Amy Sullivan of Time Magazine published an article yesterday counting votes in the House of Representatives on the abortion funding issue.  Her conclusions are summarized below.

     Health care reform passed the House by a vote of 220 to 215.  One Republican voted for the bill and 39 Democrats voted against it.  Furthermore, 64 House Democrats voted in favor of the Stupak Amendment which would require women to purchase separate policies for abortion coverage.  The Senate bill contains language proposed by Senator Nelson which requires the segregation of public and private funding in the purchase of health insurance, with abortion coverage paid for with private funds.  The President's proposal does not mention abotion funding, but it is expected that he would favor the language of the Nelson Amendment.  How many of the 64 representatives who voted for the Stupak Amendment will be willing to vote for the Senate bill or the President's proposal?

     In her Time Magazine article published Wednesday entitled "Could Abortion Still Sink Health Care Reform," Sullivan breaks down the different categories of representatives based upon how they cast their votes on both the Stupak amendment and the final House bill:

Yes on Stupak Amendment, No on the Health Care bill = 23 Democrats, mostly from southern states.  Not only are they pro-life, but they did not like the House bill even with the Stupak Amendment.  Very few, if any, of these representatives are likely to vote for the President's proposal.

Yes on Stupak Amendment, Yes on Health Care bill = 41 Democrats.  Of these, 17 are not members of the House pro-life caucus, and will probably be satisfied with the Nelson language.  Of the remainder, many of them supported Brad Ellsworth's compromise measure that was similar to the Nelson Amendment.  (Brad Ellsworth is a member of this group of 24).  The leadership hopes that several of these representatives will vote for the Senate bill or the President's proposal. 

No on Stupak amendment, No on health care bill = 16 Democrats.  These relatively pro-choice representatives may have voted against the bill because of the inclusion of the Stupak Amendment or because of the inclusion of a public option, and may be willing to vote for a bill that is more moderate on both counts like the Senate bill or the President's proposal.

     If the President can persuade the 16 relatively pro-choice / anti-House bill Representatives in the final group to vote for the Senate bill or for his compromise proposal, and gain the support of at least four more pro-life members such as Representative Ellsworth, the health care reform bill will pass the House.

Visit Professor Huhn's website on health care financing reform for links to information about proposed legislation, studies and reports, public agencies, and private organizations concerned with this issue. 

     President Barack Obama has released his proposal merging the House and Senate health care reform bills and adding some Republican ideas.  Links and analysis below:

     Here is the President's new website called "Putting Americans in Control of Their Health Care."  The President's proposal itself – consisting of a lengthy summary, not legisative language – may be accessed either here at whitehouse.gov or here from Talking Points Memo.  The President's site also contains a description of several Republican-supported ideas that are contained in the final package. 

     The President's proposal retains the principal features of the health care reform bills adopted by the House and Senate.  Individuals will be reuquired to purchase health insurance, and in return health insurers may not turn down persons with pre-existing conditions nor may insurers place annual or lifetime limits on the amount of coverage a person qualifies for.  The bill will create an Exchange for the sale of non-group policies, and the government will have the power to regulate insurance sold through the Exchange.  One new provision – in light of the recent sharp increases in health insurance premiums, the President's proposal would empower both state insurance commissioners or the Secretary of Health and Human Services to determine whether increases in insurance premiums are justified.

     On the revenue side, the President reduces reliance on taxing expensive health insurance plans (the approach taken in the Senate bill) in favor of increasing the Medicare tax on persons earning over $200,000 annually – and it extends that tax for the first time to persons receiving unearned income (interest, dividends, and the like).

      Here are the other principal changes that the President has made in reconciling the House and Senate bills:

1.  The President reconciled the differing schedules in the House and Senate bills for government reimbursement for health care.  Families earning less than $88,000 annually will qualify for tax credits to help pay for health insurance purchased through the non-group market;

2.  The President's proposal closes the "donut hole" for prescription drugs under Medicare by the year 2020;

3.  The President would allocate $11 billion more than current law for community health centers over the next ten years – this splits the difference between the House and Senate bills;

4.  Like the Senate bill, the President's proposal does not contain an employer mandate but it does increase the penalty on employers who do not.  Businesses with fewer than 50 employees do not have to provide health insurance, and businesses with more than 50 employees will have to either provide health insurance  or pay a fine of $2000 per employee.  The President's proposal allocates $40 billion in tax credits to encourage employers to provide health insurance for their employees.

5.  Persons who earn more than $200,000 annually in passive income (dividends, interest, annuities, royalties, or rents) will have to pay a tax of 2.9% which will be contributed to the Supplemental Medical Insurance Fund.

     The President's proposal largely merges the House and Senate bills.  Like Democrats in Congress, the President has decided to address the problems of cost, access, and quality of medical care by enacting an individual mandate and publicly-subsidized purchase of private health insurance.  I see nothing in the President's proposal that will ameliorate Republican opposition to the bill.  If this package is not enacted as a whole, I predict that significant portions of it will be enacted separately.  But let's see what happens at the bipartisan health care summit on Thursday!

Visit Professor Huhn's website on Health Care Financing Reform for information about proposed legislation, studies and reports, advocacy organizations, and more.

     Following reports of Wellpoint's 39% increase for individual health insurance coverae in California comes news of even larger increases in other states – up to 56%, according to this article by Ricardo Alonso-Zalvidar of the Associated Press.  Which way will this cut in the current debate over health care reform?

     According to Alonso-Zalvidar:

Proposed premium increases of as much as 39 percent by WellPoint's Anthem Blue Cross in California set off a wave of criticism and forced the company last week to announce a postponement. President Barack Obama seized on Anthem as Exhibit A to make his case for sweeping change before a bipartisan White House health summit next week. California officials said more than 700,000 households face increases averaging 25 percent overall and as high as 39 percent for some.

In a briefing for reporters, WellPoint executives blamed their rate increases on rising medical costs and a pool of customers that is gradually becoming older and sicker, as younger, healthier people drop coverage. They insisted that their competitors are raising rates in much the same way.

     The President and the Democratic majority contend that these increases demonstrate the necessity for requiring everybody to pay for health insurance so that the cost of injury and illness are spread evenly across society.  Republicans, on the other hand, may argue that it is unfair to require healthy persons to subsidize medical care for unhealthy persons, and they may point to the exodus of healthy persons from the system as evidence of this.  They may also contend that the method of reform chosen by Democrats is futile – that it is simply too expensive to attempt reform by requiring all persons to purchase health insurance from private companies.

     If people become convinced of that final argument – that the system of private health insurance is simply too inefficient and too unwieldy to be brought within the reach of the middle class – then we may see reformers turn away from the current Democratic bills and towards a public option.

     Below is a description of and links to the House Republican health care plan.

     Minority Leader John Boehner (R-OH) has sponsored the Common Sense Health Care Reform and Affordability Act, which appears to have the support of the House Republican caucus.  Boehner describes his position on health care at this page of his website.  On November 4, 2009, the Congressional Budget Office released its estimate of the likely effect and cost of Boehner's bill.

     Representative Boehner and the President agree on what the problems are: the high cost and limited availability of health insurance.  However, they do not agree as to the causes of those problems.  Rep. Boehner blames "burdensome mandates" and "unlimited lawsuits" for the high cost of health insurance:

Like many Americans, I am concerned with the rising cost of health care. These costs have increased because of the burdensome mandates placed on providers.

Nearly 130 million Americans – almost 80% of all workers in the United States – get their health coverage through their workplace. Another 43 million have no health coverage at all. Any legislation must offer the millions of uninsured Americans increased access to affordable health coverage by making it easier for small employers to offer more benefits while protecting employers from unlimited lawsuits.

     Rep. Boehner opposes expanding Medicaid or reducing payments under Medicare:

Some have proposed expanding government-provided health benefits created to help children of low-income families have access to affordable healthcare to families who already can afford private insurance. Equally as bad as expanding government-run health care is that it would be paid for by slashing Medicare for seniors who depend on these valuable benefits to provide affordable healthcare and prescription drugs.

     Rep. Boehner would address the problems of coverage and cost by making it easier for small employers to provide health insurance:

[S]ince small business employees make up more than 50 percent of those without health coverage, we need to make it easier and more affordable for small businesses to offer health benefits. One proposal that deserves consideration involves association health plans that allow small businesses to pool their resources with other small businesses to purchase insurance at a better rate. In turn, the premiums paid by their employees will remain affordable.

Innovative proposals like association health plans and health care tax credits for employers – another idea under consideration – will assist us in solving the “uninsured problem."

     Unlike the Democratic bills, the House Republican bill does not contain an "individual mandate" requiring people to purchase health insurance; nor does it prohibit insurance companies from excluding coverage for preexisting conditions; nor does it include a widespread program for subsidizing the purchase of health insurance for low-income persons.  Here is a summary of the provisions of the House Republican bill from the CBO report: 

• • Regulatory reforms in the small group and nongroup markets, including establishing AHPs and individual membership associations, and allowing states to establish interstate compacts with a unified regulatory structure;
  • A State Innovations grant program to provide federal payments to states that achieve specified reductions in the number of uninsured individuals or in the premiums for small group or individually purchased policies; 
  • Federal funding for states to use for high-risk pools in the individual insurance market and reinsurance programs in the small group market; and
  • Changes to health savings accounts (HSAs) to allow funds in them to be used to pay premiums under certain circumstances, to make net contributions to HSAs eligible for the saver’s credit, and to provide a 60-day grace period for medical expenses incurred prior to the establishment of an HSA.

     On November 5, 2009, I published this post comparing the Democratic and Republican proposals.  The bottom line is that the Republican bill would spend far less than the Democratic bill, and it would achieve much less as well.  According to the CBO, the Republican bill would reduce the number of uninsured Americans by 3 million persons, instead of the more than 30 million additional citizens who would receive coverage under the Democratic bill. 

     In my next post on this subject I will identify the separate elements of each plan so that you can "keep score" going into the bipartisan health care summit.

Visit Professor Huhn's website on health care financing reform for links to information about proposed legislation, studies and reports, public agencies, and private organizations concerned with this issue.

     In yesterday's post I described the President's invitation of Congressional leaders of both parties to a bipartisan health care summit on February 25, and how Judd Gregg (R-NH) has responded by stating that he is looking forward to the summit where he will put forth his plan for health care reform.  What is his plan?

     Senator Gregg calls his proposal "CPR" – for "Coverage, Prevention, and Reform."  He states that "the health care system is flat lining and is in grave need of CPR."  His website contains a short press release describing his plan as well as a detailed four-page summary.   In the press release, Gregg says:

“There is significant bipartisan ground from which to reset the health care debate. A good place to start would be my own plan, Coverage, Prevention and Reform (CPR) or the bipartisan Wyden-Bennett Healthy Americans Act. Both of these fiscally responsible, market-based plans would go a long way to produce the reform that the American people need. I look forward to working with the President and my colleagues on both sides of the aisle to get this right.”

      The press release states that Gregg's proposal is intended to accomplish the following three goals:

• Ensuring access to affordable, meaningful health insurance coverage regardless of health or where you work;

• Providing coverage for preventive measures and disease management with nominal co-payments; and

• Reducing costs and improving the quality of services to provide better care while at the same time saving hundreds of billions of dollars.

     Sounds good.  What are details of the plan, and how does it compare to the Democratic plans passed by the House and Senate?

     The centerpiece of the Democratic health care bills is the "individual mandate."  Everyone has to purchase health insurance.  Insurance companies could not exclude anyone on account of pre-existing conditions (no insurance ratings for health).  Insurance companies could not include annual or lifetime limits on coverage, and preventive care would have to be completely covered – no co-pays.  Finally, persons with low income (below 400% of the federal poverty level) would receive either tax credits or subsidies to purchase health insurance. 

     The Democratic plans would require nearly all individuals to purchase relatively comprehensive health insurance policies.  In addition, the Democratic plans would greatly expand Medicaid coverage to include all persons earning up to 133% of the federal poverty level, with all additional costs to be borne by the federal government.  These two changes would each cost about $50 billion annually, or a total of about $100 billion annually.  In ten years the number of uninsured Americans would be reduced to between 15 and 20 million Americans, instead of over 50 million Americans that are expected if we continue to operate under current law.

     Senator Gregg's CPR plan contains the same core as the Democratic plans.  It requires all persons over 21 to have proof of health insurance.  Insurance companies would be required to cover pre-existing conditions.  His plan would eliminate annual and lifetime limits on coverage and preventive care would be completely covered.  And the government would subsidize low income perssons to purchase health insurance.  Gregg draws the line for assistance lower than the Democratic bills, at 300% of federal poverty level. 

