Health Care
It’s Time to Delay Obamacare
April 4, 2013 •Over at the AEI Ideas blog my colleague Yuval Levin and I make the case that both supporters and opponents of Obamacare should agree to delay the implementation of the major provisions of the law that are now scheduled for 2014.
Everyone should now understand that, if there is not a delay, next year will be the scene of an epic disaster for American health care. The trouble started, as it often does, at the top. The president insisted on passing a reform with only Democratic support. That guaranteed large-scale public opposition, which has persisted. It also left the nation’s Republican governors less than enthusiastic about becoming the law’s enablers.
The president compounded the problem by stalling on key implementation decisions in 2011 and 2012 to avoid controversy before the election. States could not get answers to basic questions about what the law’s “exchanges” would involve or what their options were for Medicaid. And insurers even now remain unclear about the regulatory environment they will confront. With so much uncertainty, states, employers, and insurers all delayed their decision-making as long as possible too. The result is that implementation of the largest social-welfare policy change in a generation is far behind schedule.
The rest of the post is online at the AEI Ideas blog here.
posted by James C. Capretta | 1:53 pm
Tags: Yuval Levin, Obamacare
File As: Health Care
End Medicaid’s Crony Federalism
March 25, 2013 •Over at National Review Online I have a column on why Republican governors should resist the Obama administration’s Medicaid expansion, and instead seek real legislative Medicaid reform.
The GOP governors engaged in these direct negotiations with the White House are playing a loser’s game, and throwing away a historic opportunity to secure fundamental and lasting reform of the Medicaid program. Even if individual states are able to secure concessions from HHS and the White House, the “deals” they strike will be in the form of temporary and inconsequential “waivers” (the terms of which will always be subject to administration amendment and revision, too). What’s worse, these deals are no way to run a national program. Why should one state receive more favorable treatment than others? And why should the administration be allowed to “buy off” states with federal taxpayer funds in the first place?
Instead, GOP governors should withdraw from this White House game of “let’s make a deal” and instead decide, as a group, what kind of Medicaid reform to demand in return for considering broader insurance coverage. Importantly, the reforms they seek should be in the form of legislative revisions of Medicaid, not temporary “waivers.” By pursuing a legislative approach, the GOP governors could join forces with House speaker John Boehner and Energy and Commerce Committee chairman Fred Upton, who have made serious Medicaid reform one of their top priorities this year.
You can read the rest of the article online here.
posted by James C. Capretta | 1:01 pm
Tags: Medicaid reform
File As: Health Care
More on Medicaid Reform in Texas
March 21, 2013 •In December last year, the Texas Public Policy Foundation released a report that I co-authored with colleagues from Leavitt Partners. The report focused on how the state of Texas should reform the long-term care components of the program to stay within the confines of a fixed Medicaid budget, such as would be the case with a block grant.
This week, TPPF released a follow-on report outlining the broader reform strategy for the Medicaid program. The report describes in some detail the provisions which should be included in federal legislation to convert Medicaid into a block grant. It then also describes what the state of Texas should do once it gets a block grant to provide more cost-effective services to its citizens. In short, the report provides a roadmap for making a Medicaid block grant work at both the federal and state levels of government and should be of interest to state policymakers in all fifty states.
The full report is available online here, and the pdf version is available here.posted by James C. Capretta | 12:04 pm
Tags: Medicaid reform
File As: Health Care
Saving Seniors and Our Most Vulnerable Citizens from an Entitlement Crisis
March 20, 2013 •Earlier this week I was invited to give testimony before a House Energy and Commerce Health Subcommittee hearing on “Saving Seniors and Our Most Vulnerable Citizens from an Entitlement Crisis.” A video of the entire hearing is available here (with my testimony beginning around at around 20:30), and you can read my written statement here.
posted by James C. Capretta | 12:30 pm
Tags: medicare, entitlement reform
File As: Health Care
The Top Ten Health-Care Bills for 2013
February 20, 2013 •Over at National Review Online I outline ten health care bills that could receive bipartisan support in Congress and would limit the worst aspects of Obamacare.
