Health Care: Republicans Will Present Alternative Plan
• "When Republicans take President Obama up on his invitation to hash out their differences over health care this month, they will carry with them a fairly well-developed set of ideas intended to make health insurance more widely available and affordable, by emphasizing tax incentives and state innovations, with no new federal mandates and only a modest expansion of the federal safety net," the New York Times reports.
• "Few congressional Democrats said Monday they are confident that President Obama's plans for televised talks with House and Senate leaders of both parties on Feb. 25 will jump-start healthcare negotiations," CongressDailyAM (subscription) reports.
• "Anthem Blue Cross of California, the state's largest for-profit health insurer, announced Monday it will increase premiums for its 800,000 customers by as much as 39 percent, drawing an immediate rebuke from" Health and Human Services Secretary Kathleen Sebelius, CongressDailyAM (subscription) reports.
• "Democrats in Congress are holding White House Chief of Staff Rahm Emanuel accountable for his part in the collapse of healthcare reform," The Hill reports.
• "State lawmakers in at least three dozen states are pushing ahead with a series of measures aimed at pre-empting whatever" version of health care reform "might come out of Washington," Politico reports.
Republicans are sure to come to President Obama's newly announced health care summit later this month armed with proposals for how to change Democratic health care reform bills. House Republicans late last year proposed an alternative that is summarized below. Which proposals are good ideas that should be seriously considered, and which should be scrapped?
1. Provide states with $25 billion to create high-risk pools or reinsurance programs. States would have to eliminate waiting lists for existing high-risk pools, and premiums would be capped at 150 percent of the state's average premium (down from 200 percent).
2. Protect those with pre-existing medical conditions by extending current provisions under the Health Insurance Portability and Accountability Act of 1996.
3. Prohibit insurers from imposing annual or lifetime spending caps.
4. Prohibit insurers from fraudulently canceling health insurance by creating an independent appeals panel.
5. Provide $50 billion to states that adopt reforms reducing the cost of health insurance and expanding coverage (subsidizing health insurance or expanding Medicaid eligibility wouldn't qualify).
6. Allow small businesses to pool together through association health plans to buy insurance.
7. Require health plan dependent coverage to go up to age 25.
8. Allow Americans to purchase insurance in any state.
9. Enhance health savings accounts by providing tax credits to low and moderate-income individuals for some contributions, and allowing taxpayers to use HSA funds to pay premiums.
10. Establish a statute of limitations on bringing a medical malpractice case; cap noneconomic damage awards at $250,000; allow the court to restrict attorney fees; clarify and limit punitive damages; and protect states with existing "functional medical liability laws."
11. Repeal the Federal Coordinating Council for Comparative Effectiveness Research.
12. Prohibit federal money from being used to pay for abortions, and create a conscience protection clause to allow health care providers to refuse to perform abortions based on moral or religious objections.
The full summary provided by the Republican staff at the House Ways and Means Committee in November can be found here.
-- Marilyn Werber Serafini, NationalJournal.com
Are the national health expenditure numbers released by the government today as bad as they sound? Which is the most important indicator to watch? Percent of GDP? Per capita spending? The shift from private to public spending? Which sectors of the industry should we be carefully watching for jumps in spending?
Spending in 2009 grew to 17.3 percent of GDP, marking the single largest annual increase in at least 50 years, according to CMS. Spending could consume 19.3 percent of GDP by 2019. Total U.S. health care spending is estimated to have been $2.5 trillion in 2009, up 5.7 percent from the year before.
The Centers for Medicare and Medicaid Services' Office of the Actuary released the data and wrote the report for Health Affairs. The findings do not account for any changes that health care reform legislation now under consideration might achieve.
The economic recession has affected both public and private health care spending as more people have lost their private insurance and government has been hit with increases in Medicaid enrollment and therefore spending. While public spending grew 8.7 percent from 2008 to 2009, private spending grew by a smaller 3 percent.
Looking forward, health spending is projected to annually outpace growth in the GDP by about 1.7 percentage points. Through 2019, public spending is expected to grow at an average of 7.0 percent a year, and private spending at a lower 5.2 percent.
The growth of Medicare spending is estimated to have slowed a little in 2009, increasing by 8.1 percent -- half a percentage point less than the previous year. The authors attribute the change to slower growth in prescription drug and hospital spending.
Overall, however, total health care spending on most medical services increased. Spending on hospitals increased 5.9 percent last year from the year before -- up from 4.5 percent growth in 2008, mostly because of increased enrollment in Medicaid. Growth in private hospital spending also accelerated, however.
