Posts Tagged ‘Medicare Part D’

The Insider: All this could be yours someday

Monday, June 14th, 2010

Fuzzy logic
As the “tax extenders” bill makes its way through the Senate, a provision to extend COBRA premium subsidies for the unemployed is in jeopardy. Opponents in the Senate and the Blue Dogs in the House who stripped the provision from legislation two weeks ago argue that it’s unfair to help people who are unemployed when other, equally needy people are getting no assistance.

Just stop and think about that for a minute: It’s not like they’re identifying an alternative beneficiary for assistance, or arguing to accelerate implementation of the Affordable Care Act. They are basically saying, “Because we can’t help everybody, we won’t help anybody.” If you apply that reasoning more broadly it leads you to advocate the repeal, or at least the suspension, of Medicare and Medicaid until 2014, when financial assistance to obtain coverage becomes more generally available–a move few Congressmembers would dare consider, even in a non-election year.

With unemployment remaining high, the COBRA premium subsidies in limbo are badly needed. They are good for the economy, the health care system, and mostly for the thousands of struggling families who will be able to retain their coverage. Find out more at Community Catalyst’s implementation headquarters.

Faulkner on health care
When William Faulkner wrote, “The past is never dead. It’s not even past,” he could have been talking about the politics of health care more than a half-century into the future. Congressional Republicans’ challenge of the White House public education campaign on Medicare changes as misuse of government funds for partisan advantage hearkens back to Democrats’ attacks on the Bush administration over the original Medicare Part D roll-out.

And Senators who opposed PPACA seem intent on re-debating the legislation at every opportunity: first, in the context of Don Berwick’s nomination to head CMS, and now in the debate over the Medicare physician payment fix. Republicans have offered an alternative that does more for the physicians but partially pays for it by eliminating desperately-needed financial assistance for state Medicaid programs—while slipping in a “poison pill” that would roll back the individual responsibility provisions in PPACA. Such a move could appeal to many on the left who are concerned that the affordability provisions don’t go far enough.

Someday, all this could be yours
As the “repeal and replace” drumbeat goes on, a third ‘r’ should be added to the sequence: Recycle. Congressional Republicans are recycling ideas from the debate that were shown to fail to reduce the number of uninsured or eliminate insurance discrimination.

But as several states move forward with anti-Affordable Care Act ballot measures, new research from Massachusetts shows just how wrongheaded such opposition is. Until the coverage provisions of the Affordable Care Act kick in in 2014, Massachusetts provides the closest thing we have to a “beta site” for what the health care system of tomorrow will look like. While critics focus on the continuing cost challenges (problems that pre-dated health reform in Massachusetts  and were not really addressed in the landmark law in 2006) new reports published by the Urban Institute and the National Bureau of Economic Research underscore just what other states can gain as they move forward with implementing the law.

Urban’s latest report shows that the coverage gap between racial and ethnic minorities and non-Hispanic whites has been closed—the only place in the country where this is true. Additional findings show:

  • –high rates of coverage in Massachusetts persist despite continued high unemployment
  • –economic barriers to obtaining care remain low and have declined further for some populations since the inception of the law
  • –four years into implementation, there is still no evidence of ‘crowd-out’ of private coverage, and public support for the Massachusetts system remains high.

Get the details here (pdf).

The NBER paper found that since reform in Massachusetts, there have been fewer preventable hospitalizations and emergency room-generated admissions, and length of hospital stays has been reduced, most likely due to improvements in access to ambulatory care.

Sure makes implementation look like a lot better idea than repeal.

–Michael Miller, director of strategic policy

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Posted in Health Reform Insider, Health disparities, Repeal Watch, affordability, national health reform, state reform | No Comments »

The Insider: Repeal vs. reality, PLUS the health reform deciders

Monday, April 5th, 2010

Are the worms turning?
While cries of repeal are still echoing in some quarters, doubt about the enterprise is beginning to seep through. Senator Bob Corker (R-TN) has publicly argued that repeal is not realistic (later clarifying he meant as long as Obama is in office), and the Chamber of Commerce, one of the interest groups most active in opposing reform, has also said it will turn its attention from repeal to influencing the regulations and pushing amendments. The Chamber is also planning to spend tens of millions of dollars to elect candidates friendly to their positions (which generally means not those who voted for health reform), but there’s little doubt that they would do that with or without passage.

More about the walk backs here and here and here.

Essentially, repeal is a nonstarter unless Republicans control both the White House and 60 Senate seats (or are close enough to 60 to make a deal with conservative Democrats). Threatening to “defund health care reform” if they take control of Congress is similarly hollow (Wonk Room says why.)

As we said last week, repeal isn’t in the interest of most of the health care industry (they’re helping to back Enroll America) or that of the employers (who doth protest too much.) Repeal is, at bottom, the rallying cry of  ideological extremists and their financial backers who oppose a set of policies embraced by many Republicans in the 1990s at Mitt Romney just a few years back-–policies well to the right of Richard Nixon. (For the record, it gave me the CREEPS to write that.)

Although the repeal caucus is becoming more marginal, the walk back from repeal doesn’t in any way mean smooth sailing for reform. (Speaking of sailing, watch our video valentine to health reform advocates.) Along with the Chamber, insurers are suiting up for the implementation game. The industry sent over 1,500 representatives to a recent meeting of the National Association of Insurance Commissioners (who number 50). The NAIC will have a major role in structuring the Exchange and the law’s insurance reform provisions.

