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Earth to Republicans: You Are In Big Political Trouble Over the Ryan Medicare Plan

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By ROBERT LASZEWSKI

It should now be clear to Republicans they are in trouble over the Ryan Medicare plan.

Yesterday, they lost a seat in a solid Republican New York House district. Their candidate had benefited from lots of money and House leadership attention. The big issue was the Ryan Medicare plan.

All month, Republican Presidential candidates have been walking a tightrope over the Ryan plan–don’t embrace it but don’t criticize it either for fear of offending the base who will drive the primary outcomes next year. You only had to watch the Gingrich implosion to see what happens if you fall off that tightrope.

Next the Senate will take up the Ryan budget. Senate Democrats can’t wait for a vote on it and are making the Ryan Medicare plan the central issue. Already, at least three Senate Republicans have said they will not vote for the House budget over the Medicare issue. Leader McConnell, sensitive to its political vulnerability, has told Senators they are free to vote their conscience on this one.Continue reading…

There Aren’t Enough Rich People To Pay For Medicare And Medicaid

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By ROBERT LASZEWSKI

I hear more and more of my progressive friends arguing, in the context of deficit reduction, that we should be raising taxes before getting aggressive about reducing the cost of Medicare and Medicaid — as well as Social Security.

To a point, I agree.

This country is in such a hole that it is senseless to deny that at least some new taxes will be needed to pay for all of the nation’s bailouts and accumulated debts.

For instance, progressives would like to end the $1 trillion cost over ten years of the Bush tax cuts for those making more than $250,000 a year.

I also believe that ending those tax cuts is necessary.

But if you’re looking to better understand the budget policy choices we face, I highly recommend the March 2011 Congressional Budget Office study, “Reducing the Deficit: Spending and Revenue Options.” The CBO prices out about all of the budget options.Continue reading…

Why ACOs Won’t Work

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By ROBERT LASZEWSKI

First, I think Accountable Care Organizations (ACOs) are a great idea. Just like I thought HMOs were a good idea in 1988 and I thought IPAs were a good idea in 1994.

The whole notion of making providers accountable for balancing cost, medical necessity, appropriateness of care, and quality just has to be the answer.

But here’s the problem with ACOs: They are a tool in a big tool box of care and cost management tools but, like all of the other tools over the years like HMOs and IPAs, they won’t be used as they were intended because everybody—providers and insurers—can make more money in the existing so far limitless fee-for-service system.

I see the $2.5 trillion American health care system as a giant health care industrial complex. It just grows on itself and sucks in more and more money. Why not? The bigger it gets the more money we give it.

How do you make it efficient? You change the game. You can’t let it any longer make money just getting bigger. The new game has to be one that only pays out a profit for results—better care for a budget the country can live with. There are lots of tools available to do that. ACOs, capitated HMOs, IPAs, disease management, enormous data mines, Electronic Patient Data Systems, and so on.

But, here’s the rub. There isn’t a lot of incentive for payers and providers to do more than talk about these things and actually make these tools work. Right now they can just make lots more money off the fee-for-service system. They demand more money and employers and government and consumers are willing to just dump more money into the system. Sure they complain about it but they just keep doing it.Continue reading…

Plan B, Mr. President?

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By ROBERT LASZEWSKI

Robert LaszewskiAs the State of the Union approaches Democrats are considering their health care policy options. There are lots of reports about “Plan B”—pushing through the Senate bill with a parallel corrections bill that could be passed in the Senate using reconciliation rules.

That’s as dead as the original House and Senate health care bills. Moderate Democrats have no stomach for such a legislative stunt in the face of Massachusetts and bad health care polls. Many liberals even question that strategy.

Everyone is awaiting this week’s State of the Union speech. Will the President:

  1. Embrace the call by many on the left to Democrat-up and just ram it through?
  2. Call for a scaled back bill built around modest and popular first steps that could attract bipartisan support?
  3. Just jabber in a way no one can figure out which course he really supports?

My bet is on number three.

