A “government takeover of health care” is back. At least it is in the mind of New Jersey governor Chris Christie. In an interview with talk radio show host Dom Giordano, the governor, who supports Mitt Romney’s presidential campaign, dished out strong clues about how Republicans are going to fight the health reform law. The weapon of choice: Frank Luntz’s focus-group tested messages. On the show Christie showed he was in sync with Romney’s defense of the Massachusetts reform law, which Romney’s administration supported and which later became the model for national reform. But to distance himself from the federal law, Romney has said what was good for Massachusetts at the time may not be good for the rest of the country. And Christie has said that what happened in the Bay State “would not be good for New Jersey.”
On the show, Christie urged the president to tell the truth about the reform law. What truth would Christie tell?
I’d say to the president, in Massachusetts, we didn’t propose to raise taxes, as you proposed to raise taxes a trillion dollars to pay for a government takeover of health care…. Ninety-three percent of the people in Massachusetts had private insurance then and have private insurance now. That’s not what’s gonna happen under Obamacare. It’s gonna be a government takeover of health care.
Really, Governor? As Campaign Desk has repeatedly noted, the health reform law does not call for a government takeover of health care. The law simply brings private insurance to people who are uninsured. You know, the kind sold by those giants of the American insurance business—UnitedHealth Group, Blue Cross, Cigna, and Humana—which just posted a large profit gained mostly from selling private Medicare Advantage plans to seniors.
It’s easy to forget, but Herman Cain first became famous in political circles for his wonky takedown of President Bill Clinton at a town hall meeting where the President was touting his universal health-care plan. (Herman Cain walked President Clinton through the math of why Clinton’s plan would drive Godfather’s Pizza out of business.) Today, Republican Presidential candidate Herman Cain spent half an hour with the GOP Congressional Health Care Caucus, where he outlined his proposals for health reform.
As Newsweek put it at the time, Cain was “the real saboteur” of the Clinton plan:
An articulate black entrepreneur, Cain transformed the debate when he challenged Clinton at a town meeting in Kansas City, Mo., last April. Cain asked the president what he was supposed to say to the workers he would have to lay off because of the cost of the “employer mandate.” Clinton responded that there would be plenty of subsidies for small businessmen, but Cain persisted. “Quite honestly, your calculation is inaccurate,” he told the president. “In the competitive marketplace it simply doesn’t work that way.”
The switchboard at Godfather’s was lit up with supportive calls. It was as if the small business community — a very large and politically powerful group — had been told to march on Washington. Cain, said Larry Neal, an aide to Sen. Phil Gramm, “was the lightning rod.”
For better or worse, Cain’s platform effectively represents consensus Republican thinking on health care. This is good, insofar as Cain endorsed repealing Obamacare, Medicaid block grants, etc. But it’s unclear if he proposed anything that would move beyond the meat-and-potatoes of Republican consensus. And there’s a lot more to do with health-care reform than simply repealing Obamacare.
Jason Millman of Politico was at today’s GOP confab for Cain’s address. “Cain said if he had the right numbers in Congress, he would sign legislation repealing health care reform on March 23, 2013 — three years after it was signed into law. A bill by Rep. Tom Price (R-Ga.), H.R. 3400, would be the starting point for replacement legislation, he said.”
President Obama’s battle to get his healthcare bill through Congress was big news on this side of the Atlantic last year, not least for the way our own National Health Service (NHS) was used as a reference point in the debate. Now though, it is Britain’s (or, to be specific, England’s) turn to be consumed by arguments about healthcare reform, and if you were to listen to some critics, you’d imagine just as much was at stake. The reform in question is the British Government’s Health and Social Care Bill, which is currently the subject of some fairly furious wrangling in the House of Lords. The bill entered committee stage last week after the Government won a key Lords vote, but although it now looks almost certain to become law in some form, there’s still fierce debate about many of the details.
Depending on where you stand, the health bill will either drag Britain’s creaking NHS into the 21st century, or it marks the first stage in the dismantling of a national institution. Actually though, some of this rhetoric is a little overblown. The bill represents a wide-ranging and pretty dramatic package of reforms, but it’s still some way short of an Obama moment. One thing it does not do is challenge the fundamental tenet on which the NHS was founded, which is that everyone in Britain has access to universal healthcare ‘free at the point of use’, funded through taxation. That tenet is rather less perfectly applied than is sometimes admitted – many people do have to pay prescription charges, and NHS coverage of dentistry is pretty patchy – but it’s nevertheless an article of faith for the British public, and no mainstream political party would dare to challenge it (overtly at least).
