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Want to Bring Down Health Care Costs? Ask the Groundhog Want to Bring Down Health Care Costs? Ask the Groundhog

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Want to Bring Down Health Care Costs? Ask the Groundhog

When it comes to bringing down the rising cost of health care, Tom Scully, former chief of the Medicare and Medicaid programs, says there aren’t any new ideas.

“The issues really haven’t changed a whole hell of a lot. Sometimes it feels like the movie Groundhog Day,” Scully told an audience at a National Journal event on health care costs on Wednesday.


The event was funded by the Blue Cross and Blue Shield Association, which pushed a set of recommendations last week asking the federal government to move faster to bring down the cost of health care.

Scully said the list of Medicare and Medicaid savings outlined by the Congressional Budget Office earlier this year were “95 percent” the same as those he had recommended when he worked in the George H.W. Bush administration.

Scully said he did not want to see the landmark 2010 health-reform law unraveled by a potential Republican White House and Congress after the 2012 election, but said he thought the law spent too much money. “I don’t have to give all people standard [Blue Cross Blue Shield] standard plan with a $250 deductible,” Scully said. “Give them very basic plan, with fairly high deductible.”


Scully said hospitals would likely be forced to write off the high deductibles if lower-income people could not afford to pay them, but that would be a far smaller bill than treating the uninsured. The solution to bringing down health care costs lies in a total overhaul of the system, Scully said.

That means offering everyone—including those on Medicare and Medicaid—a choice of about 10 private plans that are “well regulated and subsidized.” “Like it or not, I’m a rabid capitalist, and well-regulated capitalism, that’s what works. In the history of mankind, price fixing has never worked in any place, ever,” Scully said.

Scully supports a single-payer system and says the Obama administration’s 2010 health care overhaul isn’t a bad start, but says he doubts it can bring down costs quickly.

Panelists at the event also were not optimistic that the deficit super committee would bring down costs. “There is a presumption that action is good,” said John Rother, CEO of the National Coalition on Health Care.


“But most of the ideas would really just shift costs to states and beneficiaries in the name of saving government some money.” Still, federal government action is necessary, Rother said.

“It’s hard for private insurers to get doctor and hospitals' behaviors to change without Medicare or Medicaid being supportive, because that’s where the money is and that where the sickest people are,” he said.

This article appears in the October 12, 2011 edition of National Journal Daily PM Update.

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