     How is Gregg's plan different from the Democratic bills?  I cannot be certain, but it appears that Senator Gregg would require individuals to only purchase "catastrophic" health care coverage – a minimal type of health insurance – which would require people to pay far more of their health care bills out-of-pocket.  In addition, it does not appear that Senator Gregg would expand Medicaid or the role of the federal government in paying for Medicaid.  These two differences would, of course, result in a far smaller drain on the federal treasury.  But it would also mean far less relief for low income persons in paying their medical bills.  Senatory Gregg's proposal does not include any estimate as to how many people would be helped or how much they would have to pay for health care in premiums and out-of-pocket as compared to the Democratic bills.

     Senator Gregg's plan also differs from the Democratic bills in how it would pay for reform.  The House Democrats would pay for the individual subsidies and expansion of Medicaid by increasing taxes on persons earning over $500,000 per year.  The Senate Democratic bill would tax "cadillac health plans" worth more than $23,000 for a family of four or $8,500 for an individual.  Both the House and Senate Democratic bills would eliminate the 14% surcharge that the government pays Medicare Advantage plans.

     The Wyden-Bennett bill (S. 391, the Healthy Americans Act) that Senator Gregg referred to in his press release in the first quotation set forth above would have paid for extensive health care reform by eliminating the favorable tax treatment for employer-provided health insurance – which is in effect a tax deduction for health insurance.  Essentially, under Wyden-Bennett, the value of health insurance would be treated as income to employees, and the tax revenues generated by this change would be used to purchase health insurance for low income persons.  Gregg's CPR plan would merely reduce this middle-class tax deduction rather than eliminate it.  Under Gregg's proposal, any health insurance provided by an employer worth over $11,000 for a family or $5,000 for an individual would be counted as taxable income.  However, Gregg would create an equivalent income tax deduction for insurance plans purchased by individuals, thus eliminating the differential treatment of employer-provided and individually-purchased health insurance that exists under current law.  While the Wyden-Bennett plan would easily pay for itself by making health insurance taxable income, Gregg's more limited plan might not.  Gregg's summary does not contain any estimates of how much money (if any) these changes would generate to pay for reform.  In effect, Gregg's CPR plan is a less ambitious version of Wyden-Bennett.

     Gregg's plan contains a number of other provisions that are the same or similar to portions of the Democratic bills.  A government agency would make findings and recommendations about best practices and most efficient treatment options.  Employers would be permitted to offer more incentives to employees to participate in wellness programs.  Medicare participants and other health care providers would be encouraged to coordinate care, reduce medical error, and prevent unnecessary readmissions.  Regardless of what other changes to existing law are enacted, these all appear to be valuable reforms.

     How much support is there in Republican circles for Gregg's plan?  Wikipedia has a chart showing that four Republican Senators, including Lindsey Graham, Mike Crapo, Bob Bennett, and Lamar Alexander, were willing to sponsor the Wyden-Bennett bill in 2009, and that a number of others did so in 2007.  Gregg's CPR plan would cost much less than the Wyden-Bennett bill would, so it is reasonable to assume that Gregg could command significant Republican support for his plan. 

     Tomorrow: the House Republican plan.

     Visit Professor Huhn's website on health care financing reform for links to information about proposed legislation, studies and reports, public agencies, and private organizations concerned with this issue.

     Hopes are high but expectations are low for the upcoming bipartisan health care summit called by President Obama.  How are Republicans approaching this meeting?

          President Obama has scheduled a bipartisan meeting on health care for February 25 that will be broadcast live on C-SPAN.  Here is the President's invitation, as well as the invitation list.  Here is an article by Jeff Zeleny of the New York Times concerning the announcement of the summit.

     In this post in California Healthline describes concerns that Republican leaders have expressed regarding the summit:

On Monday, House Minority Leader John Boehner (R-Ohio) and House Minority Whip Eric Cantor (R-Va.) sent a letter to White House Chief of Staff Rahm Emanuel with a list of questions that they requested responses to ahead of the meeting (Shear, Washington Post, 2/9).

The letter asked whether Obama:

Would agree to "start over" with the negotiations process that would produce legislation "that is truly worthy of the support and confidence of the American people;"

Has ended consideration of using the parliamentary procedure of budget reconciliation to push a reform bill through the Senate with only 51 votes;

Plans to invite to the meeting Democratic lawmakers who have opposed the House and Senate bills (HR 3962, HR 3590), or any provisions in them; and

Whether state lawmakers and health officials, and health care policy experts would be present at the meeting (O'Connor, "Live Pulse," Politico, 2/8).

     At a press briefing after his recent meeting with Republicans at their retreat, President Obama reiterated the three goals that he wishes to accomplish with health care reform: reduce costs, end insurance company abuses, and expand the availability of insurance in individual market.  When asked to respond to the Republican request to discard the two Democratic bills passed by the House and the Senate and "start from scratch," the President said:

So I've got these goals. Now, we have a package, as we work through the differences between the House and the Senate, and we'll put it up on a Web site for all to see over a long period of time, that meets those criteria, meets those goals. But when I was in Baltimore talking to the House Republicans, they indicated, we can accomplish some of these goals at no cost. And I said, great, let me see it. And I have no interest in doing something that's more expensive and harder to accomplish if somebody else has an easier way to do it.  So I'm going to be starting from scratch in the sense that I will be open to any ideas that help promote these goals.

     Kate Pickert of Time authored this entertaining piece about the President having accepted the Republican challenge to televise the summit.  According to an article by Sam Stein of the Huffington Post, John Kyl of Arizona has characterized the summit as "pointless."  In separate opinion pieces published in Politico, Frank Dontelli, Chairman of GOPAC, calls for adoption of the House Republican plan, but Christie Todd Whitman, former Governor of New Jersey and Director of the EPA under President George W. Bush, expresses more willingness to compromise with the President.

     Of all of the statements from Republicans in advance of the summit, the most intriguing may be that of Judd Gregg, Senator from New Hamshire.  David Rogers of Politico posted this article entitled "Can Judd Gregg Help White House Save Health Bill," and Chris Mathews of Harball conducted an interview in which Gregg said:

[I]t is in the interest of the Republican Party to put in place a plan that will bring down the cost of health care and make it readily more available and make our quality better in the this country, so that we can afford it. I mean, we are on a path here to fiscal insolvency as a nation and a large part of the problem that we have relative to our finances as a country is driven by the cost of health care, especially in the Medicare accounts. So, you can‘t address those unless you address them in a bipartisan way, in my opinion and as a very practical matter, we don‘t solve this, we are all going to be in the soup and we‘re going to end up passing onto our kids a country where their standard of living is less than ours. 

      Tomorrow: Gregg's plan. 

Visit Professor Huhn's website on health care financing reform for links to information about proposed legislation, studies and reports, public agencies, and private organizations concerned with this issue.

     The Centers for Medicare and Medicaid Services has issued another report estimating the financial and coverage effects of the health care reform bill as adopted by the Senate on December 24, 2009.  The good news is that CMS believes that the Senate bill will expand health insurance coverage to 34 million more people.  The biggest disappointment is its conclusion that prevention and wellness programs will not reduce the overall cost of medical care. 

     Here is the new CMS report as posted by Modern Health Care.  The report estimates the effect that the health care reform bill adopted by the Senate would have on federal expenditures and total health care expenditures, as well as predicting how many more people will be covered by health insurance. 

     The report states that the Senate bill would extend health insurance coverage to an additional 34 million people.  One third of the gain is achieved by expanding Medicaid and CHIP to ten million more people, and two-thirds by opening up "exchanges" for over 20 million persons to purchase non-group health insurance, most of whom will qualify for government subsidies.  (Page 3 of the report).  The 34 million increase in persons with health insurance is one million more than would have received coverage under the prior version of the bill.  (See Page 3 of the December 10, 2009 CMS report on the November 18 Senate bill.) 

     Roughly 23 million people would remain uninsured, instead of over 56 million people under current law.  CMS explains who those 23 million people are:

For the estimated 23 million people who would remain uninsured in 2019, roughly 5 million are undocumented aliens who would be ineligible for Medicaid or the Exchange coverage subsidies under the proposed legislation. The balance of 18 million would choose not to be insured and to pay the penalty (if applicable) associated with the individual mandate. For the most part, these would be individuals with relatively low health care expenses for whom the individual or family premium would be significantly in excess of any penalty and their anticipated health benefit value.  (Page 7 of CMS report).

     CMS estimates that 67% of persons eligible to purchase insurance through the Exchange would do so.  According to CMS it is people within a narrow income range – about between 365% and 493% of the federal poverty level – who will be most likely to forego coverage.  People earning just under 400% of the federal poverty level will qualify for only small subsidies, and those earning more than 400% of FPL will receive no subsidies.  If these people are relatively healthy, they may choose to pay the penalty of $750 per person rather than purchase health insurance.  Furthermore, if the cost of health insurance would exceed 8% of their income, they would not even have to pay the penalty.  (Page 7)

     CMS also estimates that the final Senate bill will be about $80 billion cheaper than the previous bill was – spending $40 billion less on coverage, and saving $40 more on Medicare and Medicaid over the ten year period 2010-2019.  (See page 2 of each CMS report.)  CMS believes that the proposed law would have very little impact on total health care expenditures.  On the one hand this is bad news – we have to bring down the cost of health care for our economy to remain competitive.  One the other hand this is good news – we will be covering far more people with much better health insurance for about the same amount of money.

     One of the significant disappointments in the report is that the CMS does not believe that any of the bill's cost-cutting measures will have a significant effect on health care expenditures.  CMS predicts that Comparative Effectiveness Research – identifying the most effective and most efficient drugs and practice protocols – will save only about $8 billion over ten years, and that none of the other cost-cutting measures will any appreciable effect.  Most disappointing of all is that CMS predicts that no savings will result from the law's emphasis on preventive care and wellness programs.  CMS states:

There is no consensus in the available literature or among experts that prevention and wellness efforts result in lower costs. Several prominent studies conclude that such provisions – while improving the quality of individuals' lives in important ways – generally increase costs overall. For example, while it is possible that savings can be achieved for many people by diagnosing diseases in early stages and promoting lifestyle and behavioral changes that reduce the risk of serious and costly illnesses, additional costs are incurred as a result of increased screenings, preventive care, and extended years of life.  (Page 13)

     Now there's a pessimistic atttude.  CMS believes that if we make better lifesyle choices and become healthier as a result, we will live longer and will therefore incur greater medical expenses.  I suppose CMS's advice for us to reduce total health care expenditures is to "Eat, drink, and be merry!" 

Visit Professor Huhn's website on health care financing reform for links to information about proposed legislation, studies and reports, public agencies, and private organizations concerned with this issue.

The New York Times compares the House and the Senate Health Care Proposals on 16 key issues.  Some of the major issues compared are:  individual mandates, employer contributions, subsidies for individuals, abortion coverage, illegal immigration coverage, cost and coverage of the two proposals and who pays for the proposals.

At the New York Times Health Care page, choose a category on the left to see a comparison of the House and Senate versions on the right.

     Jordan Fabian of The Hill reports that thirteen state Attorneys General – all Republicans – have written a letter to House Speaker Nancy Pelosi and Senate Majority Leader Harry Reid threatening legal action if the health care reform legislation is enacted with the exception singling out the State of Nebraska for favorable treatment under Medicaid.  The AGs contend that the exception for Nebraska violates the Constitution.  I agree that this particular provision of the Senate bill is unwise, unfair, and unappealing.  But is it unconstitutional?

     The Senate health care reform bill expands Medicaid enrollment to all individuals and families earning less than 133% of the federal poverty level.  Beginning in 2014 the federal government will pick up 100% of the costs attributable to the expanded enrollment in the program until the year 2016.  After that date, the federal government will pay for about 90% of the cost of the additional enrollees.  In addition, beginning in 2014 the federal share of CHIP funding in the states will increase from an average of 70% to an average of 93%.  (See page 7 of the CBO report of December 19, 2009)  

     However, the bill contains an exception for the State of Nebraska.  Under a provision that was reportedly designed to secure the vote of Senator Ben Nelson (D-NE), after 2016 Nebraska will continue to receive 100% federal funding to cover the cost of the Medicaid expansion.  According an article by Michael O'Brien of The Hill, the CBO estimates that the "Cornhusker Kickback" would cost taxpayers an additional $100 million over ten years.  O'Brien also reports that the Senate bill directs even larger amounts of additional funding to the states of Vermont and Massachusetts.