And big employers are already squawking about the fact that the law closes a loophole in the Medicare Part D statute that allowed them previously to deduct from their taxable earnings the portion of retiree health benefits cost subsidized by the federal government.

This is the brave new world of our next four years: powerful special interests focusing their fire on specific provisions that they find objectionable, while repeal remains “red meat” to rile up the far-right voters. Better get used to it and dig in for a long fight.

A closer look at public opinion post-reform: Is there a bump from this Baby?
(Maybe, but it’s not really showing yet.)

On his recent trip to Maine, President Obama chided the media for their obsessive focus on the popularity of health reform, saying the new law must be given time to work.

But, if anything, the importance of public opinion is growing post-passage. During the legislative cycle that just finished, public opinion mattered, but was only one among many factors that influenced the outcome. The real decision makers were Congressmembers, who are influenced not only by voters, but by donors, advisors, party leaders and other folks who want stuff.

In the election (spin) cycle we are entering, voters are the decision makers. And what they think about health reform in 2010 and 2012 will, in part, determine who is in a position to make the key decisions about implementation. Right now, voters are pretty evenly split on the question of whether passage was a good thing for the country. On balance, they believe that reform will help someone other than themselves and are worried that that help will come at their expense.

The public also holds internally inconsistent views about the role of government in health care, with majorities simultaneously believing that there is too much government involvement in health care, that health care reform didn’t do enough to check the power and potential abuses of insurers, and that there should be a public insurance option available.

One factor in public opinion that could have big mid-term consequences is the age divide. The majority of younger voters support reform, but older voters, who tend to be a relatively larger fraction of the mid-term electorate, are more negative on reform.    And while younger voters are more likely to care about other things (e.g. unemployment), health care is a more pressing issue for older voters.

These older voters’ critical role in midterms helps explain why one of the first things out of the box is help for seniors facing high prescription drug costs. Starting this year, Medicare beneficiaries who enter the “doughnut hole” coverage gap in Medicare Part D will receive a $250 rebate—giving seniors a tangible benefit to weigh against the fear of future change that has been stoked by opponents throughout the debate. (Remember the death panels?)

Although it is still a long way from election day, right now it looks likely that Republicans will make big gains in the midterms in both houses, though still fall short of wresting control of either chamber away from the Democrats. With narrower margins to work with at best, we can expect future [positive] tweaks to reform to come via the budget reconciliation process.

Deconstructing the kids pre-existing condition brouhaha
In the run up to reform, Democrats touted the elimination of pre-existing condition exclusions for children as one of immediate benefits of reform. Then, shortly after passage, there was a brief argument about what the provision actually meant: Did it mean that insurers could no longer refuse to cover a family based on a child’s pre-existing condition? Or did it only mean that if they covered a child, they could not impose an exclusion? (Prior to passage, there was quiet concern about the ambiguity of the provision, but it did not reach the media). After a stern letter from HHS Secretary Sebelius, insurers—who had briefly asserted the more narrow interpretation—quickly folded their tents and agreed to the more expansive view.

Why? Was the law clearly on the side of the administration, or was something else at play? (If you guessed the latter, give yourself a star.)

First, staging a fight to defend their right to deny coverage to sick kids is a bad PR move for the insurers. Second, insurers don’t really oppose reform overall (Enroll America, remember?)

Third, and most importantly, insurers retain the ability until 2014 to vary premiums based on the “experience,” or expected cost, of enrollees with significant illnesses. Until then, the immediate win for kids with pre-existing conditions is less meaningful than it first appears. So score it as a PR win for the administration and insurers, and a small step forward for children with pre-existing conditions.

No Fooling
Has Senator Tom Coburn (R-OK)been spending too much time with Congresswoman Michelle Bachman (R-MN)? Last week, Sen. Coburn admitted to being paranoid. “This may be a little paranoid, but I think they know it’s going to fail,” Coburn said. “Then we’ll go to a single payer system like Western Europe.”

(Upon hearing Coburn’s comments, Dennis Kucinich is rumored to have said, “From his mouth to God’s ear.”)

–Michael Miller, director of strategic policy

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Land Ho!

Monday, March 15th, 2010

After a stormy voyage of more than a year, this Monday morning finds the good ship health reform within sight of a final vote. The tentative timetable has a CBO score out today or tomorrow, Rules Committee action on Wednesday and a vote before the end of the week.

Our understanding is that House leaders are leaning toward a single vote on the Obama fixes that will contain a clause passing the Senate bill passed upon passage of the amendments. That way, House members who are unhappy with the Senate bill will never actually have to vote on it. We do not expect House leadership to wait for all the votes to be locked down before going to the floor, but instead think they will schedule the vote once they are close and try to round up the last few yeses as the debate and vote are happening.

Deconstructing the Opposition Strategy: Be Very Afraid

The Republicans’ strategy at this point boils down to trying to scare the House Democrats into voting no. Their two main lines of attack are:

  1. The Senate won’t pass the fix-it bill, leaving the House stuck with the Senate bill.
  2. It will mean electoral trouble for Democrats in the fall.

