ON EVE OF SENATE VOTE ON HEALTH REFORM,
COCHRAN PROVIDES OVERVIEW OF PROBLEMS IN PLAN
Mississippi Senator Will Vote Against Senate Passage
WASHINGTON, D.C. – U.S. Senator Thad Cochran (R-Miss.) today issued a summary of problems he sees in the health care reform legislation the Senate is expected to pass early Christmas Eve morning.
On the day before the scheduled final vote for Senate passage of the Patient Protection and Affordable Care Act (HR.3590), Cochran reviewed a wide variety of concerns he has with the legislation crafted in the offices of Senate Majority Leader Harry Reid.
Cochran will vote against Senate passage of HR.3590 which will cut half a trillion dollars in Medicare benefits, increase taxes and fees, and expand the federal bureaucracy in ways that will increase the government’s role in the doctor–patient relationships.
“While we all agree that the quality of healthcare is important, questions arise as to how these standards will be developed, how they will ultimately be used by the federal government and the impact they will have on coverage and treatment options. Again, with the drive toward standardization and efficiency, how will this bill ensure that physicians focus on individual patients in determining treatment options, rather than on ensuring they are in line with government policies?” Cochran asked.
“While the idea that government programs should direct dollars to treatments which are most cost-effective may sound laudable, we must be careful not to follow that path to a conclusion where the government ends up discouraging useful treatments just because they cost too much,” he said.
In his assessment, Cochran also outlined the actions that could have been taken to improve the American health care system.
“We are fortunate to live in a nation with the best doctors, scientists, and hospitals in the world. By building on the strengths that already exist in our health care system we can work in a positive way to provide the best health care in the world,” Cochran said.
“We need to improve our nation’s health care system and solve problems that we can solve, but this legislation is flawed and should not be imposed on the American people,” he said.
The following is the text of the remarks prepared by Cochran and submitted for the Congressional Record:
Mr. President, reforming our health care system is needed to help ensure that all Americans have access to quality health care. Expensive insurance premiums and copayments, and out-of-pocket expenses, are making health care unaffordable.
Although our health care system has major problems, we have the best physicians, scientists and hospitals in the world, but we can make the current system work better. Creating a health care market that works would be a powerful force to increase the quality of health care and make it more affordable. We must fix the incentives in the health care system so that health insurers are motivated to provide high-quality plans at lower costs.
Despite claims that this bill covers 94 percent of Americans, stays within the $900 billion limit set by President Obama, and reduces the deficit over the next ten years, others dispute that claim. According to the Senate Budget Committee, the scoring of the bill uses budget gimmicks that pay for six years of coverage with 10 years of new taxes and massive Medicare cuts to hide the true 10-year implemented cost of the bill. The bill would also cut Medicare by half a trillion dollars, not to strengthen Medicare but instead to fund another unsustainable new health care entitlement program. In addition to these permanent cuts to Medicare payment updates, the bill establishes a permanent board of unelected members that will dictate annual Medicare cuts geared toward reducing Medicare spending. Described by The Wall Street Journal as the “Rationing Commission,” this board will create policies to meet spending targets and impose a global budget in Medicare.
The present health care system focuses too much on treating patients only when they are sick instead of keeping them healthy.
I believe we need incentives to drive down the cost of health care, promote wellness and prevention, discourage frivolous lawsuits and reform the payment system.
Chronic diseases, such as diabetes, heart disease, and asthma, are largely preventable or manageable with a healthy lifestyle. Still, these diseases are the leading causes of death and disability in the United States and account for the vast majority of health care spending. Unless we begin to change America’s unhealthy habits, this problem will become worse, and health care costs will continue to rise.
Many employers provide health insurance benefits to their employees, and may have taken the lead in implementing wellness initiatives to help their employees take control of costs. Companies such as Safeway Grocery Stores, Inc. have implemented programs to encourage their employees to lose weight and quit smoking. The results have led to a more productive workforce and lower health care costs for employers and their employees.
But we must help guarantee that every American has access to affordable insurance coverage. By reducing the number of the uninsured, we will help eliminate the shifting of costs to those who have private insurance.
