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A Health Reform Framework: Breaking Out Of The Medicaid Model


July 10th, 2014

Editor’s note: This post is coauthored by Joseph Antos and James Capretta.

A primary aim of the Patient Protection and Affordable Care Act (ACA) is to expand insurance coverage, especially among households with lower incomes. The Congressional Budget Office (CBO) projects that about one-third of the additional insurance coverage expected to occur because of the law will come from expansion of the existing, unreformed Medicaid program. The rest of the coverage expansion will come from enrolling millions of people into subsidized insurance offerings on the ACA exchanges — offerings that have strong similarities to Medicaid insurance.

Unfortunately, ample evidence demonstrates that this kind of insurance model leaves the poor and lower-income households with inadequate access to health care. The networks of physicians and hospitals willing to serve large numbers of Medicaid patients have been very constrained for many years, meaning access problems will only worsen when more people enroll and begin using the same overburdened networks of clinics and physician practices.

It does not have to be this way. It is possible to expand insurance coverage for the poor and lower-income households without reliance on the flawed Medicaid insurance model. Opponents of the ACA should embrace plans to replace the current law with reforms that would give the poor real choices among a variety of competing insurance offerings, including the same insurance plans that middle-class families enroll in today. Specifically, we propose a three-part plan that includes a flexible, uniform tax credit for all those who lack employer-based coverage; deregulation of Medicaid; and improved safety-net primary and preventive care.

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A Senate GOP Health Reform Proposal: The Burr-Coburn-Hatch Plan


February 12th, 2014

Republican Senators Richard Burr, Tom Coburn, and Orrin Hatch recently released a blueprint for repealing and replacing Obamacare, called the Patient Choice, Affordability, Responsibility, and Empowerment Act, or the Patient CARE Act (PCA). The plan is getting significant attention from supporters and critics alike (including the editorial page of the New York Times) because both sides recognize that it is a serious effort to address the problems in U.S. health care in a manner that is strikingly different from Obamacare. The debate over the merits (or perceived drawbacks) of the PCA proposal was given further impetus by an assessment of its coverage and cost implications from the Center for Health and Economy (H&E), a new think tank headed by former Congressional Budget Office Director Doug Holtz-Eakin (and with a board including several other academics, including Uwe Reinhardt of Princeton University) and devoted to providing independent analytical assessments of major public policy initiatives.

In this short post, we describe the major provisions of the PCA, as we understand them from the descriptive material and conversations with the authors’ staffs. We also offer our views on how to think about the budgetary and coverage implications of the PCA proposal in the context of the estimates produced by H&E.

Major Provisions of the Patient CARE Act (PCA)

Repeal of Obamacare. The starting point for the PCA is repeal of Obamacare in its entirety, with the exception of the law’s Medicare provisions. We do not take the retention of the Medicare provisions from Obamacare as an endorsement of them by the authors. That would be inconsistent with the public record. For instance, Senator Coburn has proposed sweeping reforms of Medicare that differ substantially from the Obamacare Medicare provisions. The retention of the Obamacare Medicare provisions would seem instead to be an acknowledgement that it will be difficult enough politically to enact a sensible reform of the insurance market for the under age-65 population without also having to pass in the same legislation a comprehensive reform of Medicare. A reworking of Medicare is badly needed, of course, but it can be addressed on a separate legislative track from an Obamacare replacement plan.

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CBO’s Long-Term Budget Projections: The Outlook Is Even Worse Than It Looks


October 2nd, 2013

The Congressional Budget Office (CBO) issued its annual update to its long-term budget projections last month. As usual, the report is chock full of useful insights about the state of the nation’s medium and long-term fiscal position, the implications of the budget outlook for the national economy, and the primary policies and programs that influence the long-term forecast.

CBO’s bottom line? The nation is facing very significant budgetary challenges over the next quarter century, and beyond, and health care cost escalation is a primary cause of the problems.

That’s not a universally held view, though. Some commentators on the budget have suggested in recent months that the push for an additional round of deficit reduction, which the president has said repeatedly he favors, is misguided. These commentators have pointed to both the near-term improvement in the budget outlook — CBO now expects the 2013 deficit to fall to about $640 billion, down from $1,087 billion in 2012 — and the recent slowdown in health care cost inflation to suggest that existing policies are working and might be all we need to get our fiscal house in order.

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Health Policy After The Election


November 9th, 2012

In the short time that has passed since the election, there have been numerous pronouncements that the struggle over the future of American health care is now more or less settled. And it is certainly true that, over the next four years, full-scale repeal and replacement of the Patient Protection and Affordable Care Act (PPACA) is not in the cards. The president is determined to move ahead with full implementation, of course, and he will not readily sign onto major changes to his signature domestic initiative.

But the 2012 election did not produce a return to 2009. The Democrats do not have supermajority control of the House and Senate, as they did in the 111th Congress when the PPACA was passed. Indeed, in 2013 and 2014, Republicans will have a rather sizeable majority in the House, along with 45 votes in the Senate. In addition, there are now 30 Republican Governors in the states, who will have much to say about health care policy in the coming years, too. So, unlike the birth of the PPACA, its implementation will proceed at a time when Republicans are controlling many levers of power.

Moreover, the president and Congress will be forced by circumstances to address very significant budgetary questions in the coming months and years. In less than two months, the combination of tax and spending policies that constitute the “fiscal cliff” are scheduled to go into effect — against the wishes of leaders in both parties. And early next year, the federal government is again expected to bump up against the statutory limit on federal borrowing. Whether they like it or not, these events will force the president and congressional leaders to engage in a difficult and contentious discussion about how to narrow the massive gap between expected revenues and expected spending commitments in coming years.

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Super Committee Post-Mortem: Health Care Policy Is Central To Partisan Budget Divide


November 23rd, 2011

The Joint Select Committee on Deficit Reduction wasn’t dubbed the “super committee” for nothing. In theory at least, it had immense and unprecedented power.  If the select committee had been able to produce a consensus plan on deficit reduction, that legislation would have been guaranteed an up or down vote in the House and Senate […]

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Changing The Name — But Not The Political Game


July 30th, 2010

Editor’s Note: Yesterday, the Obama administration announced interim final regulations governing the temporary Pre-Existing Condition Insurance Plan created by the Patient Protection and Affordable Care Act. Below, Thomas Miller and James Capretta criticize this portion of the Act and the design of the temporary health insurance pools for high-risk individuals that it creates. For more on […]

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