Cato Institute: Sarah Palin is partly right

Sarah Palin ignited a firestorm when she accused Obama and Democrats of wanting to institute health care "death panels" in a post on her facebook page. President Obama tried to debunk the charge at a town hall in Portsmouth, NH. Now, Michael F. Cannon,director of health policy studies at the Cato Institute, says Palin is (partly) right.


Detroit Free Press reported:

The intelligentsia have been quick to dismiss former Alaska governor Sarah Palin’s claim that, under President Obama’s health plan, “my parents or my baby with Down Syndrome will have to stand in front of Obama’s ‘death panel’ so his bureaucrats can decide…whether they are worthy of health care.”

No one ever accused Palin of being a health policy expert, and many found her hyperbolic term “death panel” off-putting. But that should not distract voters from this reality: President Obama has proposed a new body that would enhance Medicare’s ability to deny care to the elderly and disabled based on government bureaucrats’ arbitrary valuations of those patients’ lives.

It is right there in the legislation now before Congress, and it is called the Independent Medicare Advisory Council.

Medicare already has the statutory authority to reduce the amount it will spend on elderly and disabled patients, but largely cannot exercise that authority. Federal law says that Medicare may deny coverage for services that are not “reasonable and necessary,” but gives no guidance on what “reasonable” and “necessary” mean. That effectively leaves the issue in the hands of the bureaucrats at the federal Centers for Medicare & Medicaid Services.

“In theory,” writesTufts Medical Center’s Peter Neumann and colleagues, “the CMS could interpret Medicare’s statutory authority to cover ‘reasonable and necessary’ services as a license to use cost-effectiveness analysis,” i.e., to deny care. “To date,” however, “this course has proved to be impossible.”