Medicare payment breakthrough and other health insurance reform news

It’s crunch time for health insurance reform, and Senator Tom Harkin and the three Iowa Democrats in the House “announced a major breakthrough today on the issue of Medicare payment reform in the final health care reform bill,” according to a joint press release. Excerpt:

[Representatives Dave] Loebsack, [Senator Tom] Harkin, [Leonard] Boswell and [Bruce] Braley have been outspoken advocates for changing the way Medicare pays health care providers for services, from its current fee-for-service system into a quality and value-based system.

Loebsack, Harkin, Boswell and Braley helped negotiate a compromise adding language to the health care reform bill that provides an immediate $800 million to address geographic disparities for both doctors and hospitals, as well as written guarantees from Health and Human Services Secretary Kathleen Sebelius for further action to reform Medicare reimbursement rates that do not qualify for reconciliation under the Byrd Rule. The Senate bill previously only provided a Medicare reimbursement fix for doctors.

The House reconciliation package maintained automatic implementation of a value index as part of the reimbursement structures for doctors, beginning in 2015.  This language was secured in the Senate bill with the help of Harkin and is based on Braley’s Medicare Payment Improvement Act, introduced in June 2009. Under the fixes secured in the Senate bill and the House reconciliation package, Iowa doctors will see five percent increases in current Medicare reimbursement rates in both 2010 and 2011.

I posted the whole press release, containing more details, after the jump. This deal appears to have secured the vote of Peter DeFazio (OR-04) as well. Yesterday he threatened to vote no because of language on the Medicare payments disparity.

President Barack Obama gave House Democrats a pep-talk today, and his speech (which wasn’t pre-written) got rave reviews from many Democrats. If only the Senate bill were as good as Obama made it sound. (UPDATE: I posted the White House transcript of Obama’s speech after the jump.)

House Democratic leaders have decided to ditch the “deem and pass” method for passing health insurance reform with a single vote, even though the legislative procedure isn’t as rare or controversial as Republicans would have you believe. Instead, the House will hold an hour of flood debate tomorrow on “the rule to allow reconcilation to get to the floor,” then House members will vote on the rule, then they will debate the Senate health insurance reform bill and vote on it. I assume this means that House Speaker Nancy Pelosi is confident she has the 216 votes she needs.

Bart Stupak is now claiming only about half a dozen Democrats are willing to vote against the bill unless it contains major new restrictions on private insurance coverage of abortion. Stupak was supposed to hold a press conference this morning, but he cancelled it, so maybe that means he didn’t get the deal he was hoping for from Pelosi. David Dayen speculates on who is still in the Stupak bloc. David Waldman warns about the prospect that Stupak will use a “motion to recommit” to try to get his anti-abortion language into the reconciliation fix package.

Outside the Capitol, tea party protesters shouted racist insults and held signs threatening gun violence if health care reform passes. Congressional Republicans should disavow this reprehensible behavior, but of course they won’t.

Joint press release from March 20, 2010:

Loebsack, Harkin, Boswell, Braley Finalize Major Breakthrough on Medicare Payment Reform

Provision will end unfair geographic disparities, change Medicare to a quality-based reimbursement system

Washington, DC – Rep. Dave Loebsack, Sen. Tom Harkin, Rep. Leonard Boswell and Rep. Bruce Braley announced a major breakthrough today on the issue of Medicare payment reform in the final health care reform bill.  Loebsack, Harkin, Boswell and Braley have been outspoken advocates for changing the way Medicare pays health care providers for services, from its current fee-for-service system into a quality and value-based system.

Loebsack, Harkin, Boswell and Braley helped negotiate a compromise adding language to the health care reform bill that provides an immediate $800 million to address geographic disparities for both doctors and hospitals, as well as written guarantees from Health and Human Services Secretary Kathleen Sebelius for further action to reform Medicare reimbursement rates that do not qualify for reconciliation under the Byrd Rule. The Senate bill previously only provided a Medicare reimbursement fix for doctors.

