Posts Tagged ‘Medicare’

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218, that elusive magic number

Monday, November 2nd, 2009

House prepares to bring a strong reform package to the floor
On Thursday, House leadership unveiled a strong health reform package and plans to begin debate on it late this week.  The House bill gelled in the middle of last week when leaders judged that a final push to get 218 votes for a bill that included the “robust public option”—a public insurer that would pay rates based on what Medicare pays—was going to fall short.

Instead, they put out a bill that includes a public insurance plan that would negotiate rates with providers.  The CBO projects this version would save less money, so Leadership made up for the lost savings by proposing a further expansion of Medicaid to 150 percent FPL instead of the 133 percent that cleared committee in the original bills.

Community Catalyst is strongly supportive of the House bill, which goes beyond earlier drafts in a number of respects. It includes a national insurance Exchange that also gives states the option of creating their own Exchanges, new rules that prevent insurers from denying coverage to people with pre-existing conditions or charging people more because they are sick, expands Medicaid, adds a long-term care insurance program for disabled adults, requires health plans to allow young people through age 26 to remain on their parents’ policy, and eliminates the Medicare doughnut hole by 2019, rather than 2024.

Compared to the bill taking shape in the Senate, the House bill is likely to provide better benefits, better subsidies and more progressive financing while reducing the federal deficit and still costing less than the $900 billion ceiling set by President Obama.  Compared to the Senate, the House leadership appears more willing to take on segments of the health care industry and also includes a more significant employer responsibility provision.  (As a result, it faces stiffer opposition from these interest groups, though insurers are opposing the Senate bill as well).  However, according to some analysts, the House legislation does less to reduce spending over the long run than the proposal that passed the Senate Finance Committee.

While the House bill represents a huge step toward quality affordable health care for all, it includes a couple of notable weaknesses. The bill bars most workers who have employer-sponsored insurance from receiving subsidies in the health insurance Exchange.  Instead, workers would be required to take up their employer offer of coverage unless its cost exceeds 12 percent of their income, a requirement that would be too burdensome for low-wage workers.  A better approach would be to exempt workers from the mandate requirement on a sliding scale, as Massachusetts does.

A second problem is that the House legislation assumes that coverage is “always affordable” for people whose income exceeds 400 percent of the federal poverty line.  This provision would be burdensome, especially for older adults with income just above the cut-off point for subsidies.  Although the bill limits premium variation based on age, an older person could still pay twice as much as young adult, leaving them with a very substantial premium liability. Establishing a ceiling on how much people could be required to pay for coverage, regardless of income, would remedy this problem.

The House bill also eliminates the Children’s Health Insurance Program, known as CHIP, and assumes that children who are not Medicaid eligible will get their coverage through employer plans or through the Exchange.

There a number of potential benefits to moving children off of CHIP, not least of which is moving away from a block grant program that gives states the ability to offer relatively limited coverage (flexibility that states have not generally utilized to date) and instead give children a federal guarantee of coverage.

But while under law, CHIP plans may be limited, in practice most states have provided kids with comprehensive coverage.  As a result, children transferring from CHIP to Exchange coverage could see their benefits reduced and their costs increase.   Preserving CHIIP as a program that provided additional benefits and cost-sharing protections for children in families above the income eligibility threshold for Medicaid could help ensure that children get the health care they need.

For more details on the House bill see this updated Community Catalyst summary and discussion.

218, that elusive magic number
As the House prepares for floor action as soon as this week, several hurdles to passage still stand.  Here are the three main sticking points:.

•    Abortion
A number of House Democrats, led by Michigan Representative Bart Stupak, want to have a vote on language that would preclude plans that receive federal subsidies from including abortion coverage.  The current language in the House bill separates out the cost of abortion coverage from a benefits package, and requires the value of subsidies to be calculated without it. But Stupak wants a stricter prohibition on abortion coverage and claims to have the support of 40 House Democrats, which could be enough to block reform if they do not get their requested vote.

•    Immigrant Coverage
A debate is simmering within the House about whether to adopt a provision, favored by President Obama, that would prohibit undocumented immigrants from buying insurance coverage through the Exchange, even with their own money.  Many progressives, especially members of the Congressional Hispanic Caucus, are concerned about the lack of equal treatment for legal immigrants.  Advocates and lawmakers are now contemplating whether to push for an amendment that would give states the option to receive federal matching funds to cover certain legal immigrants through Medicaid.

•    Public Option
While the House leadership believes they lack the votes for a public option tied to Medicare rates, some progressives still want a chance to vote on that amendment and may block action if they don’t get it.

All of these issues could be addressed in a “manager’s amendment” or in the rule that will govern debate in the House later this week.

