How a CBO Error Could Cost the Pharmaceutical Industry Billions

Government officials often attempt to bury bad news. Aaron Sorkin’s “The West Wing” even coined a term for it: “Take Out the Trash Day.” So it proved last week. A Congressional Budget Office (CBO) document released quietly on Thursday hinted at a major gaffe by the budget agency and its efforts to conceal that gaffe.

In a series of questions for the record submitted following Director Keith Hall’s April 11 hearing before the Senate Budget Committee, CBO admitted the following regarding a change to the Medicare Part D prescription drug program included in this past February’s budget agreement:

When the legislation was being considered, CBO estimated that provision would reduce net Medicare spending for Part D by $7.7 billion over the 2018-2027 period. CBO subsequently learned of a relevant analysis by the Centers for Medicare and Medicaid Services and incorporated that analysis in its projections for the April 2018 Medicare baseline. The current baseline incorporates an estimate that, compared with prior law, [the relevant provision] will reduce net Medicare spending for Part D by $11.8 billion over the 2018-2027 period.

As I wrote at the time, the provision attracted no small amount of controversy at its passage—or, for that matter, since. The provision accelerated the closing of the Part D “donut hole” faced by seniors with high prescription drug costs, but it did so by shifting costs away from the Part D program run by health insurers and on to drug companies.

The pharmaceutical industry was, and remains, livid at the change, which it did not expect, and tried to undo in the March omnibus spending bill. CBO didn’t just get its score wrong on a minor, non-controversial provision—it messed up on a major provision that will over the next decade affect both drug companies and health insurers.

Because the provision substitutes mandatory “discounts” by drug companies for government spending through the Part D program, it saves the government money through smaller Part D subsidies—at least on paper. (That said, the score doesn’t take into account whether drug manufacturers will raise prices in response to the change, which they could well do.) Because seniors actually spend more in the “donut hole” than CBO’s initial projections said, the provision will have a greater impact—i.e., cost the pharmaceutical industry billions more—than the February budget estimate says.

In its response last week, CBO tried to cover its tracks by claiming that “the $4 billion change…accounts for about 2 percent” of the total of $186 billion reduction in estimated Medicare spending over the coming decade due to technical changes incorporated into the revised baseline. But a $4.1 billion scoring error on a provision first projected to save $7.7 billion means CBO messed up its score by more than 53 percent of its original budgetary impact. That’s not exactly a small error.

Moreover, CBO didn’t come clean and publicly admit this error of its own volition. It did so only because Senate Budget Committee Chairman Mike Enzi (R-WY) forced the budget office to do so.

Enzi submitted a question noting that “CBO realized its estimate of a provision [in the budget agreement] was incorrect. Where is the correction featured in the new report?” CBO didn’t “feature” the correction in its April Budget and Economic Outlook report at all—it incorporated the change into the revised baseline without disclosing it, hoping to sneak it by without anyone calling the budget office out on its error.

Since that time, the purportedly “nonpartisan” organization realized it published an incorrect score—off by more than 50 percent—on a high-profile and controversial issue, changed its baseline to account for the scoring error, and said exactly nothing in a 166-page report on the federal budget about the change. If CBO won’t disclose this kind of major mistake on its own, then its “transparency efforts” seem like so much noise—a distraction designed to keep people preoccupied from focusing on errors like the Part D debacle.

To view it from another perspective: Any head of a private company whose analysis of a multi-billion-dollar transaction proved off by more than 50 percent, because his staff did not access relevant information available to them at the time of the analysis, would face major questions about his leadership, and could well lose his job. But judging from his desire to conceal this scoring mistake, the CBO director apparently feels no such sense of accountability.

Thankfully, however, members of Congress have tools available to fix the rot at CBO, up to and including replacing the director. Given the way CBO attempted to conceal the Part D scoring fiasco, they should start using them.

This post was originally published at The Federalist.

The Insurer Bailout Inside the Senate Budget “Deal”

I noted in my prior summary of the Senate budget “deal” that, as with Obamacare itself, Senate leaders wanted to pass the bill so that we can find out what’s in it. And so it proved.

My summary noted that the bill includes a giveaway to seniors, by accelerating the process Obamacare started to close the Part D prescription drug “donut hole.” I also pointed out that this attempt to buy seniors’ votes in the November elections by promising them an extra benefit in 2019 might backfire, because encouraging seniors to choose more expensive brand-name pharmaceuticals over cheaper generics will raise overall Medicare spending and increase premiums.

How the ‘Donut Hole’ Currently Works

The Part D prescription drug benefit Republicans and the George W. Bush administration created in 2003 included a “donut hole” to reduce the bill’s overall costs. During his 2000 presidential campaign, Bush proposed creating a limited drug benefit that provided only catastrophic protection for seniors with very high costs.

But political pressure (to give “benefits” to more seniors) and actuarial concerns (if the federal government covered only catastrophic costs, only very sick people who would incur those costs would enroll, creating an unstable risk pool) prompted Republicans to expand the Part D program. The “donut hole” resulted from these twin goals of providing basic coverage to seniors and catastrophic coverage for those with high medical costs, with the coverage gap or “donut hole” occurring between the end of the former and the start of the latter.

As part of their “rock-solid deal” with the Obama administration, the pharmaceutical industry and Democrats agreed to close the “donut hole” as part of Obamacare. The law required branded drug manufacturers to provide 50 percent discounts for seniors in the “donut hole,” with the federal government gradually increasing its subsidy (provided through Part D insurers) and beneficiaries’ co-insurance gradually declining to 25 percent (the same percentage of costs that beneficiaries pay before reaching the “donut hole”).

The budget “deal” changes the prior law in several ways. First, it reduces the beneficiary co-insurance from 30 percent to 25 percent in 2019, thus filling in the “donut hole.” But in so doing, it also increases the manufacturer’s “discount” from 50 percent to 70 percent, beginning next year.

That second change effectively shifts 20 percent of the cost of filling in the “donut hole” from Medicare, and insurers that offer Medicare drug plans, to drug manufacturers. In other words, it bails out health insurers, who in the future will have to bear very little risk (only 5 percent) of the cost of their beneficiaries’ drug spending.

No Crocodile Tears

That said, drug companies don’t have much reason to cry about the budget “deal” overall. The industry saw the repeal of Obamacare’s Independent Payment Advisory Board (IPAB), an important, albeit flawed, way to control skyrocketing Medicare costs. While Republicans in prior Congresses insisted on paying for legislation repealing IPAB, the party changed its tune at the beginning of this Congress—reportedly at the behest of Big Pharma.

The enacted legislation repeals the IPAB spending controls without a replacement mechanism to contain Medicare costs. This is total derogation of conservatives’ belief in reforming entitlements, and one enacted at the behest of drug company lobbyists.

Moreover, the budget “deal” included another huge win for pharma, by excluding legislation supported on both sides of the aisle to accelerate the approval of lower-cost generic drugs. Pharmaceutical lobbyists claimed the measure would lead to more lawsuits, and those objections meant the provision got left on the proverbial cutting room floor.

More Bailouts Ahead

Given that Kentucky-based health insurer Humana holds a large market share in the Medicare arena—with 5.3 million of the roughly 25 million seniors enrolled in stand-alone drug plans, and more enrollment in Medicare Advantage besides—and that Sen. Mitch McConnell (R-KY) has fought hard, and publicly, on behalf of Humana’s interests in the past, it doesn’t take a rocket scientist to ask whether the Senate majority leader proposed a backroom deal to help his insurer constituents.

Moreover, as we’ve previously reported, Republican leaders want to pass an even bigger bailout, this one for Obamacare, in next month’s omnibus spending agreement. One news outlet reported earlier this week that Republicans’ desire to bail out Obamacare—to “lower” premiums by throwing more of taxpayers’ money at the problem—has risen to such a level “that Democrats don’t feel like they have to push very hard” to ensure its enactment.

Insurer bailouts, measures to raise rather than lower health costs, and an abdication of any pretense of fiscal responsibility or restraint towards our looming entitlement crisis. The Republican Party circa 2018 is truly a pathetic spectacle to behold.

This post was originally published at The Federalist.

Lowlights of Senate “Budget” Deal

In the budget agreement announced Wednesday between Republican Sen. Mitch McConnell and Democrat Chuck Schumer, McConnell’s negotiating position can be summed up thusly: “Give us the money we want for defense spending, and you can run the rest of the country.”

The result was a spending bonanza, with giveaways to just about every conceivable lobbying group, trade association, and special interest possible. The unseemly spectacle resembles “Oprah’s Favorite Things:” “You get a car! You get a car! You get a car! EVERYONE GETS A CAR!!!”

Even reporters expressed frank astonishment at the bipartisan profligacy. Axios admitted that “there’s a ton of health care money in the Senate budget deal,” while Kaiser Health News noted that the agreement “appear[s] to include just about every other health priority Democrats have been pushing the past several months.”

Of course, McConnell and Schumer want to ram it through Congress and into law by Thursday evening—because we have to pass the bill to find out what’s in it.

