Health Care & Prescription Drugs News

WASHINGTON, Oct 22 – Consumer group U.S. Public Interest Research Group (U.S. PIRG) is lauding a little-noticed cost-containment provision in Thursday’s deal between House leadership and Representatives from states with low health care costs on the public option and Medicare rates.

Politically, the agreement cements support for Speaker Nancy Pelosi's “Medicare rates” public option proposal by addressing Medicare reimbursement rates in low cost states.

However, the deal also calls for special Congressional consideration of an independent Institute of Medicine (IOM) study on how best to incentivize high value care.  According to Larry McNeely, Health Care Advocate at U.S. PIRG, "This deal might prove to be the game-changer on cost-containment America needs"

Under a provision to be inserted into the House health care bill, the IOM would be charged with recommending how to achieve what a fact sheet released by Rep. Bruce Braley's (D-IA) office calls "the efficient delivery of high quality, evidence–based, patient centered care." 

The agreement was announced at a press conference Thursday morning featuring the Quality Care Coalition led by Rep. Braley, Rep. Jay Inslee (D-WA), Rep. Ron Kind (D-WI), and Rep. Betty McCollum (D-MN).

"If the IOM recommends a real move away from today's wasteful fee-for-service system, which pays based on volume but not on quality or value, the potential savings are vast," said McNeely. A recent roundtable of experts sponsored by IOM identified $800 billion in wasted health spending by the private and public sectors.

Unlike many Congressionally-mandated studies, the recommendations of the IOM would automatically go into effect by 2013 unless Congress issues a resolution of disapproval by February 28, 2012. 

This provision is intended to advance the Obama administration’s goal of reducing wasteful health care spending by scaling up high-quality, low cost approaches to the delivery of health care.

Each of the current House and Senate health bills, as currently written, already take some steps to study what treatments work best and test innovative models of care such as medical homes, accountable care organizations, and bundled payments in Medicare and Medicaid. The recent Senate Finance bill goes further by paying bonuses to hospitals and providers for high quality care and creating a Medicare Commission with the authority to make payment changes. McNeely added, "These are all important steps forward, and deserve inclusion in any final legislation."

But McNeely sees the potential for much more in today’s deal. "Kicking off reform with strong cost-saving payment reforms in 2013 will help get health care reform off on the right foot.  For years, special interests have blocked moves to squeeze the waste out of our outmoded fee for service system.  But if future generations achieve higher quality health care at lower costs, they may well look back at today's deal as a critical step to making that happen."

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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 Making Health Care Work campaign, click here.

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