The House reconciliation package maintained automatic implementation of a value index as part of the reimbursement structures for doctors, beginning in 2015.  This language was secured in the Senate bill with the help of Harkin and is based on Braley’s Medicare Payment Improvement Act, introduced in June 2009. Under the fixes secured in the Senate bill and the House reconciliation package, Iowa doctors will see five percent increases in current Medicare reimbursement rates in both 2010 and 2011.

“This agreement proves that coalition building and hard work are the key to effecting change. I am hopeful that this agreement could be the crucial first step towards cost-control for the nation, and I look forward to seeing Iowa doctors, hospitals, nurses, and health care professionals lead the charge,” said Loebsack. “By shifting our nation’s health care system to one in which patients receive quality care, and health care providers are rewarded for making patients healthy as opposed to ordering unnecessary test after test, we move America towards the fiscal responsibility and efficiency that makes Iowa a model for fundamental reform.”

“Iowans can rest assured knowing they have the highest quality of care from our doctors and hospitals.  But for many providers, this quality of care comes at a lower Medicare reimbursement than other larger states than say, California.  This is unfair for our providers, and subsequently, Iowa seniors,” Harkin said.  “With this fix, Iowa providers will be on more equal footing and therefore, able to serve more needy seniors. It’s a win-win for our state.”

“This is a big win for Iowans as our state’s hospitals and providers have shouldered the burden of unfair Medicare reimbursements for the high quality care they provide for too long,” Boswell said. “The House reform bill will start the process to begin paying doctors and hospitals more fairly by increasing their base pay in the Medicare payment system. By ensuring fair payments for our providers we will improve access for our health care consumers.  This is just one reason why I am supporting reform for our health care system, and continued progress in creating a more efficient and value based system for Iowans.”

“This compromise represents a major breakthrough in health care reform that will finally reward Iowa’s medical providers for the high-quality care they’ve been providing Iowa’s families for years,” Braley said.  “After negotiating directly with Speaker Nancy Pelosi late Friday into the early hours of Saturday morning, I’m proud to say the health care bill will finally fix these inequities, move us to a better reimbursement model that emphasizes quality over quantity, and help recruit well-qualified health-care providers to Iowa – all because of changes I championed.”

Medicare currently operates under a fee-for-service system, basing payments to doctors and hospitals on the amount of procedures completed and the number of patients seen.  This system creates a financial incentive to order more and more procedures.  Ironically, according to many studies, this increased number of procedures does not result in better outcomes for patients.

·         The letter from Sebelius promises the following steps to improve Medicare reimbursement rates for Iowa’s medical providers:

·         Institute of Medicine (IOM) study to reform the Medicare system to address all geographic disparities for doctors and hospitals and implementation of IOM recommendations by December 2012.

·         IOM study based on Braley’s house-passed language making firm recommendations to move toward high quality, low cost care across the health care sector and implementation of the recommendations, as part of the new Independent Payment Advisory Board, by 2014.

·         Additional direction to the new Center for Medicare and Medicaid Innovation to further test innovative models to incent high quality, low cost care across the provider spectrum.

·         A personal commitment from Sebelius to convene a National Summit on Geographic Variation, Cost, Access and Value in Health Care later this year.

Loebsack, Boswell and Braley were all members of the Congressional Quality Care Coalition that negotiated for fair reimbursements throughout the legislative process.


Office of the Press Secretary


For Immediate Release                        March 20, 2010



Capitol Visitor Center Auditorium

Washington, D.C.

3:53 P.M. EDT

    THE PRESIDENT:  Thank you.  Thank you.  Thank you.  Thank you.  Thank you.  Thank you, everybody.  Thank you.  Thank you very much.  Thank you.  Everybody, please have a set.

    To Leader Reid, to Steny Hoyer, John Larson, Xavier Becerra, Jim Clyburn, Chris Van Hollen, to an extraordinary leader and extraordinary Speaker of the House, Nancy Pelosi, and to all the members here today, thank you very much for having me.  (Applause.)  Thanks for having me and thanks for your tireless efforts waged on behalf of health insurance reform in this country.