Lowlights of the Health Legislation

Repeal of Medicare Spending Restraints: The bill would repeal Obamacare’s Independent Payment Advisory Board (IPAB), a board of unelected bureaucrats empowered to make rulings on Medicare spending. I noted last year that conservatives could support repealing the power given to unelected bureaucrats while keeping the restraints on Medicare spending—restraints which, once repealed, will be difficult to reinstitute.

Congressional leaders did nothing of the sort. Instead the “deal” would repeal the IPAB without a replacement, raising the deficit by $17.5 billion. Moreover, because seniors pay for a portion of Medicare physician payment spending through their Part B premium, repealing this provision without an offset would raise seniors’ out-of-pocket costs. While a Congressional Budget Office (CBO) score of the bill as a whole was not available as of press time Wednesday evening, this provision, on its own, would raise Medicare premiums by billions of dollars.

Big Pharma Giveaway: In a further giveaway to the pharmaceutical industry, the bill would close the Medicare Part D prescription drug “donut hole” a year earlier—that is, beginning in 2019 rather than 2020. Having failed to repeal Obamacare, Republicans apparently want to expand this portion of the law, in the hopes of attracting seniors’ votes in November’s mid-term elections.

Extension of an Unreformed SCHIP Program: The bill would extend for another four years the State Children’s Health Insurance Program—a mandatory spending program that Republicans extended for six years just last month. I previously explained in detail that last month’s reauthorization failed to include at least ten different conservative reforms that Republicans previously supported. By extending the program for another four years, the “deal” would prevent conservatives from enacting any reforms for a decade.

Back in 2015, Republican aides pledged that “Republicans would like to reform and improve this program, and the next opportunity will be in two years when we have a new President.” Not only have Republicans done nothing of the sort, the additional extension will prevent this president—and potentially the next one as well—from reforming the program.

Mandatory Funding for Community Health Centers: The bill provides for $7.8 billion in mandatory spending for community health centers over the next two years, once again extending a mandatory program created by Obamacare.

While many conservatives may support funding for community health centers, they may also support funding them through the discretionary appropriations process, rather than by replenishing a pot of mandatory spending created by Obamacare to subvert the normal spending cycle. The normal appropriations process consists of setting priorities among various programs; this special carve-out for community health centers subverts that process.

Mandatory Opioid Funding: The bill also provides $6 billion in mandatory spending over the next two years to address the opioid crisis. As with the community health center funding, some conservatives may support increasing grants related to the opioid crisis—through the normal spending process.

The Schumer-McConnell “deal” would bust through the Budget Control Act spending caps, increasing the amount of funds available for the normal appropriations bills. (Most of this spending increase would not be paid for.) Additional mandatory health care spending on top of the increase in discretionary funding represents a spendthrift Congress attempting to have its cake and eat it too, while sticking future generations with the bill in the form of more debt and deficits.

But Wait—There’s More!

Surprisingly, the bill does not include an Obamacare “stabilization” (i.e., bailout) package. But other reports on Wednesday suggest that will arrive in short order too. One report noted that Democrats want to increase Obamacare premium subsidies. They not only want to restore unconstitutional payments that President Trump cancelled last fall, “but to expand it—and to bolster the separate subsidy that helps people pay their premiums.”

Republican leaders want to pass a massive Obamacare bailout in the next appropriations measure, an omnibus spending bill likely to come to the House and Senate floors before the Easter break. In a sign of Republicans’ desperation to pass a bailout, Wednesday’s report quoted a Democratic aide as saying that corporate welfare to insurers in the form of a reinsurance package “has become so popular among Republicans that Democrats don’t feel like they have to push very hard.”

There are two ways to solve the problem of rising premiums in Obamacare. One way would fix the underlying problems, by repealing regulations that have led to skyrocketing premiums. The other would merely throw money at the problem by giving more corporate welfare to insurers, providing a short-term “fix” at taxpayers’ ultimate cost. Naturally, most Republicans wish to choose the latter course.

Moreover, in bailing out Obamacare, Republicans will be forced to provide additional taxpayer funding of abortion coverage. There is no way—zero—that Democrats will provide any votes for a bill that provides meaningful pro-life protections for the Obamacare exchanges. Republicans’ desperation to bail out Obamacare will compel them to abandon any pretense of pro-life funding as well.

Most Expensive Parade Ever?

Press reports this week highlighted Pentagon plans to, at President Trump’s request, put on a military spectacle in the form of a massive parade. Trump tweeted his support for the Schumer-McConnell deal on Wednesday, calling it “so important for our great Military.”

It’s an ironic statement, on several levels. First, the hundreds of billions in new deficit spending coming from the military buildup included in the agreement would make the parade the most expensive ever, by far. Second, Michael Mullen, the former chairman of the Joint Chiefs of Staff, called our rising debt levels our biggest national security threat, because it makes us dependent on other countries to buy our bonds. Given that statement, one can credibly argue that this deficit-driven spending binge will harm our national security much more than the defense funds will help it.

Time will tell whether or not the legislation passes. But if it does, at some point future generations will look back and wonder why the self-proclaimed “king of debt” imposed a financial burden on them that they will not be able to bear easily—if at all.

This post was originally published at The Federalist.

White House Budget Summary: Obama’s “One Percent” Solution

According to the Congressional Budget Office’s most recent baselines, the federal government will spend a total of $6.87 trillion on Medicare and $4.36 trillion on Medicaid over the next ten years – that’s $11.2 trillion total, not even counting additional state spending on Medicaid.  Yet President Obama’s budget, released today, contains net deficit savings of only $152 billion from health care programs.  That’s a total savings of only 1.35 percent of the trillions the federal government will spend on health care in the coming decade.  Sadly, it’s another sign the President isn’t serious about real budget and deficit reform.

Overall, the budget:

  • Proposes a total of $401 billion in savings, yet calls for $249 billion in unpaid-for spending due to the Medicare physician reimbursement “doc fix” – thus resulting in only $152 billion in net deficit savings. (The $249 billion presumes a ten year freeze of Medicare physician payments; however, the budget does NOT propose ways to pay for this new spending.)
  • Proposes few structural reforms to Medicare; those that are included – weak as they are – are not scheduled to take effect until 2017, well after President Obama leaves office.  If the proposals are so sound, why the delay?
  • Requests a more than 50% increase – totaling $1.4 billion – for program management at the Centers for Medicare and Medicaid Services, of which the vast majority would be used to implement Obamacare.
  • Includes mandatory proposals in the budget that largely track last year’s budget and the President’s September 2011 deficit proposal to Congress, with a few exceptions.  The largest difference between this year’s budget and the prior submissions is a massive increase in savings from reductions to nursing and rehabilitation facilities – $79 billion, compared to a $32.5 billion estimated impact in September 2011.

A full summary follows below.  We will have further information on the budget in the coming days.

Discretionary Spending

When compared to Fiscal Year 2013 appropriated amounts, the budget calls for the following changes in discretionary spending by major HHS divisions (tabulated by budget authority):

  • $37 million (1.5%) increase for the Food and Drug Administration (not including $770 million in increased user fees);
  • $435 million (4.9%) increase for the Health Services and Resources Administration;
  • $97 million (2.2%) increase for the Indian Health Service;
  • $344 million (5.7%) increase for the Centers for Disease Control;
  • $274 million (0.9%) increase for the National Institutes of Health; and
  • $1.4 billion (52.9%) increase for the discretionary portion of the Centers for Medicare and Medicaid Services program management account.

With regard to the above numbers for CDC and HRSA, note that these are discretionary numbers only.  The Administration’s budget also would allocate an additional $1 billion mandatory spending from the Prevention and Public Health “slush fund” created in Obamacare, further increasing spending levels.  For instance, CDC spending would be increased by an additional $755 million.

Obamacare Implementation Funding and Personnel:  As previously noted, the budget includes more than $1.4 billion in discretionary spending increases for the Centers for Medicare and Medicaid Services, which the HHS Budget in Brief claims would be used to “continue implementing key provisions of [Obamacare].”  This funding would finance 712 new bureaucrats within CMS when compared to last fiscal year – a massive increase when compared to a request of 256 new FTEs in last year’s budget proposal.  Overall, the HHS budget proposes an increase of 1,311 full-time equivalent positions within the bureaucracy compared to projections for the current fiscal cycle, and an increase of 3,327 bureaucrats compared to last fiscal year.

The budget includes specific requests related to Obamacare totaling over $2 billion, including:

  • $803.5 million for “CMS activities to support [Exchanges] in FY 2014,” including funding for the federally-funded Exchange, for which the health law itself did not appropriate funding;
  • $837 million for “beneficiary education and outreach activities through the National Medicare Education program and consumer support…including $554 million for the [Exchanges];”
  • $519 million for “general IT systems and other support,” including funding for the federal Exchange;
  • $3.8 million for updates to healthcare.gov;
  • $18.4 million to oversee the medical loss ratio regulations; and
  • $24 million for administrative activities in Medicaid related to “implement[ing] new responsibilities” under Obamacare.

