Medicare and Medicaid
6 Treats in the New House Health Care Bill
Published October 31, 2009 @ 08:38PM PT
For a bill introduced during Halloween week, there was very little to shock and alarm us in the new combined House health care bill, HR 3962, the Affordable Health Care for America Act.
As much as progressive reform advocates rejoiced, there was a touch of anticlimax in the mainstream reporting. The only two parts that attracted media attention -- the price tag and the configuration of the public option -- haven’t moved at all from where we left them at the end of July. I know it doesn’t feel that way, in that said news coverage has made the evolution of the bill both seem like seat-of-the-pants, anything-can-happen toss-up on both issues. But we began August with a negotiated rates public option and a price tag just above $1 trillion -- and end with a negotiated rates public option and a price tag just above $1 trillion. From that point of view, ain't nothing new under the sun.
But that’s a deceptive way of looking at the House bill. Look closely and you’ll see some big surprises -- some vast improvements over the previous version, HR 3200, that was passed out of committee this summer. Here are 6 examples that we’re just not talking about enough when evaluating the impact of this bill, were it to pass.
- CLASS ACT joins the party -- This is a huge win for advocates for the disabled, and a huge cost-saver for the bill as a whole. Where currently Medicare’s reimbursement incentives all point towards institutionalization, either in a hospital or nursing home, and private insurance often has no provisions for long-term care, the CLASS ACT would create a new, voluntary, publicly run long-term care program that individuals can buy into with payroll reductions. This will allow more and more disabled Americans who can stay in their homes with regular visits from a nurse or aide to do so, and save a lot of money in the process.
- Take THAT prescription drugs! -- Pharma has really had an easy time in this season of reform. Few have been taking their name in vain or burned them in effigy. More to the point, we know Sen. Max Baucus and the White House struck a deal with Pharma over the summer to cap their contribution to reform at some $80 billion over 10 years – enough to partially close the Medicare Part D doughnut hole but not to wring even greater savings out of the system. Well, as Speaker Pelosi was fond of saying, the House wasn’t party to that deal -- and the new bill shows it. Not only does it completely eradicate the payment gap for Medicare Part D seniors over 10 years, but it requiring the Secretary of HHS to actually negotiate for the best drug prices in Medicare, rather than allowing Pharma to name its own price. Imagine that!
8 Things You Need to Know About the New House Health Reform Bill
Published October 30, 2009 @ 06:00AM PT
Nancy Pelosi couldn’t have announced the new House healthcare reform bill, the Affordable Health Care for America Act (H.R. 3962), with any more pomp and circumstance. It was certainly more impressive than the Senate’s mouse-like rollout, apparently intended to avoid rubbing salt in the Baucus “bipartisanship” wound. H.R. 3962 is definitely a major milestone in attempting to reform our broken system-less healthcare; it’s historic, certainly. But no, it’s not the best our legislators could do.
To be fair, House Democrats are being predictably attacked for their effort anyway. There’s the usual carefully contrived “It will raise the cost of Americans’ health insurance premiums; it will kill jobs with tax hikes and new mandates; and it will cut senior’s Medicare benefits.” Thank you Republican John Boehner. There’s also a highly amusing senior’s ad running. Check out this two-faced “how dare you cut (read: wring the waste out of) our government-run healthcare – we’re entitled to it! And by gum you young un’s better be scared of a government-run plan” message.
Meet Medicare Part E
Published October 23, 2009 @ 06:00AM PT
How much time-consuming bluster did it take to get to this simple and obvious option? Open up Medicare to everybody, like Ted Kennedy originally proposed in the Senate HELP bill. Part E does stand for “Everybody.” While it’s only one of the three public options being considered by the House, it’s the strongest. Keith Olbermann gives us a great introduction to the concept in the video clip above. Meet Medicare Part E.