Let’s break down each argument:

The first argument has shifted in recent weeks. Originally, the Republicans tried to play on the institutional distrust between House and Senate, suggesting that if House members “took the plunge,” Senate Democrats would leave them high and dry. But as more and more Senate Democrats committed to voting yes on a package of amendments (at least the necessary 50 have done so) the power of this scare tactic has waned, and so Republicans now threaten instead to gum up the works, making passage as hard as possible.

As we observed before, the bill that comes to the Senate will be small and will contain things that are easy to support—e.g. closing the Medicare doughnut hole, increasing federal funding for Medicaid, taking out special deals. Though Republicans certainly might play obstruction games, such parliamentary delay tactics may not play out the way they hope—think of the way Gingrich shutting down government in the 90s backfired with the public.

The second line of attack is that if Congressional Democrats vote yes, it will cost them their jobs. Republicans recently put out a poll from districts of swing members purporting to show that vote for reform would hurt their electoral chances. Whether a coordinated part of the strategy or on their own initiative, two former Democratic pollsters made the same argument in a Washington Post op-ed.

What makes the piece fishy is that a) the only polling they cite is from Rassmussen, a polling company with a well-known “house effect” in favor of conservatives and Republicans  and b) they conclude that what the Democrats should do is essentially pass the House Republican health care proposal (you can compare the GOP proposal to Obama’s plan here).

A more fair reading of the polling:

  • People want major change
  • The main elements of the reform bill are popular, and some are very popular.
  • People don’t know what’s in the bill. As Jon Stewart pointed out (watch at 4:05), there have been not a few misinformation campaigns to take the credit there. But once they learn what’s actually in the bill, they like it a whole lot better.

As the President has become more active in the debate and pushed out a clearer message about what reform does—eliminate insurance company abuses, provide people with security of never losing their coverage, provide tax credits to small business to help them afford insurance—public support has trended up.

Not to say that there aren’t some fundamental glitches in public opinion. Voters think a bipartisan bill is important, and that Democrats should keep working with Republicans until they get it. What the media have failed to convey is that

  1. the bill is supported by Republicans, including governors, former Senate leaders and former administration officials and
  2. the bill is essentially what Republican Senators proposed as an alternative to the Clinton plan in the 90s.

Finally, what should be clear after the Blair House summit is that there is no hope of getting any kind of bipartisan agreement, short of giving up and passing the Republican plan. It would be much more meaningful if pollsters confined their questions to the real choices that are available instead of setting up straw men.

Polls aside, there’s no doubt Democrats are sailing into a stiff headwind right now. The President’s party usually loses seats in the midterm, and this year the persistently high unemployment is fueling voter discontent. Discontent is aimed at incumbents generally, but with a large number of House seats to defend in historically Republican-voting districts, and with incumbent Senate Democrats from conservative states like North Dakota and Indiana retiring, the GOP could see substantial pick-ups. Add in the expected flood of corporate cash into the elections courtesy of the Supreme Court and it is shaping up to be a tough year for Democrats, indeed.

But the fundamental political question persists: are Democrats helped or hurt by failure to pass health reform? They are already on the hook for voting yes and attack ads are already being produced. Flip-flopping is famously unpopular in politics and is unlikely to win a pass from reform opponents in the election. Passing reform gives House Democrats a concrete historic accomplishment with which to fight back.

It don’t come easy: Math in the House
In November, the House health care reform bill passed with  220 votes. Currently with vacancies, 216 are needed to win.  If everyone who voted yes last time votes yes again, reform passes. But House leaders can’t count on every yes vote remaining in place, so every yes-to-no vote must be offset by finding a no-to-yes.

Here are three places where votes are at risk:

Abortion
The number of Democrats willing to ‘vote off’ because of abortion seems to be declining.  A recent letter from pro-life clerics and theologians looked at the abortion provisions in the Senate bill, chapter and verse, and concludes that the bill does not provide federal funding for abortion.  Several members who voted for the Stupak amendment have publicly reached the same conclusion. And although Stupak claimed that he has about 12 members who will stick with him in voting off, his camp seems to be shrinking as the reality that the Senate bill does not allow federal funds for abortion has begun to sink in. Most analysts put the total number of no votes on account of abortion at five or six.

Immigration
The Senate bill bars undocumented immigrants from purchasing health insurance through the new insurance Exchanges even if they use their own money. It also fails to provide equal coverage to legal immigrants, continuing a ban on federal matching funds for state Medicaid coverage and offering instead less comprehensive and more costly coverage in the Exchange. As a result, a number of lawmakers in the Congressional Hispanic Caucus have said that they were leaning toward a no vote.  The issue is further complicated by the fact that the provision relating to undocumented individuals cannot be addressed via budget reconciliation.

But a Medicaid provision that gives states at least the option to cover legal immigrants could be addressed in reconciliation.  While most states would probably not take up the option, the measure could at least provide fiscal relief and perhaps better coverage in those states who now cover legal immigrants with 100 percent of state dollars.

How possible is this? Remember that in the initial House vote in November, there was an 11th hour change on abortion. It’s still possible that House leaders and the President will see the light on Medicaid for immigrants, especially if it is the only remaining obstacle to passage. However, even if this last-minute adjustment is made, the legislation does not go far enough in providing equal access to coverage for immigrants, which only underscores the importance of comprehensive immigration reform (check out this weekend’s march here).