Exchange Funding:  The budget envisions HHS spending $1.5 billion on Exchange grants in 2013.  That’s an increase of over $300 million compared to last year’s estimate of fiscal year 2013 spending – despite the fact that most states have chosen not to create their own Exchanges.  The budget anticipates a further $2.1 billion in spending on Exchange grants in fiscal year 2014.  The health care law provides the Secretary with an unlimited amount of budget authority to fund state Exchange grants through 2015.  However, other reports have noted that the Secretary does NOT have authority to use these funds to construct a federal Exchange.

Abstinence Education Funding:  The budget proposes eliminating the abstinence education funding program, and converting those funds into a new pregnancy prevention program.

Medicare Proposals (Total savings of $359.9 Billion, including interactions)

Bad Debts:  Reduces bad debt payments to providers – for unpaid cost-sharing owed by beneficiaries – from 65 percent down to 25 percent over three years, beginning in 2014.  The Simpson-Bowles Commission made similar recommendations in its final report.  Saves $25.5 billion.

Medical Education Payments:  Reduces the Indirect Medical Education adjustment paid to teaching hospitals beginning in 2014, saving $11 billion.  Previous studies by the Medicare Payment Advisory Committee (MedPAC) have indicated that IME payments to teaching hospitals may be greater than the actual costs the hospitals incur.

Rural Payments:  Reduces critical access hospital payments from 101% of costs to 100% of costs, saving $1.4 billion, and prohibits hospitals fewer than 10 miles away from the nearest hospital from receiving a critical access hospital designation, saving $700 million.

Anti-Fraud Provisions:  Assumes $400 million in savings from various anti-fraud provisions, including limiting the discharge of debt in bankruptcy proceedings associated with fraudulent activities.

Imaging:  Reduces imaging payments by assuming a higher level of utilization for certain types of equipment, saving $400 million.  Imposes prior authorization requirements for advanced imaging; no savings are assumed, a change from the September 2011 deficit proposal, which said prior authorization would save $900 million.

Pharmaceutical Price Controls:  Expands Medicaid price controls to dual eligible and low-income subsidy beneficiaries participating in Part D, saving $123.2 billion according to OMB.  Some have expressed concerns that further expanding government-imposed price controls to prescription drugs could harm innovation and the release of new therapies that could help cure diseases.

Medicare Drug Discounts:  Proposes accelerating the “doughnut hole” drug discount plan included in PPACA, filling in the “doughnut hole” completely by 2015.  While the budget claims this proposal will save $11.2 billion over ten years, some may be concerned that – by raising drug spending, and eliminating incentives for seniors to choose generic pharmaceuticals over brand name drugs, this provision will actually INCREASE Medicare spending, consistent with prior CBO estimates at the time of PPACA’s passage.

Post-Acute Care:  Reduces various acute-care payment updates (details not specified) and equalizes payment rates between skilled nursing facilities and inpatient rehabilitation facilities, saving $79 billion – a significant increase compared to the $56.7 billion in last year’s budget and the $32.5 billion in proposed savings under the President’s September 2011 deficit proposal.  Equalizes payments between IRFs and SNFs for certain conditions, saving $2 billion.  Adjusts payments to inpatient rehabilitation facilities and skilled nursing facilities to account for unnecessary hospital readmissions and encourage appropriate care, saving a total of $4.7 billion.  Restructures post-acute care reimbursements through the use of bundled payments, saving $8.2 billion.

Physician Payment:  Includes language extending accountability standards to physicians who self-refer for radiation therapy, therapy services, and advanced imaging services, saving $6.1 billion.  Makes adjustments to clinical laboratory payments, designed to align Medicare with private payment rates, saving $9.5 billion.  Expands availability of Medicare data for performance and quality improvement; no savings assumed.

Medicare Drugs:  Reduces payment of physician administered drugs from 106 percent of average sales price to 103 percent of average sales price.  Some may note reports that similar payment reductions, implemented as part of the sequester, have caused some cancer clinics to limit their Medicare patient load.  By including a similar proposal in his budget, President Obama has effectively endorsed these policies.  Saves $4.5 billion.

Medicare Advantage:  Resurrects a prior-year proposal to increase Medicare Advantage coding intensity adjustments; this provision would have the effect of reducing MA plan payments, based on an assumption that MA enrollees are healthier on average than those in government-run Medicare.  Saves $15.3 billion over ten years.  Also proposes $4.1 billion in additional savings by aligning employer group waiver plan payments with average MA plan bids.

Additional Means Testing:  Increases means tested premiums under Parts B and D by five percentage points, beginning in 2017.  Freezes the income thresholds at which means testing applies until 25 percent of beneficiaries are subject to such premiums.  Saves $50 billion over ten years, and presumably more thereafter, as additional seniors would hit the means testing threshold, subjecting them to higher premiums.

Medicare Deductible Increase:  Increases Medicare Part B deductible by $25 in 2017, 2019, and 2021 – but for new beneficiaries only; “current beneficiaries or near retirees [not defined] would not be subject to the revised deductible.”  Saves $3.3 billion.

Home Health Co-Payment:  Beginning in 2017, introduces a home health co-payment of $100 per episode for new beneficiaries only, in cases where an episode lasts five or more visits and is NOT proceeded by a hospital stay.  MedPAC has previously recommended introducing home health co-payments as a way to ensure appropriate utilization.  Saves $730 million.

Medigap Surcharge:  Imposes a Part B premium surcharge equal to about 15 percent of the average Medigap premium – or about 30 percent of the Part B premium – for seniors with Medigap supplemental insurance that provides first dollar coverage.  Applies beginning in 2017 to new beneficiaries only.  A study commissioned by MedPAC previously concluded that first dollar Medigap coverage induces beneficiaries to consume more medical services, thus increasing costs for the Medicare program and federal taxpayers.  Saves $2.9 billion.

Generic Drug Incentives:  Proposes increasing co-payments for certain brand-name drugs for beneficiaries receiving the Part D low-income subsidy, while reducing co-payments for relevant generic drugs by 15 percent, in an attempt to increase generic usage among low-income seniors currently insulated from much of the financial impact of their purchasing decisions.  Saves $6.7 billion, according to OMB.

Lower Caps on Medicare Spending:  Section 3403 of the health care law established an Independent Payment Advisory Board tasked with limiting Medicare spending to the growth of the economy plus one percentage point (GDP+1) in 2018 and succeeding years.  The White House proposal would reduce this target to GDP+0.5 percent.  The Medicare actuary has previously written that the spending adjustments contemplated by IPAB and the health care law “are unlikely to be sustainable on a permanent annual basis” and “very challenging” – problems that would be exacerbated by utilizing a slower target rate for Medicare spending growth.  According to the budget, this proposal would save $4.1 billion, mainly in 2023.

Medicaid and Other Health Proposals (Total savings of $41.1 Billion)

Limit Durable Medical Equipment Reimbursement:  Caps Medicaid reimbursements for durable medical equipment (DME) at Medicare rates, beginning in 2014.  The health care law extended and expanded a previous Medicare competitive bidding demonstration project included in the Medicare Modernization Act, resulting in savings to the Medicare program.  This proposal, by capping Medicaid reimbursements for DME at Medicare levels, would attempt to extend those savings to the Medicaid program.  Saves $4.5 billion over ten years.

Rebase Medicaid Disproportionate Share Hospital Payments:  Proposes beginning DSH payment reductions in 2015 instead of 2014, and “to determine future state DSH allotments based on states’ actual DSH allotments as reduced” by PPACA.  Saves $3.6 billion, all in fiscal 2023.

Medicaid Anti-Fraud Savings:  Assumes $3.7 billion in savings from a variety of Medicaid anti-fraud provisions.  Included in this amount are proposals that would remove exceptions to the requirement that Medicaid must reject payments when another party is liable for a medical claim.  A separate proposal related to the tracking of pharmaceutical price controls would save $8.8 billion.

Transitional Medical Assistance/QI Program:  Provides for temporary extensions of the Transitional Medical Assistance program, which provides Medicaid benefits for low-income families transitioning from welfare to work, along with the Qualifying Individual program, which provides assistance to low-income seniors in paying Medicare premiums.  The extensions cost $1.1 billion and $590 million, respectively.

“Pay-for-Delay:”  Prohibits brand-name pharmaceutical manufacturers from entering into arrangements that would delay the availability of new generic drugs. Some Members have previously expressed concerns that these provisions would harm innovation, and actually impede the incentives to generic manufacturers to bring cost-saving generic drugs on the market.  OMB scores this proposal as saving $11 billion.

Follow-on Biologics:  Reduces to seven years the period of exclusivity for follow-on biologics.  Current law provides for a twelve-year period of exclusivity, based upon an amendment to the health care law that was adopted on a bipartisan basis in both the House and Senate (one of the few substantive bipartisan amendments adopted).  Some Members have expressed concern that reducing the period of exclusivity would harm innovation and discourage companies from developing life-saving treatments.  OMB scores this proposal as saving $3.3 billion.

