Washington Report: A Bevy of Bad Ideas

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Washington ReportA Bevy of Bad Ideas

• Greg Scandlen

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Underlying Premise

• Peter Orszag
• 700 billion a year (30) wasted on unnecessary
  medical care.
• Enough to pay for reform, save Medicare, and
  balance the federal budget!
• In fact
• Estimate is based on end-of-life care for
  Medicare, projected to entire population.
• Looked at cheapest 10 of areas and assumed all
  could operate as cheaply.

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How to Make it Happen

• Mandatory Health Information Technology
• 20 billion already enacted.
• Wire up all providers and all patients to keep
  tabs on what they are doing.
• Has nothing to do with efficiency or quality.
  Balance of evidence says both will be reduced.
• Comparative Effectiveness Research
• 2 billion already enacted.
• Like Britains NICE agency.
• Set a dollar value on a QALY and deny services
  that exceed it.

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How to Make it Happen

• Mandatory Insurance Coverage
• Subsidize based on income
• Very rich benefits so all services are captured.
• Widely supported by interest groups
• However --
• Mandates never work (auto, Medicare Catastrophic)
• Enforcement? (tax penalty, school registration,
  licenses)
• More important than food, housing,
  transportation?
• Massachusetts -- of people affected, 22 say it
  is helping them, 60 say it is hurting them
• California 20, Florida 25, Texas, 27
• Need to listen, not dictate, to the uninsured.

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How to Make it Happen

• Public Option
• Government-administered plan, like Medicaid
• Managed by bureaucrats
• Crowd out -- will under-price private plans
• No need for reserves
• No need to pay taxes, pay interest, collect
  revenues, or pay for office space, customer
  service, anti-fraud
• Price controls on providers
• Lewin Group -- 120 million will go from private
  to public
• Rationing.

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The Cost Conundrum

• CBO -- 1 trillion to cover one-third of
  uninsured (Senate HELP bill)
• CBO -- 1.6 trillion to cover two-thirds (Senate
  Finance bill)
• HSI -- 3.5 trillion to cover 97 of uninsured.
  (House bill)
• CBO -- individual and corporate income tax rates
  would rise by 90 to pay for increased spending
  through 2050 without the new public plan
  option.
• Medicares current unfunded liability is 37.8
  trillion or 333,585 per household
• All borrowed money.

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Prospects

• Who Knows?
• Interest groups want a seat at the table but
  are getting push-back from their members
• Grass roots are activating on both sides
• House Dems can pass anything they want
• Senate Dems less unified and will need 60 votes.
• Two key issues
• Public option is drop dead issue for both sides
• No one knows how to pay for all this
• Enactment is one thing, implementation is
  something else.
• Nothing will be settled, even if a law is passed
  and signed

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The essential problem has always been
Insurer

• Third Party Payment

Consumer
Provider
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Contact

• Greg Scandlen
• Consumers for Health Care Choices
• www.chcchoices.org
• 301-606-7364
• GMScan_at_comcast.net