Offers Suggestions on How to Bring the Grade Up to an A
WASHINGTON, Sept. 21 – When it comes to cutting costs, Senator Max Baucus (D-MT) and his health care plan get only a B-. But if Senators do their homework during the Senate Finance mark-up this week, and the bill is improved, by the end of the week the bill could still earn an A.
Health policy experts at the U.S. Public Interest Research Group evaluated the controversial Baucus bill to determine if it delivers what Americans want and need most from health reform: lower health care costs.
U.S. PIRG Health Care Advocate Larry McNeely and his colleagues across the nation looked at how aggressively the legislation attacks the key causes of skyrocketing health care costs: uncompetitive insurance markets, high administrative costs, skewed incentives that discourage high-quality, cost-effective care, and the lack of unbiased research about which drugs or treatments work better.
Overall grade?
Just a B-, but with a potential to reach an A… but only if the Senators make the improvements suggested below.
“This compromise bill is not perfect, but with the right amendments in the Finance Committee this week, it could deliver what Americans want from health reform: lower costs, better choices and increased security,” McNeely said.
Baucus Bill Report Card Summary
Overall grade: B-
Detail Current Grade
Skewed Incentives A-
Studying What Works Best B+
Uncompetitive Insurance Markets D+
High Administrative Costs C+
Here's how our experts graded Senator Max Baucus’ proposal:
Skewed Incentives: A-
The Baucus plan includes aggressive payment reforms such as value-based purchasing, bundled payments and physician feedback programs. These reforms would reward quality of care, not just the number of tests and procedures. Critically, the plan also proposes a Medicare Commission that would insulate payment policies from special interest politics, as well as preserve Medicare for the future. A range of amendments could strengthen these already excellent provisions and improve this grade to an A+.
Studying What Works Best: B+
The bill establishes a permanent home and funding stream for comparative effectiveness research, ensuring that doctors can rely on the best science in helping patients make their care decisions, not the latest propaganda from an industry sales representative. While a strong start, the House bill's alternative language gets an A for applying more protective conflict of interest requirements to board members overseeing the research studies.
Uncompetitive insurance markets: D+
While the plan does include a health insurance exchange for small businesses and individuals which will allow them to pool their bargaining power and get a better rate for their coverage, it does not sufficiently increase competition in insurance markets. Also, unlike the House bill and the Senate HELP bill, it does not include a public health insurance option that would keep insurers honest through competition on a level playing field. Several proposed amendments could significantly improve this grade by creating a public health insurance option within the exchange.
High Administrative Costs: C+
The bill does call for simplified, less expensive electronic transactions between providers and insurers, and meshes well with the Health Information Technology programs in the American Recovery and Reinvestment Act. However, the Baucus plan does not yet include insurer efficiency standards requiring premium dollars to be spent on care not administrative overhead and executive compensation. Senator Ron Wyden (D-OR) has offered an amendment that would include such a standard and bring this grade up to a B+.
Overall Grade on Costs: B- now, but with the potential for an A- or A+ if the Finance Committee the improvements identified above.
“Of course, costs are not the only issue in health reform. Affordability, consumer protections, care quality, and access to coverage are also critically important. But as the debate proceeds, let’s not forget about the skyrocketing cost of care,” McNeely said.
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U.S. PIRG, the federation of state Public Interest Research Groups, is a non-profit, non-partisan public interest advocacy organization. For more information visit http://www.uspirg.org
For more on U.S. PIRG’s health care reform campaign, click here.