State Waivers:  Accelerates from 2017 to 2014 the date under which states can submit request for waivers of SOME of the health care law’s requirements to HHS.  While supposedly designed to increase flexibility, even liberal commentators have agreed that under the law’s state waiver programcritics of Obama’s proposal have a point: It wouldn’t allow to enact the sorts of health care reforms they would prefer” and thatconservatives can’t do any better – at least not under these rules.”  No cost is assumed; however, in its re-estimate of the President’s budget last year, CBO scored this proposal as costing $4.5 billion.

Implementation “Slush Fund:”  Proposes $400 million in new spending for HHS to implement the proposals listed above.

FEHB Contracting:  Similar to last year’s budget, proposes streamlining pharmacy benefit contracting within the Federal Employee Health Benefits program, by centralizing pharmaceutical benefit contracting within the Office of Personnel Management (OPM), saving $1.6 billion.  However, this year’s budget goes further in restructuring FEHBP – OPM would also be empowered to modernize benefit designs (savings of $264 million); create a “self-plus-one” benefit option for federal employees and extend benefits to domestic partners (total savings of $5.2 billion, despite the costs inherent in the latter option); and adjust premium levels based on tobacco usage and/or participation in wellness programs (savings of $1.3 billion).  Some individuals, noting that OPM is also empowered to create “multi-state plans” as part of the health care overhaul, may be concerned that these provisions could be part of a larger plan to make OPM the head of a de facto government-run health plan.

Other Health Care Proposal of Note

Tax Credit:  The Treasury Green Book proposes expanding the small business health insurance tax credit included in the health care law.   Specifically, the budget would expand the number of employers eligible for the credit to include all employers with up to 50 full-time workers; firms with under 20 workers would be eligible for the full credit.  (Currently those levels are 25 and 10 full-time employees, respectively.)  The budget also changes the coordination of the two phase-outs based on a firm’s average wage and number of employees, with the changes designed to make more companies eligible for a larger credit.  The changes would begin in the current calendar and tax year (i.e., 2013).  According to OMB, these changes would cost $10.4 billion over ten years – down from last year’s estimate of $14 billion over ten years.  Many may view this proposal as a tacit admission that the credit included in the law was a failure, because its limited reach and complicated nature – firms must fill out seven worksheets to determine their eligibility – have deterred American job creators from receiving this subsidy.  Moreover, the reduced score in this year’s budget compared to last year’s implies that even this expansion of the credit will have a less robust impact than originally anticipated.

Obama’s Medicare Fantasies

Ahead of this evening’s first presidential debate, it’s worth examining what may happen on entitlement reform in a post-election environment.  Politico had a piece last Friday examining what the President isn’t saying about Medicare:

[During debt ceiling negotiations in mid-2011,] Obama and his top aides made clear that they were willing to swallow serious changes to Medicare in exchange for deficit reduction….Obama, in an interview with [Bob] Woodward, acknowledged he was open to nudging reluctant liberals on Medicare and Social Security if Republicans were willing to deal on taxes.  “’I am willing to move on entitlement reform — even if my own party is resisting, and I will bring them along — as long as we have significant revenues so that people feel like there’s a fairly shared burden when it comes to deficit reduction.’”

The Obama camp’s statements mislead on multiple fronts.  First, President Obama is currently claiming on the campaign trail that his proposals “will save Medicare money by getting rid of wasteful spending in the health care system.  Reforms that will not touch your Medicare benefits.”  What President Obama is claiming – before the election – is that he fully intends to break his own campaign promise “not [to] touch your Medicare benefits” after the election – so long as Republicans agree to break their own campaign pledge and raise taxes on the American people.  To say that is a cynical move – the antithesis of hope and change – is putting it mildly.

The second problem is that the President’s claim itself doesn’t withstand serious scrutiny, given his past track record.  Take, for instance, his pledge to Congress in September 2009 that his health plan would “cost around $900 billion over ten years.”  Here’s how that turned out:

  1. The final health care legislation as enacted spent $938 billion on insurance subsidies – more than the President’s $900 billion figure;
  2. The legislation also included a total of $144.2 billion in additional mandatory spending on programs other than insurance subsidies (e.g., closing the Medicare “doughnut hole,” prevention “slush fund,” etc.) – taking the measure’s mandatory spending to well above $1 trillion;
  3. The legislation included more than $100 billion in authorizations for domestic discretionary spending – figures revealed only after the legislation was signed into law; and
  4. Even the $1.2 trillion in combined mandatory and discretionary spending was an under-estimate of the law’s true 10-year fiscal impact, as the insurance expansions were delayed until 2014 in an attempt to make the bill seem less expensive than it really was.  The Congressional Budget Office concluded in July that the $938 billion in insurance subsidy spending has nearly doubled, to $1.68 trillion, now that more years of subsidy spending are present in the 10-year budget window.

So when all is said and done, and the gimmicks exposed, the plan President Obama claimed in 2009 would cost “only” $900 billion will in reality spend much more than that – a liberal, and recklessly irresponsible, record that would make many question Obama’s ability, and desire, to take on America’s unsustainable entitlements.

Even if the above fears are unfounded, and President Obama will finally put aside his liberal tendencies, the man who claims that “even if my own party is resisting” entitlement reform, “I will bring them along” appears to be vastly over-estimating his ability to influence the “professional left.”  According to Bob Woodward, Speaker Nancy Pelosi hit the mute button on President Obama during negotiations on the “stimulus” in 2009.  That might be a nice way to avoid listening to someone who has described himself as “long-winded” – but it doesn’t speak well to the President’s ability to influence his own party.

To sum up: President Obama wants Republicans to break their campaign promises after the election – which his advisers already claim he fully plans on doing himself – so that they can negotiate with someone whose health care bill cost twice what he promised, and whose own party’s leaders have tuned him out.  Somewhere, P.T. Barnum must be smiling.

Pharmacies Join Obamacare Propaganda Campaign

The Hill reports this afternoon that several major pharmacies “will promote [Obamacare]…to seniors,” providing brochures about all the law’s supposed new benefits.  In a conference call announcing the program, CMS Acting Administrator Marilyn Tavenner refused to give a straight answer to the question about whether the pharmacies came up with the idea for the program, or the Administration proposed it – strongly suggesting that the Obama Administration proposed this idea to pharmacies as yet another propaganda effort to win support for their unpopular law.

One unanswered question remains: Will these pharmacies also educate seniors about the law’s cuts to Medicare Advantage – which will cut enrollment in Medicare Advantage in half and reduce plan choices by two-thirds?  Or does the Administration’s call for seniors to be able to “make informed healthcare decisions” only apply to the information the Administration wants seniors to see?

It’s perhaps not surprising that pharmacies would look to advertise Big Pharma’s “rock-solid deal” struck behind closed doors with President Obama – after all, pharmacies have the same financial incentives to sell more brand-name prescriptions that Big Pharma companies do.  However, the more than 17 million seniors participating in Medicare Part D who are facing higher premiums thanks to this “rock-solid deal” may not be so happy.

46 Reasons to Repeal an Unconstitutional Law NOW

46 50 Reasons to Repeal ALL of Obamacare NOW

Today the Supreme Court struck down portions of Obamacare as unconstitutional – states cannot be “dragooned” into expanding their Medicaid programs according to the law’s dictates. However, a list of 50 particularly onerous or egregious provisions in Obamacare (with sections from the statute duly noted) reveals just how much of this bad law remains. By the most generous interpretation, the Court struck down only four of the 50 egregious policies, illustrating why Congress should immediately repeal the entire measure once and for all. Among many other bad policies, the law:

