Blessings on you folks who can stomach the details of this fiasco.

Saddle up! It’s Showtime!

dday, before all attention turns to analyzing the senate bill, any reports/thoughts on that 10% cut in medicare funding in the house bill? (all i’ve seen is from the cms report). that looks like trouble to me.

Refresh my memory on that, selise. Also, keep in mind that CMS is relying on their own models, just as CBO is relying on theirs, and neither are foolproof.

thanks for the reply dday, i remember is was from table 5 – but there is more. will quote some of the relevant bits in the am (i plead the need for a bit of a delay due the the late hour and my need for sleep).

So, who will think the final bill will be better than than the previous senate bill and the house bill? Virtually the same? PO further limited? Triggers? PO completely gone?

I’m betting it’ll have a further weakened “public option” and possibly a trigger. The signs haven’t been good and these bills don’t tend to stay or become more progressive in secret. We’ll see soon.

Do we know if the Hagan-Enzi-Hatch biosimilars amendment, which corresponds to the Eshoo amendment in HR 3962, will be in the Reid bill?

Michael Moore weighs in:

“Michael Moore says Democrats’ healthcare bill is giveaway to insurance industry”

http://rawstory.com/2009/11/michael-moore-democrats-healthcare-bill-giveaway-insurance-industry/

P.S.: That’s what happens when you make back room deals with industry insideres and have the industry lobbyists writing the bills.

from table 5 – Estimated Impacts of H.R. 3962 on National Health Expenditures (NHE), for calendar year 2019

Current Law Baseline, medicare component of NHE = $1,010.9 billion
Proposed — H.R. 3962, medicare component of NHE = $908.0 billion

–> for a decrease of $102.9 billion (about 10%) in medicare funding for the year.

i don’t understand table 3 well enough to figure out the details of the $ amount of the various changes on medicare funding, but here are the relevant bits i could find from the text (my bold):

page 3-4

As described in more detail in a later section of this memorandum, we estimate that most of the provisions of H.R. 3962 that were designed, in part, to reduce the rate of growth in health care costs would have a relatively small savings impact. An important exception is the reductions in the “market basket” price indices that are used to update Medicare payments to health providers. Total national health expenditures under this bill would increase by an estimated 1.3 percent in calendar year 2019, reflecting the net impact of (i) greater utilization of health care services by individuals becoming newly covered (or having more complete coverage), (ii) lower prices paid to health providers for the subset of those individuals who become covered by Medicaid, and (iii) lower payments and payment updates for Medicare services.

pages 7-9

The estimated financial impacts of the Medicare provisions in H.R. 3962 are provided in detail in table 3, attached, which is organized by section of the proposed legislation. Net Medicare savings are estimated to total $571 billion for fiscal years 2010-2019, with the majority of the savings arising from provisions in Title I of Division B (“Improving Health Care Value”). Specifically, substantial savings are attributable to provisions in this title that would, among other changes, reduce Part A and Part B market basket payment updates and adjust them for productivity improvements ($282 billion); eliminate the Medicare Improvement Fund ($15 billion); reduce Medicare Advantage payment benchmarks and extend the authority to adjust for coding intensity ($201 billion); require prescription drug rebates at Medicaid levels from manufacturers for all low- income Part D enrollees ($115 billion); and establish arrangements with drug manufacturers for 50-percent price discounts on drugs purchased by enrollees in the coverage gap ($14 billions).6 The provisions in other titles would generate relatively smaller amounts of savings, principally through Title IV (“Quality”) and Title VI (“Program Integrity”) with combined savings of $4 billion.