Still, the bill does make two very substantial changes to the way the NHS is organised across England (although it has been brought by the UK government, it does not apply to Scotland, Wales or Northern Ireland, all of which have devolved powers for their own parts of the NHS). The two key changes are both designed to make the NHS more efficient in the face of Britain’s financial crisis, both could have far-reaching implications and both have been hugely controversial. Firstly, it abolishes a whole tier of NHS management and hands its powers instead to the family doctors at the frontline – the general practitioners, or GPs, as they are known here. Secondly, it loosens the constraints on the NHS’s internal market, providing scope for private companies to compete to run many more NHS services. The two reforms are intended to work together to drive efficiency across the health service, and the efficiencies required are pretty frightening – 4% a year for the next four years.
Every year I write about the projects and trends which keep me up at night. Here’s my list for FY12:
1. Workforce recruitment/retention – $27 billion in stimulus funds from HITECH have increased demand for experienced IT staff to implement and support electronic health records. In many ways, it’s a mini “dot com” boom for healthcare IT experts. This makes recruiting and retaining qualified staff even harder. Tomorrow, I’m meeting with a consulting team to formulate an FY12 workforce strategy.
2. 5010/ICD10 – 5010 describes a set of X12 standards used for administrative transactions (benefits/authorization. referral authorization, claims). Payers and providers must support 5010 by January 1, 2012 or risk disruption of the revenue cycle. BIDMC completed all its 5010 work and is now in final testing with every payer. Most payer and provider stakeholders will meet the deadline, but significant resources have been pulled from other projects. ICD-10 implementation is required by October 1, 2013 and I’ve written about those challenges. Billions will be spent, many healthcare IT projects will be deferred for the next 2 years, and the end result will be no cost savings (coding costs are likely to increase 50%), no quality improvement, no increased safety, and no efficiency gains. If we complete the ICD-10 project on time, no one will notice, but customers will all be angry at the IT department (and the CIO) for the work on other projects that was deferred.
3. Vendor Product Quality – over the past year, I’ve had several bad experiences with infrastructure and application vendors which delivered products that did not have the reliability, security, or performance promised. Why?
* the pace of innovation is so fast, that time for quality assurance is diminished
* the economy has stressed companies and they are focused on making as many sales as fast as they can while controlling development and support costs
* the end result is less satisfied customers
Republican presidential frontrunner Mitt Romney has pledged to end “Obamacare.” Upon taking office, he would immediately begin the process by granting the states waivers from having to implement it:
“I’ll grant a waiver on Day One to get repeal started. On Day One, granting a waiver for all 50 states doesn’t stop it in its tracks entirely. That’s why I also say we have to repeal Obamacare, and I will do that on Day Two, with a reconciliation bill [requiring only 51 votes in the Senate] because as you know, it was passed by reconciliation with 51 votes.”
Romney appears to be on thin ground in making his waiver promise and his promise to use reconciliation to stop “Obamacare” could lead to chaos in the market and among consumers.
The waiver promised is based on a provision in the law authored by Senator Ron Wyden (D-OR). Wyden’s provision was designed to allow states to petition the feds to opt out of the new health care law by taking the federal money that was going to be spent in their state under the Affordable Care Act and draft a comprehensive plan of their own that covered at least as many people as well as the Affordable Care Act would have.Continue reading…
Much of the national press took a pass last week on another important “study says” story out of Massachusetts. This is the second time in the last month where the national media missed a story with implications for the success of health reform. The latest report, which came from the Harvard School of Public Health and the Blue Cross Blue Shield of Massachusetts Foundation, showed that Massachusetts residents have different views about what’s causing the high prices of medical care than do the state and national policy wonks who are framing the solutions. What a surprise! We have repeatedly reported that the public is disconnected from what the pols are saying. Why should we be astonished they are not in step with the policy community?
The study, says lead researcher Dr. Robert Blendon, found that the public generally believes the cost problem stems from excessive charges by drug companies, insurers, and hospitals. Why not doctors? “Doctors have managed to present a picture in the state that they are not the reason why costs are rising. It speaks to the efficacy of the physicians’ campaign that their fees are not high enough,” Blendon told me. Indeed, doctors around the country have mounted local media campaigns to build their case that Medicare’s fee cuts will result in patients not getting care. Furthermore, the state media have focused mostly on the duel between hospitals and insurers, and that’s the message the public has received.
Like a tragic literary figure, the 11th Circuit’s opinion declaring the individual mandate unconstitutional is doomed to failure by its own internal contradictions. What follows is a series of quotes directly from the opinion, paired to show how desperately the majority twisted logic in order to find its path to a unsupportable conclusion:
1. On the key necessary and proper argument, the court obfuscated as follows:
The government’s argument derives from a Commerce Clause doctrine of recent  vintage: . . . the “essential part of a larger regulation of economic activity” language in Lopez. . . . Raich [is the] the only instance in which a statute has been sustained by the larger regulatory scheme doctrine.