    I have the great pleasure of having a really nice library at the White House.  And I was tooling through some of the writings of some previous Presidents and I came upon this quote by Abraham Lincoln:  “I am not bound to win, but I’m bound to be true.  I’m not bound to succeed, but I’m bound to live up to what light I have.”

    This debate has been a difficult debate.  This process has been a difficult process.  And this year has been a difficult year for the American people.  When I was sworn in, we were in the midst of the worst recession since the Great Depression.  Eight hundred thousand people per month were losing their jobs.  Millions of people were losing their health insurance.  And the financial system was on the verge of collapse.

    And this body has taken on some of the toughest votes and some of the toughest decisions in the history of Congress.  Not because you were bound to win, but because you were bound to be true.  Because each and every one of you made a decision that at a moment of such urgency, it was less important to measure what the polls said than to measure what was right.

    A year later, we’re in different circumstances.  Because of the actions that you’ve taken, the financial system has stabilized.  The stock market has stabilized.  Businesses are starting to invest again.  The economy, instead of contracting, is now growing again.  There are signs that people are going to start hiring again.  There’s still tremendous hardship all across the country, but there is a sense that we are making progress — because of you.

    But even before this crisis, each and every one of us knew that there were millions of people across America who were living their own quiet crises.  Maybe because they had a child who had a preexisting condition and no matter how desperate they were, no matter what insurance company they called, they couldn’t get coverage for that child.  Maybe it was somebody who had been forced into early retirement, in their 50s not yet eligible for Medicare, and they couldn’t find a job and they couldn’t find health insurance, despite the fact that they had some sort of chronic condition that had to be tended to.

    Every single one of you at some point before you arrived in Congress and after you arrived in Congress have met constituents with heart-breaking stories.  And you’ve looked them in the eye and you’ve said, we’re going to do something about it — that’s why I want to go to Congress.

    And now, we’re on the threshold of doing something about it.  We’re a day away.  After a year of debate, after every argument has been made, by just about everybody, we’re 24 hours away.

    As some of you know, I’m not somebody who spends a lot of time surfing the cable channels, but I’m not completely in the bubble.  I have a sense of what the coverage has been, and mostly it’s an obsession with “What will this mean for the Democratic Party?  What will this mean for the President’s polls?  How will this play out in November?  Is this good or is this bad for the Democratic majority?  What does it mean for those swing districts?”

    And I noticed that there’s been a lot of friendly advice offered all across town.  (Laughter.)  Mitch McConnell, John Boehner, Karl Rove — they’re all warning you of the horrendous impact if you support this legislation.  Now, it could be that they are suddenly having a change of heart and they are deeply concerned about their Democratic friends.  (Laughter.)  They are giving you the best possible advice in order to assure that Nancy Pelosi remains Speaker and Harry Reid remains Leader and that all of you keep your seats.  That’s a possibility.  (Laughter.)

    But it may also be possible that they realize after health reform passes and I sign that legislation into law, that it’s going to be a little harder to mischaracterize what this effort has been all about.

    Because this year, small businesses will start getting tax credits so that they can offer health insurance to employees who currently don’t have it.  (Applause.)  Because this year, those same parents who are worried about getting coverage for their children with preexisting conditions now are assured that insurance companies have to give them coverage — this year.  (Applause.)

    Because this year, insurance companies won’t suddenly be able to drop your coverage when you get sick — (applause) — or impose lifetime limits or restrictive limits on the coverage that you have.  Maybe they know that this year, for the first time, young people will be able to stay on their parents’ health insurance until they’re 26 years old and they’re thinking that just might be popular all across the country.  (Applause.)

    And what they also know is what won’t happen.  They know that after this legislation passes and after I sign this bill, lo and behold nobody is pulling the plug on Granny.  (Laughter.)  It turns out that in fact people who like their health insurance are going to be able to keep their health insurance; that there’s no government takeover.  People will discover that if they like their doctor, they’ll be keeping their doctor.  In fact, they’re more likely to keep their doctor because of a stronger system.