The Scott Brown effect
In the wake of the election of Republican Senator Scott Brown, the Massachusetts delegation has become visibly uneasy about reform. Despite compelling evidence that the Brown election did not turn on the candidates’ positions on health care,  some members of the normally solidly liberal Massachusetts delegation have indicated concern about moving forward, though not all have given the same reasons.  It’s hard to imagine that Massachusetts Democrats would actually sink national health care reform. But as the Brown election proved, nothing can be taken for granted—even in Massachusetts.

Coming soon

Stay tuned for updates this week as the CBO score becomes available and we get more clarity about the vote schedule.

-Michael Miller, director of strategic policy

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And now, the moment you’ve all been waiting for

Tuesday, March 9th, 2010

For months, various parties have been calling on the President to clarify exactly what he was for and, following the loss of a 60-vote majority in the Senate, how he thought that could be accomplished. Starting with the run-up to the Feb. 25 summit, President Obama did just that, laying out a package of amendments to the Patient Protection and Affordable Care Act passed by the Senate and calling last Wednesday for an up-or-down vote on health care within the next few weeks.

The President’s proposal would improve on the Senate bill by toughening oversight of the insurance industry, improving benefits and affordability provisions and closing the Medicare part D doughnut hole. He also added several Republican ideas from the summit such as new proposals to reduce payment errors in Medicare and Medicaid.

In a surprise to many, the RNC called on Groucho Marx to deliver their response.

OK, just kidding. What was striking about the real response from Congressional Republicans was the way they resorted to invective. Away from the Blair House setting—where they could be directly challenged for “having their own facts”—they reverted to much harsher language than they used in the largely civil exchange during the summit. “Job-killing“(Independent analysts say health reform will promote job growth), “budget-busting” (the CBO says that reform will reduce the budget deficit by about $100 billion over 10 years and by $1 trillion over 20 years) “government takeover” (people get a choice of private insurance plans) were some of the greatest hits from the last week in sound bytes. Oh, and of course the ubiquitous “jam” that Jon Stewart spoofed last week (video at 2:20).

Despite the fact that the Senate bill that is remarkably similar to the one that Republican moderates were advancing in the 1990s, today’s Republicans have made it clear (through this RNC fundraising presentation, among other things ) that polarization and fear-mongering are central to their campaign strategy. No wonder no bipartisan health care compromise has been possible.

This fact-resistant extremism could be a factor that helps clear the way for final passage. Another other is a series of highly visible double-digit premium increases that are being proposed across the country, especially in the non-group market. The lack of any insurer accountability has been a stark and timely reminder of the need for change.

Here to there: the New new timetable
Deadlines have come and gone more than once while the health reform debate has dragged on. We now have another schedule for action, albeit a tentative one. The administration is hoping to have a reform vote in the House by March 18, just 11 days from now, and hopes that Senate action will begin prior to the spring Congressional recess, which starts March 29.

The first vote is the hardest
Although the challenges of using budget reconciliation have drawn the most attention from commentators, the hardest step in the process from here on out is the first vote in the House. Although subsequent action will address many of the problems House members have with the Senate bill, the path forward requires the House to vote first for the Senate bill as-is and then vote to fix it—something that many House members have expressed reluctance to do.

Abortion contortion
Probably the House leadership’s biggest stumbling block to assembling a majority is dealing with the abortion issue. In the initial debate in the House, Democrats who opposed choice were joined by Republicans to put in very restrictive language, authored by Congressman Bart Stupak, that many feel will eliminate abortion coverage within the Exchange and may undermine private coverage for abortions in employer-based plans.

According to an analysis by Faith in Public Life,  the language in the Senate already precludes federal funding of abortion.

However, Congressman Stupak has argued that the Senate language is not strong enough, and has declared his intention to vote against the Senate bill, claiming that about 10 other Democrats will join him. Given the very narrow margin of victory in the House, every Democrat beyond Stupak who switches from yes to no because they don’t like the Senate abortion language (or for any other reason) must be offset by switching the vote of someone who voted no the first time to yes the second time.

Facts not worth a hill of beans?
Although it seems his vote is pretty fact-resistant, it appears that Congressman Stupak is misreading the Senate language.2352670827_dc9563c0c3_m

The Senate bill, as best as I can tell, does not allow federal funding of abortions—despite Rep. Stupak’s insistence that it does. And we don’t have to take either Speaker Pelosi’s or the pro-choice community’s word for it. If the Senate allowed federal funding of abortion, then presumably the matter could be addressed in an amendment that would pass through budget reconciliation—an amendment Rep. Stupak would undoubtedly bring.

But there is no such amendment on the table. Why? Because amendments through budget reconciliation must impact the budget, and there is no budgetary implication in the difference between the Nelson and Stupak abortion language. Although there is no public document available, this appears to be the view of CBO.

Remember: the CBO is neither pro nor anti-choice in this debate. They are simply the bean counters. And if they say there are no beans on the table to count that should count for something–if not to Congressman Stupak, then at least to other Congress members who oppose abortion rights as a matter of conscience or religious conviction.

Smooth sailing?
Once a bill does clear the House, the road to reform becomes smoother (not quite seat-belt sign off, but smoother). Although Republicans have threatened to delay the vote in the Senate by filing endless amendments and launching parliamentary challenges, this is as much a psychological game as anything else.

