Editor’s Note: This is the second of 2 posts on the health care summit from Tim Jost. Part 1 looks at insurance reforms, premium rates and more.

Most of the last three hours of the summit was devoted to the effects of proposed legislation on the federal budget deficit (primarily on Medicare and Medicaid) and on expanding coverage.  It seemed to me that the Democrats were stronger in the second half than in the first, less focused on telling stories (although there were still a lot of them) and more on substance.  The Republicans kept to their talking points, but were at a disadvantage because their bills do not really address Medicare or coverage expansions.

Insurance Reform: Risk Pools and Mandates

Before turning to the deficit issue, several Congressmen who were not able to talk before the lunch break offered useful comments on the insurance reforms. Rep. Dave Camp (R-MI) pointed out a problem with the interim national high risk pool in the Senate bill.  At $5 billion, it is not adequately funded and would run out of money well before the 2014, at which point the bill authorizes the Department of Health and Human Services (HHS) to close the pool.  By contrast, the Republican high risk pools are more generously funded, although the Congressional Budget Office (CBO) does not score them as becoming fully funded until 2016.  Rep. Marsha Blackburn (R-TN) noted that the interstate compacts in the Senate bill would require federal approval as well as the approval of each participating state, and would not become effective until 2016.

Democratic Congressmen, on the other hand, ably defended the comprehensiveness of their approach to reform generally, Sen. Tom Harkin (D-IA) noting that if someone is drowning 50 feet away it does not help to throw them a 10-foot rope.  Senator Harkin also drew a parallel between the discrimination based on health status which still defines the health insurance industry and other forms of discrimination long since outlawed in the United States.

Several Republican commentators attacked the individual mandate, claiming that it has become a rallying point for opposition to the bill.  A couple even called it unconstitutional. The President defended the mandate, noting that people who refuse to take responsibility for purchasing insurance simply shift their costs to the rest of us through public programs or uncompensated care once they need high cost care.  He also pointed out that we cannot expect insurance companies to accept people with preexisting conditions if those people can simply wait until they become ill to purchase insurance.

Medicare and the Budget Deficit

Vice President Biden led off the discussion of the deficit and Medicare, noting that the CBO had scored the Senate bill as reducing the budget deficit by over $100 billion over the first decade and far more in the second decade.  He also claimed that the proposal did not cut Medicare benefits but rather cut “waste,” in fact improving benefits by closing the donut hole and increasing coverage in preventive care.

Since the Republicans have not offered legislation to reduce Medicare spending, their contribution to this part of the discussion was mainly to criticize the Democratic proposals.  Rep. Paul Ryan (R-WI) led off with a dizzying critique of the Democrats’ deficit reduction math, noting, for example, that the Center for Medicare and Medicaid Services (CMS) Actuary report was less sanguine than the CBO about the cost of the bill and that the Democrats’ budget numbers do not include the sustainable growth rate fix, which everyone agrees must happen.  This led to a challenge from Rep. Xavier Becerra (D-CA), who called Ryan out on whether he accepted the CBO’s judgment, observing that if there was no agreement to the CBO as a referee, the business of Congress could not be done.  Ryan claimed he was not challenging the CBO, only the Democrats’ math.  Sen. Chuck Grassley (R-IA) followed on, pointing out, as have others, that the Democrats cannot claim the Medicare savings both as reducing the Medicare trust fund deficit and as a funding source for coverage expansions.

As the Medicare discussion progressed, the Republicans tried to focus on the effect that the cuts were likely to have on Medicare beneficiaries and providers.  The Democrats, on the other hand, pushed the Republicans on the need to make hard choices if the deficit is going to be confronted.  Rep. Jim Cooper (D-TN) and Sen. Kent Conrad (D-ND) were particularly eloquent on this point.  President Obama pushed the Republicans on whether they could defend the fact that we spend 14 percent more on Medicare Advantage than on traditional Medicare for the same benefits, increasing not only the cost to the taxpayers but also the Part B premiums of beneficiaries who are not in MA plans.  Their response was not convincing.