    It’ll turn out that this piece of historic legislation is built on the private insurance system that we have now and runs straight down the center of American political thought.  It turns out this is a bill that tracks the recommendations not just of Democrat Tom Daschle, but also Republicans Bob Dole and Howard Baker; that this is a middle-of-the-road bill that is designed to help the American people in an area of their lives where they urgently need help.

    Now, there are some who wanted a single-payer government-run system.  That’s not this bill.  The Republicans wanted what I called the “foxes guard the henhouse approach” in which we further deregulate the insurance companies and let them run wild, the notion being somehow that that was going to lower costs for the American people.  I don’t know a serious health care economist who buys that idea, but that was their concept.  And we rejected that, because what we said was we want to create a system in which health care is working not for insurance companies but it’s working for the American people, it’s working for middle class families.

    So what did we do?  What is the essence of this legislation?  Number one, this is the toughest insurance reforms in history.  (Applause.)  We are making sure that the system of private insurance works for ordinary families.  A prescription — this is a patient’s bill of rights on steroids.  So many of you individually have worked on these insurance reforms — they are in this package — to make sure that families are getting a fair deal; that if they’re paying a premium, that they’re getting a good service in return; making sure that employers, if they are paying premiums for their employees, that their employees are getting the coverage that they expect; that insurance companies are not going to game the system with fine print and rescissions and dropping people when they need it most, but instead are going to have to abide by some basic rules of the road that exemplify a sense of fairness and good value.  That’s number one.

    The second thing this does is it creates a pool, a marketplace, where individuals and small businesses, who right now are having a terrible time out there getting health insurance, are going to be able to purchase health insurance as part of a big group — just like federal employees, just like members of Congress.  They are now going to be part of a pool that can negotiate for better rates, better quality, more competition.

    And that’s why the Congressional Budget Office says this will lower people’s rates for comparable plans by 14 to 20 percent. That’s not my numbers — that’s the Congressional Budget Office’s numbers.  So that people will have choice and competition just like members of Congress have choice and competition.

    Number three, if people still can’t afford it we’re going to provide them some tax credits — the biggest tax cut for small businesses and working families when it comes to health care in history.  (Applause.)

    And number four, this is the biggest reduction in our deficit since the Budget Balance Act — one of the biggest deficit reduction measures in history — over $1.3 trillion that will help put us on the path of fiscal responsibility.  (Applause.)

    And that’s before we count all the game-changing measures that are going to assure, for example, that instead of having five tests when you go to the doctor you just get one; that the delivery system is working for patients, not just working for billings.  And everybody who’s looked at it says that every single good idea to bend the cost curve and start actually reducing health care costs are in this bill.

    So that’s what this effort is all about.  Toughest insurance reforms in history.  A marketplace so people have choice and competition who right now don’t have it and are seeing their premiums go up 20, 30, 40, 50 percent.  Reductions in the cost of health care for millions of American families, including those who have health insurance.  The Business Roundtable did their own study and said that this would potentially save employers $3,000 per employee on their health care because of the measures in this legislation.

    And by the way, not only does it reduce the deficit — we pay for it responsibly in ways that the other side of the aisle that talks a lot about fiscal responsibility but doesn’t seem to be able to walk the walk can’t claim when it comes to their prescription drug bill.  We are actually doing it.  (Applause.)  This is paid for and will not add a dime to the deficit — it will reduce the deficit.  (Applause.)

    Now, is this bill perfect?  Of course not.  Will this solve every single problem in our health care system right away?  No.  There are all kinds of ideas that many of you have that aren’t included in this legislation.  I know that there has been discussion, for example, of how we’re going to deal with regional disparities and I know that there was a meeting with Secretary Sebelius to assure that we can continue to try to make sure that we’ve got a system that gives people the best bang for their buck.  (Applause.)

    So this is not — there are all kinds of things that many of you would like to see that isn’t in this legislation.  There are some things I’d like to see that’s not in this legislation.  But is this the single most important step that we have taken on health care since Medicare?  Absolutely.  Is this the most important piece of domestic legislation in terms of giving a break to hardworking middle class families out there since Medicare?  Absolutely.  Is this a vast improvement over the status quo?  Absolutely.

