April 25, 2014

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Tuesday, December 1, 2009 - 10:51 PM

As you have read here, here, and here, The Concord Coalition firmly believes that having an independent Medicare commission is one of the most important elements being considered in current health care reform legislation. Without the commission -- which would be empowered to continuously evaluate Medicare costs and propose changes to the delivery of care that might be able to help reduce system-wide health care costs -- it is doubtful that current legislation will succeed in reducing long-term health care inflation. 

Unfortunately, the bill currently being debated in the Senate has effectively neutered the commission's powers (and the House didn't even have a commission in their bill). As pointed out by David Leonhardt in the New York Times, the Senate directs that the commission leave doctors and hospitals untouched by its recommendations for the first four years of its...

Monday, November 16, 2009 - 12:29 PM

For the last few weeks, members of Congress have been increasingly pushing for a bipartisan commission to tackle the nation's fiscal challenges. The impetus has been the need to raise the debt limit as the national debt rapidly approaches the $12 trillion statutory ceiling. Because legislation to raise the debt limit is must-pass, lawmakers are trying to tie commission creation to the legislative language. Senator Evan Bayh highlighted this issue in a letter to Majority Leader Harry Reid, which was co-signed by nine additional senators. The Blue Dog coalition of Democrats in the House also recently announced their support for a commission.

Last week, Budget Committee Chairman Senator Kent Conrad held...

Thursday, November 5, 2009 - 4:18 PM

The news from Thursday’s Washington Post:

The Senate voted Wednesday to renew the government’s $8,000 tax credit for first-time home buyers through the first six months of next year as part of a broader bill designed to extend unemployment benefits.

For the first time, the tax credit program would also enable many homeowners who buy a new primary residence to receive a $6,500 refund.

The measure was attached to a bill that would provide 20 weeks of unemployment benefits in more than two dozen states with jobless rates above 8.5 percent and up to 14 weeks elsewhere. Another provision in the bill would allow businesses that had operating losses in 2008 and 2009 to seek refunds for taxes paid on profits over the past five years.

Why this legislation now?  Because despite signs that the economy as a whole, as measured by GDP, is growing again, most American households are still feeling the pain of a very weak labor market which all economists expect will be unusually slow to recover this time around.  Hence, the extension of unemployment benefits is easy to justify.

But what about the ...

Friday, October 30, 2009 - 11:52 AM

Here are a few initial thoughts from The Concord Coalition about the House of Representatives health care bill (H.R. 3962) and the preliminary scoring of that bill by the Congressional Budget Office (CBO):

  • It does not appear that this bill would alter the unsustainable trend of federal health care spending, often referred to as “bending the cost curve.” [1] According to CBO, “On balance, during the decade following the 10-year budget window, the bill would increase both federal outlays for health care and the federal budgetary commitment to health care, relative to the amounts under current law.” [2]
  • CBO does not make a projection of national health care expenditures (public and private) and it’s unclear if the bill would have a major impact on lowering private costs. All the usually discussed efforts to accomplish that are present in the bill, (accountable care demonstration project; medical home pilot, comparative effectiveness research and wellness,) but these score as a cost in the first 10 years. CBO does not include a specific analysis of how these initiates might play out over time and it would, in fact, be very difficult to do so. Thus, the long-term effect of these policies is highly uncertain, at best. This is the risk of expanding...
Monday, October 19, 2009 - 10:23 PM

I have written a lot in this blog about the Congressional Budget Office and their estimates (here is the latest example). Today, the Washington Post has another great article explaining the process.

Reading it, I thought about how many things we do here at Concord that depend on CBO. We have been working over the last few weeks updating all of our education exercises with CBO information and data. Next week we will be unveiling a new online budget game that also is based on CBO publications. As is our plausible baseline, chart talks and many of our issue briefs.

We do this not because CBO can see the future, but because having a neutral umpire (especially one easily searchable online!), makes what we have to say stand out--because we don't have to spend as much time worrying or...

Wednesday, October 7, 2009 - 10:37 AM

Well, it took a couple months, but those with a stake in health care reform have finally figured out that the idea of an excise tax on insurance companies instead of an any alternative tax on “real people” was no magic cure for the want-more-revenue-but-don’t-want-higher-taxes blues. From a story by Ben Smith and Patrick O’Connor in today’s Politico (emphasis added):

More than half of the Democrats in the House have signed on to a letter denouncing a key element of the Senate Finance Committee’s health care legislation as labor unions draw a line in the sand on paying for reform.

