Stuart Butler is Vice-President for Domestic and Economic Policy Studies at The Heritage Foundation in Washington DC. He plans and oversees the Foundation's research and publications on all domestic issues. He is an expert on health, welfare and Social Security policy. He is also an Adjunct Professor at Georgetown University Graduate School and has been a Fellow at Harvard University's Institute of Politics. He is widely recognized as an individual who is willing to work with people across the ideological spectrum to find solutions to the nation's health care problems.
Time For A Real Summit Not A Showdown A televised summit is hardly the best way to build bipartisanship. A competent marriage counselor would never advise a separated couple to discuss their differences on national TV (with their legal and political advisers feeding them soundbytes). President Obama would have invited the GOP leaders to a private "beer summit" at the White House or Camp David if he were really serious. That said, he could still work across the aisle to achieve compromise in several areas. Among them: A firm Republican commitment to achieving affordable coverage for all Americans in annual… Read more
The idea that Medicare fees will actually be cut 20% and be held down is politically delusional. Health Bill Will Reverse Any Slowdown Not only would it be unwise to relax because of the recent slower growth numbers, but there are many reasons to expect the health bill, if passed, will trigger a surge in future health spending. In part that's because key expected savings are illusory and also because there are pent-up pressures in the bill that will increase health spending. Former OMB official James Capretta has recently indicated some of these problems. For one thing the idea that Medicare fees… Read more
Updated at 11:11 a.m. on Dec. 21. On the face of it, the reform proposals would help ease the $37 trillion unfunded obligations of Medicare, making it a tad more viable for current and future seniors. But the savings on one credit card just become new liabilities on another. Moreover, if the key cuts actually went into place it would be a disaster for seniors. In the Reid bill, physician fees are to be cut more than 20 percent in 2011 and kept there indefinitely. That would cause docs to leave in droves and mean care cutbacks from those who remain. And Medicare’s chief actuary… Read more
Bills Will Only Increases Costs We’d better be nice to the Chinese, who hold much of our debt. There are several reasons why many of us who for years have supported health reform and coverage expansion are now so concerned about the direction the bills are taking. Here are just a few: Congress is taking a “big bang” approach rather than reforming in stages. The US health care economy is larger than the entire economy of Britain. Trying to fix something that large in one bill is impossible to get right. The bills bend total spending up, not down, and… Read more
Fine oratory but little of the real leadership needed at this stage, and no serious attempt at bipartisanship. To lead he needed to say which major titles of existing, competing leadership bills actually constitute “our bill” – he didn’t. Talking about malpractice reform demonstrations was almost amusing as an excuse for bipartisanship. We all know that to deep six anything you set up either a study commission or a demonstration (and this one will even be organized by a former director of the Kansas Trial Lawyers Association). If he was serious about bipartisanship he would have embraced such existing bipartisan bills as… Read more
It’s worth looking at Utah’s recent reforms as an appropriate approach. Utah reforms limit age rating to a maximum difference by age of four to one. Uwe Reinhardt argues that matching subsidies to age-rated premiums, "would quickly become administratively cumbersome, with a fair amount of cheating." I don’t think that is right. A 'percent of premium up to a maximum amount' approach would be a simple and compatible subsidy mechanism to accompany age-rated premiums. Furthermore, the amount of the subsidy cap could even be adjusted by the recipient's age (or the age of the head of household in the case of… Read more
I testified before Senator Kenned on many occasions. As he did with other conservatives genuinely interested in health reform, he treated me with the outmost civility, respect and courtesy. He listened careful and sometimes made clear he agreed. When he asked tough questions, which he always did, he asked them without any edge of disdain. He wanted to listen to the answers, and see if there were areas of agreement, or points I made that he could convice me were wrong. He was a tough, principled gentlmanly liberal whom we will all miss.… Read more
If it walks like a duck….. And if it has all the characteristics of a public plan option then it is a public plan option. Had Senator Conrad and others wanted to make more private options available to Americans by empowering member-owned co-ops to offer health insurance he could have proposed that. It would merely require changes in the tax law to allow true nonprofit co-ops to operate like mutual insurance companies. But instead, the federal co-op proposal is just an attempt to create a public plan by another name. Rather than relatively minor tax changes there would be federal… Read more
So, Senator Daschle, you’d like to see a “federal health board with the political autonomy” and the legal power to run our health system. Well, let’s think about that for a moment. Annual spending in America’s health system is larger than the economies of all but six countries in the world (and that includes the US economy). It is the size of the economy of Britain. And it is just as complex as any economy. Imagine if someone suggested that a special board of experts with “autonomy” (i.e. free from effective democratic control) should run the entire British economy, or the French economy, or the… Read more
It is good to see the Finance Committee re-opening the discussion about reforming the health tax exclusion as part of overall health reform. While I think an overall replacement of the exclusion with credits would be the right way to go, that would be a heavy political lift. But capping the exclusion based on income and the local actuarial value of a benchmark plan would be a good and achievable step. Given the choice between revamped regulation of the private market and a public plan, count me with the regulators – notwithstanding Uwe’s caution about the degree of regulation… Read more
It didn’t take long. The story used to be that a) widening coverage now would mean more efficient care and immediate savings, and b) there is so much overspending in the system that we can do much more with less. Now the story is that if we just spend more on X now it will help us save money in the future, so please “bend” PAYGO just for us and you will be happy. Honest. I was at Obama’s “Fiscal Responsibility Summit” where this was the constant refrain around the table of health care providers: just spend more money on the people we represent… Read more
If we are going to provide new health services to Americans who now lack them then one of two things has to happen. Either taxpayers are going to get squeezed (more than they are currently scheduled to be) or some providers are going to get less than they expected so that others serving the uninsured will get more. One person’s saving is another person’s squeeze. It is that simple. Doctors and hospitals as a group have no sacred right to ever-growing revenues, any more than computer makers or teachers do. The issue they should be concerned about is how savings are achieved. They can support market-based… Read more
Paul Ginsburg has it right. The kind of “public plan” Len Nichols lays out is a public plan in name only. If it operates under exactly the same rules then in what sense is it a public plan? Well, then, what is the big problem with it, one might ask. The problem is that it is inconceivable that Congress would set up a public plan that would actually have to live by the same rules. For instance, would Congress make it live by the same financing and financial reserve requirements as its private competitors, or would it have special access to the Treasury? If private GM… Read more
My friend and self-styled country bumpkin economist Uwe Reinhardt is missing two points, I think. First, whatever one thinks of the merits of Medicare the promises to everyone in that program imply huge financial commitments that right now are likely to be honored only by crowding out funds from other priorities in the future, such as education. And second, the design of Medicare itself (e.g. heaving subsidizing drugs without regard to income) inefficiently fuels general health costs – as do many perverse incentives in the private sector, such as the unlimited tax exclusion for employer-sponsored coverage. So it is reasonable and… Read more
I attended the Summit and the health care breakout session. The good news is that the conversation was cordial and positive, and could presage a serious conversation about what to do. The bad news is that nobody was willing to talk about tough choices. But unless hard choices are made, it’s impossible to rein in the tsunami of Medicare and other health spending that makes the long-term fiscal picture so dire. The President should commit to getting out of Washington and holding a bipartisan Fiscal Wake-Up Tour, modeled on the very successful Tour that Heritage, Brookings and the… Read more
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