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Recommendations for U.S. Health Care System Overhaul (MC)

Kaiser Daily Health Policy Report

Coverage & Access|Health Reform Dialogue Coalition Releases Recommendations for U.S. Health Care System Overhaul

[Mar 30, 2009]

A coalition representing health care firms, patients and medical providers on Friday presented a five-page report to Congress recommending changes to the health care system, CQ HealthBeat reports (Adams, CQ HealthBeat, 3/27). The report from the 18-member group, known as Health Reform Dialogue, called on lawmakers to complete health reform this year, maintain the employer-sponsored coverage system and make coverage available to everyone (Young, The Hill, 3/27). According to the Wall Street Journal’s "Washington Wire," the group "sidestepped the thorniest issues, such as whether individuals or employers should be required to buy or offer coverage, and whether a government-run health plan should be available to compete with private companies" (Meckler, "Washington Wire," Wall Street Journal, 3/27).

The group did not explicitly call for a requirement that all U.S. residents obtain health insurance, but it said that Congress should "enact reforms necessary so that all individuals will purchase or obtain quality, affordable health insurance" (Alonso-Zaldivar, AP/Miami Herald, 3/27). The group called for expanding income eligibility levels for Medicaid, providing tax credits for more affordable coverage and removing Medicaid restrictions on documented immigrants (Budoff Brown, Politico, 3/27). In addition, the report recommended creating a "fair and transparent marketplace" for buying insurance ("Washington Wire," Wall Street Journal, 3/27). The coalition also recommended promoting prevention and wellness, as well as increasing the efficiency of health care delivery, as a way to improve overall health and reduce costs.

According to Politico, the coalition met over six months, and discussions were overseen by a conflict mediator, which represented a "break from the past, when interest groups worked at odds" (Politico, 3/27). However, according to The Hill, the report "did not resolve the major bones of contention." The report stated, "This health reform dialogue was never intended to cover every issue likely to arise as health reform is considered in the ensuing months. Some issues currently elude consensus" (The Hill, 3/27).

Two members of the group representing union workers, the Service Employees International Union and the American Federation of State, County and Municipal Employees, refused to sign the final report on the grounds that it did not contain explicit support for a new public insurance option. A statement from the coalition stated, "The unions were very involved with process, and this final document reflects a lot of their input" (Politico, 3/27).
Healthcare Leadership Council President Mary Grealy said, "I think what this [report] represents are some tough choices and some very tough consensus, adding, "It tells Congress: Here are some very important components for health care reform that you can now be assured have widespread agreement" (AP/Miami Herald, 3/27). Pharmaceutical Research and Manufacturers of America President Bill Tauzin said the report is a "historic achievement and an important step forward in helping to get a compromise health reform package on the president’s desk this year" (CQ HealthBeat, 3/27).

However, another participant in the discussions, who spoke on the condition of anonymity, said the group’s recommendations were "[a] day late and a dollar short" (Connolly, Washington Post, 3/28). Robert Kirsch, national campaign director of Health Care for America Now, said, "They’ve moved the health care debate forward a few inches (AP/Miami Herald, 3/27). He added, "After months of discussions the groups that remained in the Health Reform Dialogue could not agree on the tough decisions that Congress and the president must make" (The Hill, 3/27).

According to materials from the coalition, "This report is meant to be progress to date. We’ll keep working with each other inside and outside the political process." Senate Finance Committee Chair Max Baucus (D-Mont.) said, "More voices, more enthusiasm, and more ideas — like the ones announced today — only add to the momentum for achieving comprehensive health reform" (Politico, 3/27). He added, "You can bet I’ll be working closely with these groups" (AP/Miami Herald, 3/27).
Funding an Overhaul
The Senate Budget Committee‘s Thursday approval of a five-year budget resolution that would allow 10 years to offset the cost of health reform shows that "lawmakers are hoping they can find a way to make the health care overhaul pay for itself, even though any substantial savings are likely to take years," the Wall Street Journal reports. Experts estimate that President Obama’s proposed overhaul would cost more than $1 trillion over the next 10 years. Sources of savings that have been suggested include reducing incentives for health care providers to deliver unnecessary care, addressing regional disparities in costs, providing doctors more information about comparative effectiveness of treatments and promoting prevention (McKinnon/Bendavid, Wall Street Journal, 3/27).

According to the Los Angeles Times, Democratic and Republican lawmakers "are expressing increasing openness to an idea that once seemed unthinkable: putting taxes on some health care benefits." Proponents of such a change say that the exemption is unfair because those who purchase their own insurance are taxed. Opponents of repealing the exemption say it would endanger the employer-based system that most U.S. residents rely on for coverage. The tax break for this coverage amounted to $246 billion in potential tax revenues in 2007, according to the Joint Committee on Taxation. House Energy and Commerce Committee Chair Henry Waxman (D-Calif.) said, "Members of Congress are seriously looking at the way health insurance is handled for tax purposes" (Levey, Los Angeles Times, 3/28).

Meanwhile, Senate Budget Committee Chair Kent Conrad (D-N.D.) on Sunday said that energy taxes are an "option" for funding health care reform, but did not specify further. He added that he and House Budget Committee Chair John Spratt (D-S.C.) have "given maximum opportunity for the committees of jurisdiction, maximum flexibility to write major health care reform and to pay for it" (Alarkon, The Hill, 3/29).
Baucus on Friday said health care legislation he is working on with Senate Finance Committee ranking member Chuck Grassley (R-Iowa) likely would encourage public-private partnerships and attempt to discourage wasteful practices and overcharging of patients. The lawmakers hope to mark up a health care overhaul bill in June and have it ready for a floor vote by August. Baucus also said he would not support the use of the budget reconciliation process to pass the bill in the Senate, which would require only 51 votes to defeat a filibuster (Lee, CongressDaily, 3/27).

House Majority Leader Steny Hoyer (D-Md.) on Thursday also announced his intention to a have a bill approved by the chamber before the August recess and expressed his opposition to the use of the reconciliation process (O’Connor, Pittsburgh Post-Gazette, 3/27).

  • Des Moines Register: The health insurance industry — in its "latest attempt … to head off the creation of a public plan" — has proposed to stop varying premiums based on the health status of members if lawmakers require all U.S. residents to obtain coverage, a Register editorial states. According to the editorial, requiring all people to obtain coverage "is a bad idea" in part because it "won’t hold down health care costs, … would require strict government mandates for insurance companies," and "moves the country in the wrong direction." The editorial continues, "The truth is a public insurance program could offer comprehensive coverage with lower administrative costs" (Des Moines Register, 3/30).
  • Virginian Pilot: President Obama’s "decision to let Congress work out most of the details of a health care reform plan was an acknowledgment that some of his campaign ideals may need to be tempered by economic and political realities," including his opposition to taxing employee health benefits, a Pilot editorial states. In terms of plans to overhaul the U.S. health care system, there are currently "more questions than answers," regarding individual mandates, employer requirements, public pools for the uninsurable and the cost of such an overhaul plan, according to the Pilot. The editorial continues, "Obama should pay close attention to alternatives being tested in Massachusetts," which since implementing the Massachusetts health insurance law in 2006 has reduced its uninsured population to 2.6%, although the state is "struggling with rising costs and recessionary pressures" (Virginian Pilot, 3/30).

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