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Wonkbook: Berwick to CMS (and a comment); DOJ files against Arizona, EPA moves

Obama will use a recess appointment to appoint Donald Berwick, head of the Institute for Healthcare Improvement, to run Medicare and Medicaid after he ran into Republican opposition in the Senate. I tend to keep these Wonkbook intros pretty dry, but indulge me a quick comment on this.

I know my way around the health-care policy community fairly well. And whatever you could say about Berwick, he's not got a reputation as a liberal. Or, for that matter, a conservative. Rather, he's known as a zealot and an entrepreneur when it comes to quality improvement. As an issue, quality -- as compared to cost and access -- is quite young, and Berwick is frequently credited with securing its place in the discussion, and saving many lives in the process. As Tom Scully, who served as George W. Bush's CMS director, said, "He's universally regarded and a thoughtful guy who is not partisan.I think it's more about ... the health care bill. You could nominate Gandhi to be head of CMS and that would be controversial right now."

The quote that gave Berwick trouble was his admission that "the decision is not whether or not we will ration care — the decision is whether we will ration with our eyes open.” Only in our highly charged political discourse is this anything but a bland statement of fact. Compare it to Paul Ryan's comment to me: "Rationing happens today! The question is who will do it?" And Berwick was always clear that the patient's will should come first: "On the whole, I prefer that we take the risk of overuse along with the burden of giving real meaning to the phrase 'a fully informed patient,'" he told Health Affairs last year.

Feelings remain raw around health-care reform, but unless and until Republicans actually repeal it, and unless and until we find some way to ease the pressure Medicaid and Medicare are placing on the budget, we need not just good people running CMS, but great people. And that's true for more than just CMS: The financial reform bill is regulator-driven, and in the Minerals Management Agency, we've seen what happens when important posts are allowed to erode under bad leadership. A world in which the two parties treat all nominees as one more skirmish in their long war is a world in which the the best people will refuse nomination, and the government will be denied the talent it needs to carry out its most difficult tasks -- and that will be true both for traditionally liberal priorities like expanding access to health care and traditionally conservative priorities like reforming entitlements.

That's my piece. Welcome to Wonkbook.

Top Stories

White House spokesman Dan Pfeiffer announced in a blog post that President Obama will recess-appoint Donald Berwick to run the Centers for Medicare and Medicaid Services: "Many Republicans in Congress have made it clear in recent weeks that they were going to stall the nomination as long as they could, solely to score political points. But with the agency facing new responsibilities to protect seniors’ care under the Affordable Care Act, there’s no time to waste with Washington game-playing. That’s why tomorrow the President will use a recess appointment to put Dr. Berwick at the agency’s helm and provide strong leadership for the Medicare program without delay."

Why the post matters: http://bit.ly/cvwnr3

House Ways and Means health subcommittee chair Peter Stark on the appointment: "Dr. Berwick is one of the nation's leading experts on how to improve the quality of health care, and a recess appointment in this case is warranted."

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The Department of Justice filed its lawsuit against Arizona's immigraiton law, report Jerry Markon and Michael Shear: "Although the lawsuit cites potential 'detention and harassment' of U.S. citizens and immigrants who do not carry identification documents, it declines to make a legal argument that the law would lead to racial profiling. But a senior Justice Department official, speaking on the condition of anonymity, said that if the law takes effect, 'we will monitor it very, very closely, and if we become aware of any racial profiling or civil rights violations, that's something that we would take action on.'"

The EPA is unveiled new restrictions on power plant emissions of sulfur dioxide and nitrogen oxide, report Mark Peters and Tennille Tracy: "The emissions plan is one of several new regulations the Obama administration has advanced to curb pollution from coal-fired power plants. The EPA is working on tougher national standards for smog, first-time rules on coal-ash waste and new limits on mercury emissions. The EPA has proposed a different set of rules to use the Clean Air Act for the first time to curb carbon-dioxide emissions linked to climate change."

Art of seduction interlude: Every pickup line from Mad Men.

Still to come: The mystery of the 3.6 million missing workers; the administration is pushing to reinstate the deepwater drilling moratorium; unemployment benefits could artificially inflate unemployment numbers; unions, not corporations, are spending the most in the wake of Citizens United; and Israeli soldiers dance to Ke$ha.