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The Outlook for a Health Reform Bill in 2009

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CongressReaders know of my year long pessimism over our getting a trillion dollar health care bill in 2009.

With the historic passage of the House bill, are we now on our way to a big health care bill in 2009—or even by early 2010? Clearly, Democrats desperately want to pass a bill. Given their compromise over abortion and the neutering of the public option in the House legislation—things most liberals said they would never agree to—it is clear the Democratic leadership will take any deal they can get.

But there are still some giant obstacles on the way to a Rose Garden bill signing late this year or early next:

  1. Getting and keeping 60 Senate votes across a wide spectrum of complex issues. Senate Majority Leader Reid has not achieved a 60-vote consensus on any of the dozen or more contentious issues. In the wake of Pelosi not being able to get more than a two-vote margin for the neutered public option, some Democratic Senators will have no interest in the “robust” version with the state opt-out Reid has been talking about. He has made even less progress on all of the other contentious issues–and you can put abortion on the top of that list. Figuring out the “sweet spot” on each issue that keeps the same 60 votes on side for the entire bill would take a super computer—if that were even possible. The growing angst over these health bills not bending any cost curves and actually getting the savings from Medicare that is projected. With the demise of the robust public option even a lot of “sympathetic voices” are having second thoughts. How many op-eds and editorials can you have announcing this is not health care reform and it is likely to continue adding to deficits before everyone wants out?The latest blow was the report from the CMS actuary that says Medicare beneficiaries will suffer from the program cuts in the bills and health care costs will more likely continue to add to the deficits. I expect opponents are cutting new ads using the CMS report against the Democratic bills at this moment.
  2. The polls are still showing opposition well ahead of support for the Democratic bills. Pollster.com combines a number of polls finding 42.5% favor and 48.6% oppose. How do you pass so big a piece of legislation with approval ratings in the 40% range?

    3. If Reid finds a way to keep 60 Senators onside it will be an example of a political master performance. If he fails it will be the more likely outcome.

    More than anything else, I sense a rising tide of anxiety particularly among people who understand this issue and want a health care bill: Somewhere we lost our way on the road to health care reform and we now find ourselves headed to an entitlement bill that falls far short of achieving universal access and a bill we still can’t afford. This will eventually spill over to mainstream voters already anxious about a trillion dollars in new spending in the midst of an economic crisis.

    That is not the place Democrats would have wanted to be just when they need to overcome what would have been stiff resistance under the best of all circumstances.

    Robert Laszweski has been a fixture in Washington health policy circles for the better part of three decades. He currently serves as the president of Health Policy and Strategy Associates of Alexandria, Virginia. Before forming HPSA in 1992, Robert served as the COO, Group Markets, for the Liberty Mutual Insurance Company. You can read more of his thoughtful analysis of healthcare industry trends at The Health Policy and Marketplace Blog, where this post first appeared.

    Continue reading…

What Voters Really Think About Evidence-Based Health Care

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By ROBERT LASZEWSKICampaign for Effective Patient Care

I want to call your attention to an important survey done by the California-based Campaign for Effective Patient Care. They surveyed California voters on their understanding of evidence-based medicine.The bad news is that patients think their health care treatment is generally evidence-based even though that assumption is highly questionable. The good news is that patients want it to be evidence-based.At a time when we hear anecdotal evidence, particularly from town hall meetings, that people don't want any "interference" between them and their doctors they do seem to appreciate they need to get all of the facts when making a treatment decision.Here is the survey summary. You can access all of it here.

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Health Reform Bills Would Be Great For the Business Of Health Care

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By ROBERT LASZEWSKI

Editors Note:  This piece by veteran THCB contributor, Robert Laszewski, first appeared on Kaiser Health News. The piece is republished here with permission.

Democrats-cap-and-trade-bill-house-renewable Have you noticed how none of the big health care business special
interests is running any negative health care reform ads? Why should
they when each is poised to gain billions of dollars from it?