Senate Republicans are trying convince some members on the House side not to take that first vote, playing on the fears of House members who worry that the improvements they’ve agreed to won’t happen and the House will be stuck with the unamended Senate bill. But once the House does vote, the dynamics change. Then the choice is no longer health reform, yes or no, it is health reform as passed by the Senate or health reform with the proposed amendments.

By opposing the amendments to improve the Senate bill, Senate Republicans risk exposing themselves as flip-floppers, voting for policies they previously opposed (such as the special Medicaid funding for Nebraska, and the special excise tax provisions that apply to union-negotiated health benefits) in an attempt to score political points. [I talked about this here last week.]

–Michael Miller, director of strategic policy

photo credit: base10 on flickr

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UPDATE: You put the right bill in, you get the right vote out

Tuesday, March 2nd, 2010

(Please see corrected link below)

It’s not about the process
With the summit behind us, the press has returned to obsessing about (and misconstruing) the process by which health reform might move forward. So a few important clarifications are in order.

First, health reform will not pass via reconciliation.  Comprehensive health reform will pass as part of the normal Congressional order via a majority vote in the House of Representatives (more on that vote in a minute); having passed the Senate with a super-majority of 60 votes.  House Republicans will have one last chance to vote on this package and nearly everyone assumes that they will unanimously vote no.

What will also pass–by majority in both the House and Senate–are amendments to that bill.  Those amendments, as outlined by President Obama, would do a number of important things: They would increase and equalize federal Medicaid payments across states, provide low- and moderate-income families with better benefits and/or premium subsidies, close that Part D “doughnut hole,” make the excise tax on high-cost plans fairer, and provide tougher oversight of health insurance premiums.

The question that will come before Congress will be on these amendments.  And here’s what the media should be spending more time on: If Republicans vote no in a block, they will be voting for the “Cornhusker kickback” and against more Medicaid dollars for their states.  They will be voting against improving coverage for seniors with multiple chronic conditions  They will also have to cast a vote that makes it clear whether they stand with regular people or insurers on the issue of premium rate hikes. If we focus on substance over process, then voting for a package of fixes to the Senate bill should be a great vote for supporters of reform, and a tough vote for opponents.

About that vote
The President is expected to offer more specifics on the path forward later this week (probably Wednesday, so check in then for our update). But by now, it seems clear that the Republicans have no interest in tighter regulation of the insurance industry or a major effort to cover the uninsured—and Democrats have no interest in scrapping these elements of reform and starting over.  So we can expect a party-line vote going forward.

There has been a lot of media speculation about whether the votes are there for reform in the Democratic caucus in this scenario. Although it’s impossible to do a real vote count before a package of amendments is agreed on, both branches seem close to having the majorities they need.

Much of the recent speculation has centered on the House, where the challenge will be to find a sweet spot that will satisfy both Blue Dogs and Progressives, avoid too many defections on the abortion issue, and also attract 50 votes in the Senate.

Does that sweet spot exist?  Speaker Pelosi and Majority Leader Hoyer believe the answer is yes, and have reiterated their commitment to passing reform. And the House leadership team has so far shown an uncanny ability to move difficult legislation through the House, so betting against them would be unwise.

The final votes in both chambers may be close, and certainly an all-out effort from the grassroots will be needed, (so sign this petition to send a message in support of comprehensive reform and forward this link to your friends and networks too.)  But as we enter the homestretch of the health care reform debate this year, there is good reason for optimism.

About that status quo
Instead of focusing on the intricacies of Congressional procedure and speculating about the vote count, we need to focus on why reform is necessary.  To that end, the Urban Institute is out with a new issue brief that shows just who loses if health reform doesn’t pass.  The biggest losers (out) are older adults, people with pre-existing conditions (and many of you know firsthand just how big a group insurance companies have made that), small businesses and their employees, low-income households  and young adults. These are the groups for whom the current dysfunctional system works least well, and who will be most at risk of being priced out of coverage if reform doesn’t pass.  But ultimately, the Urban brief points out, improvements in security and stability of coverage, and in the quality of care people get, will benefit everyone.

And that’s what it’s all about.

–Michael Miller, director of strategic policy

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Reaching the Summit

Wednesday, February 24th, 2010

Must-see TV

If you’re not already planning to tune in to the President’s health care summit tomorrow, maybe it’s time to reconsider. It will be streamed live here, from 10 AM-4 PM Eastern. Forget Lindsey Vonn and The Office baby special: This is must-see TV.

And if you can’t convince your boss that six hours of C-SPAN is equivalent to 30 minutes for lunch, you can follow the Hub’s twitter feed right from your desktop for a live analysis of what’s going down at Blair House (and maybe a little reform haiku thrown in, too.)

Reaching the Summit

With the release of his plan—really a series of amendments to the Senate-passed Patient Protection and Affordable Care Act (PPACA)—President Obama  is ready to embark on the last leg of the health reform journey. Key changes in the proposal include:

•    Improvements in affordability for low- and moderate-income families in the Exchange. Relative to the Senate bill, most families will either pay less and/or get better benefits.

•    Stronger oversight of health insurance premiums. The proposal would give the HHS Secretary the power to deny or modify excessive premium increases as well as strengthen the ability of state insurance regulators to oversee rates.

