The odds are against Super Congress
Kaiser Health News, via
McClatchy, has a good, quick overview of how the debt deal could affect health care spending, both through the Super Congress and the automatic triggers, should the Super Congress fail.
The crux is Medicare and Medicaid, which are protected in the initial round of immediate cuts, but not necessarily from cuts in the next round, unless the Super Congress comes up with an agreement that cuts $1.2 trillion without touching these programs, a result that doesn't seem likely at this point. So either the Super Congress comes up with cuts to the programs that the full Congress would approve, or Congress doesn't act and the automatic cuts are triggered. The triggers protect Medicaid, they but will include at least a two percent cut in Medicare payments to providers.
Q. What might the committee look at?
A. Among some of the alternatives that are expected to be considered are Medicare premium supports, which would give enrollees vouchers or credit to purchase private insurance plans rather than having the government directly pay for covered services; converting Medicaid to a block grant program, which also would limit federal funding; or asking higher-income Medicare beneficiaries to pay more for their coverage. Changes in spending for the 2010 health care overhaul also may be considered.
Bob Crittenden, the executive director of the Herndon Alliance, a liberal health care advocacy group, said Medicaid was most at risk in the committee because the group was unlikely to agree on cuts to Medicare or Social Security.
Q. Why are Medicare and Medicaid part of the debt discussions?
A. Medicare and Medicaid make up about 23 percent of federal spending and their costs have been growing faster than the economy overall has. Medicare costs have climbed partly because of the aging population, which has meant that more people are eligible for coverage. Medicaid costs increased with the recent economic downturn, which led to dramatic uptick in enrollment as people lost jobs and private health coverage.
Q. What do doctors and hospitals say about the cuts proposed as part of the automatic trigger?
A. Medicare providers say the reductions would hurt their ability to deliver medical care and that they'd mean less access to care for seniors. "If it affects providers, it affects beneficiaries," said Chip Kahn, the president and chief executive officer of the Federation of American Hospitals.
Q. How does a "fix" to Medicare's doctor payments figure into the issues the committee faces?
A. At the end of the year, Medicare is scheduled to cut pay to physicians by about 30 percent because of a budget rule adopted years ago. Since 2003, Congress has granted an extension each time the requirement has come due. Some analysts argue that the debt reduction efforts and the need to fix the doctor reimbursement formula could collide, especially because of the cost of fixing doctor pay. Pushing the issue off for another year would cost about $25 billion, although doctors have been pressing for a two-year fix at a cost of roughly $50 billion. These fixes would add to the nation's budget deficit and complicate the committee's work.
On the whole, the automatic triggers appear to be a better alternative, but the threat from providers on access is one to take seriously. Those cuts could mean fewer providers taking on Medicare patients, which is already a problem in many parts of the country. But it's still gaming out to be the lesser of the two evils presented by the deal. And probably the likelier one to occur. One analyst, Stan Collender, a partner at Qorvis Communications and a former congressional budget staffer, estimates that there's "less than a 5 percent chance that the committee would come to an agreement that Congress would approve."