PhRMA supports expanding access to high-quality, affordable health insurance coverage to all Americans.

We recommend building on the employer-based system and expanding coverage through public and private approaches. Such options include providing subsidies to low and moderate income individuals and families and providing targeted tax credits for small employers so they can afford coverage for their workers and families.

Access to public programs, including Medicaid and the State Children's Health Insurance Program, should be expanded to fill the gaps for low income and vulnerable children and families. Insurance market regulations can also be established to help assure that health insurance coverage is more affordable and available to millions of Americans with chronic or pre-existing medical conditions.

To address chronic diseases, which account for 75 percent of all of America's health care spending, we recommend a much greater emphasis on disease prevention, wellness programs and reducing health care disparities.

As for health insurance coverage, it should be comprehensive and include generic and brand-name medicines. That is essential to promoting access to care and providing financial and health security for millions of under-insured Americans. Medications play a pivotal role in preventing full-blown disease and often help to drive down the cost of surgery and hospitalization. In other words, they are crucially important to chronic disease management.

In the end, what we need is comprehensive health care reform that expands access to high-quality, affordable health insurance while also working to improve the quality, value and affordability of care for all Americans.

As mark-ups begin this week, Congress must not forget children's unique needs. While the recent expansion of the Children's Health Insurance Program was a significant step forward, even when it is fully implemented, 5-6 million children will still be uninsured and millions more underinsured. Now is our chance for comprehensive reform.

The House and Senate legislation must ensure every child in America access to affordable comprehensive health coverage regardless of the state and family they live in and all children should receive the comprehensive and age-appropriate benefits currently mandated in Medicaid. CDF is urging that any legislation include these three core principles and child protections:

• Coverage must be affordable. Establish a national eligibility floor of 300 percent of the federal poverty level for all children and pregnant women, with an affordable buy-in based on a family’s income for those over that income level.
  
• Benefits must be comprehensive. Guarantee every child access to all medically necessary services to maximize a child’s health and development.
  
• The system must be simple and seamless. To ensure children get enrolled and stay enrolled, simplify the application and enrollment process to make it easy for all children to get covered and stay covered. This includes eliminating known barriers to enrollment and instituting automatic enrollment of eligible children.

Several of the draft health reform proposals recently released by major Congressional committees contain much-needed provisions to expand affordable insurance coverage to everyone, improve the quality of care that patients receive, and bend the health care cost curve to more sustainable rates of increase. Policymakers and major stakeholders have begun outlining workable policies that offer real hope to American families, businesses, and our country.

As the committees begin the process of mark-up, several principles must come to the forefront. First, to ensure long-term fiscal stability, options for financing reform need more attention. To that end, the Administration has offered several innovative proposals to generate savings for a health reform reserve fund, including proposals to implement productivity adjustments in Medicare payment updates, lower the cost of prescription drugs, and utilize imaging capacity more efficiently, as well as proposals to reduce overpayments to private insurers in the Medicare program and to offer incentives for improving care after hospitalizations and reduce readmission rates by moving to bundled acute-care episode payment. Congress should incorporate these cost-cutting strategies into legislation.

It is equally crucial for Congress to design a process that replaces today's chaotic and administratively costly price negotiations between private insurers and health care providers. As it stands, multiple negotiations among multiple insurers and multiple providers generate significant administrative costs, non-competitive market prices that vary widely, and favorable rates for the most powerful participants in the negotiations. What is needed is an accountable process that brings the benefits of reformed payment methods and negotiated rates to all enrollees in private and public plans participating in an insurance exchange.

Finally, Congress should consider the approaches to medical liability reform that show the greatest promise for lowering the cost of health care while simultaneously ensuring that all patients receive the safest care possible. Generating information on the comparative effectiveness of treatments and protecting providers who follow best-practice guidelines is one strategy that may help drive down health care costs. Similarly, offering favorable rates to providers who participate in patient safety and risk management and improvement initiatives may help reduce medical errors.

Tim Trysla, executive director of the Access to Medical Imaging Coalition, urges Congress to be careful not to harm patients when considering cost-saving measures. Here's what he has to say:

"When considering health reform legislation, lawmakers should take great pains to avoid creating short-term measures intended to cut health care costs that will prove detrimental to patients in the long-term. Lawmakers should also keep the needs of rural Americans in mind.

"Unfortunately, recent proposals have already violated this common sense advice. For example, the Obama Administration recently proposed to base Medicare and Medicaid reimbursements on the assumption that physicians operate imaging equipment 95 percent of the time their office is open. This is an arbitrary assumption intended to cut costs for imaging by denying adequate payment for services rendered. This new use assumption will cause congestion and delays at the point of care, force physicians – especially in rural America – to pull back services in their communities, and will disrupt patients’ access to diagnostic imaging services that, when used appropriately, have been proven to improve health outcomes while reducing costs.

"Lawmakers should reject this proposal. Making it more difficult for our nation’s seniors to have access to life-saving imaging procedures is simply unacceptable - and it’s a serious threat to the high-quality, innovative and less invasive medical care that Americans have come to appreciate and expect as the standard of care.

"The proposal, similar to past proposals advanced by the Medicare Payment Advisory Commission (MedPAC), is based on a deeply flawed survey. The MedPAC survey relied on a statistically insignificant sample size of only six urban medical imaging centers, rather than a representative national sampling. Also, MedPAC’s methodology used to make its utilization assumptions did not account for the health or age of the patient – both of which are the two most important factors accounting for patient preparation time - the single biggest determinant affecting the length of an imaging appointment, and ultimately utilization rates. Older and less healthy patients require longer preparation and examination time, which is highly relevant when talking about the Medicare population.

