Congressional Hearings Analyze Federal Health Reform Law Spending
On Wednesday, Congressional Budget Office Director Douglas Elmendorf and CMS Chief Actuary Richard Foster defended their savings estimates for the federal health reform law to the House Energy and Commerce Health subcommittee, National Journal reports (McCarthy, National Journal, 3/30).
CBO has projected that the law will lower the federal deficit by $210 billion from 2012 through 2021, Elmendorf told the panel (Zigmond, Modern Healthcare, 3/30).
However, Foster said he is skeptical that the law ultimately will reduce the deficit because he believes Congress likely will prevent more than $500 billion in scheduled Medicare cuts included in the overhaul. He testified that the cuts eventually would lead to medical providers becoming "unable or unwilling to provide services to Medicare beneficiaries" and that lawmakers would block them (Adams, CQ HealthBeat, 3/30).
During the hearing, Rep. Phil Gingrey (R-Ga.) discussed the effect of the overhaul on Medicare reimbursements, saying that the law "harms access to care" because reimbursements would fall "far below" private insurance rates. Foster said, "If you leave out some of the adjectives, I'd probably agree with most of what you just said."
Later, Elmendorf admitted that the projections were only estimates. He said, "Certainly, projections of the effects of this legislation are quite uncertain," adding, "All of these projections and assumptions represent our objective and impartial judgment" (National Journal, 3/30).
The hearings also broached several other topics related to the health reform law. For example:
- Elmendorf told lawmakers that CBO has known of an estimated $105 billion in long-term appropriations that some Republicans argue was hidden in the reform law (Millman, "Healthwatch," The Hill, 3/30); and
- Foster agreed with Reps. Sue Myrick (R-N.C.) and Leonard Lance (R-N.J.) that a 2.3% excise tax on medical devices mandated by the overhaul likely would be passed on to consumers through higher premiums (Modern Healthcare, 3/30).
Sebelius Testifies Before Senate Panel
The Senate Appropriations Health subcommittee also investigated overhaul funding at a hearing on Wednesday, during which HHS Secretary Kathleen Sebelius provided the only testimony (Pecquet, "Healthwatch," The Hill, 3/30).
Sebelius said that if HHS cannot rework the Community Living Assistance Services and Supports program to be financially sustainable, officials might have to break the reform law and not implement it (Norman, CQ HealthBeat, 3/30).
Opponents of CLASS, a long-term care initiative in the federal health reform law, say the program would allow too many high-risk individuals to enter, which could drain funding within a decade. CBO has estimated that by 2030 benefits paid out of the program would exceed incoming premium payments (California Healthline, 3/18).
Sebelius said, "[I]f we can't have a program design we know at the outset is going to be solvent, I think we'll return to Congress and say it won't be solvent and therefore we'll be violating the law" (CQ HealthBeat, 3/30).
During a previous House hearing on the program, HHS Assistant Secretary for Aging Kathy Greenlee said that the agency will not launch the CLASS program until it is financially sustainable (California Healthline, 3/18).