Economy/FinReg

The unemployment rate may be artificially inflated because of unemployment benefits, reports Sara Murray: "The government’s unemployment rate counts only workers who say they’re looking for work. To qualify for benefits, a person has to say he or she is looking for work. When benefits were less generous - or simply unavailable - more jobless workers indicated that they had given up looking, and thus weren’t officially counted as unemployed. Michael Feroli, a J.P. Morgan Chase Bank economist, says this phenomenon may have boosted the reported unemployment rate by 1.5 percentage points."

You should also read Murray on the economic debate about unemployment insurance: http://bit.ly/a9xal3

The June drop in the unemployment rate was evidence not a labor-market recovery, but of a new class of "missing workers," reports Annie Lowrey: "Increases in the size of the United States’ population mean the labor force should have expanded by around 3.5 million workers during the 30 months between the start of the recession and last month. Instead, it has lost 128,000 people. Those 3.6 million — the ones who didn’t enter the workforce and the ones who left it — make up a class of “missing workers,” people who in better economic times would be producing goods and services, and contributing to the United States economy. Now, they do not even show up in the official counts of the unemployed and employed."

Ruth Marcus argues we can't balance the budget just by raising taxes on the rich: http://bit.ly/aT8Zkb

Sam's Club will start offering small business loans of up to $25,000, reports Mae Anderson: "Sam's Club says 15 percent of its business members reported they were denied a loan in a November survey. That's up from 12 percent in April 2009. The program will focus on minority-, female- and veteran-owned businesses. Sam's Club members who apply for a small-business loan during the pilot will receive $100 off the application fee, a 20 percent discount and a discount on interest rates."

The service sector is growing slowly: http://bit.ly/cE7O6y

And it isn't generating many jobs either: http://bit.ly/c2OnJv

Economic optimists are relying high business spending to fuel a recovery, writes Kathleen Madigan: "While I think recent data point to GDP growth slipping closer to 2%, the underlying assumptions of the 3%-plus optimists aren’t off the wall. Their projections, as well as those of some Federal Reserve officials, rely significantly on the business sector to step up as a growth leader, which will require company executives to look beyond the current uncertainty and start spending some of their accumulated cash. Swiss Re, Deutsche Bank and Morgan Stanley all belong in the camp of plus-3% growth in the second half."

Even state capitals are getting economically squeezed due to state cutbacks: http://bit.ly/9t6m71

David Leonhardt proposes five steps Congress can take to kick the economy in gear: "The Senate will hold confirmation hearings for three new Fed governors, all of whom have the potential to make it a more balanced institution. It couldn’t hurt if a few senators used those hearings to review some basic facts: inflation has been zero lately, inflation expectations are tame, 15 million Americans remain unemployed and job growth has slowed in recent months."

Indie video interlude: Cults' "Oh My God".

Energy

The Obama administration is pushing an appeals court to reinstate the deepwater drilling moratorium, report Stephen Power and Ann Zimmermann: "In a filing with the U.S. Court of Appeals for the Fifth Circuit, Justice Department officials said a six-month suspension of drilling in more than 500 feet of water is in the "long-term public interest of the nation," and is needed to give the Interior Department time to develop and implement new regulations to prevent another spill. The filing was in response to a federal judge's decision in June to block the moratorium, saying the Interior Department had trivialized the economic impact of the temporary ban."

Solar carports in parking lots are picking up steam: http://bit.ly/aULwnl

Fannie and Freddie's regulator are sinking an Obama-backed energy efficiency program, reports Nick Timiraos: "The Federal Housing Finance Agency, which regulates Fannie Mae and Freddie Mac, suggested the mortgage finance titans should avoid participating in the program or should tighten their lending standards where the initiative moves forward."

Europe is excelling at adopting renewable energy, writes Jeffrey Kluger: "According to a new report from the European Commission's Joint Research Center (JRC), fully 62% of new electrical capacity installed in the European Union in 2009 came from renewables--meaning that nearly 20% of all electricity consumed by the continent is now clean and green. Of the 62% that was newly installed, 37.1% was wind power, 21% was photovoltaics, 2.1% was biomass, 1.4% was hydropower, and .4% was concentrated solar power--solar electricity produced not from panels, but from collected sunlight that boils a fluid which in turn drives a zero-emissions turbine."

