Weekly Newsletter: June 23, 2008
Controversial Medicare Bill to be Considered Tuesday
On Tuesday, the House is scheduled to consider under suspension of the rules legislation (H.R. 6331) addressing physician reimbursement levels under Medicare. The bill would prevent for 18 months a reduction in fee schedule levels scheduled to take effect on July 1, and would expand access to certain subsidy programs for low-income beneficiaries. These provisions would be offset largely by cuts to private Medicare Advantage plans, particularly private fee-for-service plans. Similar legislation (S. 3101) failed to advance on a procedural vote in the Senate on June 12.
Some conservatives may be concerned that a bill making significant changes to the Medicare program— which in 2006 spent more money than the national economies of Israel, the Czech Republic, and Colombia combined—is being considered under expedited procedures usually reserved for minor, noncontroversial matters. Some conservatives may also be concerned that the bill fails to address the long-term integrity of the Medicare program, relying on funding gimmicks and government-controlled price-fixing rather than undertaking comprehensive reform that would inject market forces into the program as a means to slow the growth of health care costs. Finally, some conservatives may be concerned that the bill’s significant cuts to Medicare Advantage would have the effect of driving beneficiaries away from a privately-run model of health insurance that has provided enhanced benefits and choice for millions of seniors.
Bipartisan Senate talks resumed last week in the hopes of reaching agreement on physician payment language before Congress begins its Independence Day recess this Friday. The RSC will weigh in with conservative concerns and updates on H.R. 6331 and any other physician payment legislation which may be introduced or considered in the coming days.
The Legislative Bulletin on H.R. 6331 can be found here.
There are additional RSC Policy Briefs on issues related to the Medicare bill: Physician Payments; Medicare Advantage; Bidding for Durable Medical Equipment; and the Medicare Trustees Report.
Supplemental Language Would Override Medicaid Fiscal Integrity Regulations
The House’s vote on amendments to wartime supplemental legislation (H.R. 2642) included several domestic spending provisions, including language that would postpone the implementation of six regulations proposed by the Administration to prevent funding abuses related to the Medicaid program. During negotiations on the components of the package, Congressional Democrats agreed to allow one of the proposed regulations—concerning the definition of an outpatient hospital—to move forward, and removed restrictions on physician-owned specialty hospitals and provisions extending access to reduced-priced pharmaceuticals to Planned Parenthood clinics incorporated into the supplemental in the Senate.
Despite the improvements over the Senate-passed language, and the maintenance of the outpatient hospital regulation, some conservatives may remain concerned by congressional actions to block six other regulations that respond to more than a dozen Government Accountability Office (GAO) reports released since 1994 highlighting the various ways states have attempted to “game” the Medicaid program and increase the amount of federal matching funds received.
Because the provisions only place moratoria on further administrative action until April 2009, the stated cost of the legislation is $1.65 billion. However, some conservatives may be skeptical that Congress would ever let these moratoria be lifted, and thus may be concerned that passage of the legislation ultimately could result in the nullification of approximately $16-18 billion in proposed savings—which, though significant, will slow the growth of federal Medicaid spending by just over 1% over the next five years.
In December 2005, 212 Members of Congress—all Republicans—voted to slow the growth of Medicaid spending by less than $4.8 billion as part of the Deficit Reduction Act. If these moratoria remain intact, some conservatives may be concerned that Congress will have more than undone the modest savings which a Republican-led Congress enacted over sharp Democrat protests.
RSC Briefs on the federal-state Medicaid relationship can be found here, here, here, and here.