Debt panel sets to work amidst challenging economic picture

Sep 15 2011

As the CBO director spoke at the panel's opening act and provided a bleak impression of the economic forces the 12 members will confront, Republicans and Democrats on the 'super committee' appear to be toeing the usual party lines, with GOP members focusing on entitlement programs and government health care spending, and Democrats pressing for higher tax revenue.

The New York Times: Democrats See Perils On Path To Health Cuts
As Congress opens a politically charged exploration of ways to pare the deficit, President Obama is expected to seek hundreds of billions of dollars in savings in Medicare and Medicaid, delighting Republicans and dismaying many Democrats who fear that his proposals will become a starting point for bigger cuts in the popular health programs (Pear, 9/13).

The Associated Press/Washington Post: Debt 'Super Committee' Members Emphasize Opposing Spending, Tax Plans Aiming For Less Red Ink
Digging in for a bruising struggle, Republicans on Congress' powerful deficit-fighting "super committee" targeted Social Security and government health care spending Tuesday while Democrats pressed for higher tax revenue as part of any deal to reduce red ink by at least $1.2 trillion over the next decade (9/13).

The New York Times:  Debt Panel Opens With Bleak Economic Picture
As the 12-member panel began its race against a November deadline to recommend substantial federal savings, Mr. Elmendorf said its task had become more difficult because the outlook for the economy had worsened in the last month. … Republican members of the panel said growth in federal spending -; for Medicare, Medicaid and Social Security, in particular -; was the main factor in the nation's fiscal problems. Mr. Elmendorf said spending for the big three benefit programs would account for 12.2 percent of the gross domestic product in 2021, compared with an average of 7.2 percent in the last 40 years. The difference, 5 percent of the economy, "is a very big number," Mr. Elmendorf said. Democrats said higher revenues were essential (Pear and Steinhauer, 9/13).

Los Angeles Times: Budget Chief Seeks Wholesale Reordering Of Government Priorities
The second meeting of the panel made clear the difficulty of the path ahead as the six Republican and six Democratic lawmakers started their work -; and showed their partisan stripes. Both sides have held fast to familiar positions, with Republicans refusing to consider new taxes and Democrats resisting cuts to Medicare and other entitlement programs without new revenue as part of the deal (Mascaro, 9/13).

Kaiser Health News: Health On The Hill:  CBO Chief Testifies At 'Super Committee' Hearing
Kaiser Health News staff writer Mary Agnes Carey talks with Jackie Judd about the "getting down to business" atmosphere at the joint debt panel's Capitol Hill hearing Tuesday. Read the transcript or listen to the audio (9/13).

Roll Call: Super Committee To Break Bread And Break Ground
The 12 members of the bipartisan, bicameral panel are scheduled to meet privately for dinner Thursday night, multiple sources from both parties confirmed. However, a spokesperson for Co-Chairwoman Sen. Patty Murray (D-Wash.) denied there were dinner plans but said the group is working to get together soon. If they do meet, it will be the first time the full group meets behind closed doors. Details of the gathering's agenda are being closely guarded, but the time could be a valuable relationship builder for the diverse group of lawmakers who were chosen primarily for their loyalty to House and Senate leaders (Shiner, 9/14).

Politico: Super Committee's First Decision Is Which Baseline To Use
It can use the standard baseline set up by the Congressional Budget Office, which says the nation faces $3.5 trillion in deficits over the next decade. But this baseline assumes that Congress will allow doctors' Medicare payments to get sliced by 30 percent next year and that former President George W. Bush's tax cuts will expire in 2012 -; neither of which is likely to happen. The committee can choose to use a more realistic scenario -; one that assumes the doctors won't get cuts and that most of the tax cuts will get renewed. But while CBO's alternative fiscal scenario is more realistic, it comes with a more daunting deficit figure: $8.5 trillion over 10 years (Haberkorn, 9/13).

The Wall Street Journal: Industry Formulates Its Own Medicare Prescription
Seeking to fend off larger cuts in federal medical spending, executives from big pharmaceutical, hospital and insurance companies are crafting their own plan to reduce the deficit which calls for wringing Medicare savings from beneficiaries, not just from hospitals and drug makers. Members of the Healthcare Leadership Council-;which includes top executives from Pfizer Inc., Aetna Inc. and the Mayo Clinic-;on Wednesday are expected to approve a proposal that would call for raising Medicare's eligibility age and shifting the program toward private plans for beneficiaries. The group plans to press members of the congressional "supercommittee," charged with finding $1.2 trillion in budget savings, to include the changes in its broader cost-cutting plan (Adamy, 9/14).

Politico Pro: Debt Panel Eyes Savings From Fighting Fraud
Members of the debt committee on Tuesday explored whether cracking down on fraud could save hundreds of billions of dollars from health benefits programs while leaving patients and providers unscathed -; but the Congressional Budget Office tamped down expectations. Senate Minority Whip Jon Kyl said he would push legislation to crack down on fraudulent or otherwise improper payments made by Medicare, Medicaid and other government programs even if better enforcement requires some upfront spending (Dobias, 9/13).

WBUR's CommonHealth blog: Larry Summers On Health Reform: Bottom Up Is Better Than Top Down
Uber-economist Lawrence Summers, former secretary of the U.S. Treasury and former controversial president of Harvard, spoke yesterday ... "If, looking back from 2030, we're seeing that not just was the arc of justice bent towards liberty but the arc of health care costs was bent toward flatness -; if that is what we look forward to, I think it is less likely that it came from a sweeping act of Congress and it is more likely that it came from widely emulated innovation in individual settings" (Goldberg, 9/13).