Cost

Can health reform heal our federal budget? Yes, but whatever passes now is just the beginning, and there will always be room for improvement.

That's our takeaway from an excellent event we tweeted this morning hosted by the US Budget Watch, a joint project between the Committee for a Responsible Federal Budget and The Pew Charitable Trusts.

There was a lot of ground covered by a panel of experts moderated by the Washington Post's Ceci Connolly and featuring New America's director of health policy Len Nichols. They tackled everything from raising Medicaid eligibility rates to fixing the Sustainable Growth Rate formula in a fiscally responsible way. But for now, we'll just give you the highlights of the discussion.

Last night, the Congressional Budget Office released a preliminary analysis of the House Republican health care bill. The bill focuses mostly on cost and repackages a lot of the conservative ideas that have been around for years (and never came to fruition even while Republicans held the torch.)

According to the CBO, by 2019, the Republican bill would only extend health coverage to three million more Americans and reduce the federal deficit by $68 billion. In comparison, by 2019, the House Democratic bill would insure 36 million more Americans and reduce the federal deficit by $104 billion.

In case you missed the ‘Space' section of your daily paper a few months ago, two planets -- one the size of Mercury and one the size of our Moon -- collided in a far off solar system.  The smaller planet went the way of Alderaan. The larger planet suffered a big dent.

My own worlds collided this week when former-professor-in-my-department Kelly Devers teamed up with my former boss (on a research project) and friend-of-the-blog Robert Berenson to publish a thoughtful critique of the panacea fever surrounding Accountable Care Organizations (ACOs).  As much as we have trumpeted ACOs as the best cure-all since Clark Stanley's Snake Oil Liniment, Drs. Devers and Berenson's thoughtful analysis published by RWJF is a welcome contribution to the dialogue.

Ceci Connolly at the Washington Post asks the $64,000 question -- or maybe it's more of a $6.4 trillion question. Do the House and Senate health care bills go far enough in reshaping how we deliver health care so that we can control rising costs?

A lot of experts, she notes, see the approach as too timid by far.

"The bills are directionally correct, but they're not going far enough," said George Halvorson, chairman and chief executive of Kaiser Permanente and the author of "Health Care Will Not Reform Itself."

(We are refiling this post to make the paragraph about the SEC a little clearer for our readers.)

"The American people and I are asking a serious question and one that deserves a straight answer -- why are health insurance costs going up each year?" Sen. Jay Rockefeller (D-WV) questioned in a letter (part 1 and part 2) to H. Edward Hanway, the CEO of CIGNA, yesterday. "Are they spending it to make people well when they are sick and keep them healthy? Or is the money they charge going to profits, to executive salaries, and to figuring out how to deny care to people when they really need it?"

Sen. Rockefeller explains:

An early draft of the House Republicans' health care bill is available at BNA. The Republican bill is much more limited in scope than the current House health reform bill, and is focused primarily on cost -- which represents only one aspect of the problems plaguing our current health care system.The bill repackages a lot of the conservative ideas that have been floating around for years -- and which didn't even get enacted when the Republicans were in control of Congress and the White House.

The bill will not end insurance company discrimination against high risk individuals nor will it provide subsidies to help the uninsured purchase coverage, according to Politico:

Boehner hasn't released the full details of the bill but has said that it would make it easier to buy insurance across state lines, impose strict limits on medical malpractice lawsuits and allow individuals and small businesses to pool their resources to buy insurance as a group. That is designed to boost their purchasing power to help lower individual premiums.

(Reposting to fix a typo in a Brendan Borrell's name)

A few good reads from this week that we didn't have time to blog about (some travel, two magazine deadlines and Halloween costumes to prepare) but still wanted to share:

Reuters Health, under the relatively new direction of Ivan Oransky, has an investigative piece by Brendan Borrell looking at some of the intrigue and controversy surrounding a couple that has to a certain extent become the face of the growing medical tourism industry.

Kaiser Health News' Julie Appleby (expanding on and explaining some fine analysis by the Center on Budget and Policy Priorities) raises some concerns about affordability under the Finance Bill.  She writes:

Proponents of the Senate Finance Committee's health care bill say the legislation will limit the amount that lower- and middle-income people must pay for health insurance to a maximum of 12 percent of their incomes.

Would you pay $4,000 for a knee brace, shoulder brace, and a heating pad? Would you pay for physical therapy for an imaginary person? How about two knee braces for a patient with only one leg? Probably not -- which is exactly why federal prosecutors are cracking down on fraud and abuse in Medicare and Medicaid.

How much of health care spending consists of fraud and abuse? And what can we do to stop it? These questions were the focus of a Senate Judiciary Committee hearing, "Effective Strategies for Preventing Health Care Fraud."

Deputy HHS Secretary Bill Corr and Assistant Attorney General Tony West testified about their departments' joint task force on health care fraud. The National Health Care Anti-Fraud Association estimates that fraud makes up about three percent of total health care expenditures (more than $60 billion a year). Other estimates go even higher.

Senate Majority Leader Harry Reid's decision to include a public plan with state opt-out in the Senate bill may have made the headlines this week, but Christina Romer's remarks Monday may tell us more about what's next for health reform

Speaking at the Center for American Progress, the chair of the Council of Economic Advisers highlighted the importance of health reform to our nation's fiscal future. (Full text of her remarks here). In particular, Romer gave a strong endorsement of the excise high value health insurance plans:

Getting professionals to work together can be hard. Take Washington's football team, for example. All the players are paid by the same owner. Yet they can't seem to get a win.

USA Today/Kaiser Health News featured a story this week on how to get physicians and hospitals to work together. Featuring Tulsa, Oklahoma's Hillcrest Medical Center, the story explores the new Medicare Acute Care Episode (ACE) Demonstration Project and its effect on providers and patients. Hillcrest, a for-profit hospital owned by the Ardent chain, receives a global or "bundled" payment for certain Medicare services. Then -- in line with previously negotiated arrangements -- it pays physicians from the global payment funds. The idea is to encourage coordination of care between physicians and hospitals, which (due to a relic of history) traditionally recieve not only separate payments but from separate Medicare funding streams (part A for hospitals, B for doctors).