In a world with a broken Congress ...
Fred Hiatt's column today calls the House's health-care reform bill "a step closer to bankruptcy." But he's not really talking about the House's health-care reform bill, which he admits the Congressional Budget Office has assessed as not only deficit neutral but deficit improving. He's talking about, first, a fix to Medicare reimbursement rates that really isn't part of health-care reform, and, second, the capacity of Congress to make hard decisions about, well, anything. Fair points both, but neither here nor there when it comes to the House legislation.
To take them in order, the $250 billion Medicare payment fix is actually the outgrowth of another bill: The 1997 Balanced Budget Act. That legislation created a payment formula for Medicare that tied the program's payments to the period's extremely low growth in health-care costs. But then cost growth accelerated again, and Republican and Democratic congresses alike began voting to reject the formula's cuts. Bringing the formula back into line with the growth of health-care costs will require a hefty $250 billion. But we'd have to do it whether President Obama pursued health-care reform or not. Just ask President Bush, who had no interest in health-care reform, but saw Congress reject these payment cuts in 2003, 2005, 2006, 2007 and 2008.
Hiatt's more compelling objection is that Congress will continue to duck the hard questions of health-care reform and vote to avoid making the cuts and reforms that are written into the bill. As he says, "history suggests that legislators will not be deaf to the complaints of seniors and those who treat them when it comes time for the ax to fall."
This may be true. The problem, however, is that it obviates any possible solutions. For instance: In the final line of the column, Hiatt proposes that "Obama puts his clout behind the progressive ideals of thrift and cost containment." Elsewhere in the column, Hiatt laments that Congress did not "end the tax break for employer-provided insurance" or "empower an independent commission that could make cost-control decisions" or "rais[e] taxes on anyone who earns less than $250,000 per year." But if Congress will simply thwart any effort at cost containment, what's the point?
Taxes can be rolled back (see the Bush tax cuts) or indefinitely delayed (see the AMT). Commissions can be ignored or overturned. Cost controls can be repealed and weakened. I'm not necessarily arguing that Hiatt's pessimistic conception of Congress is inaccurate, but the appropriate response is either nihilistic or revolutionary. It cannot, however, be to propose different and harder cost controls than the ones Congress itself has passed.
Meanwhile, in a world where Congress cannot make the hard decisions to avert fiscal catastrophe, health-care reform hardly matters. As Uwe Reinhardt has noted, a trillion-dollar health-care bill would be less than 1 percent of the GDP America is expected to produce between 2010 and 2020. In that world, health-care spending, alongside the general growth in the state, will bankrupt the country. If Congress passes this bill and then repeals all of the cost controls and moves the day of reckoning forward by a matter of months, that hardly seems meaningful. And, on the bright side, tens of millions more Americans will have health-care insurance between now and the day when the republic collapses.
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