted from their assets. LET THAT SINK IN. The tax payers had no say in the matter.

Enter The Medicare Modernization Act of 2003 (MMA)

More specifically, the Income-Related Monthly Adjustment Amount Act (IRMAA). This surcharge tax is illustrated at the “on the way out” side of the Turnstile illustration. Congress voted for this to help fund deficit spending on the ever- revising Medicare Part B and the newly (in 2003) introduced Medicare Part D program. MMA was voted for in 2003 and ENACTED in 2007. This is how our congress avoids accountability. Pass it today, don’t enact it until 4 years later. Then the public is unclear who to blame for the added taxes.

Then Came The Affordable (actually the Patient Protection and Affordable) Care Act of 2010. That Dear People, Is OBAMACARE.

Passed in 2010 and enacted in 2011. Congress froze the income thresholds and thus through wage inflation added more suckers to pay the new, Medicare Means Scheme, added taxes to fund Medicare B and D. More tweaking continued to follow.

Enter The Medicare Access and CHIP Reauthorization Act of 2015.

Congress further adjusted the income threshold (downward) to increase the number of “higher income” paying beneficiaries. I hope Joe Q Public sees the shell game. They distract you by pretending you don’t have the ball under your cup. Then, in a few short years, there is a ball under everyone’s cup. Instead of racial discrimination, there is income discrimination (at first). If you are a sucker for Elizabeth Warren’s logic, you think “ok that is fine” if “that rich guy I don’t know is paying more”. But before you know it, you are that rich guy Ms. Warren is pretending isn’t you.

PS. The MACRA Legislation was the final death knell to the doctor profession, as most adults remember the profession to be. I explained this in detail years ago. This “epiphany” is what led me to understand the system is insolvent and we have to create a care model fully free of government and insurance payment and control.

Death Knell

The Biden Administration Went Bananas With More Payment Promises At The Expense Of The Citizens.

Reviewing all the added pet projects and programs added in the Inflation Reduction Act to be funded under CMS is what inspired my first illustration in this piece. There is an ever expanding number of seats at the roundtable, extracting payment from our CMS coffers.

From my review there are approximately 80 individual acronyms in the 2024 CMS report. Most of these acronyms are attached to program initiatives. Some of these likely will disappear (thankfully) as they were related to Diversity Equity and Inclusion initiatives. The Biden Inflation Act included pet projects like funding sweat lodges, and music therapy as covered services.

And The Big Doozy- Medicare Drug Price Negotiation Program

Let Me Help Everyone With This Secret. Uncle Sam Is Not Negotiating Better Prices.

Another shell game in action here. President Biden’s administration told us they were dressing down big Pharma with Medicare price negotiations AND in the CMS report, they legislated a program to phase out the Medicare part D “doughnut hole” that beneficiaries were paying out of pocket for medications. Sorry but it JUST AIN’T SO.

The 10 drugs they listed as being negotiated are actually going to all be losing patent protection and going generic by the time the negotiated prices are settle. The last thing we want is CMS and Medicare to lock in prices for drugs going out of patent protection. This will actually result in Medicare Beneficiaries paying MORE for generics as they enter the market. This program will create an artificial ceiling price for what could and would become a free market wholesale cash price for generic equivalents leaving the market.

As of this posting, it has only been a few weeks into January but patients are already realizing unexpectedly higher out of pocket copays for their medications upon first fill compared to last year. Instead of paying less initially as you moved to the doughnut hole, Medicare D beneficiaries are paying this up front. Name brand copays are reported at $700 dollars “out of the box” vs prior lower copays.

Let’s face it folks. Explained within the 2024 Budget report is higher outlays, higher debt financing and no true price reduction in the program. They cost shifted the doughnut hole problem to up front higher copays, added more coverage for non proven services and intend to tax the higher income bracket group to expand more government expansion into the health care system. Hospitals, universities and Insurance win and Joe Q gets the shaft further driven in.

I am only further convinced that we need out of the present day full dollar health insurance 3rd party payer system. We need enter a free market health care economy and your Direct Primary Care physicians are showing everyone how this gets done. Doctor practices need to provide our services at fully revealed pricing and remove conflicts of interest insurance and employment contracts with institutions. As we forge the way, other specialties will follow.

The public will facilitate this by moving their care in our direction. The public can also start refusing to pay health care premiums. Choose health sharing or shop the true market and realize it is actually more affordable to go bare. Employers need to explore consulting third party administrators to help with market pricing and planning for health expenses.

If you are a victim of paying again on the way out with your part B fees being extracted, consider not buying any part B or D gap insurance and get your generics at the cash price at the pharmacy window. If the retailers won’t quote you a reasonable price, use Mark Cuban’s cash plus pharmacy, Amazon or your local physician’s dispensary. If the insurance companies see consumers walking out of the trap, then maybe they will be back into the insurance business and out of the cartel business.

Your health insurance is harmful to your wallet and your health.