Creative Accounting

I actually heard of this a while back, but it has suddenly been a topic of discussion in the blogosphere (such as here and here). In order to make it appear the Republicans aren’t running up as huge a deficit, they are going to delay making government payments from late September until October. That means that Medicare will hold up the checks paid to doctors and hospitals for services performed in September:

That way, point out the gleeful budgeteers and Medicare pooh-bahs, all of whom presumably are glowing with health, Uncle Sam’s Medicare tab this fading fiscal year will be $5.2 billion less than it otherwise would have been. Or at least would seem to be $5.2 billion less — in Washington, as we all know, appearance and reality are not invariably the same phenomena.

Of course, this oh-so-clever stratagem would mean that next fiscal year’s Medicare bill will be $5.2 billion more than it would have been. But, not to worry, those indefatigable financial watchdogs in the Office of Management and Budget and their henchmen in the uppermost reaches of Medicare are on the case. And we have every confidence that next year they’ll make up for any untoward increases in costs by ceasing to send checks to doctors, hospitals et al. in August or even July, if necessary.

Actually the Bush Administration can’t even take full credit for this idea. Several years ago they placed a permanent delay of around a couple of weeks into payment of Medicare claims. This gave the appearance of a one time reduction in expenses. Ever since then Medicare claims have continued to take a little longer to be paid than other payers. They’ve also considered temporary delays of this type in the past.
If this really helps keep the government out of a financial mess, so be it. I just have one question. May I delay sending in my quarterly federal income tax estimate from September until October when I receive payment from the government?

1 Comment

  1. 1
    Carol says:

    Go to camp democracy and speak out!

    Learn more on c-span in 15 minutes.

    Watch Camp Democracy’s Press Conference on C-Span Today, August 29, from 6-7 p.m. ET

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