1. DELAY
The Obama administration chose to delay many of the most controversial implementing rules of Obamacare during 2012 to avoid stirring up opposition to the president during the election year. That decision has now put everything behind schedule. Moreover, a majority of states have decided (as was their right) not to build the state exchanges envisioned in the law, leaving the task to the federal government. And there’s no direct appropriation available to the federal government for this task. So it’s quite clear that implementing the law by January 2014 will create significant and unnecessary chaos in the insurance marketplace. Republicans should seize the opportunity this state of affairs provides and push for a delay of the law’s implementation. The administration will of course vigorously oppose any suggestion of delay, but many employers, states, and health-sector participants would welcome it.
You can read the other nine proposals here.
posted by James C. Capretta | 11:33 am
Tags: Obamacare
File As: Health Care
The Incredible Lowering of the Medicare Drug Benefit Baseline
February 15, 2013 •Over at e21 I have a short article on how the restrained growth of Medicare spending owes more to the market-oriented reforms in the Medicare drug benefit program enacted in 2003 than to the supposed cost-restraining features of Obamacare.
The talk of the supposed cost-restraining features of Obamacare has also distracted attention away from an actual trend in health spending that is worth noting. Last week, the Congressional Budget Office (CBO) released its annual updated projections for the entire federal budget, including health programs. And, in those projections, CBO dropped the projected ten-year cost for Medicare quite substantially—by $137 billion. The reason? Buried deep in the CBO report there’s this explanation: “the largest downward revision in the current baseline is for spending for Medicare’s Part D (prescription drugs).”
That’s an understatement. Of the $137 billion drop in the Medicare baseline, $104 billion—or 75 percent—was due to the drop in expected Medicare drug benefit spending. This is truly remarkable because CBO had already lowered the drug benefit baseline several times in the preceding years. With this latest revision, CBO’s part D projections bear almost no resemblance to what was expected to occur when the law was enacted in 2003.
You can read the rest of the column here.
posted by James C. Capretta | 11:32 am
Tags: Medicare Part D
File As: Health Care
Delay, Repeal, Replace
January 30, 2013 •Jeffrey H. Anderson and I have an piece in The Weekly Standard on what conservatives can do to stop Obamacare and fix the problems with the American health care system.
Delaying the implementation of Obamacare would be important for three reasons: It would save hundreds of billions of dollars in federal spending. It would spare Americans from having their health care premiums spike until a somewhat later date. And it would move the onset of Obamacare much closer to the 2016 presidential election, which would put Obama’s centerpiece legislation at center stage in that race—as the future health of the nation demands that it be.
Of course, this is the last thing that Obama wants, but he may not have much choice in the matter. Once a possible delay gets floated by Republicans in Congress, it could gather momentum. Many governors, including some Democrats, are likely to support such a move because they see a train wreck coming in 2014 and are eager to avoid it. Moreover, many businesses, including insurers, would support a delay because they know the government is not remotely ready to implement Obamacare on schedule. Even a one-year delay would pay dividends in all of the ways listed above.
For those interested, the rest of the article can be found here.
posted by James C. Capretta | 12:53 pm
Tags: Obamacare
File As: Health Care
The Urgent Need for Genuine Health and Entitlement Reform
January 22, 2013 •The editors of economics21.org recently invited Charles Blahous, David Malpass, and me to provide some commentary on the state of fiscal and monetary policy as President Obama begins his second term. In my contribution to the collaborative article, I make the case for market-friendly reforms to American health care entitlement programs.
You can read the rest of my piece, along with the contributions of David Malpass and Charles Blahous here.At the heart of the nation’s fiscal challenges are the rising costs of the major health care entitlement programs -- Medicare, Medicaid, and the new subsidies provided by the 2010 health care law. In 1972, total federal spending on Medicare and Medicaid was just 1.1 percent of GDP. By 2010, the costs of these programs had risen to 5.5 percent of GDP, and CBO projections from last year show the costs rising to 9.1 percent in 2030 when the new entitlement spending from Obamacare is also added in and when plausible assumptions about on-going enforcement of arbitrary cost-cutting measures are used.