As
President Barack Obama has said many times, any health care bill that
costs about $1 trillion would be paid for, roughly half and half, with
savings in the health care system and new revenues (taxes).

All
told, health care providers will likely get hit by $500 billion in
federal payment reductions over 10 years from what they would have
received otherwise. This is their "savings" contribution to help pay
for the overhaul effort. It amounts to no more than a couple of
percentage points less than they would have received anyway.

But
more importantly, the Congress is getting ready to spend $1 trillion
over the same 10 years mostly to expand Medicaid and provide subsidies
to the uninsured to help them purchase private health insurance and be
able to pay their medical bills. The health industry, by giving up $500
billion, gets millions more patients armed with public and private
health insurance cards. Not a bad deal—particularly when the other $500
billion needed to finance the bill comes from new levies on taxpayers,
not bigger industry cuts.

The details show an even prettier picture for the business of health care.

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There Will Not Be Health Care Reform in 2009…

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By ROBERT LASZEWSKI

…without Republican leadership.

I will suggest that there is an opportunity for the Republicans to
score a huge political and policy win. It can be done in a bipartisan
way and it can be done in a way that does not sell out the core
principles that either Republicans or Democrats believe in.It would require a new effort—a clean sheet—this time initiated by the Republicans.The
Republicans have won August. No doubt about it. But they have “won,”
not because they actually did anything to deserve the win—they pretty
much sat back and let political gravity do all of the work.Now what? Do Republicans really think they can sit back and do nothing for three or four more months and come out “winners?”At this rate, this health care debate is headed for a stalemate that will not do the country, nor either party, any good.

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Ditching the Public Option

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By ROBERT LASZEWSKI

6a00d8341c909d53ef01157023e340970b-pi It looks to me like the popular objections to a health care bill being expressed by voters this month are concentrated in two primary areas:  

  1. A concern about “government control of the health care system”—mostly around the public plan option.
  2. The trillion-dollar cost of a health care bill at a time deficits are swelling and worries about who will really end up paying for it.

As a result of the first concern, we are getting the first indications that some Democratic leaders are ready to ditch the robust Medicare-like public option and are beginning the process of talking the party out of demanding it be included in a health care bill.

This from Politico today:

After the toughest week yet for health reform, leading Democrats are warning that the party likely will have to accept major compromises to get a bill passed this year – perhaps even dropping a proposal to create a government-run plan that is almost an article of faith among some liberals…"Trying to hold the president's feet to the fire is fine, but first we have to win the big argument," former President Bill Clinton said Thursday at the Netroots Nation convention, a gathering of liberal activists and bloggers who will prove most difficult to convince. "I am pleading with you. It is OK with me if you want to keep everybody honest. . . .But try to keep this thing in the lane of getting something done. We need to pass a bill and move this thing forward."

It has been clear to me for months, and I have been saying so on this blog, that the public option has not had the votes even among Democrats to make the finals. With all the heat “a government takeover” of health care has attracted from those at the town hall meetings either the Democrats ditch it or get used to the idea they have no chance of passing health care reform.

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Health Care Reform Coming Out of Senate Finance?

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By ROBERT LASZEWSKIBaucusgrassley110th

We’ve been getting lots of news these past few days leading to optimism that a bipartisan health care bill will soon emerge from discussions between the “Coalition of the Willing.” That term refers to the three Republicans and three Democrats trying to find common ground in the Senate Finance Committee.First, let me be clear that I have the greatest respect for Senators Baucus and Grassley and their four colleagues. Theirs is the kind of bipartisan approach that all of Washington, DC should be following on any number of issues.And, as I have posted here before, I am concerned that in their efforts to find compromise they are headed for a health care bill that is based on a formula of cost containment “lite,” minor paring of Medicare and Medicaid provider payments, and at least $500 billion in new taxes. I don’t see much changing fiscally if that is the final result in a health care system that is already unsustainable and on the way to spending upwards of $35 trillion to $40 trillion over the next ten years as it goes to 22% of GDP by 2018.From what we have heard, their bill would hardly "bend" any curves.

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