  1. Imposes $800 billion in tax increases, including no fewer than 12 separate provisions breaking candidate Obama’s “firm pledge” during his campaign that he would not raise “any of your taxes” (Sections 9001-9016)
  2. Forces Americans to purchase a product for the first time ever (Section 1501)
  3. Creates a board of 15 unelected and unaccountable bureaucrats to make binding rulings on how to reduce Medicare spending (Section 3403)
  4. Pays over $800 billion in subsidies straight to health insurance companies (Sections 1401, 1402, and 1412)
  5. Requires all individuals to buy government-approved health insurance plans, imposing new mandates that will raise individual insurance premiums by an average of $2,100 per family (Section 1302)
  6. Forces seniors to lose their current health care, by enacting Medicare Advantage cuts that by 2017 will cut enrollment in half, and cut plan choices by two-thirds (Section 3201)
  7. Imposes a 40 percent tax on health benefits, a direct contradiction of Barack Obama’s campaign promises (Section 9001)
  8. Relies upon government bureaucrats to “issue guidance on best practices of plain language writing” (Section 1311(e)(3)(B))
  9. Provides special benefits to residents of Libby, Montana – home of Max Baucus, the powerful Chairman of the Senate Finance Committee, who helped write the law even though he says he hasn’t read it (Section 10323)
  10. Imposes what a Democrat Governor called the “mother of all unfunded mandates” – new, Washington-dictated requirements of at least $118 billion – at a time when states already face budget deficits totaling a collective $175 billion (Section 2001)
  11. Imposes reductions in Medicare spending that, according to the program’s non-partisan actuary, would cause 40 percent of all Medicare providers to become unprofitable, and could lead to their exit from the program (Section 3401)
  12. Raises premiums on more than 17 million seniors participating in Medicare Part D, so that Big Pharma can benefit from its “rock-solid deal” struck behind closed doors with President Obama and Congressional Democrats (Section 3301)
  13. Creates an institute to undertake research that, according to one draft Committee report prepared by Democrats, could mean that “more expensive [treatments] will no longer be prescribed” (Section 6301)
  14. Creates a multi-billion dollar “slush fund” doled out solely by federal bureaucrats, which has already been used to fund things like bike paths (Section 4002)
  15. Subjects states to myriad new lawsuits, by forcing them to assume legal liability for delivering services to Medicaid patients for the first time in that program’s history (Section 2304)
  16. Permits taxpayer dollars to flow to health plans that fund abortion, in a sharp deviation from prior practice under Democrat and Republican Administrations (Section 1303)
  17. Empowers bureaucrats on a board that has ruled against mammograms and against prostate cancer screenings to make binding determinations about what types of preventive services should be covered (Sections 2713 and 4104)
  18. Precludes poor individuals from having a choice of health care plans by automatically dumping them in the Medicaid program (Section 1413(a))
  19. Creates a new entitlement program that one Democrat called “a Ponzi scheme of the first order, the kind of thing that Bernie Madoff would have been proud of” – a scheme so unsustainable even the Administration was forced to admit it would not work (Section 8002)
  20. Provides $5 billion in taxpayer dollars to a fund that has largely served to bail out unions and other organizations who made unsustainable health care promises to retirees that they cannot afford (Section 1102)
  21. Creates a tax credit so convoluted it requires seven different worksheets to determine eligibility (Section 1421)
  22. Imposes multiple penalties on those who marry, by reducing subsidies (and increasing taxes) for married couples when compared to two individuals cohabiting together (Sections 1401-02)
  23. Extends the Medicare “payroll tax” to unearned income for the first time ever, including new taxes on the sale of some homes (Section 1402)
  24. Impedes state flexibility by requiring Medicaid programs to offer a specific package of benefits, including benefits like family planning services (Sections 2001(a)(2), 2001(c), 1302(b), and 2303(c))
  25. Requires individuals to go to the doctor and get a prescription in order to spend their own Flexible Spending Account money on over-the-counter medicines (Section 9003)
  26. Expands the definition of “low-income” to make 63 percent of non-elderly Americans eligible for “low-income” subsidized insurance (Section 1401)
  27. Imposes a new tax on the makers of goods like pacemakers and hearing aids (Section 9009)
  28. Creates an insurance reimbursement scheme that could result in the federal government obtaining Americans’ medical records (Section 1343)
  29. Permits states to make individuals presumptively eligible for Medicaid for unlimited 60-day periods, thus allowing any individual to receive taxpayer-funded assistance ad infinitum (Section 2303(b))
  30. Allows individuals to purchase insurance on government exchanges – and to receive taxpayer-funded insurance subsidies – WITHOUT verifying their identity as American citizens (Section 1411)
  31. Gives $300 million in higher Medicaid reimbursements to one state as part of the infamous “Louisiana Purchase” – described by ABC News as “what…it take[s] to get a wavering senator to vote for health care reform” (Section 2006)
  32. Raises taxes on firms who cannot afford to buy coverage for their workers (Section 1513)
  33. Forces younger Americans to pay double-digit premium increases so that older workers can pay slightly less (Section 1201)
  34. Prohibits states from modifying their Medicaid programs to include things like modest anti-fraud protections (Section 2001)
  35. Includes a special provision increasing federal payments just for Tennessee (Section 1203(b))
  36. Allows individuals to purchase health insurance across state lines – but only if politicians and bureaucrats agree to allow citizens this privilege (Section 1333)
  37. Allows the HHS Secretary and federal bureaucrats to grant waivers exempting people from Obamacare’s onerous mandates, over half of which have gone to members of union plans (Section 1001)
  38. Creates a pseudo-government-run plan overseen by the federal government (Section 1334)
  39. Removes a demonstration project designed to force government-run Medicare to compete on a level playing field with private plans (Section 1102(f))
  40. Gives the Secretary of HHS an UNLIMITED amount of federal funds to spend funding state insurance Exchanges (Section 1311(a))
  41. Creates a grant program that could be used by liberal groups like ACORN or AARP to conduct “public education activities” surrounding Obamacare (Section 1311(i))
  42. Applies new federal mandates to pre-Obamacare insurance policies, thus proving that you CAN’T keep the insurance plan you had – and liked – before the law passed (Sections 2301 and 10103)
  43. Prohibits individuals harmed by federal bureaucrats from challenging those decisions, either in court or through regulatory processes (Sections 3001, 3003, 3007, 3008, 3021, 3022, 3025, 3133, 3403, 5501, 6001, and 6401)
  44. Earmarks $100 million for “construction of a health care facility,” a “sweetheart deal” inserted by a Democrat Senator trying to win re-election (Section 10502)
  45. Puts yet another Medicaid unfunded mandate on states, by raising payments to primary care physicians, but only for two years, forcing states to come up with another method of funding this unsustainable promise when federal funding expires (Section 1202)
  46. Imposes price controls that have had the effect of costing jobs in the short time since they were first implemented (Section 1001)
  47. Prohibits individuals from spending federal insurance subsidies outside government-approved Exchanges (Section 1401(a))
  48. Provides a special increase in federal hospital payments just for Hawaii (Section 10201(e)(1))
  49. Imposes new reporting requirements that will cost businesses millions of dollars, and affect thousands of restaurants and other establishments across the country (Section 4205)
  50. Codifies 159 new boards, bureaucracies, and programs

The Supreme Court may have struck some of these onerous provisions, but the only way to ensure that ALL these provisions are eliminated – and never return – is to repeal ALL of this unconstitutional law immediately.

Rebates NOT an Obamacare “Game Changer”

Various press outlets are reporting on an Administration-hyped story about how medical loss ratio rebates will turn into a “game changer” for the President’s unpopular health care law.  However, this leak to a reporter yielding a favorable story misses several key points:

  1. As we reported last month, a Kaiser Family Foundation study found that rebates would average $127 for about three million individuals who will directly receive the rebates.  The study itself admitted that the overall rebates are “not particularly large in many instances.”  By contrast, nearly four million seniors in the Medicare “doughnut hole” received $250 rebate checks in 2010 – and that didn’t stop seniors from expressing their outrage about Obamacare at the polls that November.  If a $250 rebate check sent to 4 million people in 2010 didn’t persuade seniors to support Obamacare in 2010, why would a rebate check averaging less than half that amount, and sent to fewer individuals, be a “Game Changer” in 2012?
  2. The Kaiser Family Foundation also notes that premiums for families in employer-sponsored insurance went up by $1,303 last year alone – premiums averaged $13,770 in 2010 and $15,073 in 2011How is an average rebate covering a mere 10% of last year’s premium increase a “Game Changer” for struggling middle-class families?
  3. More importantly, candidate Obama repeatedly promised that premiums would go DOWN – and not by tens or hundreds of dollars, but by thousands.  For instance, in a speech on February 27, 2008, he said that “We’re going to work with you to lower your premiums by $2,500 per family per year.  And we will not wait 20 years from now to do it or 10 years from now to do it.  We will do it by the end of my first term as President.”  But as the below chart demonstrates, while candidate Obama promised that premiums would go DOWN by $2,500, they actually have gone UP by nearly as much – from $12,680 in 2008 to $15,073 in 2011, according to Kaiser data.  Given that candidate Obama promised premiums would go down by $2,500, how does a $127 rebate check represent a “Game Changer” and not a promise broken on a massive scale?

Favorably leaked stories to reporters aside, a $127 rebate won’t even begin to make up for the $2,400 in premium increases families in employer plans have faced just since Barack Obama was elected – let alone the $2,500 in premium reductions they were promised under ObamacareThat’s the real “Game Changer” here.

