Health Care Reform Celebrates Six Month Anniversary

By Kyle LaFleur - Talk Radio News Service

Secretary of Health and Human Services Kathleen Sebelius along with Senate health and finance leaders held a press conference today in Washington, D.C. to celebrate the six month anniversary of the passing of comprehensive health care reform and mark the day a number of provisions take effect.

“As Senator Harkin said, today is the day that the worst abuses of insurance companies come to an end in America,” said Sebelius, “It’s long overdue for millions of Americans who now will have some peace of mind and some health security.”

Sebelius was joined by Sens. Tom Harkin (D-IA), Chris Dodd (D-CT) and Maria Cantwell (D-WA) as they outlined some of the benefits consumers will begin seeing after today. The Senate trio touted provisions of the bill that took effect today which included banning insurance companies from denying coverage to those with pre-existing conditions and increasing the age young adults can remain covered under their parents’ plan from 23 to 26.

“I worked very hard to include in the health reform law a sharp emphasis on wellness and prevention, keeping people out of the hospital in the first place,” Harkin said. “This is good for the health of the American people and it’s our best bet for bending the cost curve downward in the years ahead.”

Obama’s healthcare reform bill has received criticism from Republicans who, as recently as today in their “Pledge To America,” vowed to repeal the plan. The bill has also remained unpopular with the American people even with the government’s addition of a website in July to help clear the air on the reform.

“I realize it’s still not popular with most Americans unfortunately but I will tell you, it will make a difference and already is in the lives of most Americans and that is what really counts to all of us here,” said Dodd.

New Bill Will Separate Commercial And Investment Banks

Travis Martinez, University of New Mexico/Talk Radio News Service

Senators Maria Cantwell (D-Wash.) and John McCain (R-Ariz.) introduced bipartisan legislation Wednesday that would prohibit commercial banks from affiliating themselves in any manner with investment banks or securities firms.

The Banking Integrity Act of 2009 would restore 1933 legislation, repealed in 1999 under legislation guided by former Sen. Phil Gramm (R-Texas), to establish a wall between commercial and investment banking to help protect depositors' money from being put at risk by Wall Street speculation.

"I'm sure that Senator Gramm probably does not agree with this legislation. It doesn't change our relationship, we just don't agree," said McCain.

“For nearly 60 years, a firewall maintained the integrity of banking systems; preventing self-dealing and other financial abuses; and limited stock market speculation,” said Cantwell during a press conference. “Our bill would return that firewall.”

Under Cantwell-McCain, major financial firms currently operating as both commercial banks and investment houses would have to make a decision on whether to focus on commercial or investment banking.

“I want to ensure that we never stick the American taxpayer with another $700 billion or even larger tab to bailout the financial industry. It is time to put a stop to the taxpayer financed excesses of Wall Street,” said McCain.

McCain brushed off concerns that Gramm, who served as a campaign adviser for the Arizona senator's 2008 presidential campaign, would be troubled by the move to sweep away his legislative accomplishments.

It's Expensive, Yes, But What is the Cost of Doing Nothing?

Coffee Brown, University of New Mexico, Talk Radio News Service

Dr. Peter Orszag, previously the Director of the Congressional Budget Office, currently the Director of the President's Office of Management and Budget, told the Senate Committee on Finance that the cost of doing nothing about healthcare reform would be fiscal crisis, decreased take-home pay, 46 million uninsured Americans, and an increasing burden on state governments which is already cutting into other services, such as increased tuition costs for college.
"Do you know of anyone in either party who wants to do nothing?" Sen. Chuck Grassley (R-Iowa) asked.
Orszag replied, "No, Sir. That's why I am confident that we can get healthcare reform passed this year."
Grassley said there was not yet any conflict between Republicans and Democrats about healthcare reform, but that that was partly because the president's budget, while "bold", was "not very detailed."

Still, $634 Billion is a lot of money.

Sen. Max Baucus (D - Mont.) said, "Would healthcare reform now lead to substantial savings?"
"Yes," answered Orzack.
"Should we accept short term deficit spending to achieve that?" asked Baucus.
Orzack replied, "The president's budget for healthcare reform is designed to be deficit neutral for the first 5-10 years, then we should begin to see savings. If we could cut one percent per year from medical cost growth, we could realize savings of 20 percent of GDP in 50 years. For forty years, medical costs have risen 2 to 2.5 percent faster than inflation."

The hearing, at which Orszag was the sole witness, turned from general costs to specific strategies.

Baucus asked, "Can we incentivize consumers to be more cost effective?"
"25 percent of beneficiaries use 85 percent of the cost. That's the group to target," Orszag replied.
"Would costs come down if everyone were covered? And how could we do that?" Baucus asked.
According to Orszag, we need to reduce consumer costs, reduce complexity, and encourage enrollment. We can encourage enrollment by subsidies, mandates, and automatic enrollment with an opt-out choice. Social norms need to change, so that people would be as shocked if you had no health insurance, as they now are if you don't buckle your seatbelt. the key to that is massive public awareness campaigns, he finished.

Grassley said he was concerned that Medicare Advantage might be cut too sharply under the new budget. Physicians might opt out of Medicare if reimbursement is too low.
Orszag said that Medicare Advantage was targeted because it paid substantially more than basic Medicare.

Expansion of the public sector would place new pressures on the private sector.

"Would a public plan undermine Obama's promise that people who prefer to can stay with their current plan? Would Obama support a plan that would 'crowd' 18 million people off private plans onto public?" Grassley wondered.

Sen. Maria Cantwell (D - Wash.) was also concerned about proposed cuts: "We've found medical homes, home care, and Medicare Advantage to be cost effective, but they face cuts under the new budget."
"Evidence strongly favors integrated care...Long term health care is in the budget...Competitive bidding should reflect local costs," Orszag replied.
He pointed out later, however, that the budget office had found that home care typically had much higher profit margins than other sectors of healthcare, and had been targeted for that reason.

Public funding means public accountability.

Orrin Hatch (R - Utah) said, "A Federal Reserve-style medical board would be a disaster, leave standards of care to the specialty boards. Keep these decisions in the private sector. We should not be be setting prices."
"Those problems are common to all the models. Both public and private systems must change," Orszag said.

Sen. Baucus closed the meeting by pointing out that time is of the essence, and the Senate must move quickly.
"We have our sleeves rolled up; we're ready to go," said Orszag.