     There are a couple of problems with the formula in the Senate bill.  Arguably the larger problem, at least in terms of dollar amount, is that states that already have expanded coverage will receive no extra help from the government.  In other words, states that have been less charitable to date will receive additional federal funding, but states that have already been extending care to the poor will not.  On December 26 the New York Times published this informative article by Kate Zernike on this aspect of the funding formula.  Zernike reports that:

roughly 20 states that have already expanded coverage in some form will pay a greater proportion of their new Medicaid costs under the bill than those states, largely in the South, that until now have covered relatively few of their poorest residents.

     The smaller problem is the exception that the law makes for the State of Nebraska, which is the provision of the Senate bill that the thirteen Republican AGs are attacking as unconstitutional.  The AGs' letter is fairly brief.  Here are the legal arguments that they present:

In Helvering v. Davis, 301 U.S 619, 640 (1937), the United States Supreme Court warned that Congress does not possess the right under the Spending Power to demonstrate a "display of arbitrary power." Congressional spending cannot be arbitrary and capricious. The spending power of Congress includes authority to accomplish policy objectives by conditioning receipt of federal funds on compliance with statutory directives, as in the Medicaid program. However, the power is not unlimited and “must be in pursuit of the ‘general welfare.’ ” South Dakota v. Dole, 483 U.S. 203, 207 (1987). In Dole the Supreme Court stated, “that conditions on federal grants might be illegitimate if they are unrelated to the federal interest in particular national projects or programs.” Id. at 207. It seems axiomatic that the federal interest in H.R. 3590 is not simply requiring universal health care, but also ensuring that the states share with the federal government the cost of providing such care to their citizens. This federal interest is evident from the fact this legislation would require every state, except Nebraska, to shoulder its fair share of the increased Medicaid costs the bill will generate. The provision of the bill that relieves a single state from this cost-sharing program appears to be not only unrelated, but also antithetical to the legitimate federal interests in the bill.

The fundamental unfairness of H.R. 3590 may also give rise to claims under the due process, equal protection, privileges and immunities clauses and other provisions of the Constitution. As a practical matter, the deal struck by the United States Senate on the “Nebraska Compromise” is a disadvantage to the citizens of 49 states. Every state’s tax dollars, except Nebraska’s, will be devoted to cost-sharing required by the bill, and will be therefore unavailable for other essential state programs. Only the citizens of Nebraska will be freed from this diminution in state resources for critical state services. Since the only basis for the Nebraska preference is arbitrary and unrelated to the substance of the legislation, it is unlikely that the difference would survive even minimal scrutiny.

     Essentially, the Attorneys General are relying on two established principles.  First, any conditions that Congress imposes upon the states as the price of receiving federal funds must be related to the purpose for which the money was allocated in the first place.  The Court has found that Congress has a great deal of discretion in this matter.  For example, in South Dakota v. Dole, cited by the AGs, the Court ruled that Congress may withhold 5% of a state's highway funding unless the state agrees to enact laws raising the drinking age within the state to age 21.  In Helvering v. Davis, also cited by the AGs, the Court made it clear that Congress has extremely broad discretion in this regard.  In that case Justice Benjamin Nathan Cardozo stated:

     Congress may spend money in aid of the ‘general welfare.’ Constitution, art. 1, sec. 8.  There have been great statesmen in our history who have stood for other views. We will not resurrect the contest. It is now settled by decision.  The conception of the spending power advocated by Hamilton and strongly reinforced by Story has prevailed over that of Madison, which has not been lacking in adherents. Yet difficulties are left when the power is conceded. The line must still be drawn between one welfare and another, between particular and general. Where this shall be placed cannot be known through a formula in advance of the event. There is a middle ground or certainly a penumbra in which discretion is at large. The discretion, however, is not confided to the courts. The discretion belongs to Congress, unless the choice is clearly wrong, a display of arbitrary power, not an exercise of judgment. This is now familiar law.  ‘When such a contention comes here we naturally require a showing that by no reasonable possibility can the challenged legislation fall within the wide range of discretion permitted to the Congress.’ Nor is the concept of the general welfare static. Needs that were narrow or parochial a century ago may be interwoven in our day with the well-being of the nation. What is critical or urgent changes with the times.

     The AGs concede that there is no doubt about Congress' power to spend money through the Medicaid program to improve people's health.  James Madison, at least in later life, would have objected that Congress only has power to spend funds in furtherance of its other enumerated powers, but the clear language of the Spending Clause granting Congress the power to provide for the common defense and the general welfare and the structure of Article I, Section 8 of the Constitution is in accord with the views of Alexander Hamilton and Joseph Story that the power of the purse is separate from and in addition to the other enumerated powers. 

     Under South Dakota v. Dole, Congress also has the power to impose conditions upon the states if they are to receive and spend federal funds, so long as those conditions are related to the purposes of the federal funding.  The Medicaid program allocates funding to each state, conditioned upon each state's contribution to the program.  Again, there is no doubt that this condition is directly related to the purpose of the federal funding, and the AGs concede this point as well.  The trouble with the AGs' argument under the Spending Clause is that they do not contend that the withhold of federal funds for Medicaid to their own states is "unrelated" to the condition that is imposed upon each of their own states – instead, they are arguing that the State of Nebraska should be held to precisely the same standard as they are with respect to participation in Medicaid.

     This brings us to the AGs' second argument set forth above – that it violates Due Process, Equal Protection, and perhaps some other provisions of the Constitution for Congress to treat one state more favorably than another with respect to spending.  It is certainly true that in situations affecting individual rights Congress may not arbritrarily draw distinctions between groups of persons or impose arbritrary restraints upon persons, and there are many examples that may be cited – Lawrence v. Texas (2003), for example, in which the Court declared the Texas law making gay sex a crime to be unconstitutional.  But there are two basic distinctions between a law like that and the law in question.  First of all, the law in question is neither a criminal law nor is it a regulation of private conduct – it is, instead, a spending measure, and as we see from the quoted excerpt from Helvering v. Davis, Congress has extremely broad discretion to spend money in furtherance of the general welfare.  It may elect to fund the military over the arts, or it may decide to reduce military spending to support music and culture.  It also has discretion within any particular category.  The government may prefer to purchase airplanes instead of helicopters, or it may choose to fund classical music instead of rock.  It is up to Congress to decide what is in the "general welfare."

     Furthermore, Congress may decide where it will distribute its largesse.  Congress may choose to build a bridge to nowhere in Alaska instead of a community college in Maine.  Members of Congress are quite jealous of their prerogative to "bring home the bacon."  Military spending is particularly susceptible to logrolling and pork barrelling, as members of Congress oppose the closing of unneeded military bases in their districts and insert earmarks for unnecessary military spending for projects that benefit their constituents.  Just last week Rep. Parker Griffith of Alabama switched from the Democratic to the Republican party partly because he disagrees with the Democrats on health care and other issues, but also reportedly in part because he is angry that the administration decided to cancel production of a missle defense shield that would have been built in his district.  

     Even in the specific field of health care, there are spending formulas that are designed to favor very specific areas of the country.  Legislators from rural states fight to preserve additional funding for rural hospitals and higher reimbursement rates for rural physicians.  States with large populations of poor persons do the same, on the theory that the hospitals in their districts bear an unfair proportion of caring for the uninsured.

     This is what members of Congress do.  They represent specific districts and specific states.  In order to secure passage of this legislation, the people of the United States bribed the people of the State of Nebraska.  This does not violate any notion of "state's rights."  It probably reinforces principles of federalism.

     Six of the thirteen AGs who signed this letter would do well to remember the old adage "Be careful what you wish for ….," because according to this 2007 study by the Tax Foundation, the states that they represent - Alabama, North Dakota, Virginia, Pennsylvania, Utah, and Florida – all receive more in federal funding than they pay out.  The same goes for the Republican Party in general.  According to this 2004 report from TaxProf based upon an earlier Tax Foundation study, Republican-leaning states in general receive more in federal funding than they pay in federal taxes, while Democratic-leaning states pay more than they receive. 

     Remember the other problem with the funding formula – the problem that journalist Zernike reported on – the fact that the Senate bill only grants federal funding for the expansion of Medicaid, and that those states that already have generous Medicaid elibility rules will receive relatively little assistance – that two states, otherwise similarly situated, would receive unequal amounts of federal funding simply because in the past one of those states had decided to provide medical assistance to the poor and the other had not.  Zernike reports that the State of Alabama, for example, will receive far more benefit from this formula than the State of California:

For example, the federal government would pick up the entire cost for the first two years and 95 percent of the cost for the next three years for newly covered working parents in Alabama, which now covers only those making up to 24 percent of the federal poverty level.

But it would pay just 50 percent of the cost for most of those newly enrolled in California, because California already makes eligible working parents earning up to 106 percent of the poverty level and its Medicaid assistance is set at 50 percent. California would get a more generous reimbursement, about 83 percent, only for parents earning from 106 percent to 133 percent of the federal poverty level.

    Is it not amazing that the thirteen attorneys general are so eager to remove the speck in the funding formula that favors the State of Nebraska, but they are oblivious to the log that favors states such as Alabama?

     I wish that our elected federal representatives – and our state attorneys general – would always put the interests of the country ahead of the interests of their own constituents.  But that is the same as wishing that selfishness and self-interest were not principal motivations of the human heart, and the framers knew better than that.  As Madison said in The Federalist Number 51, "Ambition must be made to counteract ambition."

     I don't believe that the Supreme Court would find the "Nebraska Compromise" to be unconstitutional.  There simply is not any principled legal doctrine that can be formulated to rein in the discretion of Congress to treat one state or one group of states more favorably than others with respect to the spending of federal funds.  This is instead a matter committed to the discretion of the political branches of the federal government.

Visit Professor Huhn's website on health care financing reform for links to information about proposed legislation, studies and reports, public agencies, and private organizations concerned with this issue, and his website on Constitutional Law for sources and materials relating to that area.

     Liberals and conservatives both find much to dislike in the health care reform legislation, and many persons in each camp are opposed to the current measure.  I urge both groups to reconsider.

     Both liberals and conservatives want health care reform.  Among liberals, the most important goal is univeral coverage.  Among conservatives, the most important goal is cost containment.  But liberals are not opposed to cost control, and conservatives are not opposed to the expansion of coverage.  In fact, we cannot expand coverage without reducing costs because it would be too expensive, beyond even the means of this wealthy country.  And many authorities agree that we cannot control costs without expanding coverage – that the large population of uninsured and underinsured Americans dramatically increases the amount of money that we spend on health care, because delaying or going without health care makes chronic conditions such as diabetes, athsma, and hypertension worse, requiring even more expensive interventions when those conditons become life-threatening.  Furthermore, the lack of adequate treatment for dental problems and mental health issues worsens the health of our citizenry, as does our failure to treat addiction in a systematic manner.  Americans are sicker and die younger than the people of other industrialized countries.  (See the 2009 WHO World Health Statistics)  This diminishes our productivity as well as our well-being.  Every single year, 45,000 Americans – both liberals and conservatives – die as a consequence of having inadequate health insurance.  (See the 2009 Harvard Study)  Both liberals and conservatives are necessarily invested in health care reform.

     However, both liberals and conservatives tend to take their eyes off the prize.  They engage in scapegoating rather than problem-solving.

     Among many liberals, private health insurance companies are the problem.  Liberals focus on the fact that insurers deny coverage for many illnesses, including preexisting conditions.  But do you realize that businesses and insurance companies have been in the forefront of demanding health care reform – that their official position is that there should be universal coverage and an abolition of exclusions for preexisting conditions?  Consider the December, 2008 position paper entitled "Now Is the Time for Health Care Reform: A Proposal to Achieve Universal Coverage, Affordability, Quality Improvement, and Market Reform," issued by the Board of Directors of AHIP, the trade association for private health insurers.  Consider this September, 2009, report prepared by Hewitt for the Business Roundtable entitled "Health Care Reform: The Perils of Inaction and the Promise of Effective Action," which also calls for universal coverage, insofar as it is feasible.  Finally, do you really believe that government programs are more likely to rein in costs than private employers and private health insurers?  Do you really think that competition in the private marketplace is not a key element for increasing access and reducing costs?  Private enterprise is not the enemy.  The real enemy is injury, disease, and the ravages of aging, and private enterprise is part of the solution.

     Among many conservatives, government is the problem.  There is a belief that this legislation represents a government takeover of medicine.  That is far from the truth – the current legislation expands coverage by requiring individuals to purchase insurance from private health insurers to pay for medical services rendered by private physicians and hospitals.  But even if it were true that this reform were a purely government program, are you opposed to Medicare?  All that I have heard from conservatives throughout this debate is a full-throated defense of Medicare!  If a government health insurance program is good for the nation's elderly, why would it be so bad for young families or middle-aged workers?  Furthermore, do you really believe that health insurers should not be regulated by the government?  Do you really believe that the law should not prohibit exclusions for pre-existing conditions, or abolish lifetime and annual limits for necessary medical care in health insurance policies, or require coverage for preventive health care without out-of-pocket cost to the consumer?  Government is not the problem.  The real problem is injury, disease, and the ravages of aging, and government is part of the solution.