Obama Abandons Medicare

President Obama and Democrats claim to be committed to “protecting” seniors.  But their policies fail to protect the essential Medicare program.  It is yet another broken promise by the president.  Once again this week, President Obama ignored a legal requirement to produce a plan to strengthen Medicare – the fourth straight year he has failed to put a plan forward.  And reports indicate Democrats in the Senate have no plans to strengthen Medicare because it would be “giving away the biggest [political] advantage” Democrats have had “in some time.”
The failure of the President’s health care law to strengthen Medicare is a prime example of Democratic hypocrisy.  A close look at provisions in the law reveal how it’s fiscal gimmicks and centralized control undermine the Medicare program, harming seniors in the process.
Millions Lose Their Current Coverage

The Congressional Budget Office (CBO) estimates that the president’s health care law will cut a total of $202.3 billion from Medicare Advantage plans.  These plans deliver a range of health care options to more than 12 million seniors, one-quarter of those enrolled in the Medicare program.  One recent study demonstrated that the law will cause Medicare Advantage plan enrollment to be cut in half by 2017.  In addition to enrollment being cut, seniors’ choice of health care plans will be cut by two-thirds

The Health Care Law Hurts Medicare’s Long-Term Solvency

Obama Administration actuaries have confirmed that the president’s health care law will increase overall health spending by $311 billion.  The increased spending further exacerbates the long-term trends that have placed the Medicare program in financial trouble.

The president’s health care law uses Medicare savings not to strengthen Medicare, but to fund new entitlements.  The CBO stated the law “would not enhance the ability of the government to pay for future Medicare benefits.”  The non-partisan Medicare actuary confirmed that Medicare reductions in the law “cannot be simultaneously used to finance other federal outlays and to extend the [Medicare] trust fund.”  Even Speaker Pelosi admitted this problem in November, when she said in an interview that “we took half a trillion dollars out of Medicare in…the health care bill,” to pay for other program spending.
Unsustainable Payment Cuts Would Drive Hospitals Out of Business

Medicare payment reductions in the Obama health care law will not improve the solvency of the program.  CBO concluded that the reductions are phantom savings.  They say the largest Medicare reductions—permanent reductions in payments to hospitals and other Part A medical providers—will be “difficult to sustain for a long period.”  The non-partisan Medicare actuary also found that provisions in the health care law “are unlikely to be sustainable on a permanent annual basis.”

 
One analysis conducted by the Medicare actuary found that over the long term, Medicare would pay hospitals only about one-third the rate paid by private health insurance.  These reductions would cause up to 40 percent of hospitals to become unprofitable—meaning medical providers would likely have to stop treating Medicare patients to remain in business, and thus jeopardizing beneficiaries’ access to care. 
Cuts to Doctors Would Lead to Higher Premiums

The president’s health care law did not fix the Medicare formula for physician reimbursement levels.  As a result, physicians will receive a 32 percent cut in payment levels beginning in January 2013 and further reductions thereafter while health costs continue to rise.  The president’s FY 2013 budget does not fix the funding shortfall either – it ignores the $429 billion cost for the fix.  If the president’s proposals become law, seniors would pay higher Part B premiums—more than $100 billion.

Most Seniors Will Pay More
In order to give a select group of beneficiaries richer coverage, the president’s health care law raises seniors’ Part D premiums  CBO estimated that “the law would lead to an average increase in premiums for Part D beneficiaries of about four percent in 2011, rising to about nine percent in 2019.”  That means 17 million seniors enrolled in Part D plans are paying higher premiums so that about 400,000 beneficiaries passing through the so-called “doughnut hole” can receive the full benefit of the law’s drug discount.  Many of these beneficiaries are low-income seniors whose additional costs were already covered before the President’s health care law.
The Law Puts Washington Bureaucrats in Control 
The president’s health care law establishes a new board of 15 unelected, unaccountable bureaucrats empowered to make decisions with the force of law on reductions within Medicare.  Each of these officials, whose salaries will be paid by the federal government, could be in power for well over a decade.  The law mandates that a majority of board members must consist of economists and other similar “experts,” NOT practicing doctors, nurses, or other medical providers.  Its members will make rulings to reduce Medicare spending, and these rulings will be binding unless overturned by a supermajority of both houses of Congress.  Medicare beneficiaries who are harmed by this unaccountable board will have no recourse to appeal its decisions, as the law prohibits both judicial and administrative review of the board’s decisions.  Patients should be concerned that the law inserts bureaucrats between patients and doctors.
Medicare must be strengthened.  CBO projects that the Medicare trust fund will run deficits in the tens of billions of dollars forever.   The president’s former Chief of Staff, Bill Daley, said in July that the program “will run out of money in five years if we don’t do something.”  The president himself acknowledged that “if you look at the numbers, then Medicare in particular will run out of money and we will not be able to sustain that program no matter how much taxes go up.  I mean, it’s not an option for us to just sit by and do nothing.”
Unfortunately, the president’s health care law fails a Medicare program in need of strengthening.  The law imposes budget gimmicks that divert Medicare savings to pay for new programs, and assumes payment reductions that will have to be overridden for seniors to have access to care.  Moreover, the law centralizes control within a government-run system, eliminating choices in Medicare Advantage and ceding massive power to a board of unelected and unaccountable bureaucrats.  While Democrats claim that Republicans want to destroy Medicare, it is Democrats who radically altered the program for the worse as part of President Obama’s massive 2700-page health law.

208 Things in Obamacare that Obama and Democrats Support

Last week, former HELP Committee staffer John McDonough wrote a list of “50 provisions I ask the media to ask Romney et al. if they are committed to repealing as President.”  McDonough noted that “there are [Obamacare] provisions opponents could pick out to create an alternative list for elimination.”

We here at RPC know a challenge when we hear one; our list is submitted below, with sections from the statute duly noted.  Remember when reading this list:  We KNOW that President Obama and Democrats all support these provisions in Obamacare – because they all voted to enact them into law.  So members of the media can readily ask President Obama and Democrat Members of Congress why they supported a law that…