Spending on physician services also was up, again driven by additional Medicaid enrollment. That spending grew 6.3 percent in 2009, up from 5.0 percent a year earlier. Private spending on physician care also increased, however, due in part to the swine flu outbreak.
Spending on prescription drugs grew at an estimated 5.2 percent in 2009, significantly more than the 3.2 percent increase of 2008. The authors attribute the growth to the need for anti-viral drugs to combat swine flu and to higher price growth in brand-name drugs.
-- Marilyn Werber Serafini, NationalJournal.com
4 responses: Paul B. Ginsburg, John C. Goodman, Sally C. Pipes, Karen Davis
In his fiscal 2011 budget proposal to Congress this morning, President Obama focused mostly on the need to bolster the economy. Can the economy be improved -- in either the short or the long term -- without also reforming the nation's health care system? How closely are they related, and what and how much needs to be done on health care to positively affect the economy?
Here is what Obama wrote in his budget proposal:
"Because even the best-trained workers in the world can't compete if our businesses are saddled with rapidly increasing health-care costs, we're fighting to reform our Nation's broken health insurance system and relieve this unsustainable burden. My Budget includes funds to lay the groundwork for these reforms -- by investing in health information technology, patient-centered research, and prevention and wellness -- as well as to improve the health of the Nation by increasing the number of primary care physicians, protecting the safety of our food and drugs, and investing in critical biomedical research."
According to the budget document, Obama is supporting expansions of patient-centered health research "to give patients and physicians the best available information on what treatments will work the best for them; supporting investments in health information technology; expanding prevention and wellness activities; and launching payment reform demonstration programs in Medicare." He proposes $290 million for centers that would expand health care to the medically underserved.
What is the proper mix of work on the economy and health care this year?
Also, what policy proposals in Obama's health reform budget do you find interesting, disturbing or missing? The president's full proposal can be found here. The specific proposals for the Department of Health and Human Services are on pages 77-83 of the PDF.
-- Marilyn Werber Serafini, NationalJournal.com
5 responses: Darrell G. Kirch, Karen Davis, Jeffrey Levi, Len Nichols, Uwe Reinhardt
Updated at 10:33 a.m. on Jan. 28.
If Washington is going back to the drawing board on health care reform, what will be the easiest, least costly way to accomplish a more modest expansion of health care coverage to the uninsured? Is a modest Medicaid expansion the answer? Low-income subsidies plus an exchange? Should policymakers be satisfied with expanding coverage to just kids? Should the focus be on early retirees, aged 55-64?
If it had to be something short of universal coverage, what would be the smartest, most cost-effective approach?
President Obama urged members of Congress to finish the job of health care reform in his State of the Union address to Congress on Wednesday. "This is a complex issue, and the longer it was debated, the more skeptical people became," he said. "... This problem is not going away. I will not walk away from these Americans, and neither should the people in this chamber.... As temperatures cool, I want everyone to take another look at the plan we've proposed."
Did the president say what he should have? Just how closely are health care and the economy tied? What should happen next?
-- Marilyn Werber Serafini, NationalJournal.com
16 responses: Darrell G. Kirch, Henry J. Aaron, Grace-Marie Turner, Rep. Pete Stark, D-Calif., Andy Stern, Rep. John Dingell, D-Mich., Karen Davis, J. James Rohack, David B. Kendall, Marilyn Werber Serafini, Mary R. Grealy, Sally C. Pipes, Len Nichols, Jason Rosenbaum, John C. Goodman, Rep. John Dingell, D-Mich.
Now that Senate Democrats no longer have a filibuster-proof 60 votes, should Congress scrap health care reform or work on a skinny bipartisan bill? Should the House consider the Senate-passed health reform bill with the promise that certain provisions will be changed in reconciliation legislation?
From a policy perspective, what would work in a skinny bill? What pieces should and could be removed from the Senate bill in reconciliation? Is it possible and wise to have insurance reforms without big expansions?
What are the best and worst things Congress could do now?
-- Marilyn Werber Serafini, NationalJournal.com
8 responses: David B. Kendall, James P. Gelfand, John Sheils, Jeffrey Levi, Kenneth E. Thorpe, Jason Rosenbaum, Grace-Marie Turner, Tom Miller
Updated at 8:13 a.m. on Jan. 19.
Should Congress settle on a single, national health insurance exchange or individual state exchanges in its final health care reform legislation? Negotiations seem to be leading to a single, national exchange.
The House-passed bill calls for the federal government to operate a single, national health insurance exchange. Advocates argue that state-run exchanges could be too small to be effective and wouldn't account for varying needs in different parts of the country.
The Senate-passed bill, meanwhile, would direct states to run individual exchanges. The National Association of Insurance Commissioners backs this idea, arguing in a Jan. 6 letter to Congress that consumers are "best served by insurance regulation that is located firmly at the state level."