Affordability woes in the Senate
In case you missed it in our Friday blog post, the Senate is still struggling with the affordability issue.

While sources on the Hill confirm that the Senate is trying to make badly-needed affordability improvements for moderate-income households, they are trying to do it while still reducing fees paid by medical device manufacturers and an excise tax on high-cost insurance plans.  As a result, the best idea the Senate appears able to come up with at this point is to reduce premiums for moderate-income households by raising them for those at the bottom (We compared this proposal with the SFC bill and House leadership plan here.)

Timetable Update
House: The House plans to start floor debate late this week and to finish no later than Thanksgiving.

Senate: A backlog of work at CBO has slowed progress on the Senate side.  Given the slower pace of debate in the Senate, and with Veteran’s Day and Thanksgiving on the holiday horizon, the Senate is unlikely finish debate this month, though there is still a good chance they will finish before Christmas.  That means though, that resolving the differences between the House and the Senate will likely extend into next year.

Shameless plug department

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–Michael Miller, Director of Strategic Policy

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Too bad they can’t vote

Monday, October 19th, 2009

A substantial and growing cadre of prominent Republicans have come out in favor of health reform recently. A partial list: former majority leaders Bob Dole, Howard Baker and Bill Frist (who this week disputed critics who claimed that Obama was promoting socialized medicine), California Governor Schwarzenegger, former HHS Secretary Tommy Thompson, and former CMS chief Mark McClellan.  Not exactly a fringe element.

Yet there’s been no sign that these endorsements will move Republicans in Congress.  Maybe it’s something in the water in Washington, or maybe it’s just an indication of the extent of ideological or simply partisan polarization that so few sitting Republicans are willing to join party elder-statesmen in moving reform forward.  Right now, the calculus in the Republican caucus seems firmly set on continuing its near-unanimous opposition to reform – and carrying it into the 2010 elections and beyond (just in case you thought this issue was going away after passage.)

The Ladies from Maine Part I: Snowe Fall
Sen. Olympia Snowe’s aye vote on the Finance Committee reform bill ended intense speculation over which way the senior Senator from Maine would go.  To many, her vote suggests that she agrees with assessments that a yes vote in Finance gives her more leverage over the process going forward than continuing to dangle the carrot of her possible future support.  Snowe is now positioned to limit the movement of the bill to the left as it’s combined with the more liberal HELP bill, to be a key decision-maker on floor amendments, and perhaps even to have a formal role in conference committee.

In the eyes of the beholder
What is it that Sen. Snowe wants as the process moves forward?  One priority is preventing the inclusion of a public option except as a fallback.  A second Snowe priority is affordability.  At the same time, she has opposed most of the options on the table advanced to make better subsidies available.

A contradiction?  Not necessarily.  Affordability in Sen. Snowe’s eyes seems to be more about slimming down the coverage people would receive rather than making subsidies better—an idea that is getting some support in Democratic quarters, as well, even though the Finance bill already offers much less generous coverage than other proposals, particularly for low-wage workers.  Common Sense Affordability Protections, a paper released today by Community Catalyst and PICO, highlights the problems for low-income people in the Finance proposal and makes recommendations for how to fix them.

The Ladies from Maine Part 2: As Snowe goes so goes Collins?
Late last week, Sen. Susan Collins (R-ME) indicated her openness to supporting reform.  This is welcome news in some quarters because of the challenge of getting 60 votes even with support from Sen. Snowe.  On the other hand, Collins’ statement triggers some alarm bells.

The concern she voiced over potential cuts to Medicare benefits (and misrepresenting what is in the bill) should be read as coded opposition to eliminating current overpayments to Medicare Advantage plans and other efforts to reduce Medicare spending  — measures that form an important part of the financing of the Senate bill.

This wouldn’t be such a problem if the Senate weren’t already having such a difficult time agreeing on revenue options.

But attacks on the current financing mix continue, especially from medical device manufacturers concerned about new fees they would have to pay, and from unions and progressives unhappy with the proposed tax on insurers who offer high-cost plans.  This tax is almost certain to be passed on to enrollees and would fall disproportionately on states with high health care costs and firms with older workers.  Senate negotiators are working to modify both of these revenue sources but the struggle will be not to lose revenue in the process.

Read the rest of the Health Reform Insider here.

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Last week, on ‘As the Public Option Turns’

Tuesday, October 13th, 2009

Insurance Industry Takes the Gloves Off
While the insurance industry has been using “guerrilla” tactics behind the scenes to undermine aspects of health reform all along – opposing strong Exchanges, a decent minimum benefit standard and eliminating discrimination based on age and health status –  a report commissioned (and heavily advertised) by the insurance industry and released late Sunday night that attacks the Senate Finance proposal is the first public shot across the bow against reform.

