THE TREATMENT DECEMBER 3, 2009
Want to feel glum or angry about health care reform? Check out Karen Tumulty's new story in Time, which discovers more instances of Congress weakening cost control behind closed doors.
This example, in particular, caught my attention:
When Obama began his push for reform, he asked Congress to create an independent commission to regulate Medicare costs. Medicare, which spends more than $450 billion a year, is such a huge health care player that any changes it makes can lead the way for reforms in the private market. As originally envisioned, the new agency would essentially take over Congress's current authority to set Medicare payment rates for hospitals, doctors, nursing homes and other health care providers. It would use a process like the military-base-closing commission, whose recommendations automatically go into effect unless Congress votes to block them.
As it turns out, however, lawmakers are reluctant to cede the power to steer extra money to hospitals in their own districts, and the House rejected the commission idea outright. While the Senate bill does contain a version of the commission, it has become weaker at every turn in the process. Under a deal to win hospitals' support for the bill, the Senate Finance Committee agreed they would be exempt from the commission's recommendations at least through 2019; doctors, hospices and medical-equipment suppliers would be beyond its reach entirely. Who is left? Maybe no one. ...
Even more damaging in the view of many reformers is a little-noticed deal that Senate majority leader Harry Reid cut to get the support he needed to bring the bill to the floor of his chamber. The original Finance Committee bill would have triggered the commission's recommendations whenever the rate of increase in Medicare spending outpaced overall economic growth--something that happens almost every year. But the current version would allow it to make recommendations only when Medicare spending per capita grows faster than overall health costs. That almost never occurs. The change in economic measuring sounds technical. In effect, however, it "turns off the commission" before it even begins, says a senior congressional aide.
Several sources say Reid made the change in part at the pleading of former Congresswoman Barbara Kennelly, who runs the National Committee to Preserve Social Security & Medicare, a powerful senior-citizens advocacy group. "We don't think there ought to be a commission at all — period," says Maria Freese, the organization's director of government relations. "This is not supposed to be a bill that shrinks Medicare." Administration officials are working to get the teeth restored to the commission idea — "We've got to have it," says an official — but that will be a huge challenge. The White House will need to find 60 Senate votes to reinsert the provision and faces another big battle when the bill reaches a conference committee with the House.
This doesn't really affect projections of whether health reform pays for itself in the next ten years. The Congressional Budget Office estimates, which suggest reform is revenue neutral, take into account the weakening of the Medicare Commission. (That's one reason CBO doesn't credit the commission with producing much in the way of savings.)
But these sorts of changes do make it more doubtful that health reform will meaningfully "bend the curve"--that is, slow the rise in medical spending--over the long term. And less curve bending means less help on everybody's premiums.
The president has indicated (through his advisers) that he wants to fix this. So has Senator Jay Rockefeller, who sponsored this idea in the Senate and has said he will be on the House-Senate Conference Committee hammering out a final deal. (Senate leadership has refused to comment on that.) Those are two powerful voices. But given the powerful lobbying muscle against meaningful cost control, they may not be powerful enough.