     Neither side must forget that if we do nothing, the cost of health care will continue to accelerate out of control, (see the June, 2009 CMS report predicting that total health care expenditures will double over the next decade if the law is not changed), and that as a consequence Americans' health will continue to deteriorate.  We do not have the best health care system in the world.  Instead among most benchmarks our system ranks last among industrialized nations, despite spending twice as much per capita on health care as any other country.  (See the September 30, 2009 statement of the OECD; the  May 15, 2007 report of the Commonwealth Fund; and the July 17, 2008 report of the Commonwealth Fund)  Reform is necessary.  This legislation represents one step – a giant step, but nevertheless only one step – towards reform that will expand coverage while reducing costs.  If this country is to survive and prosper we must take that step together.

     Finally,  I remind both sides that this is not the only crisis facing this nation.  We must deal with the question of illegal immigration – how to control our borders, and how we shall treat the persons living here illegally.  We must continue to deal with the threat of terrorism, both at home and abroad.  We must figure out how to reverse the process of global warming, whatever its causes.  These and other challenges we face can be overcome – if we, as Americans, seek practical solutions and present a united front to the world.    

Visit Professor Huhn's website on health care financing reform for links to information about proposed legislation, studies and reports, public agencies, and private organizations concerned with this issue.

     The differences between the House and Senate health care reform legislation will be reconciled not by a conference committee, but rather informally by the leadership of the House and Senate, in consultation with the White House and with Senators and Representatives whose votes are necessary for passage of the measure.

     In the past few postings I have described some of the critical differences between the House and Senate bills, regarding the employer mandate, the extent of coverage and amount of subsidies, and the public options in each bill.  In addition, of course, there is also the subject of funding for abortions, with the difference between the Nelson amendment and the Stupak amendment.  But Congress will not be convening a conference committee to resolve these differences.  Is that appropriate?

     In its report of November 26, 2008, entitled "Resolving Legislative Differences in Congress: Conference Committees and Amendments Between the Houses," the Congressional Research Service describes three ways for the House and Senate to prepare a bill for presentation to the President.  Each House of Congress may enact identical legislation; different versions of bills may be sent to a conference committee which may prepare a single, unified bill; or differences between bills may be resolved through the amendment process.  The CRS report states:

The Constitution requires that the House and Senate approve the same bill or joint resolution in precisely the same form before it is presented to the President for his approval or veto. To this end, both houses must pass the same measure and then attempt to reach agreement about its provisions. The House and Senate may be able to reach agreement by an exchange of amendments between the houses. …  Alternatively, the House and Senate can disagree to each other's positions on a bill and then agree to create a conference committee to propose a package settlement of all their disagreements. 

     In the case of the competing health care reform bills passed by the House and Senate, Congressional leaders have chosen to proceed by the amendment process rather than convene a formal conference committee.  That will give members of Congress two more bites at the apple - they will try to influence the substance of the amendments that are created in the informal bargaining among President Obama, Speaker Pelosi, and Majority Leader Reid, and they may offer an "amendment to the amendment" once the unified bill is presented to the House and Senate.  The CRS report states:

Each house has one opportunity to amend the amendments from the other house, so there can be Senate amendments to House amendments to Senate amendments to a House bill. 

     The CRS dryly observes:

the procedures associated with the exchange of amendments can become complicated.

     No doubt the Democratic leaders will attempt to forge a compromise that will attract 218 votes in the House and 60 votes in the Senate without the necessity for additional amendments to either bill. 

     David Waldman at Congress Matters has posted a very informative essay explaining why the amendment process is a more attractive alternative than submitting the bill to a conference committee.  A principal reason is that Senator Jim DeMint (R-SC) blocked the use of a conference committee by objecting to unanimous consent and forcing three more votes on the matter – each of which might have been the object of a filibuster.  Rather than struggle with the necessity of keeping the Senate in session for another week and holding three more cloture votes to close off debate on the creation of a conference committee, the Democratic leadership decided to proceed informally by means of the amendment process.  Waldman offers this summary of what the leadership plans to do:

There's no formal requirement that the differences between the houses be settled in a conference committee. That's just one vehicle available to them, and one that comports with their preference for formal and transparent process. But there's nothing that prohibits them from meeting informally and trying to cobble together a package of amendments that they think can pass both houses, and then taking that package to the floor of the House and offering it as an amendment to H.R. 3590 as amended by the Senate. If they've calculated correctly, that package would pass the House and be sent back to the Senate, which would have an opportunity to vote on whether or not to accede to the House amendment. And if the House amendment has been pre-cleared in the informal negotiations, then Senate leaders will know that they'll have the 60 votes it would take even to overcome any threatened filibuster of the motion to take up the House amendment, which would all but seal the deal.

      We shall see.

Visit Professor Huhn's website on health care financing reform for links to information about proposed legislation, studies and reports, public agencies, and private organizations concerned with this issue.

     Another difference between the House and Senate health care reform bills is with respect to the "employer mandate" – more accurately, the provisions that penalize employers that fail to provide health insurance to their employees.  In general, the House bill contains a stronger employer mandate than the Senate bill.

     Both the House and the Senate bills contain an "individual mandate" requiring people who can afford it to purchase health insurance.  But only the House bill contains a strong employer mandate.

     According to the Kaiser Family Foundation side-by-side comparison chart, the House health care reform bill requires employers with payrolls greater than $750,000 to provide health insurance to their employees or pay a fee amounting to 8% of their salaries.  KFF states that the House bill would:

Require employers to offer coverage to their employees and contribute at least 72.5% of the premium cost for single coverage and 65% of the premium cost for family coverage of the lowest cost plan that meets the essential benefits package requirements or pay 8% of payroll into the Health Insurance Exchange Trust Fund.  

     In contrast, the Senate bill exempts businesses with fewer than 50 employers, and requires employers that do not offer coverage to pay a fee of only $750 or less.  The KFF states that the Senate bill would:

Assess employers with more than 50 employees that do not offer coverage and have at least one full-time employee who receives a premium tax credit a fee of $750 per full-time employee. Employers with more than 50 employees that offer coverage but have at least one full-time employee receiving a premium tax credit, will pay the lesser of $3,000 for each employee receiving a premium credit or $750 for each full-time employee.

     Who supports and who opposes the "employer mandate?"  The employer mandate is supported by insurance companies, unions, and large businesses that already provide health insurance coverage to their employees.  (See this January 5, 2006 press release from the AFL-CIO  announcing the "Fair Share Campaign" to encourage businesses to provide employees with health insurance; page 7 of this December, 2008 statement from AHIP entitled "Now Is the Time for Health Care Reform" promoting the use of incentives for employers to purchase insurance; and pages 7-12 of this September, 2009 report by Hewitt for the Business Roundtable citing the many advantages of universal coverage in the workforce.) 

     The U.S. Chamber of Commerce opposes the employer mandate.  On its website it encourages members to contact members of Congress to oppose the pending legislation, stating:

Tax increases to pay for a public plan, employer mandates, and minimum coverage will do more than devastate the private insurance industry–they could bankrupt our economy.

     This is yet another wrinkle to be ironed out by the House and Senate leadership working with the White House.

Visit Professor Huhn's website on health care financing reform for links to information about proposed legislation, studies and reports, public agencies, and private organizations concerned with this issue.

     If a principal goal of health care reform is universal coverage, both the House and Senate bills fall short of this ideal.  But each bill gets us most of the way there.

     According to the CBO, the House bill would extend coverage to an additional 36 million Americans by the year 2019; the Senate bill would add 31 million persons to health insurance rolls.  (October 29 CBO report on House bill; December 19 CBO report on Senate bill).  The House bill would leave 18 million residents without health insurance and the Senate bill would leave 23 million persons without coverage, of whom about 8 million are not legal residents.  (Page 16, CBO report on House bill; page 22, CBO report on Senate bill)  As a result the House bill would cover all but 10 million lawful residents, and the Senate bill all but 15 million lawful residents.

     The predominant distinction between the bills explaining their differential impact on total coverage lies in the amount of money that each bill provides in subsidies to low income persons and small employers to purchase health insurance.  The House bill allocates $630 billion over ten years for this purpose; the Senate bill only $476 billion (Page 17 of CBO report on House bill; page 23 of CBO report on Senate bill)  One of the principal matters to be reconciled between the two bills is how much funding the law will provide for low income Americans to purchase non-group health insurance through the Exchange. 

     There are, furthermore, substantial differences between the House and Senate bills in the type of health insurance that Americans will have.  The House bill includes a stronger employer mandate, and the CBO predicts that under that bill employer-provided health insurance will actually increase by 6 million enrollees to 168 million persons, as opposed to 162 million under current law.  Under the House bill another 21 million people would purchase non-group insurance through the Exchange.  The Senate bill lacks a strong employer mandate, and the CBO estimates that 4 million fewer people (158 million people) would receive insurance from their employers than would under current law, but that 26 million additional people would purchase insurance through the Exchange.  (Page 16, House; page 22 Senate).  This accounts for the difference in total insurance coverage – the House bill would result in 10 million more people being covered by employer-sponsored plans than under the Senate bill, and 5 million fewer through the Exchange.

Visit Professor Huhn's website on health care financing reform for links to information about proposed legislation, studies and reports, public agencies, and private organizations concerned with this issue.

     It is well-known that the House bill, the Affordable Health Care for America Act, contains a "Public Health Insurance Option" - a government-run health insurance company that would have competed with private insurers to provide coverage for American citizens.  It is also well-known that the Senate rejected this provision in its bill, the Patient Protection and Affordable Care Act.  Less appreciated is the fact that the Senate bill contains two provisions that would extend government financed health care to millions of more people than the "public option" in the House bill would.

     The Senate rejected the "public option," even with "opt out" or "trigger" mechanisms that would have made the program optional with the states or contingent upon circumstances such as lack of competition in the marketplace or rising costs.  However, the public option was not expected to cover very many people, under either the House or Senate version of health care reform.  The CBO estimated that under the House version of the reform bill six million people would have enrolled for coverage by 2019, and that the Senate plan would have attracted only two or three million enrollees by that time.

     However, the Senate bill contains two provisions that promise to extend efficient, low-cost, government-financed health care to tens of millions of American citizens – the Basic Health Plan introduced by Senator Maria Cantwell (D-WA), and additional funding for Community Health Centers which was included at the urging of Senator Bernie Sanders (D-VT).  I have written about these provisions previously (here and here). 

     The Kaiser Family Foundation website contains an informative side-by-side comparison of the House and Senate bills.  Here is their description of the Basic Health Plan, which would allow the states to use the money that would have gone to low-income individuals to purchase health insurance for them as a group:

Permit states the option to create a Basic Health Plan for uninsured individuals with incomes between 133-200% FPL who would otherwise be eligible to receive premium subsidies in the Exchange. States opting to provide this coverage will contract with one or more standard plans to provide at least the essential health benefits and must ensure that eligible individuals do not pay more in premiums than they would have paid in the Exchange and that the cost-sharing requirements do not exceed those of the platinum plan for enrollees with income less than 150% FPL or the gold plan for all other enrollees. States will receive 95% of the funds that would have been paid as federal premium and costsharing subsidies for eligible individuals to establish the Basic Health Plan. Individuals with incomes between 133-200% FPL in states creating Basic Health Plans will not be eligible for subsidies in the Exchanges.

     Essentially, under the Basic Plan the federal government would subsidize the states to contract with health insurance companies – or perhaps even provider systems – to provide health care for persons earning less than double the federal poverty level.  (The FPL for 2009 is $10,830 for an individual and $22,050 for a family of four.)  It is a safe assumption that by pooling the purchasing power of every individual and family earning between 133% and 200% of the federal poverty level into one group plan, the state could purchase insurance at far lower cost than these people could acting as individuals.  Furthermore, this would save the federal government money – it would pay the states only 95% of what it would have paid the individuals.  I expect that many states would choose this option, and that participation in the Basic Plan will far exceed what enrollment in the "public option" would have been.

     In addition, the Senate bill establishes a "Community Health Services Fund" (starting at page 329 of the Manager's Amendment) which vastly expands funding for community health centers and the National Health Service, as well as funding a three-year demonstration project in up to ten states that would provide low-cost health care to the uninsured.  The Community Health Services Fund could end up supporting primary medical and dental care and establishing medical "homes" for tens of millions of Americans.