The report, produced by PricewaterhouseCoopers, is problematic for a several reasons—it doesn’t make an “apples to apples” comparisons, it looks only at selected parts of the bill, not the bill in total, and it makes unjustified assumptions about some of the provisions.

For example, the report ignores all of the cost-containment provisions, the positive effect on the risk pool of providing subsidies or the potential for administrative savings through benefit standardization.  And it is, to say the least, disingenuous for the industry to oppose provisions that would lead to more effective cost-containment, such as a public option or an Exchange that can negotiate actively with insurers, and then complain that cost-containment efforts do not go far enough.  Hopefully, lawmakers will see through the report’s flaws and not make concessions to the industry that has finally stopped playing nice.

Food Fight
Insurers aren’t the only interest group turning up the volume as reform lurches forward.  Watch for worried governors to further press their case for Medicaid help.  Govs got the Finance Committee to move from temporary to permanent enhanced federal matching funds for the expansion population, but many remain nervous about new costs their states would have to shoulder under reform.  Governors like Schwarzenegger, who represent a much-sought-after bipartisan voice could be particularly influential, and some Senators have already committed themselves to finding extra help for the states.  Another group turning up the heat is the hospitals, upset that SFC would leave them with a substantial uncompensated care burden while slashing federal funding to hospitals that provide that care.

What this also means is that we can expect a fierce food fight for the remaining $70 billion in “headroom” – the difference between what President Obama said he would support and the CBO score of the Senate Finance bill.  Additional affordability improvements are one way that space could be filled (if revenue or savings measures can be agreed to), but others include the above-mentioned additional help for states, or rolling back fees on health industry stakeholders that are in the SFC proposal now and that have provoked vocal opposition from Senators in both parties.

House inching closer
The House continues to grapple with divisions within the Democratic caucus, aiming to send a combined House bill to CBO this week.  The key divisions remain over the revenue provisions and the public option.  House leaders are likely to scale back the surtax on wealthy households, raising the threshold to perhaps as high as $1 million, but they have yet to agree on how they would plug the resulting revenue hole.  Don’t look for a bill to hit the House floor for another couple of weeks.

Meanwhile, join us for another installment of:

As the Public Option Turns
The ongoing debate over public options sometimes feels like soap opera – lots of drama but not much plot advancement.

Previously on As the Public Option Turns, we found the importance of the issue elevated by a White House commitment to keep cost of reform under $900 billion.  That means Congress must find ways to make reform more cost effective unless they are willing to sacrifice affordability.

We now join our hero, Public Option, in the House, where the latest whip count shows the House Democratic caucus overwhelmingly in favor of a strong public option with rates based on Medicare payments, but close doesn’t count.  They have to get to 217 votes for passage and it’s those last few that will be the hardest to lock down.

While back in the Senate…
Last week Sen. Carper offered a proposal that would allow states to opt out of the public option.  This week, Sen. Schumer is floating a counterproposal which would make inclusion of the public option the default position but allow states opt out instead of having to opt in.  Schumer is also actively working to defang the Republicans’ number one emerging attack line:  that the individual mandate non-compliance penalties constitute a tax increase on the middle class.  Schumer proposes to blunt that attack by changing the penalty from a fee paid to government to a required contribution that an individual could use to purchase insurance at a later date.

In a separate but related plot line, another public insurance plan is getting a second look.  In their search for more a more cost-effective proposal, House leaders are considering a further Medicaid expansion, up to 150 percent of the FPL.  Even if the federal government paid 100 percent of the cost, expanding Medicaid is more cost-effective than putting people in private plans.

It’s Beginning to Look a Lot Like Christmas (or later)
The goal in the Senate is to have a bill on the floor next week, but it is not certain Majority Leader Reid will be able to complete the combination of the HELP and Senate Finance bills as fast as originally thought. Sen. Reid has indicated that he would like a CBO score on the blended bill, which could also slow things down depending on how extensive changes are. (It’s worth noting that work to combine the bills started even before the SFC final vote).

Add on three weeks of floor debate (maybe even more to account for procedural delays) and, assuming House can match the generally more slow-moving Senate, bills could clear the floor by Thanksgiving.  (That assumes the Senate remains on track for a 60-vote strategy and doesn’t have to pull the bill off the floor to adjust it for Budget Reconciliation).

This leaves only a few weeks before Christmas for what promises to be a protracted and challenging conference committee and final votes in each chamber. As an example of just one of those contentious issues that will have to be resolved in conference, more than half of House Democrats have signed a letter opposing the primary financing source in the Senate proposal.  With multiple and similarly thorny issues to resolve, don’t be surprised if health reform spills over into the new year.