The Democrats are attacking a plan to finance expanded health care by taxing expensive health insurance plans. The plan, sometimes cast as a tax on “Cadillac” plans, would in fact include the health care plans of many public employees and union members and has triggered a revolt from Obama’s labor supporters and their many allies on the Hill.

The letter from 154 House Democrats to Speaker Nancy Pelosi urges her “to reject proposals to enact an excise tax on high-cost insurance plans that could be potentially passed on to middle-...

Thursday, September 17, 2009 - 10:28 PM

The big news this week on the health care front was the release of the Senate Finance Committee's initial draft of its health care legislation. The big interest in the budget world with this development is that it marked the first complete reform legislation with a score from CBO that shows deficit reduction, not only during the 10-year budget window but also in the years beyond.

While this is encouraging, there are a lot of caveats to keep in mind about where we are in the process. One is that the bill leaves out a quite expensive item--a fix to doctor payments under Medicare--that costs hundreds of billions. That "fix" is included in the House bill where it is not paid for. Another caveat is that the proposed Medicare Commission, an idea we at Concord support, is seemingly having more restrictions placed on it at every turn. Finally, the legislation still has a long way to go and just one amendment at some point could change the CBO scoring dramatically. Furthermore, the other bills the Finance Committee's have to be merged or conferenced with do not appear as fiscally responsible (...

Friday, September 11, 2009 - 3:42 PM

After President Obama's big health care speech this week, we have been talking here at Concord about how he makes it sound as if all we have to do to cut health care costs is cut the “waste” and “abuse” that no one should want anyway. That’s how he can claim his plan would reduce federal health spending without cutting any federal health care “benefits” -- because it wouldn’t cut any spending that actually “benefits” people.

The problem often in Washington however, is that one man’s “waste” is another man’s precious benefit. And when politicians traditionally talk about cutting "waste, fraud and abuse," they do so, in part, to duck the hard choices required to make real progress on the nation's long-term fiscal problems. That is why one of the foundational agreements among all of the members of the Fiscal Wake-Up Tour is that we can't solve our problems simply by cutting those items. (By the way, you can now watch a special set of videos on our website featuring the Fiscal Wake-Up Tour panelists speaking about health care reform.)  

When talking about health care and waste, the term does...

Friday, September 4, 2009 - 12:16 PM

Ezra Klein has a good post today discussing the problem with the costs of health care reform and how to pay for them. His point is that the structure of the bills being discussed so far lead them to not do enough to control long-term costs, and that efforts to scale them back further either achieve a lower price by delaying implementation--which just allows cost to dramatically diverge from the "pay-fors" outside the budget window--or they simply leave the currently unaffordable system relatively intact.  As David Brooks seconds in the New York Times, the effort to make reform politically palatable--in that it didn't try to dramatically change how most Americans get their health care--instead left us with proposals that are not very popular, but also don't provide the change needed to begin to fix our health care cost problems.

In some sense this is because the problems with our health care system are so dramatic, that the broader in scope the reform, the greater the chance that reform has to actually cut costs. But it is also because members of Congress have a hard time doing the right thing from a policy...

Friday, August 28, 2009 - 9:52 AM

Perhaps even more than most of Concord’s Fiscal Wake-Up Tour programs, the one in Maine this week underscored the need for a really big alarm clock.

The recession has sliced into the government's revenue while putting its spending on steroids. Concord Executive Director Robert L. Bixby offered the Wake-Up Tour audience of more than 200 in Kennebunkport a troubling factoid: last month’s federal deficit of $180 billion was larger than the deficit for all of 2007.

And on the same day, the Obama administration released a grim projection of $9 trillion in deficits over the next decade, $2 trillion higher than its previous estimate. When this was reported in Kennebunkport, fretful murmurs swept through the room. 

Even the $9 trillion figure is probably too optimistic, according to Concord’s analysis. So to borrow an analogy from David M. Walker, president and CEO of The Peter G. Peterson Foundation: Watch out for the "tsunami" that’s on the way.

Then there’s the current status of the health care debate: High interest in new government services and assistance, considerably less enthusiasm for proposals to pay for them. And not all that...