"Doc Fix" Shows (AGAIN) Why the House's Health Reform Bill Is Better Than the Senate's
Published October 21, 2009 @ 11:03AM PT
The last House committee to work on comprehensive health reform finished at the end of July. The last Senate committee (Sen. Max Baucus's Senate Finance Committee) finished last week. But the House has not been idle. News comes today that an initial score from the Congressional Budget Office says the House has refined its bill to only cost $871 billion over 10 years. Of course that is likely to get overshadowed by the train wreck in the Senate concerning Medicare's "Doc Fix." So many commentators are focused on the political clumsiness of pushing a separate bill in the Senate to fix the Medicare Sustainable Growth Rate (SGR) that they may miss what this Three Stooges-esque vignette tells us about the policy strength of these House and Senate bills.
Simply put, the House has its act together. The Senate's got a lot of work to do.
The SGR was an attempt to curb skyrocketing costs in Medicare which has not only failed, it's become the second-worst accounting trick in the federal budget over the past decade (the worst being leaving the costs of the wars in Iraq and Afghanistan out of the budget every year of the Bush Administration so the deficit wouldn't look so big.) A brainchild of the Gingrich Congress and an amendment to the 1997 Balanced Budget Act, the SGR is a formula intended to prevent physician compensation for Medicare from rising above the rate of growth in GDP each year. If physician fees were threatening to go higher, all doctors' fees across the board in Medicare would be cut to keep them within that limit. Not inherently a bad idea, but it has a huge flaw -- in most years, medical costs rise at several times the rate of growth in GDP whether you're talking public coverage or private insurance. The net result is that SGR would guarantee a major cut to Medicare nearly every year, at least until we get an explosive economic growth like we had in the 1990s. And we're not talking obvious waste like Medicare Advantage subsidies for HMOs or those motorized scooters you see in ads on cable TV -- we're talking doctors' fees. You know, the whole point of having health coverage.
So every year, Congress passes a one-year moratorium on the SGR. Every year, all Democrats in the Senate vote for it. Every year, almost all Republicans vote against the moratorium and for the cuts to take place (including every single one of the conservatives who are making "how dare we cut Medicare in any way, shape or form!" their rallying cry for defeating reform. Gotta love that blatant disregard for consistency.) Every year, doctors' fees in Medicare continue to rise at roughly the same "way, way over inflation" rate they do for private insurance, meaning if the cuts took place this year, it'd yield a 21% cut across the board. But every year, the cut never actually happens. It's like a bad sitcom whose punchline you can see coming from miles away. It's absurd. And it needs to be fixed.
Enter health care reform -- an obvious spot to fix it.
Faulty Math in CBO Senate Healthcare Bill Analysis
Published October 08, 2009 @ 06:00AM PT
Well, the CBO definitely got one thing right in its financial analysis of the Senate Finance Committee’s health bill. In commenting on Kent Conrad’s nonprofit co-op idea, it wrote that they "seem unlikely to establish a significant medical presence in many areas of the country." I already shared my opinion on co-ops as destined-to-fail recycling attempts.
Other than that, though, here is their 10 year breakdown of the bill:
- Cost: $829 billion
- Benefit: $81 billion in reduced federal deficits
- Coverage: Increase from 83% to 94% of Americans
- Uninsured Reduction: 29 million
- Missing: $200 billion in Medicare physician payment increases
- Risk: 15% low-income subsidy cuts to abide by Obama’s budget-neutral failsafe mechanism
The SFC bill’s lower cost sent House Democrats scrambling to reduce HR 3200’s cost under the $900 billion limit set by the president, even though their plan would cover 8 million more people than the SFC’s. Part of their strategy may be to move 7 million low-income individuals onto Medicaid instead of providing subsidies for private insurance.
Which brings me to my point. They realized something most of us haven’t. Much of the budgeting exercise has been based on faulty math because the largest cost factor is an unknown – private insurance costs. Higher education provides a useful, though painfully similar, example.
