Significant Health Reform Ideas: Fiscal Commission Report May Impact Health Policy
The President’s Fiscal Commission Report contains significant recommendations for health care policy that could yet influence policymakers. On December 3, 2010 the Report failed to get the affirmative vote of 14 of the 18 members of the Commission. That may have marked a fork in the road, but is unlikely the end of it. The Report says health care spending “represents our single largest fiscal challenge in the long run” and it offers six recommendations for health policy that policymakers may find appealing.
One recommendation involves actions that CMS can take under the Affordable Care Act (ACA) “without any further congressional action.” CMS should implement new pilot and demonstration projects “aggressively” and “as rapidly as possible.” The Commission believes that “there could be substantial savings in Medicare, Medicaid, CHIP, and other health programs” if successful pilots are aggressively implemented.
We note that one idea in the Report, the introduction of “downside risk” to Accountable Care Organizations (ACOs) under the ACA, is already gaining momentum as MedPAC recently recommended that CMS introduce this concept to ACOs. (For more information, see the On the Subject about MedPAC's comments to CMS.)
The Report also urges the following measures:
- Eliminate the carve out for hospitals and other providers that are currently exempt from changes in Medicare payment policies established by the ACA’s Independent Payment Advisory Board.
- Reform the Sustainable Growth Rate (SGR), known as the “doc fix,” by implementing a three-year freeze at current reimbursement rates followed by a 1 percent cut in 2014, then reinstatement of the SGR in 2015.
- Modify Medicare cost-sharing rules. First, introduce an annual deductible of $550 per beneficiary with coinsurance thereafter until the beneficiary reaches a maximum annual out-of-pocket of $7,500. Second, restrict “first dollar” Medicare supplement insurance, which cause over-utilization of health services.
- Establish a long-term global budget for federal health care spending.
- Eliminate the CLASS Act, which is “viewed by experts as financially unsound.”
The Report can be found on the Commission’s website at http://www.fiscalcommission.gov.
