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Health Policy Matters

Thursday, April, 28, 2011

You Won't Want To Miss This!

By Grace-Marie Turner

Our biggest conference of the year is coming up next Thursday in Washington, and you won't want to miss it. It's the third in our very successful series on the value of innovation in health care.

"Health Care 2011: Advancing Health Care by Facilitating Innovation" will be held at the Columbus Club at Union Station on Capitol Hill and features a dynamite roster of speakers, including members of Congress who are leading the charge to facilitate continued innovation, and business leaders who are in the real world developing real-time solutions to usher in 21st century medicine.

You can learn more and register to attend by visiting The day will be packed with fascinating talks about the bright promise that entrepreneurs believe is still possible in the future. Thursday, May 5, 8:30 a.m. to 1:30 p.m. Please join us!

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Town halls and polls: Public opinion poll results are wildly divergent on the Ryan plan for Medicare reform, showing alternately that 1) people understand that changes are necessary and a plurality is supportive, 2) it is hugely unpopular, and 3) the public is evenly divided.

As the YouTube videos of town hall meetings show, the public is upset and understandably confused about the barrage of unfounded charges that the plan would end Medicare and leave seniors destitute.

The loudest demand, especially from seniors, is that Medicare simply be left alone.

But that is not an option.

Medicare isn't being left alone by ObamaCare and, without a serious course adjustment, the program is facing a steep and inevitable decline. It will become a third-rate, price-controlled program that rations a lower-quality of care through waiting lines and other restrictions. Either that, or we will continue to pour money into the antiquated, open-ended, fee-for-service model for millions more baby boomers with entitlement programs consuming such high taxes that the economy will topple.

Here's what the evidence predicts for the future of Medicare under ObamaCare:

  • Under existing law, ObamaCare will reduce payments to providers such that seniors will find it harder and harder to get care. Look at the trouble that Medicaid patients have today for a preview of what it will be like for seniors. Only it will be worse because the president announced earlier this month he wants even deeper cuts in Medicare payments.

  • Rationing will ensue. The powerful, 15-member Independent Payment Advisory Board will try to squeeze Medicare payments into ObamaCare's global budget in a futile attempt to use price controls to meet ever-elusive spending targets. One of the rare points of bi-partisan agreement is the call for eliminating the IPAB board or at least strongly curtailing its powers.

  • Access to new medicines and cutting-edge medical equipment will diminish. Payment restrictions and the politicization of medical decisions will give companies less of an incentive to take the huge capital risks to invest in new products. And the government is targeting drugs and devices -- which often are the most cost-effective treatments overall -- in its futile effort to rein in spending.

  • A whopping 87% of doctors say they will stop seeing or restrict the number of Medicare patients they see, further shrinking the pool of providers and further restricting access to care.

  • According to the Congressional Budget Office's April 5 letter to Rep. Ryan, Medicare spending under ObamaCare will be only 60% of projected spending for a private plan with standardized benefits by 2030. The main reason is that the government would be able to use its price control powers to pay doctors and eventually hospitals so much less than private plans. See above for the impact on access and quality. How on earth is that protecting Medicare or seniors?

In fact, the only way to save Medicare is to change it. Educating the public about this will be the challenge of the next year and a half. Betsy McCaughey writes more about this issue in yesterday's Wall Street Journal. She asks: "Will Americans now in their 40s and 50s choose to put their health care in the hands of this cost-cutting board, or pick their own health plan when they retire?" That's the right question.

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Close the checkbook: One aspect of ObamaCare that is particularly outrageous is the unlimited spending authority it gives to HHS Secretary Sebelius to help set up the bureaucracies to implement the health overhaul law.

House Energy and Commerce Chairman Fred Upton wants to put a stop order on this blank check. The House will take up his bill (HR 1213) next week. The headline grabber in the Upton initiative would be to stop the secretary from being able to make unlimited grants to the states to set up ObamaCare's health insurance exchanges.

This is an important step in defunding the legislation by putting a stop to the law's end-run around Congress. (See Article 1, Sec. 9 of the Constitution).

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Grace-Marie Turner on Why ObamaCare Is Wrong for America

In this podcast, co-author Grace-Marie Turner discusses Why ObamaCare Is Wrong for America on The Wall Street Shuffle with hosts Dan Cofall and Dan Stewart.
Listen now >>


Doctors Should Decide When Generic Drugs Are Acceptable

Grace-Marie Turner
The Sacramento Bee, 04/22/11 (and other publications)

In any health plan, the whole point of providing a prescription drug benefit is to make sure that patients have access to medicines to treat their specific illnesses. Why, then, would some analysts recommend that state officials limit the prescription drugs available through Medicaid just to generic drugs when evidence shows those may not be the right drugs for individual patients? The motivation, of course, is costs. The top priority should be which category of drug actually works best for individual patients and would save money in the long run. For example, patients with epilepsy and mental illness are particularly at risk under an "only generics policy" because they may respond well to one drug but not to another, even though the drugs are in the same therapeutic category. Expensive complications and hospitalizations can ensue. The main point is obvious: On-the-scene doctors should be making the decisions on which medicine works best for their patients rather than government officials in state capitals and Washington. In such crucial matters, the price of a drug is a short-sighted marker for the overall cost of patient care. Cheaper may not be better -- or less expensive -- after all.
Read More »


(Mis-)Using the Tax System to Subsidize Health Spending
Joseph Antos, National Tax Journal, 12/10

Entitlements Can't Survive Unless They're Reformed
Paul Howard,, 04/21/11

The Case Against President Obama's Health Care Reform: A Primer for Nonlawyers
Robert A. Levy, Cato Institute, 04/25/11

How Health Reform Punishes Work
Daniel P. Kessler, The Wall Street Journal, 04/25/11

When the Government Talks To Your Doctor, Who's Listening?
Peter J. Pitts, The Daily Caller, 04/25/11

Obama Declares War On Medical Innovation
Peter J. Pitts, Wilson County News, 04/20/11

Innovations in Employment-Based Health Benefits
Tracey Young, Employee Benefit Research Institute, 04/11


Reforming Medicare -- Toward a Modified Ryan Plan
Gail R. Wilensky, Ph.D., The New England Journal of Medicine, 04/27/11

Medicare by the Numbers
John C. Goodman, Texas Insider, 04/19/11


RomneyCare's Unhappy Anniversary
Sally C. Pipes,, 04/26/11

R.I.'s Medicaid waiver's big influence
John R. Graham, Providence Journal, 04/23/11


Healthcare Spending and Preventive Care in High-Deductible and Consumer-Directed Health Plans
Melinda Beeuwkes Buntin, PhD, Amelia M. Haviland, PhD, Roland McDevitt, PhD, and Neeraj Sood, PhD, The American Journal of Managed Care, 03/11

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