Monday, June 22, 2009

NASUA Health Care Reform Update

June 22, 2009

WASHINGTON, DC – The Senate Health Education Labor and Pensions (HELP) Committee began hearings on health care reform last week amid reports of preliminary cost estimates by the Congressional Budget Office (CBO). Senator Edward Kennedy’s (D-MA) bill, the “Affordable Health Choices Act” was estimated to cost $1 trillion and cover only 16 million out of 47 million uninsured Americans. The Senate Finance Committee’s bill was estimated to cost $1.5 trillion. Neither of those proposals was complete when scored.

Finance Committee Chairman Max Baucus (D-MT), who was planning to release his draft legislation last week, delayed the release of that committee’s proposal to look for further savings. The Senate Finance Committee’s markup will also be delayed until possibly after the July 4 recess. The Senate HELP Committee, led by Senator Chris Dodd (D-CT) in ailing Chairman Kennedy’s absence, will continue its daily hearings beginning at 3 p.m. today through the end of the week. The committee’s archived hearings are available at:

House Democratic leaders from three committees of jurisdiction released an 852-page draft bill last week. It excluded provisions on how to pay for the bill due to divisions between House and Senate Democrats. Some revenue proposals include taxing employer sponsored health benefits, increasing the Medicare payroll tax, adding a “value-added” tax, and taxing soda and alcoholic beverages. The House bill includes a mandate on consumers to carry health insurance, and a mandate on employers to provide a health insurance benefit. It also provides for a public insurance option that would compete with private insurance plans.

The House Energy and Commerce Health Subcommittee will hold hearings on health reform on Tuesday and Thursday. The House Ways and Means Committee, which oversees taxes, Medicaid and Medicare, will hold a hearing on Wednesday morning in which it is expected to release some of the first revenue details for the House Democratic approach.

The President has said he would like to sign health care legislation by October, setting an ambitious timeline for Congress. To have a bill to the President by October, Democratic leaders in Congress aim to complete their committee work and vote on the bills in their respective chambers before the August recess. Differences between the final House and Senate bills – on how to fund the measure and what a public option would look like, for instance – could then be worked out in a conference committee in September. With timelines slipping in both chambers, that is proving to be an elusive goal.

NASUA will provide ongoing information about the health reform debate, the evolving health reform proposals, and instructions for advocacy efforts in upcoming email alerts. Please also check out the Project 2020 blog for updates on our legislation and health care reform.

Thursday, June 18, 2009

Surface Transportation Act of 2009

House Committee on Transportation and Infrastructure Chairman James L. Oberstar (D-MN) has released a white paper to outline plans for the new surface transportation authorization bill. The authorization bill is currently being drafted and will replace the current authorization, SAFETEA-LU, which is due to expire on September 30. Oberstar has promised that the new authorization will transform the way the federal government invests highway, safety, and transit funds.

The Surface Transportation Act of 2009 redefines the Federal role and restructures the Federal surface transportation by consolidating or terminating more than 75 programs. The consolidation creates Highway and Transit funding, each of which have four program categories.

Within transit funding, one of the program categories is providing mobility and access to transit-dependent individuals. Many of the current programs that assist aging Americans and individuals with disabilities are slated for consolidation into the access and mobility program or termination.

Programs slated for consolidation into the mobility and access program include:
• ADA Project Action
• Elderly Individuals and Individuals with Disabilities Program Section 5310
• Human Services Transportation Coordination
• Job Access and Reverse Commute Program
• National Technical Assistance Center for Senior Transportation
• New Freedom Program

Programs slated for termination include:
• Growing States and High Density States program
• Contracted Paratransit pilot program
• Elderly Individuals and Individuals with Disabilities pilot program
• Medical Transportation Demonstration Grants
• Over-the-Road Bus accessibility program

The news conference, originally set for Wednesday, June 17, occurred instead late in the afternoon on Thursday, June 18 at in the Rayburn House Office Building.

To view the executive summary of the white paper:

To view a full list of the programs slated for consolidation or termination:

To view a video of the news conference:

Wednesday, May 13, 2009

2009 Social Security and Medicare Boards of Trustees Annual Reports

The Trustees of the Social Security and Medicare trust funds have released their annual report summarizing the financial situations of both Medicare and Social Security. The 2009 report demonstrates that both the Social Security and Medicare programs remain in challenging financial situations as costs are not sustainable given the current program parameters.

