Jul 30 2013
ICYMI: Chairman Murray Holds Senate Budget Committee Hearing on Containing Health Care Costs: Recent Progress and Remaining Challenges
Today, Chairman Murray and the Senate Budget Committee held a hearing about the recent encouraging news regarding health care spending trends and delivery system reforms, and discussed areas of further work that focus on aligning incentives and making the system more efficient, rather than simply shifting costs to seniors and families. "The cost of health care affects every kitchen table and conference table conversation in the United States, as American households and American businesses face the question of how to pay for the healthcare coverage they want for their families and employees,” Chairman Murray said at the hearing.
Chairman Murray emphasized the importance of coming together around real, lasting reform—rather than shifting costs, or lurching from crisis to crisis.
“We can’t lower health care spending simply by shifting those costs from the federal government on to seniors, states, and the most vulnerable families. But unfortunately, that’s exactly the approach that House Republicans take in their budget. If House Republicans had their way, seniors would immediately see an increase in what they pay for routine doctor’s visits, the number of uninsured Americans would rise, and the most vulnerable families would be put at greater risk. This is not the right way to address our long-term challenges in health care spending.”
“Republicans claim that Democrats don’t want to tackle health care costs, that’s simply not true. We agree that we need to address this significant part of our federal spending. But we believe that we need to do so by coming together around a solution for real, lasting reform—not just by shifting costs, and shifting risks.”
“…the latest threat, coming from my colleagues Senators Rubio and Lee, is that they want to actually defund health care reform or they’ll shut down the government. So not only are Tea Party Republicans willing to push us towards a crisis, but they’ll do that to: cut off health care coverage for 25 million people, end free preventive care for our seniors, and cause them to pay more for their prescriptions. These political games might play well with their Tea Party base. But the reality is that not only is the Affordable Care Act already helping millions of Americans stay healthy and financially secure, but it’s also helping slow health care cost growth.”
“…So I am hopeful Republicans will join us at the table in a budget conference under regular order, and work with me and other Democrats to address our long-term debt and deficit challenges, as well as our long-term health care challenges. We owe it to the American people to come together around fair solutions that help the economy grow, tackle our deficit and debt responsibly, and ensure we have a health care system that delivers high quality, affordable care.”
Watch Chairman Murray deliver her opening statement, and read the full statement online here.
Witness Dr. Len Nichols described the challenges to sustained cost growth reduction across the health care system, including the current gridlock in Congress.
Dr. Nichols, Director and Professor at the Center for Health Policy Research and Ethics, College of Health and Human Services at George Mason University, highlighted his belief that Congress should come together around real, lasting reform: “to move forward toward solidifying cost growth reduction, which I know both parties support, the charade of repeal and de-funding should stop and all of you should get on with the serious business of working together to improve the existing law of the land so that more of our people will be better served.”
He also noted the positive developments in delivery system reforms which could help sustain the current positive cost trends, noting that, “private and public payers are developing congruent incentive structures for clinicians and hospitals, frequently in tandem, that have the potential to link the self-interest of all major health system stakeholders with the social interest in cost growth containment, quality improvement, and better health for our population, the triple aim.”
“This alignment of public and private goals – made possible by the ACA and the private contracting innovations that preceded and have followed it – is by far the most humane way to get the health spending portion of our long-run budget priorities where it needs to be. The alternative to incentive realignment is draconian benefit and price cuts, which would be income-based rationing in reality if not in euphemistic name. Severe cuts are also wholly unnecessary if we choose to support and nurture those already on the path to a better aligned American health system that is within our imagination and our grasp.”
Read Dr. Nichols’ full testimony here.
Witness Dr. Kavita Patel noted that many of the reforms included in the Affordable Care Act are having an impact on the downward cost trends.
