On the latest Facing the Future, I was joined by Concord Coalition Senior Policy Advisor, Josh Gordon, Director of Health Care at the Progressive Policy Institute, Arielle Kane, and Senior Fellow at the Manhattan Institute, Brian Riedl, for a discussion on ideas to protect America’s health care system and patients during the COVID19 pandemic, as well as new national debt and federal budget deficit projections and their potential effects.
[Note: Portions of this week’s Facing the Future can be seen in the video clips posted below.]
“I estimate that the budget deficit this year will be $4.2 trillion,” Riedl said. And I had him repeat that figure a second time.
Riedl has pieced together his own estimate of the federal budget deficit, combining the CBO budget baseline, the cost of recent Congressional action and the economic and technical costs of the crisis. He stressed that his figures do not assume any new legislation from Congress, but he emphasized that there would likely be more. You can read Riedl’s full analysis by clicking here.
“A lot of us in the budget world had been sort of panicky that this year the deficit might top a trillion, which hadn’t happened since the Great Recession,” he said. “Well, we skipped all the way up to $4 trillion in one year, and to put that in context, last year the entire budget was $4.4 trillion.”
Given these staggering figures and uncharted waters, Riedl gave a charge to Congress.
“Spend what you need to spend to fix the economy now, but that doesn’t mean you can’t start putting policies into place to be implemented down the road to save money,” he said. “Spend what you need to spend now, but don’t use that as a blank check for unrelated things … spend what you need to spend, but not a dollar more.”
In my conversation with Kane and Gordon, we focused on health care.
Kane said there are several challenges at play during the COVID19 pandemic: the cost of providing care during a public health crisis and its increased demand and cost to health care providers, while at the same time decreased revenues for providers from the shut down on “non-essential” care, plus the loss of health insurance for individuals during an economic crisis.
“Those three problems are all interconnected, and that means we need some way of paying for the overall cost of the pandemic, a way of paying providers for the care that they’re providing and a way to make sure that the newly uninsured, or people that are sick, are not bearing the cost of a public health crisis on their own,” Kane said. “We proposed three potential solutions for how to mitigate the damage.”
PPI’s proposals aim to fill in where Congressional action has fallen short during the pandemic and potentially provide long-term solutions: a federal reinsurance program, where the government would help cover exceptionally high-cost claims to insurers; a disease-specific federal health benefit through which the federal government would cover all of the health care costs associated with COVID-19; and a capitation model that utilizes a global budget for providers to improve efficiency, enable prioritization of care, make funding more predictable and reduce cost.
Gordon said, “These three ways of handling this issue have all been tried in one form or another.” And you can read more about PPI’s proposals by clicking here.
When discussing what Congress is already considering doing in its next relief package, such as increasing funding to hospitals and covering the cost of COBRA, both Kane and Gordon had strong responses.
“The idea of bailing out COBRA, to me, is a little bit crazy to put it mildly,” Kane said. “COBRA is insurance that you can purchase after you are laid off from an employer … and, no exaggeration, it is literally the most expensive place to buy insurance in the United States.”
Gordon said, “We actually do have a lot of different infrastructures in place to replace that COBRA coverage with cheaper public insurance or publicly subsidized, private insurance.”
“If we want to talk about the most efficient way to help the most people in this crisis, any of those structures are better than just subsidizing COBRA,” he added.
Hear more on Facing the Future. I host the program each week on WKXL, NHTalkRadio.com (N.H.), and it is also available via podcast. Join me and my guests as we discuss issues relating to national fiscal policy with budget experts, industry leaders and elected officials. Past broadcasts are available here. You can subscribe to the podcast on Spotify, iTunes, Google Play Music or with an RSS feed. Follow Facing the Future on Facebook and watch videos from past episodes on The Concord Coalition’s YouTube channel.