     In my opinion, the Basic Plan and the Community Health Services Fund – each of which may contract with for-profit and non-profit health care companies to provide care for low-income persons – are far more promising than the public option contained in the House bill or the one that was initially contained in Senator Reid's bill.

     Our common goal is universal health care that is both affordable and of high quality.  I predict that House Democrats will embrace these two provisions as a more than adequate substitute for the public option contained the bill that they originally enacted, and that many Republicans, while still voting against the bill, will find these provisions attractive – particularly in states with large rural areas that rely on community health centers for primary care.

Visit Professor Huhn's website on health care financing reform for links to information about proposed legislation, studies and reports, public agencies, and private organizations concerned with this issue.

     Minutes ago the United States Senate approved the Patient Protection and Affordable Care Act and sent the legislation to a conference committee with the House of Representatives.   

      With nearly all of the Senators at their desks and Vice-President Joe Biden presiding, the Senate just voted 60-39 to approve the Patient Protection and Affordable Care Act. 

     In his closing remarks about the bill, Majority Leader Senator Harry Reid (D-NV) compared the proposed law to Social Security and Medicare, and the analogy is apt.  This law, like those two, is landmark legislation that expands the "social safety net."  But its significance goes beyond that.

     First of all, this bill extends benefits not just to the elderly but to all Americans.  The intent of the bill is to help everybody – young families, middle-aged workers, small and large employers – find affordable health care.

     Second, the bill creates a mechanism that will allow the government to regulate both the health insurance industry and, by extension, the health care industry.  This will be absolutely necessary going forward because the bill itself does not do enough to control the cost of medical care.  As a nation we all want to be healthier, and our health care providers have to learn how to deliver medical care with less waste and more efficiency, particularly as our population ages.  By controlling how medical care is paid for, these reforms – including preventive care, wellness programs, community health centers, home health care, medical homes, pay-for-performance, and the productivity gains that may be realized through information technology - can help us achieve those goals.  The bill lays a foundation that will permit our society to experiment and discover what we have to do to broaden access, improve quality, and reduce costs.

     Third, the bill relies on private enterprise to both extend coverage and control costs.  To the dismay of liberals, the public option was rejected, and private employers will continue to purchase health insurance for their employees, private medical institutions and professionals will continue to provide the care, and private insurance companies will continue to serve as brokers.  This system is more complex than "single-payer," but it promises to harness both the energy of private enterprise and the rigor of the competitive marketplace to ensure that all Americans will receive necessary health care.  Let us all hope that it works.

     If we fail to enact reform legislation the cost of health care would continue to accelerate faster than our ability to pay for it.  The cost of health insurance would continue to grow faster than salaries and wages.  As employers absorb ever-increasing health care costs American products would become uncompetitive in the global marketplace.  Medicare would go bankrupt and our federal and state governments would face ballooning deficits far into the future.  And, most seriously, Americans would live less healthy lives and would die sooner than the people of other industrialized countries who have created more rational and more efficient health care delivery systems.

     This is a historic moment for America.  We are all in this together, and this legislation will help to move us towards a more just and more equal society.

Visit Professor Huhn's website on health care financing reform for links to information about proposed legislation, studies and reports, public agencies, and private organizations concerned with this issue.

     The "manager's amendment" offered by Majority Leader Harry Reid includes $10 billion in new funding for community health centers.  It has been reported that this funding will support primary medical care for 25 million Americans.

     On December 19, Chris Frates of Politico reported that Senator Bernie Sanders (I-VT) threw his support to the Senate health care bill because it added $10 billion in funding for community health centers, where people can obtain low-cost medical and dental care.  Frates quotes Sanders:

"If you expand Medicaid and if you expand health insurance in general, that is enormously important. But at the end of the day it doesn't mean much if people can't find a doctor or they can't find a dentist. And what we have managed to accomplish is substantially increase community health centers, 10,000 communities in America as a result of this legislation will now have access to community health centers. 10,000 more communities, 20,000 more primary health care physicians and dentists. And we think that is going to help revolutionize primary health care in America and it is a really important step forward in health care reform."

     Katrina Vanden Heuvel at The Nation praises the amendment, stating:

"These non-profit, community-based facilities provide primary healthcare, dental care, mental health services, and low-cost prescription drugs on a sliding scale."

     Not surprisingly, the National Association of Community Health Centers agrees:

"NACHC continues to support the Senate health reform bill, and the inclusion of the manager’s amendment will further improve access to affordable, quality health care for the newly insured and low-income, underserved individuals.

Health Centers particularly appreciate several provisions that will have a major impact on health centers across the country. Due to the extraordinary efforts of U.S. Senator Bernie Sanders of Vermont, the manager’s amendment includes a direct investment of $10 billion for health centers and the National Health Service Corps, including $1.5 billion for health center construction. This direct funding, a new and guaranteed stream over the next five years, will ensure that health centers are available to serve millions of additional patients in need.

The manager’s amendment also restores a provision that protects health center payments within the new Health Insurance Exchange, ensuring health centers are paid reliably and adequately for providing a health care home to millions of newly insured patients. Finally, the manager’s amendment improves health center payments in Medicare, eliminating caps and screens and updating the Medicare covered services to include preventive services – critically important as health centers’ Medicare population continues to grow."

     Even the New York Daily News likes the idea.  Kenneth R. Bazinet, in an article published on December 21, states:

"In exchange for his vote on the diluted Senate health care bill, Sanders asked for and received just what the doctor ordered — $10 billion to increase the number of community health care centers nationwide, including at least two more for Vermont. It means health care for 25 million Americans nationwide, if the bill passes.

The Green Mountain State already has eight of those centers, which provide primary care, dental and low-cost prescription drugs. Nobody is turned away, since the centers accept as payment Medicare, Medicaid or nothing at all from people who are uninsured. More than 100,000 Vermonters get their primary care at these health care centers."

     Bazinet reports that Sanders also obtained funding to add 20,000 more doctors, dentists, and nurses to the National Health Service in order to improve primary care for low income Americans.

     This single provision addresses all three of the goals of health care reform: it broadens access to health care, improves its quality, and reduces its cost.  Bravo!

Visit Professor Huhn's website on health care financing reform for links to information about proposed legislation, studies and reports, public agencies, and private organizations concerned with this issue.

     The American Medical Association has endorsed the Senate health care plan.  In light of the role that doctors and hospitals played in defeating health care reform 17 years ago, this was a significant development, but it was not particularly a surprise.  However, I hadn't realized how much consensus there is in favor of health care reform until I read what AHIP (the private health insurance lobbying group) and the U.S. Chamber of Commerce are saying about the Senate bill. 

     The A.M.A. has been largely supportive of health care reform for some time.  The current legislation achieves a number of its goals.  There will be near-universal health insurance coverage, and health insurance policies will be far more comprehensive.  There will be coverage for pre-existing conditions and no annual or lifetime limits for necessary medical care.  There will be no public option, thus postponing the development of a "single-payer" system such Canada's or Britain's.  Best of all from the A.M.A.'s standpoint, there will be no expansion of the relatively low Medicare reimbursement rates through either a public option or Medicare buy-in plan.  Had either of those provisions passed the Senate, doctors and hospitals would almost certainly have opposed the legislation.  The legislation will increase demand for medical care which will ensure a market for the services of medical care providers.  It is therefore not surprising that doctors and hospitals support the legislation.

     More surprising is the rather tepid opposition being offered by AHIP and the U.S. Chamber of Commerce.

     Karen Ignagni, President of AHIP, issued a statement on December 19, in which she advocates changes to the current legislation – notably eliminating the $10 billion per year tax on health insurance companies and restoration of the 14% premium that the government pays for Medicare Advantage plans – but she does not call for the defeat of the legislation.  Here a portion of her statement:

“The debate before us today is not whether insurance market reforms are needed. In fact, health plans proposed and support a complete overhaul of insurance market rules and new consumer protections to ensure all Americans have guaranteed access to affordable, portable coverage. The critical policy questions are whether the current legislation can bend the cost curve and result in a sustainable system. While the bill makes important improvements in access and takes steps towards cost-containment, it lacks accountability to ensure that costs are brought under control. Moreover, this bill includes provisions that will increase costs for families and small businesses and disrupt the quality coverage on which millions of Americans rely today.”

     The private health insurance industry stands to gain much under the current legislation.  Health insurance will be mandated, thus vastly expanding the market for their product.  It is for this reason that many liberals oppose the Senate bill.  Many on the left attribute all of the problems in health care to "greedy" insurance companies that deny people medical care.  Regular readers of this column are aware that I do not agree with this characterization of the insurance industry.   Someone has to make utilization review decisions, and experience has shown that private companies are far more effective in this role than the government is.  One might just as well criticize doctors and hospitals as being "greedy" for charging too much.  But the problems here are not moral, they are economic, and the solution is to put in place a system that covers everybody but rewards efficiency.  In my opinion the private health insurance industry is a key component of that solution, if administrative costs can be brought under control.  That is what the health care legislation attempts to do.

     Finally, here is a lengthy list of proposals for health care reform being touted by the Chamber of Commerce, the main business group that has been opposed to the House and Senate health care reform legislation.  Notice how many of the following provisions are already contained in the health care bill, including individual mandates, creation of pooling mechanisms such as insurance exchanges, subsidies for low-income persons to purchase insurance, elimination of exclusions for pre-existing conditions, comparative effectiveness research, wellness and prevenion, creation of medical homes, administrative simplification, pay-for-performance reform, long-term care reform, and (drum roll) … "living wills and end-of-life issues."  Is the Chamber of Commerce finally endorsing "death panels?"  Here are the Chamber's proposals:

1) Get costs under control. Use an all-of-the-above strategy.

Medical liability reform

FDA pathway for biosimilars

Health information technology

Comparative effectiveness research

Wellness and prevention

Coordination of care and medical homes

Pay-for-Performance reform

Combating fraud and abuse

Living wills and end-of-life issues

Reinsurance

Consumer-driven health options

Small business pooling

Administrative simplification

Long-term care reform

Tax parity: Let individuals/small business deduct the full cost of insurance expenses

Without spending a trillion dollars or raising taxes, we could implement these and many other reforms that would help us start to bend the cost curve.

2) Reform the insurance system.

Eliminating the use of pre-existing conditions or health status

Guaranteeing that any individual or entity will be issued a policy

Guaranteeing that policies will not be revoked

Place reasonable limits on rating differences

Subsidies for those who cannot afford coverage

An individual obligation to obtain coverage

For negligible costs to the taxpayers, we could make the insurance system work. Insurance companies support it. An individual obligation is necessary to the equation, and would raise billions for the government that could be spent toward subsidies for the poor. New rating rules would make the system fair for small business and the selfemployed.

3) Create a vibrant market place.

Create a national all-inclusive connector/exchange that removes fragmentation

Should allow individuals and businesses from anywhere in the country to enroll

Should facilitate improved pooling mechanisms, choice, and competition

These three simple steps, at low cost to taxpayers, could make the insurance system work for everyone (thereby increasing access for the uninsured), improve our health care delivery system, and make serious progress toward controlling costs. They have support from a vast array of stakeholders. We don't need a $1-2 trillion dollar possible government takeover of health care — we need simple, pragmatic reforms.

     Employers, like individuals, are consumers of health care, and they stand to gain from any changes that will make health care more affordable.  If we can lick this problem the American workforce will be more productive and our businesses will be more competitive.

     The positions now being taken by the AMA, AHIP, and the Chamber of Commerce are persuasive evidence of the necessity to overhaul our system of health care by extending health insurance to cover more people and all medical conditions.  Different groups may object to specific aspects of the plan – principally on the revenue side of the equation, such as where cuts in federal spending will be made and who will have to pay the taxes necessary to purchase health insurance for an additional 30 million people – but there is a surprising amount of consensus on what we must do.

Visit Professor Huhn's website on health care financing reform for links to information about proposed legislation, studies and reports, public agencies, and private organizations concerned with this issue.

     Funding for health care reform comes principally from two sources: reductions in payments to providers under Medicare and Medicare Advantage, and increased taxes.  In this post I describe the new taxes that will be imposed to pay to provide health care to tens of millions of low-income Americans.