Whistleblowers Expose Hospitals Fleecing the Public's Back
Published October 07, 2009 @ 09:00AM PT
What happens when two whistleblowers separately expose widespread Medicare fraud to authorities? Other than nearly $90 million in fines, one wrongdoer loudly protests that she just lacked supporting documentation for the fraud.
Such is life in the case of medical device maker Medtronic Spine LLC and its hospital customers. After two former employees alerted the Justice Department of a scheme that ran from 2002-2008, Medtronic’s acquisition of Kyphon Inc. came back to haunt it with a $75 million fine. Kyphon made equipment and materials used to perform kyphoplasty. It promoted the procedure as a hospital money-maker if clients billed Medicare for inpatient rather than outpatient surgery.
Yes, in a cringe-worthy twist, hospitals were making decisions on inpatient versus outpatient status based on financial gain, not medical necessity. Just not according to Pamela Jones, St. Francis Hospitals’ chief legal eagle: "It is important to note that the probe had nothing to do with quality of care, patient safety or medical necessity ... the issue is that the documentation did not support the inpatient stay." Well Pamela, as for medical necessity, receipt of the lawsuit’s largest hospital fine for fraud ($3,158,629) would suggest otherwise. And I would hope St. Francis wasn’t jeopardizing patient safety and providing low-quality care while fleecing the public.
The Cost of a Health Reform Fail
Published September 30, 2009 @ 06:48PM PT
Robert Wood Johnson Foundation and the Urban Institute today gave us a peek at what lies ahead for the U.S. if we don’t complete the job on health care reform. What does the future hold if we continue to face costs that rise at three times the rate of inflation, and the subsequently depressed wages and increased number of employers dropping coverage or shifting the costs to individuals and families? From 1999-2009, the number of uninsured rose 10 million -- even with an increase in public coverage through SCHIP, Medicaid and Medicare. What will that number be in 2019? What will that do to state budgets? To the federal budget? How will we manage to pay the cost of failure?
To see what trajectory we’re on, you only need to look at where we’ve been. Health care costs have risen an average of 9% for private insurance each year since 1970 (for Medicare, it’s 8%). More and more employers are dropping coverage altogether, or substantially decreasing their contributions. The number for the uninsured, for uncompensated care, for those on public programs will continue to go up -- as will medical debt-related bankruptcies. The trendlines are long-term and irrefutable. So Urban Institute plugged the numbers into their Health Insurance Policy Simulation Model and projected a number of scenarios for each state and the District of Columbia. They presented two scenarios: one where the recession is prolonged, health care costs continue accelerating, and income growth is about the same; and another where we rebound to almost full employment, income growth is brisk, and health care costs don’t accelerate the way they have the past several years.
But even the best-case scenario numbers ain’t that rosy.
It’s the fulfillment of all the anti-reform slogans you’ve ever heard. If you think reform will take away your choices, imagine an America where 57.0-65.7 million have no choices because they're uninsured. If you think reform means losing what you have in terms of coverage, imagine being one of the 20 million Americans who will lose their employer-sponsored insurance by 2019. The why is obvious -- employer costs for health care would more than double in 27 states in the worst-case scenario. That enrollment in government-funded Medicaid and CHIP programs for lower-income Americans will also increase. If hospitals are complaining about a hypothetical public option based on Medicare rates (the versions of the public option in the bills now would not use Medicare rates), then imagine how happy they’ll be with increases in uncompensated care rise from 72-128%.
You may be OK with an increase in the uninsured, and working families and businesses continuing to see more of their budget eaten up by health care costs. But, as the report concludes, “[Uncompensated care] together with the increased spending for Medicaid and CHIP, this would inevitably mean higher taxes even without reform.” Even if we miraculously avoid a tax increase at the federal level through clever accounting or spending cuts, the state tax piper for Medicaid and CHIP must be paid.
So you can continue telling me that we can’t afford health reform. But for me to take you seriously, you’re going to have to show me how we can afford a health reform epic fail.
(Photo credit: http://www.flickr.com/photos/southpaw2305/ / CC BY 2.0)