Climate change is making heat waves like the current one in DC more likely: http://bit.ly/cQgLj8

To fix the climate, we need to fix the US Senate, argues Alan Durning: "The absurdly exaggerated influence of small states in the U.S. Senate, plus the historically accidental supermajority rules under which the Senate operates, militate against sweeping reform there in any area of public policy. When the reform in question would target the petroleum and coal industries, which are political goliaths in Alaska, Montana, Wyoming, and many other small-population states, the prospects shrink further."

Public diplomacy interlude: Israeli Defense Forces troops dance to "Tik Tok".

Domestic Policy

Unions, not corporations, are spending the most in the first post-Citizens United election cycle, reports T.W. Farnam: "Several large corporate-backed groups have yet to fully open their war chests for campaign ads. The conservative group American Crossroads raised $8.5 million in June, said its president, Steven Law. 'Donors who are from the center-right side of the spectrum are going to close the gap this year,' he said. 'There's both an opportunity in this election cycle to achieve real progress and a large sense of concern in the direction of Washington.'"

State insurance commissioners are resisting a proposal to allow the HHS secretary to stop rate hikes, reports Gloria Park: "Illinois Insurance Director Michael McRaith said he does not have authority to approve or deny rates in Illinois’s exclusively for-profit health insurance market. McRaith added that although he prefers state regulation to federal regulation, federal oversight would be better than none to protect consumers. 'While I do think and will continue to think that state oversight of rates is the most appropriate vehicle for rate regulation, our objective is to assure that consumers receive value in exchange for their premium dollars.'"

The recession has led to stricter immigration policies across developed countries, reports Emmeline Zhao: "As a result, Ireland, Spain, the U.S. and the U.K. -- among others -- adopted policies that would limit immigrants’ access to the labor force. The Troubled Asset Relief Program in the U.S. discouraged banks receiving stimulus funding from hiring foreign workers, and an executive order this year created stricter regulations for foreign farm workers. Ireland discontinued work permit issuance to immigrants for low-paid positions in 2009 and created stricter rules for work permit renewals. The U.K. increased salary and education standards for non-EU high-skilled workers and passed stricter citizenship requirements."

Arizona Gov. Jan Brewer is facing criticism from neighboring governors after canceling a border states' meeting with the Mexican president: http://nyti.ms/cfWHqP

Brian Palmer explains how it got so hard to fire teachers: "Until the early 20th century, teachers had few protections. According to anecdote, they were fired for flunking the children of powerful parents, holding unpopular views, or simply getting old....The National Education Association began pushing for tenure in 1887, as a means of ensuring that employment decisions were based on merit rather than politics. Tenure also protected minority teachers in an era of weak civil rights law. But even then, school administrators worried that such a system might destroy 'the important incentive to effort which makes retention in service depend upon usefulness and ability.'"

Research suggests that starting school later can improve students' results: http://bit.ly/a41I6J

Closing credits: Wonkbook compiled with the help of Dylan Matthews and Mike Shepard.

By Ezra Klein  |  July 7, 2010; 6:28 AM ET
Categories:  Wonkbook  
Save & Share:  Send E-mail   Facebook   Twitter   Digg   Yahoo Buzz   Del.icio.us   StumbleUpon   Technorati   Google Buzz   Previous: Reconciliation
Next: The case for austerity, and our case

Comments

""The absurdly exaggerated influence of small states in the U.S. Senate . . ."

That's the nature of the body, and attempts to change that are pretty much doomed to failure. One could complain that the executive branch comes down to "one single man with an absurdly exaggerated influence over the policy direction of this country", and it would be true. Yet complaining about it accomplishes nothing, because it's inherent in our political structure and isn't going to change.

Posted by: Kevin_Willis | July 7, 2010 7:47 AM | Report abuse

Berwick is an important nomination for Obama and for health care reform. I'm so glad he went ahead and pushed him through. The Republicans really wanted to make his nomination a way to raise their issues about health reform all over again. The least known thing about Berwick, though, is that he is not a top down kind of reform guy. He truly believes in changing health care one community at a time and he has a blueprint for doing that. Whether or not he can handle the "politics" of the job is an open question especially in this very ugly environment, but I hope knowledgeable people will step up now and help him do his job.