     The new taxes that will be imposed under the Senate bill are described in the December 19, 2009 report of the Joint Committee on Taxation.  The report is only three pages long, and it may be accessed from this link.  According to the report, these new taxes will generate $397 billion over the next ten years, approximately half of what is needed to pay for the expansion of Medicaid and to subsidize low-income persons to purchase health insurance, thus helping to extend health insurance to 31 million people (one-tenth of the American population) who are currently without health insurance.  The largest new revenue sources are the following: 

40% excise tax on high-end health care plans =$148.9 billion

Raise hospital insurance taxes on individuals earning more than $200,000 by .9% = $86.8 billion

Tax on health insurance providers =$59.6 billion

Tax on manufacturers and importers of certain medical devices = $19.2 billion

Raise the floor for medical expenses deduction from 7.5% to 10% = $15. billion

     By way of contrast, the principal revenue source in the health care reform bill passed by the House of Representatives is a tax surcharge of 5.4% on persons earning more than $500,000 annually.  According to the November 6 report of the JCT (available from this link), this tax would raise $460.5 billion over the next decade – significantly more than the taxes on health care that would be imposed by the Senate bill.

Visit Professor Huhn's website on health care financing reform for links to information about proposed legislation, studies and reports, public agencies, and private organizations concerned with this issue.

     News outlets are reporting that 60 Senators have agreed upon an amended health care reform bill.  The new bill and the CBO estimate are discussed below.

     Carrie Budoff Brown and Chris Frates of Politico and David Espo and Ricardo Alonso-Zalvidar of The Huffington Post are reporting (here and here) that Senate Majority Leader Harry Reid (D-NV) has secured 60 votes in favor of an amended health care reform bill.   The amended bill was introduced in the Senate this morning, and the CBO released its estimate of the effect of the bill on the federal deficit.  Jeffrey Young of The Hill reports that the unvailing of the amended bill

strongly suggests that he has united his caucus of 58 Democrats and two independents behind a measure that would extend health insurance coverage to around 30 million people and make fundamental changes to the U.S. healthcare system.

     Here is the 2074-page bill as introduced by Senator Reid on November 18, and here is the 383-page amendment to that bill that Reid introduced this morning. 

   Here are links to the 38-page CBO report on the effect of the bill on federal spending, as well as the CBO Director's summary of that report.

     On page 2 of the report the CBO identifies the following changes in the bill that will have the largest budgetary impact:

The changes with the largest budgetary effects include: expanding eligibility for a small business tax credit; increasing penalties on certain uninsured people; replacing a “public plan” that would be run by the Department of Health and Human Services (HHS) with “multi-state” plans that would be offered under contract with the Office of Personnel Management (OPM); deleting provisions that would increase payment rates for physicians under Medicare; and increasing the payroll tax on higher-income individuals and families.

    The amended bill also contains compromise language on funding for abortions.

     In tomorrow's post I will begin to analyze the changes that have been made to the Senate bill.

Visit Professor Huhn's website on health care financing reform for links to information about proposed legislation, studies and reports, public agencies, and private organizations concerned with this issue.

      Yesterday's post discussed the potential advantages of the public option in making health care more affordable.  However, in its evaluation of the House and Senate health care reform bills the CBO didn't think that the public option would have much of an impact either on the federal deficit or on overall expenditures for health care.

     In its report of November 13, 2009, evaluating the effect of the House bill on the federal budget, the Congressional Budget Office predicted that while the costs incurred by the public plan would likely be lower than the cost of private insurance largely because of lower administrative expenses, premiums for coverage under the public option would likely be higher than the cost of private insurance purchased through the exchange.  The CBO explained:

We estimate that the public plan would have costs that were 5 percent below the average level for private plans but that the public plan premiums would be roughly 4 percent higher than private as a result of antiselection by enrollees.  (Page 6)

     In other words, sicker persons would likely enroll on the public option thus raising the cost of the program.  In the absence of a public option, the additional expenses attributable to higher administrative costs and the cost of caring for sicker persons will have to be absorbed by the rest of the health care reform program.   

     Finally, the CBO stated that only a relatively small percentage of Americans would sign up for the public option, and that the public option itself would not have a significant impact on costs or the number of uninsured. 

We further estimate that about 25 percent of the approximately 25 million people with Exchange coverage would choose the public plan option, the actual percentage could be substantially different, although the impacts on Federal costs and the number of insured persons are not especially sensitive to this estimate. (Page 7)

     The figures cited by the CBO later in its report are slightly different, but the final result is the same.  On page 19 of the report, the CBO predicts that in the year 2019 18.6% of the American population would purchase private health insurance through the exchange, and that 6.2% of the population would purchase insurance through the public option.  On page 30 of the report, the CBO states that people's expenditures for health insurance on the public option during the same year would amount to $42 billion, while expenditures for private insurance through the Exchange would be $121 billion.  In other words, one-fourth of persons purchasing insurance through the Exchange would select the public option, and the cost of that insurance would be slightly higher than the cost of private health insurance.

     The November 18, 2009, CBO scoring of the Senate health care reform bill assigns an even smaller role to the public option, and as it found with respect to the House bill, the public plan would not be likely to save money because the government program would be less likely than private insurers to engage in utilization review - i.e., to deny coverage for desired procedures.  At page 9 of its report the CBO states:

     Roughly one out of eight people purchasing coverage through the exchanges would enroll in the public plan, CBO estimates, meaning that total enrollment in that plan would be 3 million to 4 million. … CBO’s assessment is that a public plan paying negotiated rates would attract a broad network of providers but would typically have premiums that were somewhat higher than the average premiums for the private plans in the exchanges. The rates the public plan pays to providers would, on average, probably be comparable to the rates paid by private insurers participating in the exchanges. The public plan would have lower administrative costs than those private plans but would probably engage in less management of utilization for its enrollees and attract a less healthy pool of enrollees.  

      In short, if the Congressional Budget Office is correct in its estimates, the public plans in the House and Senate bills would not have covered many people and would not have saved much money.

     There are liberals for whom the public option is the be-all and the end-all, and conservatives for whom the public option is the devil incarnate.  But perhaps liberals should not be so quick to dismiss the Senat health care bill as it now stands.  Even without the public option the legislation will extend health insurance to tens of millions of Americans and improve the coverage of everybody else.  If the free market can be regulated in such a way as to reduce health care expenditures we should all be pleased.  And perhaps conservatives should not rejoice over the demise of the public option.  If the CBO is wrong and the public option would indeed substantially reduce the cost of health care, then that would reduce the amount of premiums and taxes that everyone would have to pay.  If in the future health care costs continue to escalate out of control, we will have to consider adopting a government-run system. 

     I wish I were smart enough – and prescient enough – to tell you precisely what will happen if we do or if we don't include a public option in the health care bill.  But I would like to remind you that all of us are in this together, and that when injury or disease strikes us or our loved ones it won't make a bit of difference whether we adhere a liberal or a conservative ideology.  When that happens the only thing that we will want is for medical care to be available, affordable, and of high quality.

     Let's leave partisanship and ideology behind, and seek to solve our nation's problems using a rational, fact-based approach.

Visit Professor Huhn's website on health care financing reform for links to information about proposed legislation, studies and reports, public agencies, and private organizations concerned with this issue.

     According to news reports (including this article by Jeffrey Young in The Hill), Senator Joe Lieberman is killing the public option in the Senate.  And as a result, some leading Democrats like former Governor and Democratic Party Chair Howard Dean now oppose the health care bill if it is stripped of the public option (according to this report by Carrie Budoff Brown and Mike Allen of Politico).  How important is the public option to expanding coverage and lowering costs?

     The "public option" is a essentially a government-run health insurance program.  It would not be free medical care.  Premiums would be established as they are by any non-profit insurance company – premiums would have to be set high enough to cover both the cost of medical care and administrative costs.  The public option would be simply one among many choices available to individuals through the exchange or (under a more expanded version of the public option) to employers for purchasing health insurance.

     The importance of the public option in protecting consumers depends upon its potential to affect the the market power of two other groups – private health insurers and medical care providers.  If private health insurers enjoy a monopoly, they may charge consumers whatever they want.  However, when health insurers are weak and fragmented, it may also result in high costs for consumers because in that situation medical care providers may be able to charge higher fees, and the private insurers would be unable to negotiate lower prices on behalf of consumers.  The trick is to create an insurance company that can drive down the prices charged by medical providers and which is willing to pass on those savings to consumers.

     That is why so many people favor a public option.  Despite the fact that the proposed legislation provides that participation by doctors and hospitals in the public option would be "voluntary," as a practical matter it becomes mandatory.  Chains of hospitals and freestanding institutions will participate in the government program, and they will require any physicians who desires privileges at those hospitals to participate as well.  Accordingly, a public insurance plan will probably automatically be able to offer consumers a sizeable network of doctors and hospitals from which they may secure medical care.

     Furthermore, the government would probably be able to drive a harder bargain with health care providers, and negotiate lower prices than private insurers would – even those insurers which enjoy monopoly or near-monopoly status in a geographic market. 

     In theory, at least, the public option would be a very attractive element to any system of health care reform designed to drive down costs.

     There are some downsides, though – and the principal one has been on display recently in the dispute over the availability of mammograms.  Whatever your position on the wisdom of annual mammograms for women over 40, it is undoubtedly easier for a private insurer to deny coverage than it is for a public insurer.  This issue quickly became a political football, and contrary to what many conservatives believe, the private market is far more likely to "ration" health care than public agencies are, and contrary to what many liberals believe, the private market is more efficient than the public sector at least with respect to ensuring that only the most cost-effective treatments are covered.

     So – how effective will health reform be without a public option?  There are a number of factors to consider.  First and foremost is the need for competition in the health insurance industry.  In almost every region of the country there is little or no competition among health insurers.  Here is the 2007 report of the AMA on "Competition in Health Insurance: A Comprehensive Study of U.S. Markets" showing that the health insurance industry is highly concentrated in almost all regions of the country.  The AMA states:

To put this in perspective, in 2000, the two largest health insurers, Aetna and United, had a total membership of 32 million lives. As a result of mergers and acquisitions since 2000, the top two insurers today, WellPoint and United, each have memberships, respectively, of 34 million and 33 million, totaling more than 67 million covered lives. Together, WellPoint and United control 36 percent of the national market for commercial health insurance. In 2004 and 2005, 28 mergers valued at a total of $53.8 billion were completed or announced, which exceeded the value of all the deals completed in the previous eight years. (Corporate Research Group, The Managed Care M&A Explosion, 2005).

Observers predict that large health insurers will continue to acquire their smaller competitors. WellPoint’s new chief executive officer stated in February that mergers will be one of the key drivers of WellPoint’s future growth. Further, in March, United announced its proposed acquisition of Sierra Health Services, the largest health plan in Nevada. The AMA has asked the U.S. Department of Justice (DOJ) to block the merger, because if the merger is approved United will control 56 percent of the Nevada marketplace (compared with its current 11 percent market share).

While large health insurers have posted very healthy profits since 2000, premiums for consumers have increased without a corresponding increase in benefits. In fact, during the same time period, consumers have faced increased deductibles, co-payments and co-insurance. This has effectively reduced the scope of their health benefits coverage.

     The Commonwealth Fund believes that by providing comptetion for health insurers the public option is one element that could contribute to bringing down costs.  In its December 7, 2009 Report "Why Health Reform Will Bend the Cost Curve" the authors state that the public option could reduce the administrative costs of private insurers: 

Currently, nearly 13 percent of insurance premiums are accounted for by administrative costs. These costs range from about 5 percent in large firms and firms that are self-insured to 30 percent for individuals. Higher costs for marketing, underwriting, churning, benefit complexity, and brokers’ fees explain the bulk of the difference.

Both the House and Senate bills propose insurance exchanges that would group individuals and small firms into larger entities and thus drive down those administrative costs. A public option would contribute to this effort. In many areas of the country, there is little meaningful insurance competition. By providing such competition, the public option can drive down profits and force insurers to streamline other components of administration, including benefit design. The House bill would offer a public health insurance plan in the exchange, and the Senate bill would establish a public option, with states being able to opt out at their choosing. Each of these would reinforce the impact of insurance exchanges.

     How big would this effect be? In tomorrow's post I will describe what the Congressional Budget Office predicts as to the magnitude of the economic effect of the public option.

Visit Professor Huhn's website on health care financing reform for links to information about proposed legislation, studies and reports, public agencies, and private organizations concerned with this issue.

     Senator Mark Warner, (D-VA) has offered a detailed amendment to the Senate health care bill that will strengthen many of the cost containment provisions of the bill.  This is in line with changes that have been demanded by the Business Rountable and other organizations whose primary concern is to reduce the cost of medical care for America's citizens and businesses.

     The greatest criticism of the proposed health care legislation is that while it does a good job of extending health insurance coverage to the uninsured, it does not do enough to reduce the high cost of medical care.  Here are some previous postings regarding projections of costs and recommendations for cost containment by CMS, the Commonwealth Fund, AHIP, CBO, and the Brookings Institute. 

