Drafting Economic Stimulus Bill Could Take Six More Weeks, Democrats Say

Main Category: Medicare / Medicaid / SCHIP
Also Included In: Health Insurance / Medical Insurance;  Public Health
Article Date: 06 Jan 2009 - 2:00 PDT

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Congressional leaders had hoped to have an economic stimulus package that includes funds for health care programs for President-elect Barack Obama to sign after he takes office on Jan. 20, but that "looks increasingly doubtful as the legislation grows in complexity and size," the Washington Post reports. Senate Majority Leader Harry Reid (D-Nev.) and House Majority Leader Steny Hoyer (D-Md.) have estimated that passage of a stimulus package could take six more weeks (Murray, Washington Post, 1/5). According to Hoyer, Obama likely would not receive the stimulus package until mid-February (Baker/Hulse, New York Times, 1/5).

The "longer timetable will require Obama to take an active role in devising the package," according to the Post. Obama this week plans to deliver a speech to outline his stimulus package priorities (Washington Post, 1/5). In addition, Obama on Monday plans to meet with congressional leaders to discuss the stimulus package (Lee, The Politico, 1/2). On Wednesday, the Steering and Policy Committee of the House Democratic Caucus will hold a hearing on the stimulus package, House Speaker Nancy Pelosi (D-Calif.) said (Russell Chaddock, Christian Science Monitor, 1/5).

Possible Provisions
The stimulus package likely will include a temporary increase in the Federal Medical Assistance Percentage for state Medicaid programs, funds to help hospitals and physicians adopt health information technology and a reauthorization of SCHIP (Heflin, Roll Call, 1/3). The temporary increase in FMAP likely will cost between $140 billion and $200 billion.

In addition, the stimulus package might include subsidies for employers that temporarily continue health benefits to laid-off and retired employees and their dependents through COBRA. The stimulus package also might include a provision to allow employees who lose jobs that did not include health insurance to apply for Medicaid (Calmes/Hulse, New York Times, 1/4).

The stimulus package likely will total between $850 billion and $1 trillion (Christian Science Monitor, 1/5). However, Obama and congressional leaders "are intent on keeping the price tag below the politically charged figure of $1 trillion," according to the New York Times (New York Times, 1/4).

Senate Minority Leader Mitch McConnell (R-Ky.) has "challenged a proposal" to provide states with grants to offset increased Medicaid costs as part of the stimulus package and has said that he prefers to provide assistance in the form of loans (Washington Post, 1/5). He said that the use of loans, rather than grants, would encourage states to spend the funds "more wisely" (Weisman/Bendavid, Wall Street Journal, 1/5).

Experts Warn Against Large Investment in Current Health Care IT
In related news, some health care industry specialists are warning against investing too heavily in existing electronic health record systems as Obama plans to include funding for the technology in an economic stimulus package, the Boston Globe reports.

In a recent open letter to Obama, David Kibbe, a senior adviser to the American Academy of Family Physicians, and Bruce Klepper, a health care market analyst, wrote that the current systems are costly, difficult to use and do not allow hospitals, physician offices or pharmacies to easily share information about patients' medical histories and treatments. They wrote, "If America's physician practices suddenly rushed to install the systems of their choice, it would only dramatically intensify the (tower of) Babel that already exists." Kibbe and Klepper wrote that some of the stimulus package should go toward EHRs, but the majority of funding for health IT should be used for less costly and simpler technology, such as rewarding physicians for using computers to communicate with specialists and patients. Funding also should be used to help extend high-speed Internet access to doctors who do not have it, they wrote.

According to the Globe, the letter "highlights the challenges confronting Obama's proposal to digitize an enormous and fragmented health care system." The Globe reports, "Those who set standards for electronic health records want to get as many doctors as possible using the technology and work out the kinks over time, while also investing in infrastructure to help share data."

David Blumenthal, a Harvard Medical School professor and director of the Institute for Health Policy at Massachusetts General Hospital/Partners HealthCare System who advised the Obama campaign on EHRs, told the Globe that health IT advocates are concerned that the U.S. could get locked into the imperfect health record system. He said, "I think this really is a question of how good does it have to be before you pull the trigger. There's no correct answer to that, but for me, the evidence tips toward acting now, not with total abandon, but making a substantial but prudent investment in health IT" (Wangsness, Boston Globe, 1/1).

