Hyper-Partisan Politics Surrounding Obamacare Suggest Not
Bipartisan Policy Center (Photo credit: Wikipedia)
The latest issue of The New England Journal of Medicine has an interesting post-Obamacare report from the Bipartisan Policy Center. It’s optimistically entitled “Prescription for Patient-Centered Care and Cost Containment”.
It’s optimistic because of the initial favorable responses it’s received from both sides of the political aisle. Its authors presume this presages a favorable bipartisan legislative response capturing its most salient measures to achieve the true healthcare reform to which Obamacare only opens the door.
While it’s possible it could be packaged for Republicans as fixing Obamacare’s flaws, that would require a sincere interest in doing just that. The endless symbolic House votes to repeal Obamacare, however, suggest otherwise.
House Majority Leader Eric Cantor (R – Va.) confirmed this with his comment just yesterday that “The best delay for Obamacare is a permanent one”.
Giving the President anything that could remotely be construed as enhancing his signature healthcare initiative just isn’t very likely in our super-charged political environment. There’s far greater interest in fabricating White House scandals than legitimately governing in the public interest.
Which is too bad, because the measures being proposed by this panel – led by former legislators Tom Daschle, Pete Dominici and Dr. William Frist and former cabinet member and economist Alice Rivlin, PhD – represent a reasoned and balanced approach to picking up where Obamacare leaves off.
There is, after all, much work still to be done. Despite Obamcare, America’s healthcare system remains far from the efficient and effective vehicle for delivering healthcare – and maintaining health – that we need for our long-term fiscal and physical health as a nation (see Our Healthcare Sucks for more on this).
If only the Bipartisan Policy Center’s hard work to achieve that vision had even the slightest chance of seeing the legislative light of day.
What Are They Proposing?
Their complex set of proposals fall into three main categories: Medicare reforms, tax policy reforms, and prioritizing quality, prevention and wellness. Let’s take a quick look at what healthcare policy might look like if we were free of the political grandstanding that now dominates Washington politics to a degree unknown in our recent political history.
The Medicare reforms being proposed address all three major players – providers, insurers and beneficiaries/patients. The proposed reforms include improving on the Accountable Care Organization (ACO) model with so-called “Medicare Networks“. These would replace the much-maligned Sustainable Growth Rate (SGR) formula for Medicare payments to doctors with an improved fee-for-service payment system.
Replacing fee-for-service payments altogether should be the ultimate goal for rationalizing our healthcare system. Removing its incentives to perform more medical interventions than are needed is the best course to reduce the third or more of our healthcare costs that serve no legitimate purpose. The Bipartisan Policy Center’s suggestions, however, may be the next best thing.
In short, they’d significantly improve the current fee-for-service system by increasing competitive bidding, bundling services, and increasing accountability and affordability through their proposed Medicare Networks. Medicare beneficiaries would get reduced premiums for joining such coordinated networks, sharing in the savings with their medical providers. Current Medicare fee-for-service payments would be frozen to motivate doctors and hospitals to participate in the new Medicare Networks.
The entirely reasonable premise behind this approach is that better, more coordinated care will reduce healthcare spending growth – much of which is due to our current disorganized and highly fragmented delivery system.
A second Medicare reform would increase competitive bidding among Medicare Advantage insurance plans. Rather than their current focus on adding extra benefits that increase costs, insurers would bid on standard Medicare benefit packages based solely on price. This would be phased in over time to protect beneficiaries from any abuses that might otherwise ensue during such a transition to a more value-driven insurance model.
A third set of Medicare reforms would rationalize beneficiaries’ Medicare coverage. These would reduce subsidies for high-income beneficiaries while enhancing them for low-income beneficiaries. They’d also simplify deductibles with a single annual deductible and increase protections to avoid catastrophic medical costs. First dollar coverage, now common with supplemental Medicare plans, would be eliminated to reduce their inflationary impact on medical utilization (i.e., when there’s no added cost for medical care, people often seek more than they need).
Taken together, these measures would spread the burden of reforms among all affected parties. They’d also impose a much more value-driven and coordinated modus operandi on our healthcare system than our current volume-driven system in which a third or more of our over-priced medical care isn’t needed in the first place.
And Beyond Medicare?
Private sector healthcare in America would also see significant changes through tax policy reforms. These are intended to replace the current “Cadillac tax” on gold-plated health insurance plans for highly-paid corporate executives with limits on corporate tax exclusions for employer-sponsored health insurance. The idea is to make current tax exclusions less regressive by capping them at 80% of employer-sponsored premiums and to remove the current preferential treatment given to self-insured corporate plans.
The net effect would be to encourage private insurance plans to also adopt alternatives to fee-for-service payments that now drive our medical overuse.
A second and crucial private sector initiative would be to clarify and enforce laws and regulations governing consolidation of providers and insurers. This trend is accelerating as Obamacare is further implemented and threatens to thwart any cost-savings it might otherwise produce. That’s because the bigger and stronger provider networks that emerge with consolidation of former competitors are better able to dictate prices in their respective medical markets.
This, of course, is anti-competitive. Yet much of healthcare is exempt from federal laws and regulations designed to prevent such anti-competitive practices. Hence the need for such reforms, especially given the accelerating pace of such consolidations across America as the industry girds itself for Obamacare.
Quality, Prevention & Wellness, Oh My!
The third leg of this three-legged post-Obamacare stool has its eye on our longer-term need for better treatment outcomes and prevention measures to reduce demand for medical care. It would do this not with fiscal gimmickry, but via the best means possible – by promoting greater health so less healthcare is needed.
Measures proposed would start by combining coverage for so-called “dual eligibles” (those eligible for both Medicare and Medicaid coverage). These tend to be those with highly complex medical needs that would benefit greatly – care-wise and cost-wise – with a more coordinated approach to their care. The current fragmented federal and state coverage is often inefficient and unnecessarily costly.
Another set of proposals in this category would offer federal financial incentives to states to adopt more coordinated and accountable models of healthcare delivery and payment. This would include strengthening the primary care workforce with more physician extenders – primarily nurse practitioners and physicians’ assistants.
It would also provide legal “safe harbors” to protect physicians who follow clinical best practices from unreasonable malpractice claims. This would reduce their reliance on defensive medicine practices that increase medical spending and often place patients in harm’s way.
And, finally, greater transparency of medical prices and quality outcomes would allow patients and their families to make more informed medical decisions. Better informed consumers are essential to an efficient marketplace of any kind. Nowhere is this more needed than in our healthcare, where this prerequisite for market efficiency remains sorely lacking.
So What’s Not to Like?
Not very much is objectionable in this broadly-cast set of reforms – unless, of course, you have a vested interest in preserving the status quo. They’re intended to take us to a post-Obamacare healthcare system that better addresses our unsustainable medical spending.
Yet they’re unlikely to be enacted any time soon – at least by this observer’s reckoning – mostly because of who might get the credit for them.
The political reality is that Republicans aren’t about to embrace anything that would lessen their ability to demonize Mr. Obama in next year’s mid-term Congressional elections. It’s what inflames their base and is their best shot, they believe, at increasing their legislative stranglehold on all things Obama.
And Obamacare still looms large in the bash Obama sweepstakes.
It’s really as simple – and as sad – as that.
Which means all these proposed measures – meritorious and overdue as they are – will have to await another day, if it ever arrives, when Obamacare is irreversible and the political calculus may again be more favorable.
All of which which leaves us to ponder whether our politics has outlived its usefulness when it so impedes our rational governance.