     Jeanne Cummings of Politico recently interviewed John Castellani, President of the Business Roundtable, a trade association of large businesses that generally supports health care reform.  Cummings reports that the Roundtable is demanding stronger cost containment provisions in the new law.

     One of the fascinating aspects of this entire debate is the extent to which the interests of different segments of society line up on different aspects of reform.  Large employers, represented by the Business Roundtable, in general support universal health care because it will reduce the amount of money that they must spend on health care for their employees.  Approximately 10% of premiums for private health insurance are spent on providing care for the uninsured.  If the uninsured either purchase health insurance or the government purchases it for them, this burden will be lifted from individuals and employers who already have health insurance.  Accordingly, the Business Roundtable supports the President's effort to achieve universal heath care.

     But the Roundtable's primary goal is to reduce the cost of medical care for its members and their employees, and as a consequence it wishes to strengthen the cost containment provisions of the bill by having the government take a more active role in forcing people to purchase health insurance and in regulating the practice of medicine to make it more efficient.  Cummings reports that the Roundtable wants these specific changes to the bill:

1.  The government should share data regarding the most cost-effective treatments and providers, allowing businesses to develop more efficient health insurance packages;

2.  The government should expand the authority of the proposed Independent Medicare Advisory Board to make medical care more efficient;

3.  Medicare should  move more quickly towards managed care models of payment in place of "fee-for-service" payment schedules.

4.  There should be higher penalties on persons who choose not to purchase health insurance so that more healthy people enter the pool thus lowering the average cost of health insurance.

     Cummings reported that Senator Mark Warner (D-VA) has drafted an amendment addressing some of the Roundtable's concerns.  On his website, Warner states that his amendment is backed by an impressive array of businesses, unions, and health insurers, and that the amendment enjoys bipartisan support, including Republicans Olympia Snowe and Susan Collins of Maine.

     Senator Warner lists three categories of reforms contained in his proposal: provisions that will "improve quality and value," those that will "promote transparency and competition," and those that will improve "accountability and responsibility."  Here is how Warner describes these various provisions:

Improving Quality and Value Through Delivery System Reform

Sec. 3601. Quality Reporting for Psychiatric Hospitals. The section would create a pay-for-reporting program for Medicare inpatient psychiatric hospitals beginning 2014. A percentage of payment for these facilities would be tied to successful reporting of quality data, which would be available to the public after opportunity for a hospital or unit to review their performance.

Sec. 3602. Pilot Testing Pay-for-Performance Program for Certain Medicare Providers.This section would direct the Secretary to begin pilot testing of value-based purchasing (pay-for-performance) programs for certain types of Medicare providers no later than January 1, 2016. These provider types include: inpatient psychiatric hospitals, long-term care hospitals, inpatient rehab facilities, acute prospective payment system-exempt cancer hospitals, and hospices. The Secretary would have authority, after 2018, to expand these pilots if the CMS Chief Actuary determines it would reduce Medicare program spending while maintaining or improving the quality of care.

Sec. 3603. Plans for a Value-Based Purchasing Program for Ambulatory Surgical Centers.This section would direct the Secretary to develop a plan to create a value-based purchasing program for ambulatory surgical centers. The plan would be submitted to Congress no later than January 1, 2011.

Sec. 3604. Revisions to National Pilot Program on Payment Bundling. This section would modify the new CMS pilot on Medicare bundled payments created by the Patient Protection and Affordable Care Act. It would expand the number of health conditions tested under the pilot and give the Secretary authority to expand the duration or scope of the pilot after January 1, 2016 if the CMS Chief Actuary determines it would reduce Medicare program spending while maintaining or improving the quality of care.

Sec. 3605. Improvements to the Medicare Shared Savings Program.This section would give the Secretary greater flexibility in administering the Medicare Shared Savings Program. This program is created by the Patient Protection and Affordable Care Act to reward Accountable Care Organizations (ACO) that successfully coordinate care to lower costs and improve the quality of care.

Sec. 3606. Incentives to Implement Activities to Reduce Disparities. This section would ensure that qualified health plans offered through new American Health Benefit Exchanges include programs to reduce health disparities as part of required quality improvement activities.

Sec. 3607. National Diabetes Prevention Program.This section would direct the Centers for Disease Control and Prevention (CDC) to establish a national diabetes prevention program that targets individuals at high risk of developing diabetes. It authorizes federal grants to entities developing community-based diabetes prevention models and other training and outreach activities.

Sec. 3608. Selection of Efficiency Measures. This section would ensure that measures of efficiency are included under new quality measure development activities supported by this Act.

Sec. 3609. Regional Testing of Payment and Service Delivery Models Under the Center for Medicare and Medicaid Innovation. This section would gives the new Center for Medicare and Medicaid Innovation (CMI) established under this Act explicit authority to target the testing of new payment and delivery models to more regions.

Sec. 3610. Additional Improvements Under the Center for Medicare and Medicaid Innovation. This section gives CMI additional flexibility in selecting models to be tested and permits the Secretary to give preference to models that would align Medicare and Medicaid spending with other public sector or private sector payer quality improvement efforts.

Sec. 3611. Improvements to the Physician Quality Reporting System.This section would modify the current Medicare Physician Quality Reporting Initiative (PQRI) to permit physicians who report quality data through a qualifying Maintenance of Certification (MOC) program to be eligible for an incentive payment for years 2011-2014. The Secretary also is permitted, starting in 2014, to include MOC participation as a component of the PQRI composite measure.

Sec. 3612. Improvement in Part D Medication Therapy Management (MTM Programs).This section would require Medicare Part D prescription drug plans (PDPs) to offer a minimum set of medication therapy management services to certain targeted beneficiaries. It also would require PDPs to routinely assess at-risk individuals who are not enrolled in MTM services and automatically enroll them (permitting beneficiaries to opt-out if they choose).

Sec. 3613. Evaluation of Telehealth Under the Center for Medicare and Medicaid Innovation.This section would permit CMI to evaluate, analyze and make recommendations about the effectiveness of telehealth behavioral health issues (such as post-traumatic stress disorder) and telestroke services in medically underserved areas and Indian Health Service facilities.

Sec. 3614. Revisions to the Extension for the Rural Community Hospital Demonstration Program. This section would extend the Rural Community Hospital Demonstration Program for an additional five years, instead of one year as originally proposed by this Act. It would expand the number of hospitals eligible for the project from 15 to 30 and make 20 rural states eligible to participate, instead of the current 10. Another provision allows already participating hospitals to rebase Medicare reimbursements according to current health delivery costs.

Promoting Transparency and Competition

Sec. 3621. Developing Methodology to Assess Health Plan Value.This section would require the Secretary to consult with relevant stakeholders to develop a methodology for measuring health plan value, which would include the cost, quality of care, efficiency, actuarial value of plans. The Secretary would submit a report to Congress concerning the proposed methodology within 18 months of enactment of this Act.

Sec. 3622. Data Collection; Public Reporting.This section would modify the new data collection and reporting efforts created by this Act by requiring the Secretary to establish and implement an overall strategic framework for the public reporting of provider performance on reported quality measures.

Sec. 3623. Modernizing Computer and Data Systems of the Centers for Medicare and Medicaid Services to Support Improvements in Care Delivery. This section would require the Secretary to develop a plan, within 9 months of enactment of this Act, to modernize the Centers for Medicare and Medicaid Services (CMS) computer and data systems.

Sec. 3624. Expansion of the Scope of the Independent Medicare Advisory Board.This section would require the Independent Medicare Advisory Board (IMAB) created under this Act to produce an annual report starting in 2014 that includes national and regional information on the cost, utilization, quality, and other features of health care paid for by private payers and Medicare. IMAB also would be required to take the findings of these annual reports into account when preparing proposals to improve Medicare. IMAB also would, starting in 2015 and at least every two years after, submit recommendations to Congress and others on how to slow the growth in national health expenditures.

Sec. 3625. Additional Priority for the National Health Care Workforce Commission.This section would require the National Health Care Workforce Commission created under this Act to also make recommendations to remove the barriers that health providers encounter to beginning or maintaining professional practice in primary care.

Promoting Accountability and Responsibility

Sec. 3631. Health Care Fraud Enforcement.This section increases federal sentencing guidelines for all federal health care offenses that involve a loss greater than $1,000,000. This section amends the definition of “health care fraud offense” to include health care crimes that are codified outside of Title 18. This section clarifies the definition of “willfully” to prevent defendants from escaping punishment for violation of a federal health care fraud offense by arguing that they were not aware of the specific criminal provision that they are accused of violating. This section also provides that obstruction of criminal investigations involving administrative subpoenas under the Health Insurance Portability and Accountability Act (HIPAA) of 1996 is treated in the same manner as obstruction of criminal investigations involving grand jury subpoenas. Finally, this section permits the Department of Justice to issue subpoenas in investigations pursuant to the Civil Rights of Institutionalized Persons Act.

Sec. 3632. Development of Standards for Health Care Financial and Administrative Transactions.This section would require the Secretary, beginning no later than January 1, 2012, and every three years thereafter, to convene stakeholders to identify opportunities to create uniform standards for financial and administrative health care transactions, not already named under HIPAA, that would improve the operation of the health system and decrease administrative costs. Initially, this would include areas such as health claim edits, provider enrollment, and audits. Once the panel identifies new health care transactions that should be made uniform, the Secretary can develop standards for them. Health plans will need to comply with these new standards and associated business rules or face a financial penalty. In addition, this section convenes health information technology stakeholders to ensure a smooth transition takes place for providers as they move from one coding software to the next.

Visit Professor Huhn's website on health care financing reform for links to information about proposed legislation, studies and reports, public agencies, and private organizations concerned with this issue.

     The Congressional Budget Office recently published a study on the cost of prescription drug advertising showing that drug companies spend more on promotion than they do on research and development.   Does this advertising raise or lower the cost of drugs?

     The CBO study, entitled "Promotional Spending for Prescription Drugs," was released December 2, 2009, and it confirms that a substantial portion of the budget of drug manufacturers is spent on advertising and free samples – in fact, they spend almost as much on these promotional activities as they do on research and development. 

     On page 2 of the report, the CBO cites these figures:

Domestic Sales of Pharmaceuticals and Medicines for 2008 = $189 billion

Domestic Spending on Research and Development = $38 billion

Promotional Expenditures = $38.5 billion, including the following elements:

Detailing to Physicians, Nurse Practicioners, and Physician's Assistants = $12 billion

Sponsoring Professional Meetings = $3.4 billion

Advertisements in Professional Journals = $0.4 billion

Direct Advertising to Consumers = $4.7 billion

Free Samples Distributed to Physicians = $18 billion (2005 estimate)

     Nearly half of the promotional budget is for free samples, and you wouldn't think that there could be a problem with that, but unfortunately, some drug companies were distributing samples of drugs that had not been approved by the F.D.A.  (See this news release from the Justice Department entitled "Justice Department Announces Largest Health Care Fraud Settlement in its History," September 2, 2009).   But even if we set aside the cost of free samples, drug manufacturers are still spending in excess of $20 billion annually to promote specific products.

     On page 6 of the report the CBO identifies which types of drugs are promoted the most.  Leading the pack in DTC (Direct to Consumer) advertising was – ta da! – Erectile Dysfunction medications.  However, these "male enhancement" drugs scored a measly seventh place among advertising to physicians, among whom the leading categories of drugs were statins, antidepressants, and antipsychotics.  Are physicians less prone to erectile dysfunction but more depressed?  We'll never tell!

     The serious question is, of course, does all this advertising for prescription drugs benefit society?  More specifically, does it encourage the development of new medications and/or reduce the cost of drugs?  I can imagine arguments on both sides of that question.  As the cost of health care rises, and particularly in light of the prescription drug benefit under Medicare Part D, it becomes rather important to determine the effect of advertising on the cost of drugs. 

     According to a study recently published in the journal Archives of Internal Medicine and summarized here by PhysOrg.com, advertising for the drug Plavix did not increase sales of the drug, but it did coincide with a dramatic increase in the price of the drug.  According to this same report, the price increase for this single drug added $240 million to government spending on Medicaid.  The posting in PhysOrg.com quotes one of researchers:

"The key issue is whether advertising to consumers, which has risen 330 per cent in the last 10 years in the US, contributes to the significant cost increases in publicly funded health insurance programs such as Medicaid," says Stephen Soumerai, co-author of the study and professor of Population Medicine at Harvard Medical School and the Harvard Pilgrim Health Care Institute.

Visit Professor Huhn's website on health care financing reform for links to information about proposed legislation, studies and reports, public agencies, and private organizations concerned with this issue. 