Opinion Pieces

• Mark Weisbrot, Spokane Spokesman-Review: Although some people "are complaining that" Obama's proposal to spend $800 billion over two years in an economic stimulus bill "is too much," he "is proposing to spend money on things that we actually need," Weisbrot, co-director of the Center for Economic Policy and Research, writes in a Spokesman-Review opinion piece. The country "will need increases in food stamps, unemployment insurance, and Medicaid spending for the poor -- who are most at risk of suffering" from the recession, he states. In addition, "Two things that could turn the stimulus package into an even more positive force for change would be health care and environmental spending," because the "federal government can subsidize health insurance for the uninsured, with public-sector insurance like Medicare, as Obama promised during his campaign," which would "advance health care reform while also providing jobs and spending in the health care sector," he writes (Weisbrot, Spokane Spokesman-Review, 1/3).
  
  
• Sen. Judd Gregg (R-N.H.), Wall Street Journal: If Obama "and the Democratic Congress want to implement a stimulus package that could reach nearly $1 trillion, they should consider a few rules that would ensure such a grand effort will actually help the country get back on its economic feet rather than create more problems," according to a Journal opinion piece by Gregg. He writes, "First, do not build up the long-term debt unnecessarily." Gregg adds, "Out of Mr. Obama's control is the massive debt issue heading his way as a large number of the baby boom generation reaches retirement during his term in office," but "trying to dig out of this recession by adding a lot of new permanent programs, or by expanding existing programs, will only accelerate this fiscal tsunami." If the nation is "going to have an infrastructure feeding frenzy, make sure government builds public works that will make us more productive as a nation," including "integrated [information technology] in public industries like health care," Gregg writes. He continues, "Although I hold out little hope that my Democratic colleagues in the House will take heed of my thoughts, I am hopeful that there are a few folks about to embark on the leadership of our country who are eager to learn from [Republican] mistakes" (Gregg, Wall Street Journal, 1/5).
  
  
• New Jersey Gov. Jon Corzine (D), Washington Post: "Given the sharp decline in state revenue, we are not able to support, let alone increase, spending to meet growing demands for basic needs such as unemployment insurance, food assistance programs and health care -- including mental health services to those with developmental disabilities," Corzine writes in a Post opinion piece. He writes, "Over two years, the federal government should boost its countercyclical spending by at least $250 billion ... by increasing the Federal Medical Assistance Percentages; the federal share of Medicaid costs; and other health care-related programs such as reimbursement to hospitals for treating the uninsured, Temporary Assistance for Needy Families and child care grants" (Corzine, Washington Post, 12/24/08).
  
  
• Sens. Kent Conrad (D-N.D.)/Gregg, Washington Post: "When Congress takes up an economic recovery package this month, it should be linked to a bipartisan commitment to begin addressing the long-term budget challenges confronting our nation," Senate Budget Committee Chair Conrad and ranking member Gregg write in a Post opinion piece. They write that "we also face a long-term budget crisis of unprecedented proportions," adding, "The leading edge of the baby-boom generation began retiring in 2008" and the "combination of this demographic tidal wave and the exploding cost of health care and inadequate government revenue will swamp federal finances." The piece states, "By acting now, we can make difficult but gradual changes to bend the cost curves of entitlement programs that will otherwise overwhelm our budget, as well as make needed reforms to our out-of-date and inefficient tax code," continuing, "The longer we put off these reforms, the more draconian our choices will become and the more likely they are to be forced upon us" (Conrad/Gregg, Washington Post, 1/5).
  
  
• Donald Lambro, Washington Times: As Obama "lobbies for his aid-to-the-states economic stimulus plan, governors are preparing to sharply raise taxes and fees that will hurt the low-to middle-income families he wants to help," Times correspondent Lambro writes. He continues that a "review of budget proposals being cooked up by governors across the country shows they intend to raise taxes next year on clothes, shoes, soda pop, hospitals, health insurers, gasoline, auto licenses, among other expenses that Americans consider necessities." According to the piece, "State officials say they are required by law to balance their budgets and that some tax increases are necessary to do that, but fiscal analysts say raising taxes in the middle of an economic downturn will only worsen their local economies and prolong the recession." He continues that "the incoming Obama administration plans to send up to $400 billion to the states to, in part, prevent budget cuts in safety-net programs for low- to middle-income Americans who will be squeezed even more by their own states and localities" (Lambro, Washington Times, 1/5).

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