HOWEVER, the court was well aware that
The Supreme Court’s most definitive statement of the Necessary and Proper Clause’s function remains Chief Justice Marshall’s articulation in McCulloch v.Maryland: 17 U.S. (4 Wheat.) 316, 421 (1819).
I like to view myself as an optimist, but two recent reports demonstrate the danger of misplaced or premature optimism. I fear that they are influenced by what the authors hope will be the case rather than what has proven to be the case. I find this generally to be the situation in the health care arena, where public policy is often based on shallow interpretations of data and on people’s political wishes rather than rigorous analysis.
The first comes from Karen Davis at the Commonwealth Fund, in a blog post entitled, “Health Spending Continues to Moderate, Cost of Reform Overestimated.” We should know from the title alone that the conclusions cannot be accurate: It is just too soon to reach them. It would be like drawing a picture of climate change from one year of data about temperatures.
Here’s an excerpt:
A recent report from the Centers for Medicare and Medicaid Services (CMS) shows that national health spending grew at a historically low rate of 3.9 percent in 2010, almost paralleling the 3.8 percent increase in our gross domestic product (GDP) last year. This is . . . good news for the federal government as the slowdown indicates that the cost of health reform has been overestimated.
Now, let’s look at the possible reasons:
First . . . continuing declines in employment and private health insurance coverage have contributed to fewer people receiving both essential and nonessential treatment. [F]ewer people have received needed preventive and acute care. And people have increasingly gone without prescriptions, tests, and elective procedures.
The 2010 health care law, the Patient Protection and Affordable Care Act (PPACA), hits small business with a barrage of inequities. Among the most egregious is the health insurance tax (HIT) launched by the law’s Section 9010. Ostensibly a tax on insurers, its real effect will be hundreds of billions of dollars of taxation on people who purchase coverage in the fully-insured market – mostly small business employers and employees and the self-employed. These are the people who usually generate around two-thirds of America’s new jobs.
In contrast, the HIT bypasses those who have coverage through self-insured plans – mostly big business, labor unions, and governments. Like PPACA’s essential health benefits and longstanding state benefit mandates, the HIT puts an anchor around the neck of small business while leaving larger organizations free to swim unburdened. And the anchor is a heavy one.
Over the first decade, the HIT will hit the fully-insured market with an estimated $87.4 billion tab, but that figure greatly understates the long-run financial impact. The tax is not implemented until the fourth year of the decade (2014) and is only fully implemented in 2018. The tax rises from $8 billion in 2014 to $14.3 billion in 2018 and in later years, even higher according to a complex (and at this point opaque) index, discussed below.
To put this in perspective, that $14.3 billion equals around 15 percent of the total small business expenditures on employee benefits in 2007. According to IRS data, proprietorships, partnerships, and corporations with up to $10 million in annual receipts deducted $96.8 billion that year for Employee Benefit Programs. An extra 15 percent or so constitutes an enormous blow to the ability of small businesses to compete against larger entities.
The HIT’s full magnitude will only become apparent in the second decade (2021-2030), when businesses and consumers experience 10 years of a premium-indexed, fully-implemented HIT. The second-decade cost is difficult to forecast, but may exceed $200 billion or even $300 billion. It all depends on how rapidly the law’s arcane index lifts the HIT beyond its $14.3 billion base in later years. There are two major sources of uncertainty in that index.Continue reading…
For a lawyer, the argument of Florida v. the Department of Health and Human Services before a three judge panel of the Eleventh Circuit Federal Court of Appeals on Wednesday, June 8, was a beauty to behold. (For a non-lawyer it was probably tedious, repetitive, and much too long). Three active and very well-prepared judges spent two and a half hours grilling three very talented lawyers about intricacies of health policy and constitutional law, rarely allowing the lawyers time to finish a thought before interrupting with yet another question.
This is arguably the most important of the many Affordable Care Act (ACA) challenges currently pending in the courts. The plaintiffs include over half of the states, as well as the National Federation of Independent Businesses (NFIB) and two individual plaintiffs. It is one of only two cases in which a part of the ACA has been held unconstitutional (out of over thirty cases that have been filed), and it is the only case in which the lower court struck down the entire statute as unconstitutional. Thirty-six amicus briefs were submitted to the appellate court, including briefs filed by professional and provider organizations, members of Congress, states and state legislators (on both sides), Nobel Prize winning economists, law professors, disease and consumer organizations, and just about every conservative advocacy group in the country.
The attorneys. The importance of the case is underlined by the fact that the federal government was represented by Acting Solicitor General Neal Katyal, while the states were represented by Paul Clement, Solicitor General under the Bush administration, perhaps the first time two solicitor generals have squared off against each other in a court of appeals argument. (The NFIB was represented by a third well-known lawyer, Michael Carvin).