Who's right? And what do we already know about state insurance regulation that should influence Congress' decision?
-- Marilyn Werber Serafini, NationalJournal.com
4 responses: Uwe Reinhardt, Karen Davis, Alan Weil, Paul B. Ginsburg
What is the best way for the House and Senate to compromise on divergent tax proposals in their health care reform bills without destroying their ability to control health care spending?
One idea under discussion is to accept the Senate tax on high-end "Cadillac" insurance plans (the House doesn't have it), but raise the threshold so that it would apply to higher premiums. A House provision to tax the wealthy could also remain in the legislation, but also with a higher threshold for who would be taxed.
The Senate's tax on high-end insurance plans would tax health plan premiums over $8,500 for individual coverage and $23,000 for family coverage. The tax, imposed on the insurer, would be 40 percent of the value of the plan that's over the threshold. The threshold amounts would be higher for some -- $1,350 higher for retired individuals over 55, employees in high-risk professions, and temporarily for the 17 states with the highest health care costs.
What is the best way to merge these proposals so that they remain effective cost-containment and revenue-raising measures? What is the appropriate threshold for these taxes?
-- Marilyn Werber Serafini, NationalJournal.com
12 responses: Marilyn Werber Serafini, John Sheils, Gail Wilensky, Uwe Reinhardt, Paul B. Ginsburg, John Sheils, Jason Rosenbaum, John C. Goodman, Jason Rosenbaum, Sally C. Pipes, John C. Goodman, Paul Fronstin
How do you read today's news that the growth of U.S. health care spending slowed in 2008 to its lowest level in 48 years?
What is significant in these numbers, and what do they mean for health care reform?
The Centers for Medicare and Medicaid Services released their findings today, and officials there wrote their analysis in the journal Health Affairs.
National health spending was $2.3 trillion in 2008, an increase of 4.4 percent from the previous year. By comparison, health spending grew 6 percent in 2007. The calculation includes spending for health care goods and services, program administration, private health insurance, public health, and the amount spent on structures, equipment and noncommercial research.
Federal health care spending actually increased, partly because the federal government stepped in to pay a larger share of Medicaid costs. Medicare spending also grew more rapidly in 2008 than in 2007.
The federal government's share of national health care spending grew by 1 percentage point to 35 percent. Moreover, more of the gross domestic product went to health care spending. In 2008, 16.2 percent of the GDP was spent on health care, up from 15.9 percent in 2007.
The GDP finding was expected, according to CMS, because GDP typically grows at a slower rate than total health spending during or after a recession. Indeed, the 2008 experience is consistent with past recessions.
Spending growth for hospital services was the slowest since 1998. While prices were down, so was Medicaid spending, as states implemented strategies to lower their spending on the program. The slower growth was partially offset by increased use of inpatient and outpatient services.
The growth of spending for physician services, nursing home services and retail prescription drugs was also down, and private health insurance premiums and benefits grew at their slowest rate since 1967, according to CMS.
-- Marilyn Werber Serafini, NationalJournal.com
4 responses: James P. Gelfand, Stuart Butler, Karen Davis, Karen Ignagni
Would health care reform still work if the individual mandate disappeared?
Reform opponents are increasingly attacking provisions in the House- and Senate-passed bills that would require individuals to buy health insurance, and some are threatening lawsuits challenging the constitutionality of such a mandate.
Would removing the individual mandate unravel health care reform? Regardless of your support or opposition to the mandate, what effect do you think killing it would have on the workability of the comprehensive package? Is such a mandate constitutional?
-- Marilyn Werber Serafini, NationalJournal.com
Would the leading Demcoratic health care reform proposals result in a better or worse Medicare?
One of Republicans' major criticisms of the Democratic plans under consideration is that they would take a chunk of money out of Medicare. Reducing payments to Medicare Advantage insurers, they say, would result in sliced benefits for seniors. In addition, the bills raise revenue by limiting spending increases for medical providers.
Democrats, along with some consumer groups, counter that the legislation would help Medicare beneficiaries, citing examples of closing the gap in prescription drug coverage called the "donut hole."
Would Democratic health care reform proposals hammer Medicare or help it? And would any negative hit be to beneficiaries, to medical providers or to both? On the whole, would Medicare be fiscally stronger or weaker as a result of Medicare changes? What kind of Medicare commission would help, and what's a waste of time?
-- Marilyn Werber Serafini, NationalJournal.com
5 responses: James P. Gelfand, Karen Davis, Stuart Butler, Gail Wilensky, Uwe Reinhardt
