Weekly Newsletter: March 3, 2008
Mental Health Parity Scheduled for Wednesday Vote
The House Democrat leadership announced last week that the House would be voting Wednesday on a mental health bill (H.R. 1424) sponsored by Rep. Patrick Kennedy (D-RI). Some conservatives may have strong concerns about both the principle behind the legislation—a costly federal mandate that will raise the health insurance premiums and increase the number of uninsured Americans—as well as the way in which the expansive House language would mandate coverage for “mental disorders” such as caffeine addiction and jet leg.
In addition, the ways in which Democrats intend to finance its $4 billion price tag may also cause conservatives concern. News reports indicate that the bill will be funded by placing further restrictions on physician-owned specialty hospitals—hindering the development of a new source of consumer choice, and medical innovation, in health care—and increasing the amount of rebates pharmaceutical manufacturers offering products to Medicaid beneficiaries must pay the federal government—which may lead some drug companies to end their participation in Medicaid altogether.
The RSC will be monitoring this legislation as it makes its way to the House floor, and will be weighing in during the process to express conservatives’ concerns.
A Top Ten list of conservative concerns about H.R. 1424 can be found here.
SCHIP Policy Brief Released
Last week the RSC released a policy brief analyzing the proposals in President Bush’s Fiscal Year 2009 budget that would effect the State Children’s Health Insurance Program (SCHIP). The brief was released prior to a House Energy and Commerce subcommittee hearing where several state Governors testified in opposition to guidance issued by the Administration that would ensure federal funds are targeted towards the low-income children for whom the SCHIP program was created.
While most conservatives support the Administration’s focus on low-income children, the significant increase in its SCHIP funding request when compared to last year—enough to fund an expansion of program participants—may give some conservatives concern.
The RSC Policy Brief can be found here.
GAO Issues Report on Medicare Advantage
Last week the Government Accountability Office released a report regarding the benefits provided by Medicare Advantage plans. The report highlighted how Medicare Advantage provides enhanced benefits and lower premiums to beneficiaries than traditional fee-for-service Medicare. Specifically, the study noted that nearly 70% of rebate payments provided to plans go directly toward reduced cost sharing for beneficiaries, with the remainder providing additional benefits and lower overall premiums.
While the GAO study generated headlines because it found that some plans in some situations may generate higher cost-sharing for beneficiaries, the true story remains the way in which private plans provide quality benefits and reduce costs for seniors, particularly low-income beneficiaries. If Congressional Democrats wish to object to so-called overpayments to Medicare Advantage plans, they should enact reforms allowing traditional Medicare to compete on a “level playing field” with private plans—which would generate downward pressure on health care costs and help Medicare remain financially viable.
Read the report here.
Article of Note: “One Cheer for the New York Times”
Last week, the editorial board of the New York Times weighed in with its verdict on the President’s plan to address the funding warning issued by the Medicare trustees. The paper’s writers agree that Medicare’s funding mechanism needs reform, and think that the additional means-testing in the President’s proposal contains merit. However, the editorial also criticizes proposals for reform of medical liability laws, noting that Congress should instead “reduce the lavish and unjustified subsidies” provided to insurance plans offering Medicare Advantage coverage—or take the “sensible step” of letting the President’s tax relief expire.
While the Times’ writers at least acknowledged what some Congressional Democrats have not—namely, that Medicare needs serious reform if it is to remain financially viable—giving millions of Americans a tax increase will not resolve a problem caused by skyrocketing spending on health care. Nor will causing more than eight million Americans to lose the additional health benefits offered by Medicare Advantage plans improve the health of America’s seniors.
A better solution would transform Medicare into a health insurance system similar to that provided to Members of Congress, where beneficiaries receive a defined contribution from Medicare to select a plan of their choosing. That and other similar ideas for comprehensive reform—and not the tax increases and benefit cuts advocated by the Times—could finally begin to bring down health care costs and ensure Medicare’s long-term solvency.
Read the article here: New York Times: “Constraining the Medicare Debate”