The Title I savings are partially offset by the costs of phasing out the Part D coverage gap ($31 billion).7 Other titles with costs, include Title II (“Medicare Beneficiary Improvements”) with an estimated 10-year cost of $32 billion and Title III (“Promoting Primary Care, Mental Health, and Coordinated Care”) with costs of $12 billion. Based on the estimated savings for Part A of Medicare, the assets of the Hospital Insurance trust fund would be exhausted in 2022, 5 years later than under current law. It is important to note that the estimated savings shown in this memorandum for one category of Medicare proposals may be unrealistic. H.R. 3962 would introduce permanent annual productivity adjustments to price updates for institutional providers (such as acute care hospitals, skilled nursing facilities, and home health agencies), using a 10-year moving average of economy-wide productivity gains. While such payment update reductions would provide a strong incentive for institutional providers to maximize efficiency, it is doubtful that many could improve their own productivity to the degree achieved by the economy at large.8 Over time, a sustained reduction in payment updates, based on productivity expectations that are difficult to attain, would cause Medicare payment rates to grow more slowly than, and in a way that was unrelated to, the providers’ costs of furnishing services to beneficiaries. Thus, providers for whom Medicare constitutes a substantive portion of their business could find it difficult to remain profitable and might end their participation in the program (possibly jeopardizing access to care for beneficiaries). While this policy could be monitored over time to avoid such an outcome, so doing would likely result in significantly smaller actual savings than shown here for these provisions.

Section 1161 of Division B of H.R. 3962 would set Medicare Advantage capitation benchmarks equal to 100 percent of the prevailing fee-for-service cost level in each county. This reduction in benchmarks, which are generally in the range of 100 to 140 percent of fee-for-service costs under current law, would reduce MA rebates to plans and thereby result in less generous benefit packages.9 We estimate that in 2014, when the MA provisions would be fully phased in, enrollment in MA plans would decrease by about 64 percent (from its projected level of 13.2 million under current law to 4.7 million under the proposal).

footnote 8: The provision of most health services tends to be very labor-intensive. Economy-wide productivity gains reflect relatively modest improvements in the service sector together with much larger improvements in manufacturing. Except in the case of physician services, we are not aware of any empirical evidence demonstrating the medical community’s ability to achieve productivity improvements equal to those of the overall economy. The Office of the Actuary’s most recent analysis of hospital productivity highlights the difficulties in measurement but suggests that such productivity has been small or negligible during 1981 to 2005. (See http://www.cms.hhs.gov/HealthCareFinancingReview/downloads/07-08Winterpg49.pdf.)

page 15

In estimating the financial impacts of H.R. 3962, we assumed that the increased demand for health care services could be met without market disruptions. In practice, supply constraints might interfere with providing the services desired by the additional 34 million insured persons. Price reactions—that is, providers successfully negotiating higher fees in response to the greater demand—could result in higher total expenditures or in some of this demand being unsatisfied. Alternatively, providers might tend to accept more patients who have private insurance (with relatively attractive payment rates) and fewer Medicaid patients, exacerbating existing access problems for the latter group. Either outcome (or a combination of both) should be considered plausible and even probable.

The latter possibility is especially likely in the case of the higher volume of Medicaid services. Despite a provision to increase payment rates for primary care to Medicare levels, most Medicaid payments would still be well below average. Therefore, it is reasonable to expect that a significant portion of the increased demand for Medicaid would not be realized.

We have not attempted to model that impact or other plausible supply and price effects, such as supplier entry and exit or cost-shifting towards private payers. A specific estimate of these potential outcomes is impracticable at this time, given the uncertainty associated with both the magnitude of these effects and the interrelationships among these market dynamics. We may incorporate such factors in future estimates, should we determine that they can be estimated with a reasonable degree of confidence. For now, we believe that consideration should be given to the potential consequences of a significant increase in demand for health care meeting a relatively fixed supply of health care providers and services.

As noted in the section on Medicare estimates, reductions in payment updates to institutional providers, based on economy-wide productivity gains, are unlikely to be sustainable on a permanent annual basis. If such reductions were to prove unworkable within the 10-year period 2010-2019, then the actual Medicare savings from these provisions would be less than shown in this memorandum.

thanks for the link. do you know where his $70 billion figure comes from?