•    Phasing out of the coverage gap known as the “doughnut hole” in Medicare Part D, making prescription drugs more affordable for seniors.

•    Increased Medicaid funding for all states (and territories), while eliminating the special funding deal for Nebraska.

•    Equalizing the treatment of union and nonunion health benefits with regard to the excise tax on high-cost plans and also adjusting for age, occupation and gender of workers so that firms with an older and sicker workforce would not be hit as hard.

The President also proposed a series of payment integrity and anti-fraud measures to reduce payment errors in Medicare and Medicaid, drawn largely from Republican proposals. (Full summary of the proposal is available here).

Democratic leaders in the House and Senate have reacted positively to the President’s proposal and seem poised to move forward with reform post-summit, with or without a bipartisan agreement that no one is expecting.

Interestingly, not all of the President’s proposals seem to fit neatly into the rules of budget reconciliation. This suggests that some ideas, such as increasing federal authority over insurance rates, will have to get 60 votes in the Senate in order to survive. However, this is likely a win-win for the Democrats: either the rate regulation provision stays in, or Republicans will have to go on record as siding with insurers against consumers on insurance rates.

Summit Watching Guide

The President has continued to sound the theme of bipartisanship by posting on a website all of the Republican-backed ideas already included in PPACA, and offering to post a Republican proposal or statement of principles side-by-side with the President’s plan.    Republican Congressional leaders, however, aren’t having any of it.

The continued trash-talking of the summit obscures the dirty little not-so-secret that the difference between the Republican and Democratic proposals is not about different means to reach the same end, but entirely different ends.

First, Congressional Republicans by and large reject the premise that all Americans should have guaranteed access to secure affordable health insurance and health care. Secondly, they reject the idea that a stronger public-interest watchdog and a new set of rules is needed to correct fundamental weaknesses in the current health insurance market.These are the central premises of the plans put forward by the President and Congressional Democrats and they are beliefs strongly held by the majority of Americans, notwithstanding their skittishness and disillusionment with the process. (Read Real Reform, Community Catalyst’s analysis of the differences between the approaches put forward by the President and the Republicans here.)

At least one prominent Republican, California Governor Arnold Schwarzenegger, has been willing to call out his party on their stance—calling the demand that the summit start with a blank piece of paper “bogus.” (Now that’s a maverick.)

Because the divide between the two parties is so fundamental, at the summit itself we can expect neither a real attempt to reach bipartisan agreement, nor even a real debate over the merits of various policies.

Instead this will be a battle of competing narratives. The President and Congressional Democrats will to try to focus the discussion on the problems with the status quo and substantive ideas for addressing those problems, while the Republican will try to reinforce their anti-government mantra. (If watching 4 to 6 hours of this kind of sparring is not your idea of fun, you can liven it up by taking a drink every time a Republican says “job-killing big government takeover.”)

Look for a special post-summit Insider Friday!

–Michael Miller, director of strategic policy

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The Health Reform Insider

Tuesday, February 2nd, 2010

“Health reform is on life support unfortunately”—Sen. Mary Landrieu

“The lady doth protest too much, methinks”—Gertrude in Hamlet

“Reports of my demise are greatly exaggerated”—Mark Twain

A lot of ink has been spilled over repeated pronouncements of those declaring health care reform dead, or nearly so. The fact that they have to assert it over and over suggests a) that they would like it to be true and b) that it’s not.

In mulling the new Congressional math coming out of the surprising victory of Massachusetts State Senator Scott Brown in the special election to replace Ted Kennedy, it’s useful to remember that the votes of neither the conservative Senate Democrats nor the ultra-conservative House Republicans who dominate the doom and gloom set are expected or needed for final passage.

Passing the Senate-approved bill in the House alongside a reconciliation bill containing the key amendments negotiated by Congressional leaders and the Obama administration prior to the Brown election offers a clear opportunity to enact almost the same bill that would have been enacted before the election. Indeed, it’s the only opportunity to pass a comprehensive bill in the near future. There are signs that both the House and Senate leadership are pursuing this path and that the votes are there in each chamber, at least in theory.

This can be done. There is no insurmountable obstacle to moving forward and there’s a compelling case to be made, both politically and policy-wise, for doing so. After a period of uncertainty, leaders in both branches and the administration (for the most part) appear to have reached that same conclusion.

That said, there is still no guarantee of success, and there are several significant hurdles to clear before a signing ceremony.

Hurdle one: Policy and politics
The first obstacle is getting agreement on the elements that could pass as part of a reconciliation bill to accompany the Senate language. Key provisions of the agreement negotiated just before the Brown election included removing special treatment for the Nebraska Medicaid program, increasing affordability protections for low- and moderate-income families, closing the Medicare Part D “doughnut hole,” making changes to the Senate plan to impose an excise tax on high-cost health insurance and increasing federal oversight of health insurance Exchanges.

Most of these elements could be included in a reconciliation bill, though it’s unclear whether or to what extent changes in the Exchanges would pass muster, since any provision passed via reconciliation must have more than an incidental effect on the federal budget. There is also a push to reopen the negotiations to revisit yet again the excise tax on high-cost health plans and the public option.