We are fortunate to live in a nation with the best doctors, scientists, and hospitals in the world. By building on the strengths that already exist in our health care system we can work in a positive way to provide the best health care in the world.
Five preventable chronic conditions—heart disease, cancer, stroke, emphysema and diabetes—consume 75 percent of our health spending and cause two-thirds of American deaths. If we focused on preventing diseases before they happen rather than treating them after the fact, we could improve health at a lower cost. Promoting initiatives that will encourage wellness and prevention programs within the workforce would improve health and reduce costs. These programs could change “sick care” into “health care.”
Every American should have health care coverage that will meet their needs. Because many Americans are enrolled in Medicare, Medicaid, or have no insurance at all, health costs are shifted to private health plans. This accounts for one of the most significant factors in driving up health care costs. If we could reduce this cost-shifting effect by enrolling everyone in some form of health insurance, health care costs would decrease significantly. In my state, we have a very high volume of uninsured because most insurance is provided by small business owners, and the number of small businesses offering health care is decreasing.
Frivolous lawsuits drive up health care costs, and force good doctors to limit or give up their practice. Rural physicians and hospitals are affected the most because one lawsuit can reduce services provided by specialty physicians or close a hospital. We must invest in practices that will reduce unnecessary medication and medical errors, and we should also make sure that patients have legal remedies. Our current system forces physicians to practice defensive medicine, which drives up costs.
Designing a system that pays providers based on the quality of care they deliver rather than the number of tests or procedures they perform could improve health care and minimize waste. This could be done by creating a test payment system that would pay for coordinated care, improve care delivery and informed patient decision making. This is particularly important in rural areas, like Mississippi, where providers are significantly disadvantaged when it comes to payment rates. This would encourage insurers to develop payment methodologies that reward high-value care.
Rather than one-size-fits-all federal mandates, a comprehensive solution to health reform must include governors and state legislatures.
While the idea of promoting competition among private health care plans is important, allowing the government to compete against the private market—or the so called “public option”—is not a viable option. Under a public option proposal, it is estimated that hospital payment levels and physician payment levels would decreased for enrollees in a public option plan. To make up for lost revenues, providers would shift costs to private payers in the form of higher charges, and as a result a public option would make private health care more expensive. This cost shift from the public option to the private plan would create a self reinforcing cycle that will eventually lead to a government-run single payer health care plan. As the public option grows and shifts more costs to the private plans, the price differential will increase and make the public option the only viable plan. This would ultimately force private insurers out of the market because the government will act as competitor, regulator and funding source.
The legislation before the Senate contains significant expansions of Medicaid and Medicare. The current bill before the Senate would expand Medicaid up to 133 percent the Federal Poverty Level. If it is enacted, the number of Mississippians on Medicaid would increase to 1,037,606 or one in three of our citizens. Over 10 years, from fiscal year 2010 to fiscal year 2019, this bill would cost Mississippi’s taxpayers $1.3 billion, requiring our state government to raise taxes to continue education and public safety programs and services. Medicaid costs are 24.5 percent of our state’s General Fund budget. With this proposed expansion, Medicaid would become 36.6 percent of projected revenue in fiscal year 2019.
Medicaid and Medicare are on an unsustainable growth path, and this legislation will make it worse. Health care reform should be accompanied by a commitment to entitlement reform to ensure solvency for the programs for future generations.
This bill also imposes almost a half a trillion dollars in new taxes, fees, and penalties on individuals, families and businesses. This would put an enormous burden on Americans at a time when they are struggling to make ends meet.
The bill will impose $28 billion in new taxes on employers that do not provide government approved health plans. These new taxes will ultimately be paid by American workers in the form of reduced wages and lost jobs. According to a recent study, these new job killing taxes will place approximately 5.2 million low income workers at risk of losing their jobs or having their hours reduced. An additional 10.2 million workers could see lower wages and reduced benefits. A small business owner in my state told me that 8 percent of his income goes to pay for health insurance for his employees. If this is increased he will have to reduce the size of his staff. This will have a chilling effect on small business and their employees in my state and across the nation.
