April 6, 2015
The $141 billion health care bill that cleared the House last month and that is expected to win Senate approval next week is a tribute from the GOP-controlled Congress to former Congressman Henry Waxman, a man who worked tirelessly – and with great success – to expand health care-related welfare spending.
Because the measure deals predominantly with Medicare, most have overlooked its nearly $30 billion hike in social welfare outlays. The bill (H.R. 2) increases Medicare payments to physicians, largely by replacing one complicated and flawed formula with another. It directs the army of bureaucrats who populate CMS cube farms to soldier on with their futile, half-century-long quest to implement a workable system of administered pricing.
via The GOP’s Gift To Henry Waxman – I | Doug’s Brief Case.
April 1, 2015
While all eyes in the health policy community have been fixed on the Supreme Court, awaiting its decision in King v. Burwell regarding the legality of premium tax credits granted through the federally facilitated marketplaces, a case of arguably equal importance has been quietly awaiting a decision. On March 31, 2015, a closely divided Supreme Court decided in Armstrong v. Exceptional Child Center, Inc. that health care providers cannot sue state Medicaid programs in federal court to enforce 42 U. S. C. §1396a(a)(30)(A) which requires states to “assure that payments are consistent with efficiency, economy, and quality of care” while “safeguard[ing] against unnecessary utilization of . . .care and services.”
Justice Scalia’s majority opinion, written for himself, Chief Justice Roberts, and justices Thomas and Alito, would have arguably swept away nearly a half century of Medicaid law and hold that lawsuits could not be brought by providers in federal court to enforce the requirements of the Medicaid program. A dissenting opinion, written by Justice Sotomayor for herself and Justices Kennedy, Kagan, and Ginsburg would have held that providers could have a cause of action under some circumstances to enforce the Medicaid law’s provider payment requirements against the states. Justice Breyer, the deciding vote for the majority, wrote a narrow opinion, joining Justice Scalia’s opinion only in part, leaving the law somewhat unsettled as to rights under the Medicaid program going forward.
via Supreme Court Turns Back Payment Suit By Medicaid Providers – Health Affairs Blog.
April 1, 2015
Former Speaker of the U.S. Representatives Newt Gingrich said something last week that many feared, but few have been willing to admit: Republicans in Congress have no intention of repealing and replacing Obamacare with patient-centered health reform.
Faced with an interviewer who seemed to believe opposition to Obamacare is actually opposition to Barack Obama, and who suggested that after this president leaves office, opposition will soften, Mr. Gingrich accused his former colleagues of misrepresenting their commitment.
Now that we are in the twilight of the Obama presidency, and Republicans have majorities in both chambers of Congress, they should be able to put such charges to rest. Unfortunately, last week’s overwhelming bipartisan support in the House of Representatives for a deal to lock in Obamacare’s way of paying doctors sends a terrible signal.
via Have House Republicans Cast Their First Vote For Obamacare? – Forbes.
March 16, 2015
The Medicare physician fee schedule uses the resource-based relative value system (RBRVS), which relies on expert committees from the American Medical Association, to decide how much an office visit is worth compared with heart surgery. This convoluted price setting mechanism remains in place. Only the annual increase in overall payments is modified by the permanent doc fix.
The bottom line is clear. By not finding offsets for the entire cost of the doc fix-CHIP proposal, Congress is opening the door to even greater deficit spending in the future. As important as the proposal is, it fails to address the problems of price fixing that distort medical decisions and drive up health care costs. If we cannot reform the entire Medicare physician payment system, we should at least find other savings in the program to avoid adding greater burdens on taxpayers and their children.
via Bounce the ‘doc fix’—but don’t increase the deficit – AEI | Health Care Blog » AEIdeas.
March 4, 2015
The health economics literature contains two models of selection, one with endogenous plan characteristics to attract good risks and one with fixed plan characteristics; neither model contains a regulator. Medicare Advantage, a principal example of selection in the literature, is, however, subject to anti-selection regulations. Because selection causes economic inefficiency and because the historically favorable selection into Medicare Advantage plans increased government cost, the effectiveness of the anti-selection regulations is an important policy question, especially since the Medicare Advantage program has grown to comprise 30 percent of Medicare beneficiaries. Moreover, similar anti-selection regulations are being used in health insurance exchanges for those under 65.
Contrary to earlier work, we show that the strengthened anti-selection regulations that Medicare introduced starting in 2004 markedly reduced government overpayment attributable to favorable selection in Medicare Advantage. At least some of the remaining selection is plausibly related to fixed plan characteristics of Traditional Medicare versus Medicare Advantage rather than changed selection strategies by Medicare Advantage plans.
via MIT Press Journals – American Journal of Health Economics – Abstract.
February 24, 2015
Sometime next year Social Security’s $150 billion disability-insurance program will become insolvent. The program, which offers income supplements to those who cannot work full time due to physical or mental disabilities, has buckled as the number of beneficiaries has soared to more than 11 million in 2014, from 3.8 million in 1984. The bipartisan Social Security Advisory Board has urged reforms.
Yet the Obama administration’s 2016 budget proposes the opposite of reform: an unconditional transfer of revenues from Social Security’s retirement program. The president’s proposal will likely be blocked thanks to a House budget rule that forbids unconditional revenue transfers. The question now is: Will serious reform be a reality under President Obama?
Americans today are about as likely as those in the past to report that they have a work-limiting disability, according to Census Bureau data. For instance, 5.6% of Americans ages 35-44 reported having a work-limiting disability in 1984, while in 2014 that figure was 5.4%. Likewise, self-reported measures of overall health have improved and workplace injuries have fallen.
via Averting the disability-insurance meltdown » AEI.
February 23, 2015
This unsustainable spending growth occurs because we continue to increase spending on Social Security, Medicare, Medicaid, and now on the massive expansion of federal health spending embodied in the Affordable Care Act. Growth in these four categories of federal entitlement spending accounts for our whole fiscal imbalance.
via Mindless Yes, Austerity No: The Real Budget Problem | Mercatus.