  1. Imposes $800 billion in tax increases, including no fewer than 12 separate provisions breaking candidate Obama’s “firm pledge” during his campaign that he would not raise “any of your taxes” (Sections 9001-9016)?
  2. Forces Americans to purchase a product for the first time ever (Section 1501)?
  3. Creates a board of 15 unelected and unaccountable bureaucrats to make binding rulings on how to reduce Medicare spending (Section 3403)?
  4. Pays over $800 billion in subsidies straight to health insurance companies (Sections 1401, 1402, and 1412)?
  5. Requires all individuals to buy government-approved health insurance plans, imposing new mandates that will raise individual insurance premiums by an average of $2,100 per family (Section 1302)?
  6. Forces seniors to lose their current health care, by enacting Medicare Advantage cuts that by 2017 will cut enrollment in half, and cut plan choices by two-thirds (Section 3201)?
  7. Imposes a 40 percent tax on health benefits, a direct contradiction of Barack Obama’s campaign promises (Section 9001)?
  8. Relies upon government bureaucrats to “issue guidance on best practices of plain language writing” (Section 1311(e)(3)(B))?
  9. Provides special benefits to residents of Libby, Montana – home of Max Baucus, the powerful Chairman of the Senate Finance Committee, who helped write the law even though he says he hasn’t read it (Section 10323)?
  10. Imposes what a Democrat Governor called the “mother of all unfunded mandates” – new, Washington-dictated requirements of at least $118 billion – at a time when states already face budget deficits totaling a collective $175 billion (Section 2001)?
  11. Imposes reductions in Medicare spending that, according to the program’s non-partisan actuary, would cause 40 percent of all Medicare providers to become unprofitable, and could lead to their exit from the program (Section 3401)?
  12. Raises premiums on more than 17 million seniors participating in Medicare Part D, so that Big Pharma can benefit from its “rock-solid deal” struck behind closed doors with President Obama and Congressional Democrats (Section 3301)?
  13. Creates an institute to undertake research that, according to one draft Committee report prepared by Democrats, could mean that “more expensive [treatments] will no longer be prescribed” (Section 6301)?
  14. Creates a multi-billion dollar “slush fund” doled out solely by federal bureaucrats, which has already been used to fund things like bike paths (Section 4002)?
  15. Subjects states to myriad new lawsuits, by forcing them to assume legal liability for delivering services to Medicaid patients for the first time in that program’s history (Section 2304)?
  16. Permits taxpayer dollars to flow to health plans that fund abortion, in a sharp deviation from prior practice under Democrat and Republican Administrations (Section 1303)?
  17. Empowers bureaucrats on a board that has ruled against mammograms and against prostate cancer screenings to make binding determinations about what types of preventive services should be covered (Sections 2713 and 4104)?
  18. Precludes poor individuals from having a choice of health care plans by automatically dumping them in the Medicaid program (Section 1413(a))?
  19. Creates a new entitlement program that one Democrat called “a Ponzi scheme of the first order, the kind of thing that Bernie Madoff would have been proud of” – a scheme so unsustainable even the Administration was forced to admit it would not work (Section 8002)?
  20. Provides $5 billion in taxpayer dollars to a fund that has largely served to bail out unions and other organizations who made unsustainable health care promises to retirees that they cannot afford (Section 1102)?
  21. Creates a tax credit so convoluted it requires seven different worksheets to determine eligibility (Section 1421)?
  22. Imposes multiple penalties on those who marry, by reducing subsidies (and increasing taxes) for married couples when compared to two individuals cohabiting together (Sections 1401-02)?
  23. Extends the Medicare “payroll tax” to unearned income for the first time ever, including new taxes on the sale of some homes (Section 1402)?
  24. Impedes state flexibility by requiring Medicaid programs to offer a specific package of benefits, including benefits like family planning services (Sections 2001(a)(2), 2001(c), 1302(b), and 2303(c))?
  25. Requires individuals to go to the doctor and get a prescription in order to spend their own Flexible Spending Account money on over-the-counter medicines (Section 9003)?
  26. Expands the definition of “low-income” to make 63 percent of non-elderly Americans eligible for “low-income” subsidized insurance (Section 1401)?
  27. Imposes a new tax on the makers of goods like pacemakers and hearing aids (Section 9009)?
  28. Creates an insurance reimbursement scheme that could result in the federal government obtaining Americans’ medical records (Section 1343)?
  29. Permits states to make individuals presumptively eligible for Medicaid for unlimited 60-day periods, thus allowing any individual to receive taxpayer-funded assistance ad infinitum (Section 2303(b))?
  30. Allows individuals to purchase insurance on government exchanges – and to receive taxpayer-funded insurance subsidies – WITHOUT verifying their identity as American citizens (Section 1411)?
  31. Gives $300 million in higher Medicaid reimbursements to one state as part of the infamous “Louisiana Purchase” – described by ABC News as “what…it take[s] to get a wavering senator to vote for health care reform” (Section 2006)?
  32. Raises taxes on firms who cannot afford to buy coverage for their workers (Section 1513)?
  33. Forces younger Americans to pay double-digit premium increases so that older workers can pay slightly less (Section 1201)?
  34. Prohibits states from modifying their Medicaid programs to include things like modest anti-fraud protections (Section 2001)?
  35. Includes a special provision increasing federal payments just for Tennessee (Section 1203(b))?
  36. Allows individuals to purchase health insurance across state lines – but only if politicians and bureaucrats agree to allow citizens this privilege (Section 1333)?
  37. Allows the HHS Secretary and federal bureaucrats to grant waivers exempting people from Obamacare’s onerous mandates, over half of which have gone to members of union plans (Section 1001)?
  38. Creates a pseudo-government-run plan overseen by the federal government (Section 1334)?
  39. Removes a demonstration project designed to force government-run Medicare to compete on a level playing field with private plans (Section 1102(f))?
  40. Gives the Secretary of HHS an UNLIMITED amount of federal funds to spend funding state insurance Exchanges (Section 1311(a))?
  41. Creates a grant program that could be used by liberal groups like ACORN or AARP to conduct “public education activities” surrounding Obamacare (Section 1311(i))?
  42. Applies new federal mandates to pre-Obamacare insurance policies, thus proving that you CAN’T keep the insurance plan you had – and liked – before the law passed (Sections 2301 and 10103)?
  43. Prohibits individuals harmed by federal bureaucrats from challenging those decisions, either in court or through regulatory processes (Sections 3001, 3003, 3007, 3008, 3021, 3022, 3025, 3133, 3403, 5501, 6001, AND 6401)?
  44. Earmarks $100 million for “construction of a health care facility,” a “sweetheart deal” inserted by a Democrat Senator trying to win re-election (Section 10502)?
  45. Puts yet another Medicaid unfunded mandate on states, by raising payments to primary care physicians, but only for two years, forcing states to come up with another method of funding this unsustainable promise when federal funding expires (Section 1202)?
  46. Imposes price controls that have had the effect of costing jobs in the short time since they were first implemented (Section 1001)?
  47. Prohibits individuals from spending federal insurance subsidies outside government-approved Exchanges (Section 1401(a))?
  48. Provides a special increase in federal hospital payments just for Hawaii (Section 10201(e)(1))?
  49. Imposes new reporting requirements that will cost businesses millions of dollars, and affect thousands of restaurants and other establishments across the country (Section 4205)?

And instead of including a 50th item on our list, we’re going to include 159 separate items.  These are the 159 new boards, bureaucracies, and programs created by Obamacare.  You can find the list below, or here.

No matter which way you look at it, this list provides 208 easy reasons why the American people still continue to reject Democrats’ unpopular 2700-page health care law.

 