    Now, I still know this is a tough vote, though.  I know this is a tough vote.  I’ve talked to many of you individually.  And I have to say that if you honestly believe in your heart of hearts, in your conscience, that this is not an improvement over the status quo; if despite all the information that’s out there that says that without serious reform efforts like this one people’s premiums are going to double over the next five or 10 years, that folks are going to keep on getting letters from their insurance companies saying that their premium just went up 40 or 50 percent; if you think that somehow it’s okay that we have millions of hardworking Americans who can’t get health care and that it’s all right, it’s acceptable, in the wealthiest nation on Earth that there are children with chronic illnesses that can’t get the care that they need — if you think that the system is working for ordinary Americans rather than the insurance companies, then you should vote no on this bill.  If you can honestly say that, then you shouldn’t support it.  You’re here to represent your constituencies and if you think your constituencies honestly wouldn’t be helped, you shouldn’t vote for this.

    But if you agree that the system is not working for ordinary families, if you’ve heard the same stories that I’ve heard everywhere, all across the country, then help us fix this system.  Don’t do it for me.  Don’t do it for Nancy Pelosi or Harry Reid.  Do it for all those people out there who are struggling.

    Some of you know I get 10 letters a day that I read out of the 40,000 that we receive.  Started reading some of the ones that I got this morning.  “Dear President Obama, my daughter, a wonderful person, lost her job.  She has no health insurance.  She had a blood clot in her brain.  She’s now disabled, can’t get care.”  “Dear President Obama, I don’t yet qualify for Medicare.  COBRA is about to run out.  I am desperate, don’t know what to do.”

    Do it for them.  Do it for people who are really scared right now through no fault of their own, who’ve played by the rules, who’ve done all the right things, and have suddenly found out that because of an accident, because of an ailment, they’re about to lose their house; or they can’t provide the help to their kids that they need; or they’re a small business who up until now has always taken pride in providing care for their workers and it turns out that they just can’t afford to do it anymore and they’ve having to make a decision about do I keep providing health insurance for my workers or do I just drop their coverage or do I not hire some people because I simply can’t afford it — it’s all being gobbled up by the insurance companies.

    Don’t do it for me.  Don’t do it for the Democratic Party.  Do it for the American people.  They’re the ones who are looking for action right now.  (Applause.)

    I know this is a tough vote.  And I am actually confident — I’ve talked to some of you individually — that it will end up being the smart thing to do politically because I believe that good policy is good politics.  (Applause.)  I am convinced that when you go out there and you are standing tall and you are saying I believe that this is the right thing to do for my constituents and the right thing to do for America, that ultimately the truth will out.

    I had a wonderful conversation with Betsy Markey.  I don’t know if Betsy is around here.  There she is right there.  (Applause.)  Betsy is in a tough district.  The biggest newspaper is somewhat conservative, as Betsy described.  They weren’t real happy with health care reform.  They were opposed to it.  Betsy, despite the pressure, announced that she was in favor of this bill.  And lo and behold, the next day that same newspaper runs an editorial saying, you know what, we’ve considered this, we’ve looked at the legislation, and we actually are pleased that Congresswoman Markey is supporting the legislation.  (Applause.)

    When I see John Boccieri stand up proud with a whole bunch of his constituencies — (applause) — in as tough a district as there is and stand up with a bunch of folks from his district with preexisting conditions and saying, you know, I don’t know what is going on Washington but I know what’s going on with these families — I look at him with pride.

    Now, I can’t guarantee that this is good politics.  Every one of you know your districts better than I do.  You talk to folks.  You’re under enormous pressure.  You’re getting robocalls.  You’re getting e-mails that are tying up the communications system.  I know the pressure you’re under.  I get a few comments made about me.  I don’t know if you’ve noticed.  (Laughter.)  I’ve been in your shoes.  I know what it’s like to take a tough vote.