Social Security's annual surpluses of tax income over expenditures are expected to fall significantly this year and to remain steady in 2010 due to the recession. They are expected to rise for a brief period before declining again. Cash flow deficits are projected beginning in 2016 as baby boomers become beneficiaries. The deficits will be alleviated by redeeming trust fund assets until reserves are exhausted (projected in 2037), at which point tax income would be sufficient to pay about three fourths of scheduled benefits through 2083.

Medicare's financial status is worse, and will become a problem before Social Security, as its problem is exacerbated by the rising costs of health care. In 2008 and again in 2009, Medicare's Hospital Insurance (HI) Trust Fund will pay out more in hospital benefits and other expenditures than it receives in taxes and other dedicated revenues. The difference will be addressed by redeeming trust fund assets. Growing annual deficits are projected to exhaust HI reserves in 2017, after which the percentage of scheduled benefits payable from tax income would decline from 81 percent in 2017 to about 50 percent in 2035 and 30 percent in 2080. In addition, the Medicare Supplementary Medical Insurance (SMI) Trust Fund that pays provider fees and prescription drug costs will continue to require increases in costs for beneficiaries and the Federal government.

The Trustee reports concluded that both programs are facing serious financial challenges that need to be addressed quickly. Secretary Sebelius’ statement reads “this isn’t just another government report. It’s a wake up call for everyone who is concerned about Medicare and the health of our economy. And it’s yet another sign that we can’t wait for real, comprehensive health reform.”

The 2009 Trustees are:

Timothy F. Geithner, Secretary of the Treasury
Hilda L. Solis, Secretary of Labor

Kathleen Sebelius, Secretary of Health and Human Services
Michael J. Astrue, Commissioner of Social Security

There are two other currently vacant Trustee positions that are public representatives appointed by the President, subject to confirmation by the Senate.

To view a summary of the reports:

To view Secretary Sebelius’ statement on the reports:

Tuesday, May 12, 2009

Senate Finance Committee – Roundtable Discussion on Financing Comprehensive Health Care Reform

Today the Senate Finance Committee held the last of three scheduled roundtable discussions on health reform. Today’s discussion focused on financing. There will be a closed-door Committee walk-through of this third element of tentative legislation on May 20.

The major themes of the financing discussion were:

• Extensive discussion of the current exclusion from income tax of employer sponsored health care. Senator Baucus stated that the exclusion would not be repealed but that modifications should be discussed. Some of the ideas for modification included capping the exclusion or linking it to income level. Some witnesses advocated phasing it out. There was some agreement that no single mechanism exists that will finance all of health reform.
• Another issue raised in the context of using the tax code to finance reform was geographic variation in health costs and whether geographic variation in the tax burden would be constitutional.
• There was some discussion of the reasons for geographic variation in health care costs and that the adherence of physicians to evidence-based guidelines is quite low. The need for developing compliance incentives was highlighted. The existence of integrated systems (Washington, Oregon, Minnesota) was noted as a mechanism that can make a difference in controlling costs.
• Comparative effectiveness research was discussed and a number of witnesses stated that it had an important role to play in ensuring that the care paid for is of high value and results in good outcomes.
• Bundled payments to hospitals, Medicare physician payment reform, and health information technology were all highlighted as areas where reforms can improve care, health outcomes, and result in savings.
• Employers do not want to abdicate their historic role in providing health insurance to their employees. Employers do want better alignment between cost and quality. Critically important to build on employer-sponsored system.

The participants in today’s roundtable are listed below. Their written statements may be accessed at
Stuart H. Altman - Professor of National Health Policy, Heller School for Social Policy and Management, Brandeis University, Waltham, Mass.
Joseph R. Antos - Scholar in Health Care and Retirement Policy, American Enterprise Institute
Katherine Baicker - Professor of Health Economics, Harvard School of Public Health
Leonard Burman - Director, Tax Policy Center, Urban Institute
Robert Greenstein - Executive Director, Center on Budget and Policy Priorities
Jonathan Gruber - Professor of Economics, Massachusetts Institute of Technology
Michael F. Jacobson - Executive Director, Center for Science in the Public Interest
James A. Klein - President, American Benefits Council
Edward Kleinbard - Chief of Staff, Joint Committee on Taxation
Gerald M. Shea - Assistant to the President, Governmental Affairs, AFL-CIO
John Sheils - Senior Vice President, The Lewin Group
Gail Wilensky - Senior Fellow, Project HOPE
Steven Wojcik - Vice President, Public Policy, National Business Group on Health