The excise tax: Once more, with feeling
Taxing high-cost health plans has been one of the most contentious issues throughout the debate. Although some significant changes were negotiated in the Senate plan that won labor backing, many in the House are calling for that deal to be reopened and for the tax to be dropped altogether. Some fear that one of the changes, a special temporary exemption for plans negotiated through collective bargaining, will look like one more special interest deal. House members raise a number of both policy and political concerns, so here is a review of the issues at stake.

Pro
The current tax exemption of employer-sponsored health benefits provides a disproportionate benefit to the wealthiest households and nothing for the predominantly low-wage workers who lack health insurance. The excise tax, which would be levied on insurers that sell the most expensive plans, is scored by the CBO as reducing health care spending over the long run and it is one of the few sources of financing on which the Senate has been able to agree. Without that money, Congress may be forced to make reductions in the affordability protections which would, in turn, strike at the core architecture of the bill—and Community Catalyst’s top priority in national health care reform. Without adequate subsidies and cost-sharing protections, the individual mandate becomes unworkable.

Con
“Overinsurance” is not a very convincing explanation for high U.S. health spending, and the tax will give insurers and employers an incentive to reduce the cost of the plans they offer. There are a number of ways to do this. Insurers could work to improve care delivery or they could reduce provider payments, but the path of least resistance is likely to be to skinny down coverage. This is exactly the opposite of what the American people want to happen.

People are looking for lower cost-sharing, not higher, regardless of whether health economists argue the tax will reduce aggregate spending—a goal that does not mean much to the average person. The excise tax not only consistently polls badly, but is also strongly opposed by organized labor which provides a disproportionate share of voters and dollars for Democratic candidates.

Further complicating the issue is that the policy itself is not well-drafted and, in the face of opposition, the response until recently had been simply to make the tax smaller rather than to make it better. The tax, as drafted by the Senate, did not adequately address the fact that plans may be high-cost—not because they have unusually rich benefits, but because of the age, gender, health status, occupation or geography of enrollees. The most recent changes have attempted to address some (but not all) of these problems.

Public option
Some progressives, both in and out of Congress, are calling for the return of the public option. They point out that since a reconciliation bill only needs 51 votes, the objections of conservative Senate Democrats who helped to toss the public option overboard is less important. Polling also shows that the American people still support the public option (though it is not the most important issue to them).

There are two problems with this argument. The first, as discussed below, is that working out an acceptable public option takes time, which is in short supply if we are going to get health care reform done.

The second problem lies more with the supposedly more liberal House than with the Senate. House leaders are still in search of 218 votes. While Speaker Pelosi has said the votes are there, there is still work to do. Several House members who provided the margin for victory the first time around are expected to vote no because of the Senate bill’s abortion provisions. Getting to 218 therefore means flipping first-round no votes to yes among Blue Dogs and other conservative Democrats—the same House Democrats who have been least supportive of the public option.

Hurdle two: “No, please, after you,” aka the trust deficit
The cooperation among committees of jurisdiction in the House and the Senate and commitment of all the key players to move forward this past year represents a stark difference from the reform attempt in the 1990s. But a problem has emerged that didn’t come up last time because a bill never got this far: The lack of trust between the branches. The adage, attributed to former House Democratic Speaker Sam Rayburn, that “the Republicans are our opponents, but the Senate is our enemy” captures the spirit of the current atmosphere, and this lack of trust and cooperation between the branches is one of the biggest obstacles to moving forward.

The House is afraid that if they pass the Senate bill first, the Senate won’t take up and pass the agreed on amendments through reconciliation. They want the Senate to move first, which greatly complicates the process because of the rules that govern the reconciliation process. For its part, the Senate thinks the House is making unreasonable demands in order to make the Senate look bad and blameworthy if health care reform doesn’t pass. These issues can be worked out, but it will take time, which brings us to the final hurdle….

Hurdle three: Time is not on our side
With popular support for health care reform below 50 percent—even if that’s based on a lack of understanding of what is actually in the bill—Democrats are eager to shift their focus. Top on their list is job creation and banking regulation.

But while a short breather might be helpful in nailing down the details of path and content for health care reform, time is running out. The closer it gets to the election, the harder it will be for some members of Congress to take what many consider to be a tough vote. And for various reasons, the parliamentary path that health care has to travel now becomes more difficult the longer we wait.

The bottom line is that a comprehensive bill still has a good shot at passage, but the opportunity is time-limited. We all have to make a strong all-out push in the next few weeks.

As the Super Bowl approaches, we go to the football analogy file. We’re just a few yards from the goal line, but it’s late in the fourth quarter. We just used our last time out and the game clock is ticking. Let’s carry it across.

–Michael Miller, director of strategic policy

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Posted in Health Reform Insider, affordability, national health reform, prescription drugs | 1 Comment »

Of Doughnuts and Dragons: The Health Reform Insider

Wednesday, January 6th, 2010

Though a series of critical votes happened in the last month, not to mention the holidays, the issues that define negotiations between the House and Senate remain largely the same (check out our list if you need a refresher). Here’s an update on a few of those, and the process ahead.

The Overall Process
Reports that the House and Senate will bypass a formal conference committee and informally negotiate a bill instead have been circulating for over a month but, in one of those mysteries of the news cycle, the plan has recently become a hot topic.

