A commission created by the Senate healthcare overhaul bill to make Medicare cost-cutting recommendations is facing some changes before final passage, including an attempt to offer up hospitals for reductions, an industry that had avoided the cutting block.
OMB Director Orszag touted the Medicare Commission Wednesday as a pillar of "fiscally responsible health reform." But he indicated the panel would be altered in response to claims that it had been weakened when Senate Finance Chairman Max Baucus promised the hospital industry it would be exempt.
"There are things as we move forward that will need to be tweaked and modified," Orszag said Wednesday at a Health Affairs breakfast. "And I know that there is significant discussion ongoing about whether the Medicare Commission, the provisions of the Medicare Commission, could be modified as the process moves forward."
Baucus exempted hospitals from the commission's purview as part of the $155 billion cost-cutting deal made with the White House earlier this year to help fund the overhaul. Other providers such as hospices that fall under Medicare Part A are exempt as well, because they are considered to be facing cuts in excess of productivity.
The American Hospital Association would oppose the inclusion of the industry in the commission's recommendations, a spokeswoman said.
Provider and congressional sources said in addition to permitting the commission to cut hospitals and other Part A providers, negotiators are discussing allowing Congress to block the commission's recommendations on a simple majority vote rather than the two-thirds vote required in the overhaul bill.
Sen. John (Jay) Rockefeller, D-W.Va., proposed the idea for the commission and is against the carve-out.
"The exception for hospitals and other providers is fundamentally counter to the goals of the original bill, and I will work to see that it is removed," he said. "A watered-down approach to fixing Medicare simply will not work."
Rockefeller is not the only one who wants the changes.
House Democratic leaders objected to the commission and one is not included in its overhaul bill passed last month. The loosened method to block the recommendations could help appease House members opposed to relinquishing their Medicare rate-setting authority.
Orszag said he would not classify the House as rejecting the panel; they just chose not to include it in their bill. "Let's let this play out," he added, referencing the conference process.
Before Congress can even contemplate a conference, the Senate needs to pass a bill.
After almost three days of floor debate without agreement, Senate Democratic and Republican leaders announced late Wednesday an agreement for four votes today.
Votes will come on a motion to recommit the healthcare bill offered by Sen. John McCain, R-Ariz.; an amendment to guarantee no reduction in Medicare benefits offered by Sen. Michael Bennet, D-Colo.; an amendment to ensure women's access to mammograms by Sen. Barbara Mikulski, D-Md., and an amendment to ensure patients receive preventive health services without government interference from Sen. Lisa Murkowski, R-Alaska.
McCain's amendment requires Democrats to find more than $400 billion to help finance the $848 billion bill somewhere other than Medicare. Republicans claim seniors' benefits will be harmed, but AARP came out Wednesday in opposition to McCain's amendment.
"AARP believes that savings can be found in Medicare through smart, targeted changes aimed at improving healthcare delivery, eliminating waste and inefficiency and aggressively weeding out fraud and abuse," AARP CEO Barry Rand wrote Majority Leader Reid. "Such changes will help strengthen Medicare's long-term financing without increasing costs for beneficiaries that make health care less affordable."
AARP gave a boost to Democrats with the endorsement of their Medicare cuts, but included a warning in the letter as well.
"However, more should be done to strengthen Medicare -- including closing the Medicare Part D coverage gap, or 'doughnut hole,' as pledged by the president," Rand wrote.
AARP waited until a final House vote was near to endorse the chamber's bill and will likely operate on the same timeline to make a decision on the Senate bill.
David Certner, AARP's legislative policy director, said Wednesday the organization is working with senators on proposals to close the doughnut hole, a coverage gap that leaves Medicare beneficiaries paying full price for their prescriptions once they are past a threshold.
"Closing the doughnut hole is the top priority for our membership," Certner said.
This article appears in the December 5, 2009 edition of NJ Daily.