About the Author

James C. Capretta

James C. Capretta

New Atlantis Contributing Editor James C. Capretta is an expert on health care and entitlement policy, with years of experience in both the executive and legislative branches of government. E-mail: jcapretta@aei.org.


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James C. Capretta’s Latest New Atlantis Articles

 Health Care with a Conscience” (Fall 2008) 

 Health Care 2008: A Political Primer” (Spring 2008) 

 The Clipboard of the Future” (Winter 2008)

 

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Text Patterns - by Alan JacobsFuturisms - Critiquing the project to reengineer humanity

Wednesday, January 7, 2009

Avoiding the Medicare Trigger 

The 111th Congress convened yesterday, and the Democratic majority in the House of Representatives wasted no time before laying down an inauspicious marker on health care.

As usual, the first order of business in the House was to update the chamber’s internal rules, covering everything from who has access to the members’ exercise facilities to certain procedural matters governing consideration of legislation.

The biennial rules package is not normally a vehicle for making significant policy changes, in health care or otherwise. But this year, House Democrats couldn’t resist the temptation to use it to settle a score. They placed deep within the larger measure they passed a suspension of the so-called Medicare “trigger” in the House for the next two years.

The Medicare trigger would seem to be an unlikely target for partisan scorn, aimed as it is at one of the nation’s most serious economic threats. In coming decades, Medicare spending is expected to rise very rapidly, putting tremendous pressure on the nation’s fiscal position.

Medicare has two sources of revenue—payroll taxes and premiums—but the program also relies heavily on general taxpayer support. In 2003, Congress decided to use the program’s reliance on general revenue funding as a proxy for assessing the program’s fiscal burden. If that reliance is projected to exceed a certain “trigger,” it sets in motion a process allowing Members of the House and the Senate to bring up corrective legislation under special rules. But these procedures in no way guarantee reform legislation will pass or even come to a vote. In fact, it is quite easy for the House to meet its obligations under the trigger provisions without Members ever having to take a tough vote. And, importantly, there is no enforcement provision to prevent perpetual inaction.

Given the stakes for the country, one might think that something much tougher is warranted to force action sooner rather than later.

But that’s not how many powerful House Democrats see it. They have no interest in reforming Medicare and reject the notion that Medicare’s reliance on general revenue financing is an appropriate measure at all. Hence their urgency in suspending provisions which force the issue into the public debate every year, however briefly.

In recent days, some Democrats, including Senator Kent Conrad, have begun suggesting that the time has come for a bipartisan effort on entitlement reform. Indeed, it is possible that the large stimulus package now being drafted in Congress will include a provision establishing a bipartisan task force focused on the long-term fiscal outlook.

Such an effort is surely needed and long overdue.

But it would certainly be tempting for Republicans to say, “Thanks, but no thanks.” They are in the minority. Why should they shoulder any of the political risks now?

Leaders of the Democratic Party in recent years have not put forward a credible plan on entitlements, even as they have fought every effort by Republicans to reform the programs (remember Social Security in 2005 and Medicare in 2003?). Indeed, most Democratic elected officials have sworn off any cuts in benefits in Social Security and Medicare. And only a very few have been willing to voice support for payroll tax increases. So what is their plan?

Before getting enmeshed in a bipartisan quagmire on entitlement reform, Republicans should consider requiring, as a condition for their participation, a credible plan from President-elect Obama. What would he do to make Social Security and Medicare permanently solvent and affordable? That would demonstrate appropriate presidential leadership and provide a starting point for a bipartisan discussion.

posted by James C. Capretta | 5:32 pm
File As: Health Care