Sen. Baucus proposes Medicare changes he says could drive 'transformation of the health care delivery system'

Apr 30 2009

The Senate Finance Committee on Wednesday during a six-hour meeting discussed proposed changes to the Medicare system from committee Chair Max Baucus (D-Mont.) and ranking member Chuck Grassley (R-Iowa), the New York Times reports (Pear, New York Times, 4/30).

The lawmakers on Tuesday released a 48-page document outlining proposals aimed at increasing the number of primary care physicians, reducing hospital readmission rates, increasing transparency, overhauling Medicare Advantage plan payments and creating quality benchmarks for physicians and hospitals (Kaiser Daily Health Policy Report, 4/22). Baucus said that changes to Medicare could drive "transformation of the health care delivery system" (New York Times, 4/30).

Wednesday's meeting was attended by committee members, their staffs, Medicare Payment Advisory Commission Executive Director Mark Miller and Congressional Budget Office Director Douglas Elmendorf (Armstrong, CQ Today, 4/29).

After the meeting, Grassley said, "There was not a lot of disagreement on what was a problem," but "[t]here might have been some disagreement on how to solve the problem." Baucus said that most concerns were about proposals to reduce MA plan payments to private insurers (Edney, CongressDaily, 4/30). Baucus added, "Some of the concerns are to make sure the policies are applied fairly to different parts of the country." He also said that committee members raised concerns about how fast some of the proposals would be implemented. A Republican committee aide noted that Republican members "are really still digesting it," adding, "A lot of the day really was going through these options" (CQ Today, 4/29).

Meanwhile, interest groups are raising objections to some of the proposals. According to a source in the physician community, specialty surgeons and physicians are particularly concerned about proposals to base Medicare payments on quality benchmarks (CongressDaily, 4/30). In addition, some groups are concerned about a proposal to "bundle" Medicare payments for all the services provided to a hospital patient, including care provided at a nursing home or by home health care providers. Bruce Yarwood, president of the American Health Care Association, said, "This proposal is a little bit scary. I don't want to give hospitals full control of our Medicare payments" (New York Times, 4/30).

The committee is expected to hold two more closed-door meetings on how to expand health care coverage and how to finance reform. Grassley said, "The next two things we do are going to be a little more difficult, but this gets us off to a good start." The committee plans to mark up a health care overhaul bill by mid-June. According to Baucus, the committee is "on schedule" (Armstrong, CQ Today, 4/29).

Congressional Democrats Push for Public Plan

Fifteen Democratic senators and one independent senator on Wednesday sent a letter to Baucus and Senate Health, Education, Labor and Pensions Committee Chair Edward Kennedy (D-Mass.) calling for the inclusion of a public health insurance option in reform legislation, CQ Today reports (Wayne, CQ Today, 4/29). The letter stated, "There is no reason to believe that private insurers alone will meet the public purpose of ensuring coverage for all Americans at affordable prices for taxpayers." Sen. Sherrod Brown (D-Ohio), who signed the letter, said that a public plan "would provide competition to the sometimes dysfunctional private insurance market" (Young, The Hill, 4/29). Brown added, "We don't have everybody in the Democratic Caucus convinced, but there's a lot of people who think that private insurance operates a step ahead of the sheriff" (Wayne, CQ Today, 4/29).

House Ways and Means Committee Hearing

At a hearing on employer-sponsored health insurance on Wednesday, the House Ways and Means Committee heard testimony from two witnesses who oppose proposals to establish employer health coverage mandates, CQ HealthBeat reports. The appearance of the witnesses was in response to accusations made by Republicans last week that committee Democrats want to hear only from allies as they craft health reform legislation. William Dennis, a senior research fellow at the National Federation of Independent Business Research Foundation, testified that mandates requiring employers to provide health coverage are "bad for small employers, bad for the low-income and bad for the economy." According to Dennis, mandates would result in job losses for low-income people, lower wages and fewer work hours (Norman, CQ HealthBeat, 4/29).

Senate HELP Committee Examines Health Care Costs

The Senate HELP Committee on Tuesday met to discuss how health care costs must be addressed in order to achieve sustainable health care reform, CQ HealthBeat reports. Committee ranking member Mike Enzi (R-Wyo.) said, "Our current pace of spending is not sustainable and we must get health care costs under control." Jon Kingsdale, executive director of the Commonwealth Health Insurance Connector in Massachusetts, said, "Near universal coverage is simply not sustainable financially unless we address health care costs."

Utah House Speaker David Clark (R) said that the federal government should preserve states' abilities to develop innovative health coverage programs, but he added that there are certain elements of reform that could be applied across states. He said, "If two states with such widely differing cultural, political and systemic backgrounds as Utah and Massachusetts can pursue similar reforms, then other states can do the same" (Attias, CQ HealthBeat, 4/29).

Letter To The Editor

"As Congress gears up for the fight over health care reform, we urge everyone in both parties not to forget the 120 million Americans who need emergency care each and every year," Nick Jouriles, president of the American College of Emergency Physicians, writes in a letter to the editor of The Hill. According to Jouriles, the "federal mandate that guarantees emergency care for everyone does not require health insurance companies, governments or individuals to pay for these services." He writes, "This lack of reimbursement and under-reimbursement for emergency care plus the closure of emergency rooms are taking their toll," adding, "Overcrowded emergency departments compromise patient safety and [threaten] everyone's access to lifesaving emergency care." He concludes, "It is imperative that Congress hold hearings on the state of emergency medicine and pass legislation to address the severe problems facing all emergency patients" (Jouriles, The Hill, 4/29).

Opinion Pieces

• Tommy Thompson, Politico: "[T]here is reason to believe that the CBO price tag for health care reform ... will not capture the future savings, because it underestimates the value of investment in health care as a means to achieving a healthier, more productive and, ultimately more prosperous America," former HHS Secretary Thompson writes in a Politico opinion piece. "Though there is not universal agreement for achieving a healthier America, we do agree that there are good reasons for tackling health care reform as a means to producing economic gains in the long term," Thompson writes. He writes, "CBO's current 10-year time frame for determining the impact of federal legislation is not sufficient to capture the potential savings of reducing the burden of chronic diseases" (Thompson, Politico, 4/30).
• David Wessel, Wall Street Journal: "This year, Mr. Obama may be able to dedicate savings from one part of the health care system to expand coverage elsewhere," but "[b]y next year, he may be forced to devote any such savings to reducing the deficit," which is "why he is pushing it now," Journal columnist Wessel writes. Wessel suggests that Obama might be more successful in implementing health reform than the Clinton administration because "[u]nhappiness with the status quo is greater"; the "White House health care summit in March was a visible manifestation that health providers, insurers and employers believe this may be the year of health reform"; "White House political tactics are smarter"; "[t]he message is smarter"; "Democrats in Congress want to do this -- now"; and "[t]he price tag doesn't look so daunting." Wessel adds that the obstacle for Obama is that he has yet to convince people that expanding coverage means "paying some health providers less, not just differently"; "saving money on Medicare and spending the money on those under 65 years old"; and "raising someone's taxes" (Wessel, Wall Street Journal, 4/30).