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The MD factor: Majority of physicians back public insurance options, study shows

Wednesday, September 16th, 2009

A study released this week in the New England journal of Medicine found that a large majority of physicians support the expansion of publicly-backed health insurance programs. The survey, funded by The Robert Wood Johnson Foundation, polled over 5000 randomly-selected physicians from a broad range of specialties, practice setting, and regions, and the findings represent the opinions of more than 2100 respondents contacted between June – Sept. 2009.

The large majority of respondents – 73 percent – supported a public option in health reform; most surveyed (62 percent) said they think health reform should include a combination of public and private options, mirroring the principles President Obama, three House committees and a Senate committee have all put forward.  A majority of American Medical Association members surveyed also supported a public option.

And in a finding that rebuffs some reform opponents’ claims that expanding or fortifying Medicare would hurt practicing doctors, there was strong, cross-specialty support for expanding Medicare to those ages 55-64.  Check out the paper’s helpful bar graph to see what we mean.

The authors acknowledge that though the American Medical Association’s stand on reform has wavered and changed during health care debates, past and present, it has most recently come out in support of a House reform proposal that includes significant coverage expansions through subsidized private insurance and a public option.   These findings demonstrate that this position is now more consistent with individual physicians’ views on health reform today.  The authors write:

Physicians’ groups have strongly influenced efforts in health care reform throughout modern U.S. history and in so doing may have often obscured the collective views of individual physicians across the spectrum of specialties, interests, and regional affiliations. Given the enormity of the current effort to reform health care and its potential effect on future generations of Americans, policymakers need to hear the views of the whole range of physicians on the key elements of reform.

Both authors, physicians at Mt. Sinai School of Medicine, are members of the National Physicians Alliance. You can hear them talk about their findings on NPR’s All Things Considered.

–Kate Petersen

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Worth the Wait

Thursday, September 10th, 2009

For days, the tension has been mounting over what President Obama would say when he addressed the nation on health care.  Last night, with an eloquent prime time address to a joint session of Congress, the President powerfully rebooted the debate on health care.

The President challenged critics to engage in a more civil and fact-based discourse – a challenge that many Republican Congressmen failed to meet.  In an unusual breach of protocol, Republicans sometimes booed the President, and one Republican Congressman even shouted out “you lie!”  In his response to the President’s speech, Congressman Boustany reiterated unsubstantiated charges of “government takeover” and “rationing” that the president had refuted just moments before.  The net effect of all of this was to make Obama seem more reasonable and unflappable – utterly Presidential – in the presence of some of his more vociferous (and less self-possessed) critics.

Coming into the evening, the President had to achieve several big goals.  He needed to reassure a nervous public, explain what he was proposing, and reenergize his base both in Congress and in the nation.

President Obama did that and more. He came across as both passionate and calmly reasoned – again, a sharp and welcome contrast to the wilder critics that have dominated the cable news media.  At same time, the President staked out the high ground in the debate by reaching out and embracing ideas from Republicans.

He also successfully navigated the treacherous political waters around the “public option.”  While he made a clear case for a public option and took on the scare-mongers directly, he also strongly cautioned the left against making the public plan a litmus test for reform.

President Obama did not shy away from engaging with opponents.  He directly addressed the most common charges made against reform, giving special attention to issues affecting seniors.  He clearly restated his commitment to allow people to keep the coverage they have, to protect the Medicare program and to make sure health care reform does not add to the deficit.

Recent polls show that most Americans are confused by the debate. After last night’s speech, the key elements of reform–including insurance reforms, individual and employer responsibility and sliding scale subsidies—should be much clearer to the public. The President also reiterated the need for an exemption for those who still could not afford coverage. However, he did not engage on a crucial question for many low- and moderate-income households: Just what constitutes affordable coverage?

The President’s closing words speak for themselves:

That large-heartedness — that concern and regard for the plight of others — is not a partisan feeling.  It’s not a Republican or a Democratic feeling.  It, too, is part of the American character — our ability to stand in other people’s shoes; a recognition that we are all in this together, and when fortune turns against one of us, others are there to lend a helping hand; a belief that in this country, hard work and responsibility should be rewarded by some measure of security and fair play; and an acknowledgment that sometimes government has to step in to help deliver on that promise….

I understand that the politically safe move would be to kick the can further down the road — to defer reform one more year, or one more election, or one more term.

But that is not what the moment calls for.  That’s not what we came here to do.  We did not come to fear the future.  We came here to shape it.

(You can read the full remarks here.)

–Michael Miller, Director of Strategic Policy

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