CBO: Health Reform Bills Bend Cost Curve In Wrong Direction

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"Congress's chief budget analyst delivered a devastating assessment yesterday of the health-care proposals drafted by congressional Democrats, fueling an insurrection among fiscal conservatives in the House and pushing negotiators in the Senate to redouble efforts to draw up a new plan that more effectively restrains federal spending," the Washington Post reports.

President Obama and congressional Democrats have said bending the "cost curve" of health care spending is a priority in health reform, to ensure soaring costs don't become unsustainable. Douglas Elmendorf, the director of the Congressional Budget Office, told lawmakers yesterday that bills proposed by the Senate health committee and the House leadership do the opposite: "The curve is being raised" (Montgomery and Murray, 7/17).

"In the legislation that has been reported, we do not see the sort of fundamental changes that would be necessary to reduce the trajectory of federal health spending by a significant amount and, on the contrary, the legislation significantly expands the federal responsibility for health care costs," Elmendorf said, according to CQ Politics. Ways to reduce the rate of growth could include taxing employer-provided health benefits and reforming Medicare payments to reward cost effectiveness, rather than volume (Clarke and Epstein, 7/16).

The Senate's No. 2 Democrat, Richard Durbin, D-Ill., retorted that Elmendorf has "taken unrealistic positions" on the health care debate, and has failed to score important cost savings from measures for things like preventive care, the Wall Street Journal reports. "It's been really hard to work with them."

Meanwhile, the Republican leadership embraced Elmendorf's comments. "The director of the Congressional Budget Office confirmed today what we have been saying for weeks: The health-care-spending plan that some are trying to rush through Congress would actually make things worse," said Senate Minority Leader Mitch McConnell (Boles, 7/16).

This information was reprinted from kaiserhealthnews.org with kind permission from the Henry J. Kaiser Family Foundation. You can view the entire Kaiser Daily Health Policy Report, search the archives and sign up for email delivery at kaiserhealthnews.org.

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