House Ways and Means Committee Chairman Dave Camp (R-MI) said this morning that his committee will not take up a proposal this year to replace Medicare’s defined benefits formula with a “voucher” or “premium support” system in which seniors would shop for private coverage using defined contributions from the federal government.
Such a reform proposal was contained in the fiscal year 2012 budget resolution authored by House Budget Committee Chair Paul Ryan (R-WI) and recently approved by House on a party-line vote. However, speaking at a Health Affairs Newsmaker breakfast, Camp said he did not want to pass a plan that had no chance of surviving in the Democratically controlled Senate.
“I’m not really interested in just laying down more markers. I’d rather have the committee working with the president and with the Senate, focused on savings and reforms that can be signed into law,” the Michigan Republican said. He spoke on the day that negotiators from the House, Senate, and Obama administration began meeting on deficit reduction and entitlement reform under the leadership of Vice President Biden, although reports indicate that a grand bargain on reforming Medicare, Medicaid, and Social Security may be unlikely before the August 2 deadline for raising the nation’ debt limit, and perhaps before the 2012 elections as well.
You can listen to audio of Camp’s remarks and answers to reporters’ questions, and you also can read other accounts of the breakfast in the Associated Press, the Business Insider, The Hill’s Heathwatch Blog, the Huffington Post, Kaiser Health News, the New York Times Caucus Blog, Politico, Reuters, and the Washington Post’s Plum Line, as well as other outlets.
Camp noted that he voted for the Ryan budget, but he also expressed a willingness to listen to other ideas on deficit reduction and entitlement reform. “If Democrats don’t like premium support, fine, but come to the table with something else. Not something that tinkers around the edges, and buys the Medicare program another year or two. Bring something that will ensure that Medicare will continue to serve America’s seniors for generations to come,” he said. Health Affairs editor-in-chief and breakfast moderator Susan Dentzer asked Camp whether President Obama’s proposal for a “strengthened Independent Payment Advisory Board (IPAB) under a fairly draconian global budget target for Medicare” met this test. Camp replied that it’s an idea,” but “it isn’t a comprehensive Medicare reform proposal that guarantees the solvency of Medicare for generations to come.”
Defending the power of Congress in setting health policy. Camp added, “I haven’t been a fan of the IPAB because it delegates authority to unelected bureaucrats.” He returned to this theme when asked about the newly formed Center for Medicare and Medicaid Innovation (CMMI) and other provisions of the Affordable Care Act designed to promote innovation in care delivery and payment methods. “It’s something we ought to look at, but we need to know where that is ultimately going to lead before it’s something I can endorse.” When asked whether he would be more comfortable with the CMMI if he could set priorities for it, he answered “I would be. One of the problems with the health care bill is the massive delegation to the agencies.
Repeal and replace … or at least repeal. During the 2010 election campaign, Republicans campaigned on a platform of “repealing and replacing” the Affordable Care Act. True to the first part of that pledge, House Republicans have held several votes repealing the legislation in whole and in part, which in all but one case have died in the Senate. However, promised House efforts to develop a comprehensive replacement to the Affordable Care Act have been moribund, and Camp – while avoiding saying that these efforts were dead — did not give any indication that they would be revived. Prodded on the subject by Dentzer, Camp said only that “you pretty much know where I am on replacement because I put up a bill last year … so that’s where I am on moving forward on health care.”
Medicare Part C and Part D – two conflicting auguries for premium support? Camp said premium support was “being done to some extent already in Part D” – the Medicare prescription drug program – “so there’s a track record, and Part D is a very popular program.” Spending for Part D has tended to run lower than predicted, but the story for the existing private-plan arm of Medicare — Medicare Part C, now called Medicare Advantage (MA) — has been markedly different. MA plans have on average received a premium over what traditional Medicare pays for similar beneficiaries, and the MA program was reformed in the Affordable Care Act.
Asked whether the history of Part C augured poorly for controlling Medicare costs through a premium support or voucher model, Camp replied “not necessarily. Obviously you had a lot of those health plans going into underserved areas, whether it be urban or rural, where there were no networks.” The Ways and Means chair described a boom and bust pattern in which Medicare private plans gained popularity over a couple of years and then were scaled back to the point whether they became ineffective. “It was a mistake to scale [private plans] back to the extent that they were in the [Affordable Care Act]. Those are the sorts of things we need to continue to try as we try to transition to a more sustainable Medicare entitlement,” he argued.
A two-stage strategy for reforming Medicare physician compensation. Camp discussed his general approach to reforming Medicare’s “Sustainable Growth Rate” mechanism for paying physicians. In a series of short-term fixes, Congress has postponed large impending cuts in physician compensation, but physicians face a nearly 30 percent cut in Medicare payments on January 1, 2012.
“My idea has always been, ‘How do we get a several-year fix that gives us the time to do the permanent, long-term fix?’ … It’s very hard every year to have your back up against the wall and come up with a long-term fix.” Asked how he would pay for reforming the SGR, he answered “when we get the policy, we’ll work on the pay-for, but I don’t think you we need to go to the $300 million [needed for a permanent SGR fix] initially.”