"MedPAC even cautioned against using its own survey to determine equipment use rates. According to transcripts of an April 19, 2006 meeting, MedPAC said: “This survey is a first step…It was not nationally representative and it was not designed to determine equipment use rates. Its intent was to assess the feasibility of getting use rate data from the survey.” CMS also agreed that that MedPAC's survey was unsound. In its 2007 proposed physician rule, CMS did not alter the equipment utilization assumption, stating: “We do not believe we have sufficient empirical evidence to justify an alternative proposal [to the 50 percent utilization assumption].”

"Instead of accepting the MedPAC recommendations without proper scrutiny, the Administration should direct HHS to launch a public-private partnership that would collect data from actual equipment scanning logs that measure the actual time an imaging machine is turned on and in use. Once HHS has accurate utilization rate data, it can better determine a utilization rate that optimizes efficient care while producing savings for the Medicare program.

What's strong? The determination of the President, his administration and Congressional leaders to pursue meaningful health care reform and ensure access and health care coverage for more Americans makes this an incredibly hopeful time. It is vital that the energy currently being devoted to health care reform discussions does not become diluted or diverted by parochial political interests.

What's missing? Without actual delivery system change (to create care services that are coordinated and centered around the needs of the patient) reform measures will deliver more of the same and run the risk of making matters worse. To drive change in the delivery system, providers should be paid for value rather than volume, but this concept is not evident in what is known thus far about the implementation of any of these plans. Value in health care means improving patient health outcomes and satisfaction while at the same time decreasing medical errors, costs and waste. Creating this kind of value cannot be accomplished by legislators; it is the responsibility of providers, medical industry leaders and patients. Nevertheless, legislators have the ability to influence the system, because any reform measure that does not include payment reform to reward high-value providers will fail to drive improvement in the health care delivery system itself.

What's wrong? Efforts to achieve savings to fund health care reform that involve the same tactics that have been used by Medicare in the past are of significant concern. These tactics typically include unilateral price pressure and productivity adjustments to Medicare payment updates that are based solely on review of individual line-items of care (volume). A more meaningful measure would address the broader picture of a patient's health and would base Medicare payment adjustments on a complete episode of care and its outcome (value).

Read more about the concepts of creating and paying for value on the Mayo Clinic Health Policy Center Web site.

With the introduction of the co-op idea, Senator Conrad has made a suggestion that may provide an opportunity to move past he hyper partisanship created by the public plan option.

However, so far, the co-op discussion has focused on how it should function (member owned, non-profit, an elected board, and return surpluses to member or reinvest them) and not as much on how it would deliver care. And in this debate, reforming the delivery care system is at the center and is the key to reducing costs and improving quality.

Therefore, we need to begin to shift the discussion on co-ops to how will care be delivered through them. President Obama has talked extensively about how we need to model care on the Mayo/Geisinger model. Co-ops could provide that opportunity. They are empty vessels so we can fill them up with whatever model we want. Community Health Teams, already included in the Senate HELP legislation, are an attempt to operationalize the Mayo/Geisinger model in new locations without the brick and mortars of clinics. Co-ops could be the delivery vehicle for this idea.

Whatever exact the answer, we should not lose this opportunity presented to move the debate forward.

DON’T LET THE EARLY RETURNS WORRY YOU!

As a four-term Governor and long-time member of the state legislature who stood for election and reelection more times than I can recall, and Secretary of HHS when we passed the most important change to Medicare since its inception, I can say the early returns don’t always forecast the final outcome. Had I let the early returns dictate some of my election outlooks I probably would have lost a few races since several times I was the underdog, and had I let the early criticisms determine our ambition for passing the Medicare Modernization Act, we never would have tried since many folks told us it had been tried before and failed.

It’s important to stay focused on the end goal, while working on addressing the immediate challenges.

The first CBO estimate, while perhaps not as positive as you might like, it is just that, an initial estimate. Don’t let the criticism and attacks that will come and have already begun, deter you from your mission.

But also remember as you begin this process; don’t let the perfect get in the way of the good. We are at a point in this debate, where doing nothing, as President Obama likes to remind us, is not an option, but doing everything you want, may also not be an option. We need to reduce costs and improve quality and that is the pathway toward providing coverage to all Americans.

As HELP and Finance start markup, I'd suggest they keep in mind the American people and what they want from health reform.

It's easy to get lost in the minutia inside the Beltway - what percentages get covered, what the CBO says, who's going to pay for it - and so it's important to keep in mind the principles America stands behind.

We want health care that is affordable for us and our families. We want health care that gives us a real choice between private and public insurance, so we don't have to be left at the mercy of private insurance any longer. We want a national public health insurance plan that can really keep the insurance industry honest and in check. We want costs for the country to go down, so we can stop spending large percentages of our economy on health care. We want employers, government, and individuals to share in the responsibility for paying for and providing health care. We want to regulate the insurance industry as a whole, to end cruel practices like denying care for pre-existing conditions. And we want reform now, reform that's ready on day one.

These positions are popular positions (and polling proves this). And these positions were in the minds of the 70 million people who voted for President Obama. I would hope our Senators keep in mind the will of the people and enact the health reform we voted for.

Here's my advice: Take the same oath doctors take -- first, do no harm.

That means (1) do not push an additional $150 billion a year into the health care system, since that will inevitably create more health care inflation; (2) do not set up an artificial insurance market in which every health plan has a financial self interest in overproviding to the healthy and underproviding to the sick, since that will undermine the quality of care everyone receives; and (3) do not encourage millions of Americans to give up their private insurance and enroll in Medicaid instead, since that will mean more rationing by waiting and less access to care.