Dr. Patel, Fellow and Managing Director at the Engelberg Center for Health Care Reform at the Brookings Institution noted that many of the reforms included in the Affordable Care Act are having an impact on downward cost trends, testifying “The Affordable Care Act includes a number of reforms that have transformed the health care system and decreased overall spending. Enhanced access to coverage, consumer protections, and payment reforms provide important direct and indirect economic benefits to millions of Americans and also extend the life of the Medicare Trust Fund by at least eight additional years. Increased coverage in the form of Medicaid expansions and Health Insurance Marketplaces translates to improvements in the labor market with more people working, working productively, and less job lock from those who fear losing access to health insurance when switching jobs.”
“…programs and policies in the ACA have also had a significant effect within the private sector, which has partly contributed to the reduction in overall national health expenditures through care transformation.”
She also discussed various opportunities to create savings in the health care sector, as well as some delivery system reforms already underway which appear to be working: “These opportunities are neither partisan nor do they involve a radical redefinition of the Medicare benefit package. Rather, they build on lessons from the introduction of Medicare, the advent of capitation and managed care, physician hospital organizations (PHOs), state-based reforms, the implementation of the Medicare Part D program, and the aforementioned initiatives in the Affordable Care Act.”
“Within and across the continuum of care, there exist savings opportunities which can promote value, reduce cost and engage patients. These reforms will not only protect our nation’s long-term fiscal growth but will also improve the quality of care delivered to our patients.“
Read Dr. Patel’s full testimony here.
Members of the Senate Budget Committee discussed the recent progress and remaining challenges with health care cost containment.
Senator Wyden (D-OR) stressed the importance of making Medicare data available in order to increase transparency, noting that “My sense is that the day you publish the Medicare database in this country, you would have in effect a new baseline for health care in America. All over the country, if somebody held an employer health plan, for example, or had an HSA – Mr. Antos referenced that – people would look at what Medicare was paying in their area for those particular services, and they would look at utilization, and they would start making that comparison and saying, why is what I’m getting out of sync, in terms of costs or utilization?”
Senator Whitehouse (D-RI) discussed the importance of price transparency and bundled payments: “Although the consumer market is a concept of some utility in health care, it’s a long way from being a complete answer. If you’ve had a stroke and you don’t even know where you are, you are not a good consumer. If you are elderly and have seven conditions going on, you are not a good consumer. This isn’t like buying a bicycle, where you say, I like that, I know how it works, here’s how much it costs. I challenge anybody in this room to explain to me what’s in their health insurance right now. If you want to have a market, you’ve got to have a product, and you’ve got to have a price.”
Senator Kaine (D-VA) discussed the impact the Affordable Care Act has had on his family, and on families across the country, “When I was a Senate candidate and for the first time in my life didn’t have a full-time job, I didn’t have insurance, and we had to go out and buy insurance on the open market. And my wife tried to buy insurance, and she was told by an insurance company that they would insure my wife and me, and they would insure two of our three children, but they wouldn’t insure our third child because of a pre-existing medical condition. … the insurance company called us back and said, ‘you were right, we were wrong, we have to offer you an insurance policy for your entire family.’ We’re not going to repeal the Affordable Care Act. Because if we did, we would be saying to all of those kids, hey, you’re back at the mercy of this heartless, pre-existing insurance company practice that we’re putting in the rear-view mirror.”
Senator Baldwin (D-WI) highlighted the need for bipartisan cooperation as we implement the Affordable Care Act “I can’t help but think that there is a real cost with the obstructionism we’ve seen. And I have to recall serving over in the other house, in the other body, during the debate on the Medicare Modernization Act… following the passage of that measure [it] felt like the most important duty we all had was to work together across the party aisle and try to make this work for our constituents.”
And Senator King (I-ME), stressed the need to reduce costs, rather than shifting them onto patients and families: “We can’t solve the federal debt problem simply by saying Medicare’s going to pay less, Medicaid’s going to pay less. All we’re doing is shifting these costs to somebody else. … Health care is where all the expenditures are. So shifting costs isn’t the answer. We need to talk about fundamentally how to lower health care costs, and to say it can’t be done is ridiculous because we pay almost twice as much as anybody else in the world for results that aren’t that good.”
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