The other important process piece (though also not really news) is that the Senate bill is expected to be the starting point for negotiations, and the House will likely have to wage a limited number of battles to make changes.  Defining what that list will include is The Task for House Democratic leaders now as they seek to hold together their own fractious caucus.  One item almost certain to make the list is closing the Medicare Part D “doughnut hole.”  Indeed, Senate leaders have already stated publicly their intention to close the Part D coverage gap—though how to pay for it remains a matter of intense debate, with House members arguing that funding should come from the drug industry, and the Senate perhaps less keen to go that route (as the specter of its summer deal with PhRMA looms.)

Financing
As we reported in December (and said many times before that), in the coverage debate, financing is the key.  Most observers believe that the excise tax on high-cost health benefits in the Senate bill will be further scaled back in negotiations with the House.  A critical and related issue—probably the most important one you never hear talked about–is one we flagged just before Christmas: How the price tag of reform gets calculated.

By our reckoning (see last week’s post), the Senate bill provides only a little over $600 billion in assistance to make coverage affordable for low- and moderate-income families, while the House comes in at around $900 billion.  Those extra $300 billion in assistance translate into a year’s worth of coverage (at the front) and more financial protection to low- and moderate-income uninsured people.

So the big financing questions left are: Will the House accounting prevail? And what, if anything, replaces the money lost from the excise tax? The answers to those questions determine whether there is any possibility of doing better than the Senate on critical affordability measures or by accelerating the implementation timetable.

Exchange Exchange
It looks now like the House is going to make a major push to swap out the Senate proposal for state-based insurance Exchanges in favor of a national Exchange as in the House bill.   (States could still opt to run their own if they met federal standards.)  With that in mind, here’s a brief overview of the pros and cons of state and federal Exchanges.

A national Exchange benefits from uniformity and is likely to have lower administrative costs than 50 state Exchanges would. A national Exchange also reduces the problems that could stem from state governments being unable or unwilling to take on the new responsibilities envisioned in the Senate bill. It’s also possible that a national Exchange would have somewhat better negotiating leverage with national insurance plans, at least in small states.

But the price tag difference between a national Exchange and state Exchanges is likely less than many proponents of a national Exchange who tout a federal model’s savings believe.  The bulk of health care costs are determined by underlying local conditions, and a national Exchange will have little influence over those factors.  In addition, while it’s likely that states will vary in how well they rise to the new challenge, at least some are likely to do an excellent job.  If a future federal administration were to be hostile to health reform, the entire Exchange for the whole country could be undermined; recall that this was a problem for many executive agencies in the previous administration.

Finally, a national Exchange is no more a safeguard against the influence of the health care industry than are state Exchanges.  In fact, the geographic remoteness of Washington from most of the country poses no real obstacle to special interests seeking to influence decisions, but does limit the ability of consumers to engage directly in the decision-making process or hold decision-makers accountable.

In the end, state versus national Exchange is of less importance than are the rules under which any Exchanges must operate and the underlying structure of insurance regulation.  So for example, a bill should ensure that there is no conflict of interest in Exchange governance and that business is conducted subject to open meeting laws, as well as provide for consumer representation in Exchange governance.

It is also important not to carve insurance markets up into distinct pieces: for instance, not to split up non-group and small-group insurance, or allow separate risk pools to operate both within and outside the Exchange. The bill should also empower the Exchange to exclude insurers if it is determined that they do not meet standards for providing good value.

On many of these issues, the House does in fact do better than the Senate, as well as on matters  of insurance regulation such as limiting rate variation based on age and clearly eliminating annual and lifetime limits on coverage.

Bottom line? If the House wants to fight about Exchanges, they should focus on the issues that matter most.

Immigrant access
Discrimination against immigrants remains a problematic aspect of reform, but the Senate seemed to make progress as reports indicate that leadership agreed to eliminate the ban on federal Medicaid matching funds for immigrants who have been in the country for less than five years.

We hope that, in negotiations,  the House will match the Senate’s willingness to remove the “5-year bar,” but won’t trade this progress for legal immigrants for its rightful opposition to the Senate proposal to bar undocumented immigrants from the Exchange, even when paying entirely with their own money—a provision supported by the Obama administration.

It’s also unclear just how many states would take advantage of the new matching funds option when, by doing nothing, they can leave the entire cost of covering low-income recent immigrants to the federal government.  The only fair alternative would be to give legal immigrants equal access to Medicaid, but state-based opposition to this fix has proved insurmountable thus far.

Next Dragon in the RoadDragon
Though negotiations between the House and Senate are far from finalized, reform opponents are already gearing up for a multi-pronged attack on the legislation, including legal challenges, state constitutional amendments and ballot initiatives.

Those who argue that these challenges have little legal merit are missing a larger point.  This strategy is first a political one, and only secondarily aims to change the course of the short-run health care debate.

First, given the pace of implementation, the Presidential election of 2012 becomes pivotal.  A change of administration that year would likely cripple implementation, perhaps fatally.  Campaigns being developed now are largely geared toward building a base of activists for 2012.

Even if they are unable to unseat Obama, Republicans see health reform as a wedge issue they can use to regain control of Congress.  Failing that, by defeating some vulnerable and prominent supporters of reform, opponents hope to create a chilling effect that will dampen the willingness in Congress to pursue further reform.

What this means for reform supporters is that—far from final negotiations curtaining the show—a new act in the saga of U.S. health care reform  is about to begin.


–Michael Miller, director of strategic policy

photo courtesy  of austinevan at flickr creative commons

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