I’ve never seen a week in health care policy like last week. The media reports have to be in the thousands, all trying to make sense of the furious debate between Obama and Romney over Medicare.
As someone who has studied this issue for more than 20 years, it has also been more than exasperating for me to watch each side trade claims and for the press to try to make sense of it.
This blog post is quite long because the subject matter is complicated. If you want to cut to the chase, see my conclusion and summary at the end of this post.
Allow me to list a few of the questions people are asking and give you my take on it.
Will current seniors suffer under the Romney-Ryan Medicare plan?
No. Let me start by saying something that will likely surprise you. If I could be king for a day, I would prohibit anyone over the age of 60 from voting in this election. This election is really about the future and the big decisions on the table are about the long-term government spending and entitlement issues that should be made by younger voters who will have to pay for them and will benefit or suffer from them.
Those in their 60s and older are almost surely going to cruise to the end with the benefits they now have.
Whether its Obama’s Medicare plan, based heavily on the Medicare cost control board imbedded in his health reform bill (which doesn’t begin to impact hospital costs until 2020), or the Romney/Ryan Medicare premium support plan (that has no effect on anyone now over the age of 55), today’s seniors’ benefits are insulated from this issue.
Last week, I noted the significant differences between Paul Ryan’s proposals, from his 2012 budget to Ryan-Wyden to his 2013 budget. I also noted that while it would be tempting to campaign against the 2012 budget, which massively shifted costs onto seniors, his later proposals did that to a far lesser extent.
Or did they?
Governor Romney has endorsed Paul Ryan’s latest plan, which is specific in that it will reduce future Medicare spending by unleashing the power of the free market through competitive bidding. But what if that doesn’t happen? Well, just like the ACA, his law backstops the growth of Medicare spending at GDP + 0.5%.
The ACA is explicit about what will happens if growth goes above that amount. The IPAB will make recommendations on how to cut it. Congress will have to override those recommendations to stop them, and have their own ideas that save just as much. It’s likely those recommendations would involve reducing provider payments. But it’s the hope of those who support the ACA that other provider-based changes, like ACO’s and the excise tax, will keep the IPAB from having to act.
The wanna-be congressman appeared with his neat hair and pressed suit, a competent yet compassionate expression on his face. ”The first thing I am going to do when I get to congress is to work to repeal Obamacare,” he said, expression growing subtly angry. ”I will do everything I can to give you back the care you need from those who think big government is the solution to every problem.”
My wife grabbed my arm, restraining me from throwing the nearest object at the television. I cursed under my breath.
No, it’s not my liberal ideology that made me react this way; I’ve had a similar reaction to ads by democrats who demonize republicans as uncaring religious zealots who want corporations to run society. I am a “flaming moderate,” which means that I get to sneer at the lunacy on both sides of the political aisle. I grew up surrounded by conservative ideas, and probably still lean a bit more that direction than to the left, but my direction has been away from there to a comfortable place in the middle.
It’s not the ideology that bugs me, it’s the use of the “us and them” approach to problem solving. If only we could get rid of the bad people, we could make everything work. If only those people weren’t oppressing us. If only those people weren’t so lazy. It’s the radical religious people who are the problem. It’s the liberal atheists. It’s the corporations. It’s the government. All of this makes the problem into something that isn’t the fault of the person making the accusation, conveniently taking the heat off of them for coming up with solutions to the problems.
The fight is on — again. Mitt Romney, Scott Brown, and Republicans across this country are doubling down against President Obama’s health care reform law. Now that the Supreme Court has said that most of the new law passes constitutional muster, the Republicans are running for office pledging to repeal every aspect of the health care reforms.
For millions of people this isn’t a political issue, it’s a personal one. Their health depends on it.
Massachusetts has led the country in health care reform. Most of us — 98 percent — have health care coverage, and our state leads the country in tackling head-on the ever-growing costs of health care. That is why President Obama used our law as a model for health care reform. But the national Affordable Care Act adds some important elements that improve care even here in Massachusetts.
For seniors, health care reform means expanding Medicare coverage to pick up the costs of prescription drugs. As the donut hole closes, the average Massachusetts senior has so far saved about $650. But Mitt Romney, Scott Brown, and their fellow Republicans want to take that away.
For young people, health care reform means staying on their parents’ insurance plans until they are 26. So far, more than 20,000 young people here in Massachusetts have taken advantage of this. But Romney, Brown, and their fellow Republicans want to take that away.
Americans believe in second chances. Mitt Romney will get his if the Supreme Court rules to throw out part, or all, of the president’s federal health insurance law. Should Romney propose replacing it with a federal version of the Massachusetts health law or a federal mega-bill that mandates a one-size-fits-all free-market solution?
The question is now central to the election — the high court has made that certain — and eclipsed in importance only by the debate over jobs and the economy.
President Obama may cite Romney’s Massachusetts reform as an inspiration for his own efforts, but there are profound differences between the laws — the size and reach, financing, the underlying philosophy. Romney sought an open marketplace for individuals to purchase benefit plans ranging from catastrophic to generous. Romney’s successor, Democratic Governor Deval Patrick, has obscured those differences by taking a big-government approach to implementation, drastically limiting choices and mandating minimum coverage levels beyond private-market norms.
