September 1, 2014

Health Care Reform Plans Seek Aggressive Cost Restraint

  • The American health care system is a patchwork of public and private programs that serve citizens in different ways, depending on their age, military...

Any credible health care reform plan that Congress passes must include a meaningful target for restraining long-term cost growth that can be enforced.

A number of recent bipartisan health plans, as well as budgets proposed by elected officials in Washington, are optimistic and even “remarkably ambitious” on this score, according to Concord Coalition Policy Director Joshua Gordon. They envision even greater cost restraint than the Affordable Care Act (ACA), which was itself considered quite ambitious in this regard when it was passed three years ago.

In the final blog post of a three-part series on the recent health care reform plans, Gordon says their tighter targets on cost growth came in response to a recent slowdown in health care inflation as well as projected reductions in Medicare provider payments because of the ACA.

Yet even more important than where cost-restraint targets are set, he writes, is that some sort of enforcement mechanism must be used to ensure that they are actually met.

Furthermore, it is critical that health care reforms restrain costs in the private sector as well as in government programs. To their credit, Gordon says, each of the four recent bipartisan plans by policy experts takes that into account.

And while long-term cost restraint is essential, Gordon notes that many of the reform proposals could produce savings that the Congressional Budget Office should be able to score in its 10-year budget window.