Thursday, May 7, 2009

Senate Hearing on Medicare and Medicaid Fraud

On Wednesday, May 6 the Senate Special Committee on Aging convened a hearing titled Catch Me If You Can: Solutions To STOP Medicare and Medicaid Fraud From Hurting Seniors and Taxpayer. The hearing was convened by Chairman Herb Kohl (D-WI) and Senator Mel Martinez (R-FL), Ranking Member of the Senate Special Committee on Aging. The hearing featured five expert witnesses from across the country to testify about their experiences with Medicare and Medicaid fraud, as well as their ideas for solutions. The major themes of the hearing included:

· A focus on prevention; identifying fraud when claims are made, before payments occur

· Implementation of stricter penalties for fraud

· Improved screening of enrollees

· Improved screening of providers

· Increased transparency in Medicare and Medicaid spending

· Increased transparency of reimbursements received by providers

The witnesses were:

R. Alexander Acosta, US Attorney for the Southern District of Florida, US Department of Justice, Miami, FL

Daniel R. Levinson, Inspector General, US Department of Health and Human Services, Washington, DC

James Frogue, Project Director, The Center for Health Transformation, Washington, DC

Robert A. Hussar, First Deputy Inspector General, Office of the Medicaid Inspector General, State of New York, Hauppauge, NY

Stephen C. Horne, Vice President, Master Data Management and Integration Services, Dow Jones Business and Relationship Intelligence, Edgewater, NJ

Senator Martinez and John Cornyn (R-TX) have introduced two efforts targeted at detecting and preventing Medicare and Medicaid waste, fraud, and abuse. The Seniors and Taxpayers Obligation Protection or "STOP" Act (S.975) will work to reduce the estimated loss of more than $60 billion every year by creating fraud prevention and detection systems. The Medicaid Accountability through Transparency or "MAT" Act (S.974) will require transparency in billing for services and medical equipment.

The STOP Act would require the Secretary of HHS to implement changes to the current system of using Social Security Numbers as the Medicare Beneficiary Identifier (MBI) on Medicare cards, seeking to reduce fraud and identity theft among seniors. In addition, the STOP Act will also help to improve HHS's detection methods and place billing statements under increased scrutiny. Items such as durable medical equipment are notoriously known to be falsely billed at taxpayer expense - often by fake companies with nothing more than a P.O. Box.

The MAT Act seeks to reduce the prevalence of fraud in the Medicaid program by requiring HHS to publicly disclose the Medicaid payment data it already collects. Under the language, the Secretary shall establish a publicly-accessible Web site containing non-aggregated Medicaid claim payment data which has been fully de-identified according to HIPAA law. This information must be provided in a format that is easily accessible, useable and understandable to the public and shall be updated at least once per calendar quarter.

To view the full testimony:

To view the legislation, search the bill number (S.974, S. 975) on

Tuesday, May 5, 2009

Senate Finance Committee Holds Second Roundtable on Health Care Reform

Today, May 5, 2009, the Senate Finance Committee held the second of three planned roundtable discussions on health care reform. The topic today was “Expanding Health Care Coverage.”

While there was agreement that the individual market needs reform and that all individuals should have health care coverage, there was no agreement about how these things should be accomplished.

There was some discussion of whether a public plan should be part of reform. Those opposed to a public plan expressed concern about whether there could be a level playing field for private plans and whether a public plan could effectively coordinate care and serve those with chronic illnesses. Those in favor of the public plan option stated that they believed such a plan could be fair and that the same set of rules could be designed to apply to both public and private plans.

Expansion of existing public programs was also discussed. Expansion of Medicaid to at least 100% of the federal poverty level was supported by many of the witnesses, including those opposed to a public plan. Senator Hatch noted that in his view, such an expansion, as well as a Medicare buy-in component, equated to a public plan. He expressed concerns about crowd out, additional stresses on these programs, as well as increased costs.

There was some discussion of long term care and the need to have the reformed system reflect the desires of individuals to receive services in their homes rather than in institutions. Senator Kerry mentioned his sponsorship of the Empowered at Home Act while Senator Cantwell talked about the efficiencies that could be realized if states have incentives to focus more on providing home care.

Other topics of discussion included: Small business and its ability to offer insurance to its employees; the importance of including oral health care in health plans, and addressed cost and provision of end of life care.

The list of witnesses and links to their written statements are available on the Senate Finance Committee’s website at:
Friday, May 1, 2009

LCAO Supports Increased Funding for OAA

On April 30, the Leadership Council of Aging Organizations (LCAO) sent a letter to the Hill, supporting increased funding for Older Americans Act programs. NASUA is one of the organizations that signed on to the letter. You can review the letter on NASUA's website at