Even with weak implementation, the Massachusetts law has yielded some positive results, including broadening insurance coverage, especially for minorities, and decreasing premiums for individual purchasers of insurance.
The Supreme Court’s imminent decision on the Affordable Care Act will trigger a political firestorm whether they accept the legislation in its entirety, throw out every page of the 906-page bill or do something in between, which is the most likely outcome.
If the high court follows the polls, it probably will rule the requirement that individuals purchase insurance – the mandate – is unconstitutional but leave the rest of “Obamacare” intact. A CBS/New York Times poll released earlier this month showed that 41 percent wanted the entire law overturned, 24 percent supported it fully and 27 percent supported it but wanted the mandate eliminated.
Pooling the latter two groups suggests there is majority support for the coverage expansion, insurance protections and delivery system reforms contained in the bill – as long as there is no mandate. It was only the Obama administration’s decision to include the requirement that individuals purchase health coverage – something done to win insurance industry backing for the law – that gave opponents the cudgel they needed to stoke widespread opposition to reform.
The insurance industry, recognizing many of the reforms are popular, is already preparing for a thumbs-down ruling on the mandate. Three major carriers, UnitedHealth, Aetna and Cigna, said last week they would continue to allow young adults to stay on their parents’ plans until age 26, pay for 100 percent of preventive services and eliminate lifetime caps on coverage, reforms from the ACA that are already in place.
New York Times reporter Abby Goodnough’s piece last week about the health insurance exchange in Massachusetts is instructive—especially since other states are trying to set up their own versions of these shopping bazaars where the uninsured can buy coverage if the health reform law eventually takes effect. For the last three years we have been suggesting there’s an untold story in the Bay State about how the law is working, so we were glad to see Goodnough’s reporting and offer a tip of the hat.
Goodnough gets into the subject with a success story: the tale of Peter Kim, who lost his employer-sponsored health insurance in 2005 when he opted for a career as an independent consultant. He found that shopping for insurance in the open market was a complicated affair, and that most plans were too expensive. He eventually chose coverage for catastrophic illness.
Then he discovered his state’s health insurance exchange, called the Connector. After just an hour of research, he found a plan with a monthly premium of only $1,086, a better deal than the coverage he previously had. And ideally, that’s how exchanges should work, Goodnough said.
The trouble, she reports, is that so far the Connector has not drawn enough full-paying customers like Peter Kim.
As Goodnough notes, the exchanges have drawn little journalistic scrutiny so far, despite their key place in health reform. (And, we note, despite the fact that they grew out of initiatives backed by former Massachusetts governor and current presidential candidate Mitt Romney.)
Mitt Romney’s entire career reflects a businesslike approach. On the one hand he has been willing to act boldly to solve problems. On the other hand he has been willing to keep what works and discard what doesn’t. The latest Romney pronouncements on health policy are consistent with that history.
As President Obama has said on many occasions, ObamaCare is based on a health reform Governor Romney spearheaded in Massachusetts. But blindly copying a health reform — while ignoring what’s really worth copying and what’s not — is hardly sensible presidential leadership.
Here is what is good about the Massachusetts health reform: (1) Governor Romney brought both parties together to achieve genuine bipartisan reform (something Barack Obama failed at miserably at the national level); (2) he cut the insurance rate in half by giving substantial tax relief to people who must purchase their own insurance, and (3) he did all this without raising taxes.
President Barack Obama has been busy recently traveling to college campuses across the country, talking about student loan debt and pitching his proposal to keep the interest rates on some federal loans at 3.4 percent for another year. His Republican rival, Mitt Romney, also supports a one-year extension.
While I agree with both that we need to make it easier for students to afford college, the president is not telling the whole story about how we got here and how we’re going to pay to fix it.
What the president needs to tell students is that his own health care policies are the principal reason that tuition and student debt are rising.
Medicaid mandates on states are soaking up dollars that would otherwise be spent on state universities and community colleges, forcing up tuition and resulting in more student loans and debt. Even worse, the federal government is trying to make a profit by overcharging students on their current loans and using part of the profit to pay for the new health care law.
According to the Congressional Budget Office, this takeover produced approximately $61 billion for the government — $8.7 billion of which went to pay for the new health care law.
The president’s new student loan proposal would, for one year, keep rates at 3.4 percent on new subsidized Stafford loans (those for which the federal government pays interest until students graduate), rather than increasing to 6.8 percent under current law. These loans account for about 40 percent of all federal student loans. According to the Congressional Research Service, the average student takes out approximately $3,600 in these new loans and will save about $7 a month in interest payments.
The Massachusetts Taxpayers Foundation (MTF) put out a report late last week on the cost of Massachusetts health reform. The number from the report that has gotten the most media attention has been– $91 million.
Over the five full fiscal years since the law was implemented, the incremental additional state cost per year has averaged $91 million…
This is a very strange way to interpret the cost data. Here is the breakdown from the report:
The better number to highlight would be the incremental increase each year over the 2006 baseline.
If you add this up and divide by 5, you come up with an average over the 2006 baseline of $738 million, and a state share of $369 million per year. That is a much different story than the $91 million being widely reported.