Democrats Squabble Over Proposed Medicare Payment Changes

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"Several senior House Democrats voiced strong concern Wednesday with a proposal to empower the executive branch to restrain Medicare spending, adding fresh uncertainty to White House efforts to build support for health legislation," The Wall Street Journal reports. "The proposal is being pushed by a coalition of centrist Democrats who are demanding greater steps to control the growth of health-care costs before they consider supporting legislation that would extend health insurance to tens of millions of Americans lacking coverage." Earlier this week, "the centrists struck a tentative deal with top Obama aides and House Energy and Commerce Chairman Henry Waxman (D., Calif.) to add the proposal to health legislation pending on Capitol Hill."

But top members of the House Ways and Means Committee "are raising alarms. They warned the measure would shift too much power away from lawmakers, giving the White House big sway over decisions reserved under the Constitution for Congress… The proposal would give the executive branch authority to act on spending restraints in Medicare recommended by independent experts. Congress could stop the cuts, but only by acting swiftly. Currently, cuts can happen only with explicit congressional approval. Fiscal conservatives say such a mechanism is needed because lawmakers can't be counted on to curb spending on Medicare, which provides health care for the elderly" (Hitt, 7/23).

Reuters: "But the liberal Democrat who chairs a health subcommittee called the idea of an independent agency 'stupid at best, unworkable, childish.' Representative Pete Stark told reporters Obama's plan would strip Congress of authority over the Medicare program, which insured 45 million elderly and disabled at a cost of $483 billion in 2007. He said doctors and hospitals were calling him with complaints as well. 'Every major provider group is calling up saying they will oppose the (healthcare) bill,' if it contains the independent agency, Stark said after a closed-door meeting of Democrats on the House Ways and Means Committee" (Dixon, 7/22).

The Wall Street Journal's health blog reports separately that Denis Cortese, a doctor who "runs the Mayo Clinic," says the House bill misses an opportunity to change the Medicare payment system. He also argues that for a public plan, "a Medicare model is a catastrophe" because it won't curb rising costs. "The basic argument Cortese and the Mayo Health Policy Center have been making for a while now is a variation on a familiar theme: Doctors and hospitals should be paid on the based value they provide rather than simply paid a fee for every procedure they do. Those who have better outcomes with less risk and fewer costs to the system should be rewarded…'Why don't we give instructions to the Health and Human Services Secretary to start value-based purchasing right now in Medicare?' he said" (Goldstein, 7/22).

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.

© Henry J. Kaiser Family Foundation. All rights reserved.

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