    But what did Lincoln say?  “I am not bound to win, but I am bound to be true.”  Two generations ago, folks who were sitting in your position, they made a decision — we are going to make sure that seniors and the poor have health care coverage that they can count on.  And they did the right thing.

    And I’m sure at the time they were making that vote, they weren’t sure how the politics were either, any more than the people who made the decision to make sure that Social Security was in place knew how the politics would play out, or folks who passed the civil rights acts knew how the politics were going to play out.  They were not bound to win, but they were bound to be true.

    And now we’ve got middle class Americans, don’t have Medicare, don’t have Medicaid, watching the employer-based system fray along the edges or being caught in terrible situations.  And the question is, are we going to be true to them?

    Sometimes I think about how I got involved in politics.  I didn’t think of myself as a potential politician when I get out of college.  I went to work in neighborhoods, working with Catholic churches in poor neighborhoods in Chicago, trying to figure out how people could get a little bit of help.  And I was skeptical about politics and politicians, just like a lot of Americans are skeptical about politics and politicians are right now.  Because my working assumption was when push comes to shove, all too often folks in elected office, they’re looking for themselves and not looking out for the folks who put them there; that there are too many compromises; that the special interests have too much power; they just got too much clout; there’s too much big money washing around.

    And I decided finally to get involved because I realized if I wasn’t willing to step up and be true to the things I believe in, then the system wouldn’t change.  Every single one of you had that same kind of moment at the beginning of your careers.  Maybe it was just listening to stories in your neighborhood about what was happening to people who’d been laid off of work.  Maybe it was your own family experience, somebody got sick and didn’t have health care and you said something should change.

    Something inspired you to get involved, and something inspired you to be a Democrat instead of running as a Republican.  Because somewhere deep in your heart you said to yourself, I believe in an America in which we don’t just look out for ourselves, that we don’t just tell people you’re on your own, that we are proud of our individualism, we are proud of our liberty, but we also have a sense of neighborliness and a sense of community — (applause) — and we are willing to look out for one another and help people who are vulnerable and help people who are down on their luck and give them a pathway to success and give them a ladder into the middle class.  That’s why you decided to run.  (Applause.)

    And now a lot of us have been here a while and everybody here has taken their lumps and their bruises.  And it turns out people have had to make compromises, and you’ve been away from families for a long time and you’ve missed special events for your kids sometimes.  And maybe there have been times where you asked yourself, why did I ever get involved in politics in the first place?  And maybe things can’t change after all.  And when you do something courageous, it turns out sometimes you may be attacked.  And sometimes the very people you thought you were trying to help may be angry at you and shout at you.  And you say to yourself, maybe that thing that I started with has been lost.

    But you know what?  Every once in a while, every once in a while a moment comes where you have a chance to vindicate all those best hopes that you had about yourself, about this country, where you have a chance to make good on those promises that you made in all those town meetings and all those constituency breakfasts and all that traveling through the district, all those people who you looked in the eye and you said, you know what, you’re right, the system is not working for you and I’m going to make it a little bit better.

    And this is one of those moments.  This is one of those times where you can honestly say to yourself, doggone it, this is exactly why I came here.  This is why I got into politics.  This is why I got into public service.  This is why I’ve made those sacrifices.  Because I believe so deeply in this country and I believe so deeply in this democracy and I’m willing to stand up even when it’s hard, even when it’s tough.

    Every single one of you have made that promise not just to your constituents but to yourself.  And this is the time to make true on that promise.  We are not bound to win, but we are bound to be true.  We are not bound to succeed, but we are bound to let whatever light we have shine.  We have been debating health care for decades.  It has now been debated for a year.  It is in your hands.  It is time to pass health care reform for America, and I am confident that you are going to do it tomorrow.

    Thank you very much, House of Representatives.  Let’s get this done.  (Applause.)

END           4:24 P.M. EDT

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  • Don't want to jinx it

    but I’ve been impressed with Pelosi over the last week or so. Had not been a Pelosi fan before; that may be due to some sexism on my part and in her standard media portrayal but I do think she has appeared more calmly competent lately than usual. Also it’s very strange for me to see the Democrats as united as it appears they are.