The bill also changes the way payroll taxes are spent. For the life of Social Security and Medicare, we have had a single simple, straight forward payroll tax base and a single straight-forward payroll tax rate. This bill would use new Medicare payroll taxes to finance a new health entitlement outside of Medicare and would turn Medicare payroll taxes into a general financing mechanism like the income tax.
This bill calls for the establishment of a National Strategy for the Improvement in Health Care and the establishment of a national Strategy to improve the delivery of health care services, patient outcomes and population health.
As part of this strategic plan the Secretary of Health and Human Services will be required to ensure that these priorities have the “greatest potential for improving health outcomes, efficiency, and patient centeredness...” This plan will also be required to identify areas in the delivery of health care services that have the potential for “rapid improvement” in the quality and efficiency of patient care. The strategic plan is also supposed to address gaps in quality, efficiency, comparative effectiveness information, and health outcomes measures, improve federal payment policy to emphasize quality and efficiency, and enhance the use of data to improve quality, efficiency, transparency and outcomes. While these all sound like worthwhile goals, the emphasis is clearly on historic expansion of the government’s role in the relationship between you and your doctor. Emphasis on government standards of cost efficiency may have a significant impact on treatment decisions physicians make and may pose a real threat to the development of new treatments and cures that many be vitally important, but perhaps only to a small population of patients.
In addition to growing the government’s role in the doctor–patient relationship, the bill will also grow government bureaucracy. The bill establishes an Interagency Working Group on Health Care Quality. This group is supposed to collaborate, cooperate and consult between federal agencies and departments to develop strategies, models, and timetables that are consistent with the national priorities that are developed as part of the National strategic health plan. It will include a long list of representatives from throughout the federal government, including 23 departments and agencies, and any other federal agencies and departments with activities relating to improving health care quality and safety, as determined by the President. This large group will have the task of reporting to Congress annually on its progress and making recommendations for ensuring that there has been collaboration, cooperation and consultation on national health priorities, and avoidance of inefficient duplication of quality improvement efforts and resources, and quality reporting and compliance.
The bill also has several sections that indicate they are related to health care “quality improvement,” and methods for measuring that improvement. In one section that measure is defined as “a standard for measuring the performance and improvement of population health”. There are also several provisions which relate to grants programs to address gaps in availability of quality measures and for the development of such measures. The bill places considerable emphasis on the development of quality standards as well as measurement methodologies and implementation of standards that are developed.
While we all agree that the quality of healthcare is important, questions arise as to how these standards will be developed, how they will ultimately be used by the federal government and the impact they will have on coverage and treatment options. Again, with the drive toward standardization and efficiency, how will this bill ensure that physicians focus on individual patients in determining treatment options, rather than on ensuring they are in line with government policies?
This is not the first time concerns have been raised about efforts to bring more quality assurance and standardization to treatment decisions. During consideration of the Stimulus bill, significant concerns were raised by patients and providers about provisions intended to spend $1.1 billion on research comparing medical treatments, portraying it as the first step to government rationing.
We must ensure that efforts to find long term savings in health care costs are not achieved simply through a public and private push for only those medicines and treatment options which work best at the lowest cost in particular patients.
While the idea that government programs should direct dollars to treatments are most cost-effective may sound laudable, we must be careful not to follow that path to a conclusion where the government ends up discouraging useful treatments just because they cost too much.
Anyone faced with healthcare crisis will not want the government setting policies which will limit their treatment options. What if, for example, a treatment is considered not cost effective because it may improve a patient’s quality of life but not affect an individual’s particular outcome? This is not just an issue for patients. Medical professionals also are apprehensive about government policies that will constrain their professional judgment on the best course of treatment. As we all know, these decisions will have a wide ranging impact on the coverage provided by insurers. This will negatively affect our ability to attract the best and the brightest to the medical profession. Without increases in the numbers of individuals interested health professions we will certainly not have the providers necessary for the expansion of coverage envisioned by this bill.
This legislation is bad policy for the United States and it also is bad for our health care system. It will make health insurance premiums go up. It will cut Medicare by $500 billion. It will raise taxes on the individual and businesses involved in health care. We need to improve our nation’s health care system and solve problems that we can solve, but this legislation is flawed and should not be imposed on the American people.
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