The prospects for seriously addressing the problem of health entitlement spending is not promising in the president's second term in large part because there is a sense in his administration and among congressional Democrats that Obamacare has already largely solved the problem. They argue that the provisions cutting future Medicare spending in the new law will work, and that numerous, government-initiated efforts to cut costs (such as the Accountable Care Organization program in Medicare) will fundamentally transform how health care is delivered in the United States.
posted by James C. Capretta | 12:09 pm
Tags: entitlement reform
File As: Health Care
The Project to Replace Obamacare Begins Now
January 8, 2013 •As 2013 begins, encouraging a discussion about how to replace Obamacare might strike some observers as a case of particularly bad timing. After all, in the year just ended, the Supreme Court upheld most of the provisions of the law and the president won re-election. As a consequence, the best opportunities to remove the law from the books all disappeared. The tough reality now is that Obamacare is not going to be undone during the next four years. So why bring up an alternative plan at this point?
The answer is that replacing Obamacare is by necessity a long-term project; you have to start somewhere. Moreover, it remains essential. Like it not, health care policy is central to the struggle over the size and scope of governmental power. Without a better approach than Obamacare, there will be no success in limiting government or in lessening the dependence of citizens on the state.
It is also going to take a lot of work and political effort to build the political coalition necessary to move health care policy in a different direction. Indeed, one of the reasons Obamacare passed in the first place is because opponents of government-dominated health care never coalesced around a serious and workable alternative in the years prior to 2009. Moreover, those efforts that did take place to promote a real alternative, such as Sen. John McCain’s proposal from the 2008 campaign, fell far short because they were not preceded by the necessary policy and political groundwork.
But all is not lost. Obamacare is flawed legislation that is already forcing employers to cut back their hiring and limit hours of work. It will soon send premiums sky high for many Americans who already have insurance. Promises about the law’s coverage and cost-control effects were greatly exaggerated. There will come a time — sooner rather than later — when Americans will be ready to hear again about an alternative to Obamacare’s government-heavy approach. At that moment, which might coincide with the 2016 presidential election contest, Obamacare’s opponents must be ready with a viable, center-right, market-based alternative that can win public support. And the only way to be ready for a debate on health care in 2016 is to get to work now on the alternative plan. It takes that long to develop a workable framework, get it analyzed with credible numbers, and refine it to ensure it has broad appeal.
In that spirit, I am circulating again two essays on this subject from 2012. The first, co-authored by myself and Robert Moffit of the Heritage Foundation and published in the journal National Affairs, describes what we see as the fundamental principles of an effective, market-based reform plan. The second — a sequel of sorts to the first — is my effort to provide more detail on some of the key features of a workable alternative plan. It was published last month by the American Enterprise Institute in its Health Policy Outlook series.
Advocates of expansive governmental power are always more comfortable than their limited-government opponents talking about health care policy. It is far easier to sell “the government will take care of it” than to explain why a decentralized, market-driven approach will be better for voters anxious for certainty about their health care needs. Nonetheless, this fight cannot be avoided. Health care is too important to fiscal policy, to the American economy, and to the concerns of voters to be set aside as an unwinnable issue.
It is of course true that full replacement of Obamacare with a workable, market-based alternative will be an extremely difficult undertaking. But it is also true that a new direction in health care policy is crucial for the future prosperity of the country. And so, that being the case, it’s far better to get started on the effort now than to delay and thereby handicap the possibility of future success.
posted by James C. Capretta | 2:28 pm
Tags: Obamacare
File As: Health Care
Reforming Medicaid in Texas
January 3, 2013 •Every state, including Texas, is struggling with the budgetary pressures associated with rapidly rising Medicaid spending. To its credit, the Texas Public Policy Foundation has been working for years to develop solutions to the growing Medicaid budget crisis. As part of its ongoing efforts to modernize the Medicaid program, the foundation reached out to me last year to prepare a report on what might be done to reform the long-term care component of Texas Medicaid. I was very pleased to work with my co-authors (Andrew Croshaw, Michael Deily, and Laura Summers) from Leavitt Partners on the project. Our goal was to develop recommendations that would allow the state of Texas to continue to provide vital services to patients even as the program would become more efficient and affordable for the state’s taxpayers, both in the short and long term.
The full report is available online here. A pdf version is available here.
posted by James C. Capretta | 11:22 am
Tags: Medicaid
File As: Health Care