     Yesterday the Centers for Medicare and Medicaid Services (CMS) released this report estimating the effect of the original Senate health care bill submitted by Majority Leader Harry Reid on the federal deficit and on projected health care expenditures.  This post concerns how the new CMS report differs from the previous report prepared by the Congressional Budge Office (CBO) scoring the bill.

     It  is difficult to compare the CMS and CBO projections for two reasons.  First, the two reports break down spending and savings into different categories.  I have tried to be careful in adjusting these figures so that we are comparing apples to apples.  Second, each report contains information that the other does not.  The CMS does not attempt to estimate the major revenue portions of the bill; the CMS is solely concerned with predicting how the bill will affect the cost of medical care to the government and to consumers.  The CBO does not attempt to measure the effect of the bill on the overall cost of medical care to consumers; it is concerned solely with the effect the health care bill on the federal budget. 

     The one area of overlap between the CMS and CBO reports is in measuring how the Senate bill will affect federal expenditures  for health care.  The three "big ticket" items of the federal health care budget affected by the bill are increased spending on Medicaid, increased spending on subsidies for individuals to purchase health insurance, and savings from reductions in payments under Medicare.  The two agencies' competing estimates for the changes in Medicaid and Medicare spending are very close, but the predictions as to the cost of subsidies for the purchase of non-group insurance through are widely divergent.  However, this difference appears to result simply from different estimates about how many people will choose to purchase insurance through the exchange.

Increased spending on Medicaid and CHIP due to the expansion of those programs to persons earning up to 133% of the federal poverty level.  The CMS estimates that over the next ten years the government will spend an addtional $328.7 billion over ten years (net of two items on page 21 of the CMS report).  The CBO report is almost precisely the same; it estimates that that government will spend an additional $327.6 billion on Medicaid and CHIP, (net of 30 line items for expenditures and savings on pages 20-24 of the CBO report). 

Increased federal spending in the form of subsidies for low income persons (persons earning less than 400% of the federal poverty level) to purchase non-group insurance through the exchange.  The CMS estimates that the total cost of individual insurance subsidies for low-income people to purchase insurance through the exchange will be $617 billion over ten years.  (Page 21, CMS)  The CBO, in contrast, puts this figure at $447 billion.   (Page 21, CBO)

Savings resulting from the elimination of the 14% premium payment to insurance companies under Medicare Advantage and changes to the reimbursement formula for non-physicians.  The CMS estimates that these savings will amount to $493.4 billion over ten years (Page 21, CMS), while the CBO predicts that these savings will total $491 billion. (Page 10, CBO)

     It becomes important, therefore, to determine why CMS believes that the cost of individual subsidies will be so much more expensive than the CBO does.  The CMS figure of $617 billion for these subsidies is almost 40% higher than the CBO prediction of $447 billion.

     The principal difference, it appears to me, is that the CMS predicts that by 2019 35 million people will be enrolled on the exchange. (Page 6, CMS)  In contrast, the CBO predicts that there will be 25 million people who are enrolled on the exchange by the end of ten years.  (Page 20, CBO).  This 40% differential in enrollment accounts for the entire variation in the cost of the subsidies, assuming that each enrollment population contains the same distribution of low-income persons.

     Like the CBO, the CMS is concerned that extending medical care to the uninsured and underinsured will drive up prices – that there will not be enough doctors and hospitals to satisfy demand, and that reimbursement rates will rise outside of price-controlled markets like Medicare and Medicaid, and that, as a consequence, fewer doctor and hospitals will be willing to participate in those government programs.  It is not clear from the CMS report how much, if any, of the increase in the cost of subsidies for insurance premiums is attributable to what it believes will happen to the price of medical care.  Other studies, like this one from the Commonwealth Fund that I described in this previous post, predict that the more people who purchase insurance through the exchange the more it will cause the cost of medical care to go down because of the economic effect of pooling the purchasing power of consumers in the non-group market.

     The CMS concludes that if  the bill is enacted, it will have only a very slight effect on total expenditures for health care.  In its report of June 29, 2009, the CMS predicted that if we do nothing, health care costs will nearly double over the next ten years.  In the report of December 10, the CMS states that the Senate bill will result in a further additional increase of seven-tenths of one percent over ten years (Page 14, CMS), while extending health insurance coverage to an additional 33 million people.  (Page 3, CMS)  In contrast, the Commonwealth Fund report referenced above predicts that the Senate bill would significantly reduce health care expenditures relative to current law.

     It should be noted that both the December 10, 2009 CMS report and the November 18, 2009 CBO report are evaluating the bill that Senator Reid proposed on November 18.  There are, as of yet, no estimates regarding the cost of the bill that may emerge from negotiations between liberal and moderate members of the Senate.  Watch, and wait.

UPDATE December 12: J. Taylor Rushing of The Hill reports on the spin that both Democrats and Republicans are putting on the CMS report.

Visit Professor Huhn's website on health care financing reform for links to information about proposed legislation, studies and reports, public agencies, and private organizations concerned with this issue.

     Once drugs that have been manufactured in America have been shipped out of the country, federal law currrently forbids their reimportation.  An amendment to the health care bill being offered by Senator Byron Dorgan (D-ND) would lift the ban on reimportation.  The amendment enjoys broad popular support, and according to the Congressional Budget Office it would save Americans billions of dollars, but is it a good idea?

     Senator Byron Dorgan intends to offer S. 1232, the Pharmaceutical Market Access and Drug Safety Act, as an amendment to the health care reform bill pending in the Senate.  Here is a press release from Senator Dorgan explaining the amendment and setting forth his arguments in favor of it.  Dorgan states in part:

Under bipartisan legislation that U.S. Senator Byron Dorgan (D-N.D.) is pushing to include in the health reform bill, North Dakotans would save an estimated $200 million on prescription drug costs, and the federal budget deficit would be cut by nearly $20 billion over the next ten years. The Senate is expected to vote this week on Dorgan’s amendment.

Dorgan’s legislation, called the Pharmaceutical Market Access and Drug Safety Act, would allow American consumers to safely import lower-priced, Food and Drug Administration-approved drugs from other countries. Dorgan said the legislation will bring consumers in North Dakota and across the country immediate relief from the world’s highest prescription medication costs, and will ultimately force the pharmaceutical industry to lower drug prices in the United States.

     In 2007, the Congressional Budget Office released this study estimating that this legislation would reduce the federal deficit by $10 billion annually – that revenues would increase by over $5 billion per year because taxppayers would be spending less on medications, thus reducing their tax exemption for health insurance, and that federal expenditures would drop by over $5 billion because the government would be paying lower prices for drugs.

     In 2004 the CBO published this report stating that the effect of changing the law to allow reimportation of drugs from other countries would have a negligible effect on the price of drugs in the United States because pharmaceutical manufacturers would simply ship fewer drugs abroad, would enter into contracts prohibiting reimportation, or would make different drugs for shipment abroad – drugs that had not been approved in current form by the F.D.A.  Dorgan's bill addresses these possible "defensive actions" that the drug companies might take, and institutes "counterdefenses" prohibiting drug companies from engaging in any of these behaviors.  According to the Congressional Research Service which prepared this summary of Dorgan's bill, the law would prohibit drug manufacturers from:

(1) discriminating against registered exporters or importers; (2) causing there to be a difference in a prescription drug distributed in the United States and one distributed in a permitted country; (3) engaging in actions to restrict, prohibit, or delay the importation of a qualifying drug; or (4) engaging in any action that the Federal Trade Commission (FTC) determines discriminates against a person that engages or attempts to engage in the importation of a qualifying drug.

     As a consequence, Senator Dorgan asserts in his press release that over the next decade his legislation would save American consumers over $100 billion due to lower prices for prescription drugs.  He also claims to have broad bipartisan support for his bill, including both Senator John McCain and former Senator Barack Obama: 

The bill also has substantial bipartisan support, with Senators Olympia Snowe (R-ME), John McCain (R-AZ), Chuck Grassley (R-IA), Debbie Stabenow (D-MI), Amy Klobuchar (D-MN), Sherrod Brown (D-OH), Jeanne Shaheen (D-NH), David Vitter (R-LA), Herb Kohl (D-WI), Patrick Leahy (D-VT), Russ Feingold (D-WI), Bill Nelson (D-FL), Bernie Sanders (I-VT), Al Franken (D-MN), Sheldon Whitehouse (D-RI), Barbara Boxer (D-CA), Jim Webb (D-VA), Jon Tester (D-MT) Tim Johnson (D-SD) and Mark Begich (D-AK) cosponsoring the amendment. Dorgan points out that President Obama also co-sponsored the bill when he was in the Senate.

     What Dorgan does not mention is that as President, Obama now opposes this legislation.  In this article published yesterday in The Hill, Jeffrey Young states that the President had promised the pharmaceutical industry that they would have to pay no more than $80 billion as their share of the cost of health care reform, and that this law would breach that agreement.  Young confirms that the bill would "likely" garner more than 60 votes in the Senate if it comes to a vote, but that so far the President had been successful in preventing a vote on the measure.  Young states:

A deal between the White House and the pharmaceutical industry is holding up a bipartisan amendment to allow the importation of cheaper prescription drugs from abroad, according to a member of the Senate Democratic leadership.

The Senate has been debating the amendment, sponsored by Sen. Byron Dorgan (D-N.D.), since Tuesday but has not held a vote, which is contributing to a stall in the floor action on healthcare reform.

     I could care less about any deals that have been made with the pharmaceutical industry, but I oppose the Dorgan amendment on substantive grounds.  Common sense – or, if you please, the laws of physics – tells us that it is not possible to export drugs to another country and then reimport those same drugs back into the U.S. and to have the price of those drugs go down as a result.  Why is it cheaper to "reimport" drugs from another country rather than to simply purchase those same drugs from a domestic supplier?  There is one reason and one reason only for this medical and economic miracle, this transubstantiation of transportation costs into transportation savings – - – other countries have adopted price controls on prescription drugs.  As the CBO explains in its 2004 report:

In many foreign industrialized countries, prices are also controlled or partially controlled by regulation. In the Canadian patented drug market, for example, drugmakers may not charge a price above a maximum level determined by Canada's Patented Medicine Prices Review Board (PMPRB).

     When Americans "reimport" drugs from Canada, the savings arise entirely from price controls generated by the Canadian PMPRB. 

     In general, I oppose price controls in government programs and instead favor a free market approach that allows the government to act just like any other consumer.  As a consequence I think that rather than simply setting reimbursement rates with doctors and hospitals under Medicare, the government should negotiate the price that it pays for medical care, just like any other insurer or employer.  Similarly, I think that the government should have the power to negotiate drug prices with drug companies under Medicare Part D. 

     But I am absolutely opposed to making ourselves subject to price controls instituted on American goods by a foreign government.  If we are going to adopt a system of price controls for pharmaceutical products, then let us do that ourselves.  Let us enact legislation creating an agency that is analogous to the Canadian PMPRB and decide for ourselves how much each pharmaceutical product should cost.  I am adamantly opposed to delegating this responsibility to foreign nations.

     Sett ing drug prices requires careful consideration of multiple factors by any government agency charged with this responsibility.  Not only must such an agency take into account how much consumers need the drug and how much they have to spend, it must also consider matters from the perspective of the drug companies – the need to stimulate innovation by rewarding research and development and conferring appropriate patent protection, the necessity to ensure safety through the approval process as well as in manufacture of drugs, and finally the requirement of setting appropriate levels of spending for manufacture, distribution, and marketing of the drug.  It makes no sense to allow foreign countries to make those determinations with respect to drugs that are manufactured in America and consumed in America.  While I am sure that Canadians are happy with their own system of price controls, I do not believe that the Canadian PMPRB has the best interests of American manufacturers or American consumers at heart.

     If we are going to institute a system of price controls for pharmaceutical products in America then let's do it.  Let's not pretend that we believe in free enterprise by refusing to institute our own system of price controls while surreptitiously making use of price control systems established by foreign governments.

UPDATE December 12: Ryan Grim of the Huffington Post reports that Senator Tom Carper (D-DE) has placed a "hold" on Senator Dorgan's amendment, and that at least one co-sponsor of the amendment, Senator Jay Rockefeller (D-WV) has stated that he will vote against the amendment if it comes to the floor for a vote.  Grim reports that Rockefeller said "that even though he is a supporter of reimportation, he is concerned that if it passes it could blow everything up."

UPDATE December 16: Grim has published another article describing how the Dorgan Amendment was defeated 51-48, with 30 Democrats and Senator Joe Lieberman (I-CT) voting against it.  Grim also believes that the amendment was defeated in return for a provision closing the "donut hole" by 2019.

Visit Professor Huhn's website on health care financing reform for links to information about proposed legislation, studies and reports, public agencies, and private organizations concerned with this issue.