Obamacare’s 159 New Boards, Bureaucracies, Commissions, and Programs

  1. Grant program for consumer assistance offices (Section 1002, p. 37)
  2. Grant program for states to monitor premium increases (Section 1003, p. 42)
  3. Committee to review administrative simplification standards (Section 1104, p. 71)
  4. Demonstration program for state wellness programs (Section 1201, p. 93)
  5. Grant program to establish state Exchanges (Section 1311(a), p. 130)
  6. State American Health Benefit Exchanges (Section 1311(b), p. 131)
  7. Exchange grants to establish consumer navigator programs (Section 1311(i), p. 150)
  8. Grant program for state cooperatives (Section 1322, p. 169)
  9. Advisory board for state cooperatives (Section 1322(b)(3), p. 173)
  10. Private purchasing council for state cooperatives (Section 1322(d), p. 177)
  11. State basic health plan programs (Section 1331, p. 201)
  12. State-based reinsurance program (Section 1341, p. 226)
  13. Program of risk corridors for individual and small group markets (Section 1342, p. 233)
  14. Program to determine eligibility for Exchange participation (Section 1411, p. 267)
  15. Program for advance determination of tax credit eligibility (Section 1412, p. 288)
  16. Grant program to implement health IT enrollment standards (Section 1561, p. 370)
  17. Federal Coordinated Health Care Office for dual eligible beneficiaries (Section 2602, p. 512)
  18. Medicaid quality measurement program (Section 2701, p. 518)
  19. Medicaid health home program for people with chronic conditions, and grants for planning same (Section 2703, p. 524)
  20. Medicaid demonstration project to evaluate bundled payments (Section 2704, p. 532)
  21. Medicaid demonstration project for global payment system (Section 2705, p. 536)
  22. Medicaid demonstration project for accountable care organizations (Section 2706, p. 538)
  23. Medicaid demonstration project for emergency psychiatric care (Section 2707, p. 540)
  24. Grant program for delivery of services to individuals with postpartum depression (Section 2952(b), p. 591)
  25. State allotments for grants to promote personal responsibility education programs (Section 2953, p. 596)
  26. Medicare value-based purchasing program (Section 3001(a), p. 613)
  27. Medicare value-based purchasing demonstration program for critical access hospitals (Section 3001(b), p. 637)
  28. Medicare value-based purchasing program for skilled nursing facilities (Section 3006(a), p. 666)
  29. Medicare value-based purchasing program for home health agencies (Section 3006(b), p. 668)
  30. Interagency Working Group on Health Care Quality (Section 3012, p. 688)
  31. Grant program to develop health care quality measures (Section 3013, p. 693)
  32. Center for Medicare and Medicaid Innovation (Section 3021, p. 712)
  33. Medicare shared savings program (Section 3022, p. 728)
  34. Medicare pilot program on payment bundling (Section 3023, p. 739)
  35. Independence at home medical practice demonstration program (Section 3024, p. 752)
  36. Program for use of patient safety organizations to reduce hospital readmission rates (Section 3025(b), p. 775)
  37. Community-based care transitions program (Section 3026, p. 776)
  38. Demonstration project for payment of complex diagnostic laboratory tests (Section 3113, p. 800)
  39. Medicare hospice concurrent care demonstration project (Section 3140, p. 850)
  40. Independent Payment Advisory Board (Section 3403, p. 982)
  41. Consumer Advisory Council for Independent Payment Advisory Board (Section 3403, p. 1027)
  42. Grant program for technical assistance to providers implementing health quality practices (Section 3501, p. 1043)
  43. Grant program to establish interdisciplinary health teams (Section 3502, p. 1048)
  44. Grant program to implement medication therapy management (Section 3503, p. 1055)
  45. Grant program to support emergency care pilot programs (Section 3504, p. 1061)
  46. Grant program to promote universal access to trauma services (Section 3505(b), p. 1081)
  47. Grant program to develop and promote shared decision-making aids (Section 3506, p. 1088)
  48. Grant program to support implementation of shared decision-making (Section 3506, p. 1091)
  49. Grant program to integrate quality improvement in clinical education (Section 3508, p. 1095)
  50. Health and Human Services Coordinating Committee on Women’s Health (Section 3509(a), p. 1098)
  51. Centers for Disease Control Office of Women’s Health (Section 3509(b), p. 1102)
  52. Agency for Healthcare Research and Quality Office of Women’s Health (Section 3509(e), p. 1105)
  53. Health Resources and Services Administration Office of Women’s Health (Section 3509(f), p. 1106)
  54. Food and Drug Administration Office of Women’s Health (Section 3509(g), p. 1109)
  55. National Prevention, Health Promotion, and Public Health Council (Section 4001, p. 1114)
  56. Advisory Group on Prevention, Health Promotion, and Integrative and Public Health (Section 4001(f), p. 1117)
  57. Prevention and Public Health Fund (Section 4002, p. 1121)
  58. Community Preventive Services Task Force (Section 4003(b), p. 1126)
  59. Grant program to support school-based health centers (Section 4101, p. 1135)
  60. Grant program to promote research-based dental caries disease management (Section 4102, p. 1147)
  61. Grant program for States to prevent chronic disease in Medicaid beneficiaries (Section 4108, p. 1174)
  62. Community transformation grants (Section 4201, p. 1182)
  63. Grant program to provide public health interventions (Section 4202, p. 1188)
  64. Demonstration program of grants to improve child immunization rates (Section 4204(b), p. 1200)
  65. Pilot program for risk-factor assessments provided through community health centers (Section 4206, p. 1215)
  66. Grant program to increase epidemiology and laboratory capacity (Section 4304, p. 1233)
  67. Interagency Pain Research Coordinating Committee (Section 4305, p. 1238)
  68. National Health Care Workforce Commission (Section 5101, p. 1256)
  69. Grant program to plan health care workforce development activities (Section 5102(c), p. 1275)
  70. Grant program to implement health care workforce development activities (Section 5102(d), p. 1279)
  71. Pediatric specialty loan repayment program (Section 5203, p. 1295)
  72. Public Health Workforce Loan Repayment Program (Section 5204, p. 1300)
  73. Allied Health Loan Forgiveness Program (Section 5205, p. 1305)
  74. Grant program to provide mid-career training for health professionals (Section 5206, p. 1307)
  75. Grant program to fund nurse-managed health clinics (Section 5208, p. 1310)
  76. Grant program to support primary care training programs (Section 5301, p. 1315)
  77. Grant program to fund training for direct care workers (Section 5302, p. 1322)
  78. Grant program to develop dental training programs (Section 5303, p. 1325)
  79. Demonstration program to increase access to dental health care in underserved communities (Section 5304, p. 1331)
  80. Grant program to promote geriatric education centers (Section 5305, p. 1334)
  81. Grant program to promote health professionals entering geriatrics (Section 5305, p. 1339)
  82. Grant program to promote training in mental and behavioral health (Section 5306, p. 1344)
  83. Grant program to promote nurse retention programs (Section 5309, p. 1354)
  84. Student loan forgiveness for nursing school faculty (Section 5311(b), p. 1360)
  85. Grant program to promote positive health behaviors and outcomes (Section 5313, p. 1364)
  86. Public Health Sciences Track for medical students (Section 5315, p. 1372)
  87. Primary Care Extension Program to educate providers (Section 5405, p. 1404)
  88. Grant program for demonstration projects to address health workforce shortage needs (Section 5507, p. 1442)
  89. Grant program for demonstration projects to develop training programs for home health aides (Section 5507, p. 1447)
  90. Grant program to establish new primary care residency programs (Section 5508(a), p. 1458)
  91. Program of payments to teaching health centers that sponsor medical residency training (Section 5508(c), p. 1462)
  92. Graduate nurse education demonstration program (Section 5509, p. 1472)
  93. Grant program to establish demonstration projects for community-based mental health settings (Section 5604, p. 1486)
  94. Commission on Key National Indicators (Section 5605, p. 1489)
  95. Quality assurance and performance improvement program for skilled nursing facilities (Section 6102, p. 1554)
  96. Special focus facility program for skilled nursing facilities (Section 6103(a)(3), p. 1561)
  97. Special focus facility program for nursing facilities (Section 6103(b)(3), p. 1568)
  98. National independent monitor pilot program for skilled nursing facilities and nursing facilities (Section 6112, p. 1589)
  99. Demonstration projects for nursing facilities involved in the culture change movement (Section 6114, p. 1597)
  100. Patient-Centered Outcomes Research Institute (Section 6301, p. 1619)
  101. Standing methodology committee for Patient-Centered Outcomes Research Institute (Section 6301, p. 1629)
  102. Board of Governors for Patient-Centered Outcomes Research Institute (Section 6301, p. 1638)
  103. Patient-Centered Outcomes Research Trust Fund (Section 6301(e), p. 1656)
  104. Elder Justice Coordinating Council (Section 6703, p. 1773)
  105. Advisory Board on Elder Abuse, Neglect, and Exploitation (Section 6703, p. 1776)
  106. Grant program to create elder abuse forensic centers (Section 6703, p. 1783)
  107. Grant program to promote continuing education for long-term care staffers (Section 6703, p. 1787)
  108. Grant program to improve management practices and training (Section 6703, p. 1788)
  109. Grant program to subsidize costs of electronic health records (Section 6703, p. 1791)
  110. Grant program to promote adult protective services (Section 6703, p. 1796)
  111. Grant program to conduct elder abuse detection and prevention (Section 6703, p. 1798)
  112. Grant program to support long-term care ombudsmen (Section 6703, p. 1800)
  113. National Training Institute for long-term care surveyors (Section 6703, p. 1806)
  114. Grant program to fund State surveys of long-term care residences (Section 6703, p. 1809)
  115. CLASS Independence Fund (Section 8002, p. 1926)
  116. CLASS Independence Fund Board of Trustees (Section 8002, p. 1927)
  117. CLASS Independence Advisory Council (Section 8002, p. 1931)
  118. Personal Care Attendants Workforce Advisory Panel (Section 8002(c), p. 1938)
  119. Multi-state health plans offered by Office of Personnel Management (Section 10104(p), p. 2086)
  120. Advisory board for multi-state health plans (Section 10104(p), p. 2094)
  121. Pregnancy Assistance Fund (Section 10212, p. 2164)
  122. Value-based purchasing program for ambulatory surgical centers (Section 10301, p. 2176)
  123. Demonstration project for payment adjustments to home health services (Section 10315, p. 2200)
  124. Pilot program for care of individuals in environmental emergency declaration areas (Section 10323, p. 2223)
  125. Grant program to screen at-risk individuals for environmental health conditions (Section 10323(b), p. 2231)
  126. Pilot programs to implement value-based purchasing (Section 10326, p. 2242)
  127. Grant program to support community-based collaborative care networks (Section 10333, p. 2265)
  128. Centers for Disease Control Office of Minority Health (Section 10334, p. 2272)
  129. Health Resources and Services Administration Office of Minority Health (Section 10334, p. 2272)
  130. Substance Abuse and Mental Health Services Administration Office of Minority Health (Section 10334, p. 2272)
  131. Agency for Healthcare Research and Quality Office of Minority Health (Section 10334, p. 2272)
  132. Food and Drug Administration Office of Minority Health (Section 10334, p. 2272)
  133. Centers for Medicare and Medicaid Services Office of Minority Health (Section 10334, p. 2272)
  134. Grant program to promote small business wellness programs (Section 10408, p. 2285)
  135. Cures Acceleration Network (Section 10409, p. 2289)
  136. Cures Acceleration Network Review Board (Section 10409, p. 2291)
  137. Grant program for Cures Acceleration Network (Section 10409, p. 2297)
  138. Grant program to promote centers of excellence for depression (Section 10410, p. 2304)
  139. Advisory committee for young women’s breast health awareness education campaign (Section 10413, p. 2322)
  140. Grant program to provide assistance to provide information to young women with breast cancer (Section 10413, p. 2326)
  141. Interagency Access to Health Care in Alaska Task Force (Section 10501, p. 2329)
  142. Grant program to train nurse practitioners as primary care providers (Section 10501(e), p. 2332)
  143. Grant program for community-based diabetes prevention (Section 10501(g), p. 2337)
  144. Grant program for providers who treat a high percentage of medically underserved populations (Section 10501(k), p. 2343)
  145. Grant program to recruit students to practice in underserved communities (Section 10501(l), p. 2344)
  146. Community Health Center Fund (Section 10503, p. 2355)
  147. Demonstration project to provide access to health care for the uninsured at reduced fees (Section 10504, p. 2357)
  148. Demonstration program to explore alternatives to tort litigation (Section 10607, p. 2369)
  149. Indian Health demonstration program for chronic shortages of health professionals (S. 1790, Section 112, p. 24)*
  150. Office of Indian Men’s Health (S. 1790, Section 136, p. 71)*
  151. Indian Country modular component facilities demonstration program (S. 1790, Section 146, p. 108)*
  152. Indian mobile health stations demonstration program (S. 1790, Section 147, p. 111)*
  153. Office of Direct Service Tribes (S. 1790, Section 172, p. 151)*
  154. Indian Health Service mental health technician training program (S. 1790, Section 181, p. 173)*
  155. Indian Health Service program for treatment of child sexual abuse victims (S. 1790, Section 181, p. 192)*
  156. Indian Health Service program for treatment of domestic violence and sexual abuse (S. 1790, Section 181, p. 194)*
  157. Indian youth telemental health demonstration project (S. 1790, Section 181, p. 204)*
  158. Indian youth life skills demonstration project (S. 1790, Section 181, p. 220)*
  159. Indian Health Service Director of HIV/AIDS Prevention and Treatment (S. 1790, Section 199B, p. 258)*

 

*Section 10221, page 2173 of H.R. 3590 deems that S. 1790 shall be deemed as passed with certain amendments.