Lawmakers, Officials Discuss Overhauling U.S. Health Care System In 2009 During Senate Finance Committee Symposium

Main Category: Health Insurance / Medical Insurance
Also Included In: Public Health
Article Date: 18 Jun 2008 - 11:00 PDT


U.S. Federal Reserve Board Chair Ben Bernanke on Monday said that improving health care system performance is among the country's most critical challenges and that efforts must focus on access, quality and cost, CQ HealthBeat reports. Bernanke spoke at the "Health Reform Summit" held at the Library of Congress and sponsored by the Senate Finance Committee (Carey, CQ HealthBeat, 6/16). Bernanke said health care spending comprises more than 15% of the U.S. economy and is the "single largest component of personal consumption, larger than spending on either housing or food." He noted that if the pace continues, health spending will exceed 22% of gross domestic product by 2020 and represent 50% of all federal spending by 2050 (Montgomery, Washington Post, 6/17). Bernanke said, "Taking on these challenges will be daunting," and we "should not expect a single set of reforms to address all concerns. Rather, an eclectic approach will probably be needed."

Rising federal spending on health care will require cuts in other government programs, higher taxes or increased budget deficits, according to Bernanke. "[I]mproving access and quality of care may increase, rather than reduce, total costs," he said (Lanman, Bloomberg, 6/16). He added, "From the economist's perspective, the question of whether we are spending too much on health care cannot ultimately be answered by looking at total expenditures relative to GDP or the federal budget," rather, "the question, whatever we spend, is whether we are getting our money's worth" (Edney, CongressDaily, 6/16). Bernanke said, "In devising policies to reform our health care system, we must take care to maintain the vitality and spirit of innovation that has been its hallmark" (CQ HealthBeat, 6/16).

Bernanke also said that if the federal government does not act to rein in spending on entitlement programs, such as Medicare and Social Security, the increasing cost "will have effects on interest rates, it will have effects on economic growth and on stability" (Aversa, AP/Hartford Courant, 6/16).

Independent Board
Finance Committee Chair Max Baucus (D-Mont.) asked Bernanke about the prospect of developing an independent board of health experts, similar to the Federal Reserve, to address technical aspects of the health care system. Baucus said, "As a member of Congress, I sometimes wonder if we're competent to answer some of the questions we're called upon to," adding, "For example, how in the world am I supposed to know what the proper reimbursement rate should be for a certain procedure?"

Bernanke said of an independent policy-making board, "I'm a little bit skeptical that you could keep politics completely out of health care reform processes because it matters fiscally, it matters on so many dimensions." He said such an entity could serve one of three roles: a simple board that would make recommendations; a commission that would generate suggestions to be voted on by Congress, similar to the board used in deciding whether to close military bases; or a technical board that Congress could order to make complex determinations related to health coverage (CongressDaily, 6/16).

He also outlined arguments for and against several proposed changes to the health care system but said the choices are best "left to the public and their elected representatives" (Bloomberg, 6/16).

Additional Comments
According to the New York Times, "At the end of the day, Democrats and Republicans appeared to agree on this much: All Americans should be insured, but they should have a choice of private health plans competing in the market alongside government programs." Sen. Ron Wyden (D-Ore.) said, "Democrats are right in saying that if you are going to fix the system, you have to cover everybody," and Republicans "are right in saying that you have to have markets, choices and private alternatives."

Committee ranking member Chuck Grassley (R-Iowa) said health care is "the number one economic issue in our country," but "Congress does not seem to have the political guts to do anything about it" (Pear, New York Times, 6/17).

Former CMS Director Mark McClellan, who now heads the Engelberg Center for Health Care Reform at the Brookings Institution, said, "We have a broad consensus that we aren't getting nearly as much as we should for the money," adding, "There's an unprecedented level of agreement that something can be done and that something must be done." McClellan said, "If all that happens is some incremental reforms, that would be a missed opportunity."

Congressional Budget Office Director Peter Orszag said, "There is increased analytical effort being dedicated to this topic in a variety of settings, including at CBO." Orszag said, "Frankly, at this point, one constraint is finding the types of highly qualified people that we need for the effort. A lot of us are very actively recruiting" (Washington Post, 6/17).

C-SPAN video of the summit is available online (C-SPAN, 6/16).

Reprinted with kind permission from http://www.kaisernetwork.org. You can view the entire Kaiser Daily Health Policy Report, search the archives, or sign up for email delivery at http://www.kaisernetwork.org/dailyreports/healthpolicy. The Kaiser Daily Health Policy Report is published for kaisernetwork.org, a free service of The Henry J. Kaiser Family Foundation.

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