Panel Recommends Cuts to Health Care Spending To Address National Debt
On Wednesday, the National Commission on Fiscal Responsibility and Reform issued a draft report on how to reduce nearly $4 trillion from projected deficits over the next decade, including proposals to reduce health care spending, The Hill's "Healthwatch" reports.
The 18-member bipartisan panel was established by President Obama in February to develop recommendations on how to reduce the national debt (Pecquet, "Healthwatch," The Hill, 11/10).
Although the document's proposals are preliminary and have not been approved by the panel, they are expected to be similar to the final recommendations that Obama has requested by Dec. 1 (Ethridge, CQ HealthBeat, 11/10).
The report calls for substantial cuts to health care and other domestic and military spending, none of which are slated to take effect before 2012, "to avoid undermining the tepid economic recovery," according to the New York TimesÂ (Calmes, New York Times, 11/10).
The blueprint sets a long-term goal to restrain the growth rate of health care spending after 2020 to no more than the gross domestic product plus 1%, with a recommendation to review the cost growth every two years (CQ HealthBeat, 11/10).
Details of Health Spending Cuts, Other Recommendations
The draft report suggests "asking doctors and other health providers, lawyers and individuals to take responsibility for slowing health care cost growth." To do that, the report recommends:
- Eliminating scheduled cuts to Medicare physician reimbursement rates and resolving the issue of the sustainable growth rate formula and offsetting the costs "not through deficit spending but through savings from payment reforms, cost-sharing and malpractice reform, and long-term measures to control health care cost growth" ("Healthwatch," The Hill, 11/10);
- Earlier cuts to Medicare Advantage and charity care payments to hospitals outlined in the federal health reform law;
- Stronger authorizations for the Independent Payment Advisory Board, which was created under the health reform law to slow the growth in Medicare spending (Pickert, "Swampland," Time, 11/10);
- Introducing new taxes on health benefits;
- Potentially reinstating the public option plan to the state-based health insurance exchanges to be created under the overhaul in 2014 (CQ HealthBeat, 11/10);
- Lowering the cost of defensive medicine by adopting comprehensive tort reform ("Healthwatch," The Hill, 11/10); and
- Increasing cost-sharing among Medicare beneficiaries and requiring plans to provide rebates for brand-name drugs (CQ HealthBeat, 11/10).
Democrats, Labor Official Criticize Report; White House Calls for Restraint
House Speaker Nancy Pelosi (D-Calif.) called the report "simply unacceptable," while AFL-CIO President Richard Trumka described the proposed program cuts as "unconscionable."
According to the Washington Times, Republicans were "more cautious" but said the draft had its strong points. However, they said that many of the proposals were unlikely to survive strong lobbying efforts (Sands, Washington Times, 11/10).
Obama also addressed the commission's report, noting that "before anybody starts shooting down proposals, I think we need to listen, we need to gather up all the facts."
Co-Chairs Call Report 'Starting Point'
The panel's co-chairs -- former Clinton White House Chief of Staff Erskine Bowles, a Democrat, and former Sen. Alan Simpson (R-Wyo.) -- acknowledged that the draft report is not likely to draw full support, but Bowles described it as a "starting point" for the discussions on resolving the national debt (Montgomery, Washington Post, 11/10).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.