Although they were supposed to be discussing the deficit, the participants kept getting off topic.  When his turn came, Rep. John Boehner (R-OH) simply recited a list of Republican talking points, which included major misrepresentations of the Democratic legislation.  He claimed, for example, that the bills require all employers to provide health insurance (which the Senate bill does not) and would provide taxpayer funding for abortion, which neither bill does.  Obama seemed nonplussed by Boehner’s misrepresentations, but said he would deal with them later.  He did not get back to them, but Rep. Nancy Pelosi (D-CA) in her closing statement emphatically noted that the bills do not provide public funding for abortion.

Malpractice Reform Redux

The Republicans also kept returning to the theme of malpractice reform.  Sen. John McCain (R-AZ) talked at length about what malpractice reform had done for Texas, reducing malpractice insurance premiums and attracting doctors to the states, including obstetricians for rural areas.  Sen. Dick Durbin (D-IL) in response noted that medical negligence is in fact a serious problem and simply denying justice to its victims does not solve it.  The figures offered by the parties as to the cost of malpractice litigation strikingly illustrated the depth of disagreement on this issue, with Senator Durbin claiming that malpractice litigation accounted for one-fifth of one percent of health care costs, while Rep. Joe Barton (R-TX) claimed it cost $150 billion a year.  Senator Durbin’s numbers are closer to those of the CBO, which has determined that the Republican reforms would save the federal government about $5 billion a year, one-half of one percent of total federal costs.  (This includes defensive medicine reduction.)  Democratic speakers also noted the irony of the Republicans, who otherwise favor state’s rights, being eager to override state law on the malpractice issue.  President Obama claimed several times that HHS Secretary Kathleen Sebelius was working on an approach to the malpractice issue that would involve giving the states incentives to address the problem, but the Republicans did not seem convinced.

Falling Short on Coverage

On the issue of coverage of the 50 million uninsured Americans, the Republicans had the least to offer.  Congressman Boehner’s plan, according to the CBO, would only cover 3 million uninsured, and the Republicans did not take issue with this number.  Rep. John Barrasso (R-WY), a physician, claimed that he had taken care of patients regardless of their insurance status, but free treatment by doctors does not seem like a viable solution.  He also asserted that we have the best health care system in the world and that Canadian politicians fly here for treatment. In response, President Obama asked how this helped uninsured Americans.

Republicans did observe that half of the coverage expansions in the legislation will come through expanding Medicaid, and Medicaid is a troubled program, paying providers inadequately and bankrupting the state and federal governments.  The Democratic response was that Medicaid is better than nothing.  There was also disagreement as to whether the federal government needed to define the “essential benefits” that insurance must cover, with the Republicans seeing this as an unwarranted extension of federal authority and restriction on choice.  The Democrats responded that minimum standards are necessary for health insurance, just as they are for food or drugs, and pointed out that the Federal Employees’ Health Benefit Program, which covers all Members of Congress, is governed by federal minimum standards.

The Republicans claimed repeatedly that public opinion polls show that the American people don’t like the Democrats’ plan, but the President noted that those same polls show that Americans support the separate elements of the plan.  Democrats also observed that the public has been misled by Republican characterizations of the Democrats’ plan. Senator McCain also called on President Obama to remove pork provisions from the legislation, which the President said would be fine with him.

Areas of Agreement?

In his conclusion, the President stated that he had seen areas of agreement and disagreement between the Democrats and Republicans over the course of the day.  He felt that there was room for agreement about the need for insurance market reforms, sale of health insurance over state lines, the use of exchanges, perhaps even for medical malpractice. He also acknowledged that basic philosophical differences separated the parties, which probably could not be bridged.  Insuring 30 million more Americans is going to cost money, and delivery system reform is going to be difficult.  Starting over is not an option, however.  The President affirmed that he wants to work with Republicans, and would be willing to wait a month, perhaps six weeks, if necessary to reach agreement.  But he did not rule out passing the legislation by a majority vote if the Republicans were not interested.

Although I was initially skeptical about the value of this exercise, it struck me in the end as useful.  I doubt many Americans sat through the whole six hours, but if they did, they got a pretty good picture of what the Democrats are proposing and why the Republicans disagree with it.  Whether or not those Americans who did not sit through it will get an accurate picture of what transpired from the media is, of course, another question.  I did come away from the day, however, believing that the time for further debate is over, and it is now time to get the job done.  I, for one, hope the votes are there to do it.