Medicare Compliance & Reimbursement

The healthcare remake will achieve President Obama's aim of expanding health insurance -- adding 34 million Americans to the coverage rolls -- but at a much higher price than expected.

The sweeping healthcare overhaul law will increase the nation's healthcare tab instead of bringing costs down, states a Health and Human Services (HHS) report posted on www.cbsnews.com.

The report, scripted by economic experts at the HHS, also found that the law didn't quite measure up to the president's goal of controlling runaway costs and will raise projected spending by about 1 percent over 10 years, according to the post. And that increase could get bigger. However, the report also warned that Medicare cuts in the law may be unrealistic and unsustainable, forcing lawmakers to roll them back, which is good news for consumers and providers. Projections in the report also show that Medicare cuts could drive about 15 percent of hospitals and other institutional providers into the red, "possibly jeopardizing access" to care for seniors.

There is however a disclaimer in this report from Medicare's Office of the Actuary, saying it does not represent the official position of the Obama administration. White House officials have repeatedly complained that such analyses have been too pessimistic and lowball the law's potential to achieve savings.

The post reported HHS secretary Kathleen Sebeilus as saying in a written statement, "The analysis by the independent Office of the Actuary reaffirms what the Congressional Budget Office has already said: the Affordable Care Act will cover more Americans and strengthen Medicare by cracking down on waste fraud and abuse, modernizing payment systems and improving benefits by providing free preventive services, supporting innovations that help control chronic disease and closing the prescription drug donut hole."

The report did acknowledge that some of the cost-control measures in the bill -- Medicare cuts, a tax on high-cost insurance and a commission to seek ongoing Medicare savings -- could help reduce the rate of cost increases beyond 2020. But it said there was little hope for progress in the first decade.

"During 2010"2019, however, these effects would be outweighed by the increased costs associated with the expansions of health insurance coverage," Richard Foster, Medicare's chief actuary has written in the report. "Also, the longer-term viability of the Medicare ... reductions is doubtful." Foster's office is responsible for long-range costs estimates.

Editor's note: Read the complete post on www.cbsnews.com at http://www.cbsnews.com/stories/2010/04/23/politics/main6423757.shtml.