Health Care System in Limbo

Supreme Court justices may have more to weigh than just the constitutionality of the Affordable Care Act.If the U.S. Supreme Court finds the federal health care reform act unconstitutional later this year, experts say it could unravel more of the nation's health care system than anticipated, including Medicare.

Judy Feder, a former Clinton administration official, tells NPR's Julie Rovner that the push toward more integrated and coordinated health care delivery would be disrupted.

Gail Wilensky, who ran Medicare and Medicaid programs for President H.W. Bush, says voiding federal health care reform would erase the most recent benchmarks for doctor and hospital payment rates. 

"Hospitals might not get paid. Nursing homes might not get paid. Doctors might not get paid," Wilensky says. "Changes in coverage that have begun to take effect for the elderly, such as closing the donut hole, might not happen." The effects, she adds, would undoubtedly spill over to everyone in the health care system.

Sara Rosenbaum, a professor of health law, likens it a train wreck. "We could find ourselves at a grand stopping point for the entire health care system." One problem she cites is the possibility of thousands of Medicare policies being suddenly null and void.

Jeremy Lazarus, president-elect of the American Medical Association, says, "With countless hours of work already done to implement the law, it is hard to imagine the full impact of it disappearing."

Dan Mendelson, a health care consultant with Clinton administration ties, says the high court's decision could put most of health care in America in a legally murky place. Lazarus calls it "political never-never land."

Repeal or partial repeal of what Republicans like to call Obamacare would make a pretty big policy crater in Congress, which already is staring at big holes in long-term funding for Medicare and Social Security. Trustees for those entitlement programs released reports showing Medicare hits the financial wall in 2024 and Social Security's Waterloo has inched closer by three years to 2033.

More than 56 million American retirees or disabled workers and their spouses and children receive Social Security payments, which average $1,232 per month. It doesn't take a calculator to realize that is a lot of money rippling through the economy because Social Security recipients spend what they receive on food, rent, transportation, utilities and medical bills.

Some 50 million American seniors are covered by Medicare, which is funded by a 1.45 percent tax on all wages, paid by both employers and employees. 

Both programs will see a large influx of new people as the wave of baby boomers retire.

Fixing Medicare is inextricably tied to the Affordable Care Act, which calls for $500 billion in unspecified spending cuts to extend the life of the program, enacted during Lyndon Johnson's presidency. Social Security and Medicare trustees warn that too-severe spending cuts could reduce the number of doctors and hospitals willing to accept Medicare patients. Some doctors already decline new Medicare patients.

Negotiations to bolster Medicare are politically sensitive in the extreme, especially if President Barack Obama wins re-election and Republicans control one or both houses of Congress. They could become even more intractable if the health care reform framework in place the last two years goes way in the flash of a Supreme Court opinion.

Gail Wilensky says pulling the plug on the Affordable Care Act could wash important Medicare policies down the drain.