Posted by: LindaB1 | July 7, 2010 8:07 AM | Report abuse

Ezra,

Agree totally with your analysis of Berwick. We will ration as cost will force us to and also force us all to be even more creative than we have been in the past. Over the next week or so Republicans as well will cry foul over recess appointments even though they've done them themselves. But then again Dems cried foul when Republicans did them in the past. Rationing is not the issue as much as how much rationing will be needed due to a lack of cost controls.

Posted by: visionbrkr | July 7, 2010 8:34 AM | Report abuse

Berwick may not have a reputation as a libreral, but a couple of conservative blogs are digging up these choice quotes:

"Any health care funding plan that is just, equitable, civilized and humane must, MUST redistribute wealth from the richer among us to the poorer and the less fortunate. Excellent health care is, by definition, redistributional."

Also Berwick really admires Britain's National Health Service: "I am romantic about the [British] National Health Service; I love it."

Conservatives will probably take that to mean Berwick is a liberal. Pretty much anything that's positive about wealth redistribution will be seen as being deeply liberal.

Posted by: Kevin_Willis | July 7, 2010 9:38 AM | Report abuse

Donald Berwick will deny medical services on a wider scale than any insurance CEO would ever dream.

Fact!

Democrats and liberal childless 20-somethings like Ezra Kelin never really were upset that insurance companies were denying care---they just thought that the whole operation of rationing care could be handled better by the heavy-hand of BIG GOVERNMENT!

Posted by: FastEddieO007 | July 7, 2010 9:48 AM | Report abuse

Donald Berwick will deny medical services on a wider scale than any insurance CEO would ever dream.

Fact!

Democrats and naive liberal childless 20-somethings like Ezra Kelin never really were upset that insurance companies were denying care---they just thought that the whole operation of rationing care could be handled better by the heavy-hand of BIG GOVERNMENT!

Posted by: FastEddieO007 | July 7, 2010 9:49 AM | Report abuse

"I am romantic about the [British] National Health Service; I love it."

- Donald Berwick, Obama's recess appointment to impose severe austerity of medical service rationing on the elderly....

....and whats not to love about UK's healthcare:


Question a doctor and lose your child
http://www.timesonline.co.uk/tol/life_and_style/health/article6823345.ece

'Doctors told me it was against the rules to save my premature baby'
http://www.dailymail.co.uk/news/article-1211950/Premature-baby-left-die-doctors-mother-gives-birth-just-days-22-week-care-limit.html

Daughter claims father wrongly placed on controversial NHS end of life scheme
http://www.telegraph.co.uk/health/healthnews/6156076/Daughter-claims-father-wrongly-placed-on-controversial-NHS-end-of-life-scheme.html

NHS is paying millions to gag whistleblowers
http://www.independent.co.uk/life-style/health-and-families/health-news/nhs-is-paying-millions-to-gag-whistleblowers-1812914.html

How junior doctors are signing 'do not resuscitate' forms for dying patients
http://www.dailymail.co.uk/health/article-1225323/How-junior-doctors-signing-resuscitate-forms-dying-patients.html

“If people let government decide what foods they eat and what medicines they take, their bodies will soon be in as sorry a state as are the souls of those who live under tyranny.”
Thomas Jefferson

Posted by: FastEddieO007 | July 7, 2010 10:01 AM | Report abuse

I basically agree with your assessment of Berwick and the whole appointee process. The problem is neither party can unilaterally disarm on this. Just look a the criticism Democrats got over Erroll Southers and Dawn Johnsen. It would be political malpractice for Republicans not to point these statements out.

I think the solution is, as you've said, not to make the Senate confirm all these hundreds of nominees. Political parties are going to make political issues of things, and when they have the power to stop something in a way that helps them politically they're going to do it. That's what they do. If you want something not to be a political issue, you need to take it away from the parties.

Posted by: amy130 | July 7, 2010 10:35 AM | Report abuse

Berwick is a great choice. Here's a post on him from back in April from Mark Graban.
http://www.leanblog.org/2010/03/dr-don-berwick-supporter-of-lean-healthcare-is-new-obama-appointee/

Does anyone else foresee a long term trend towards a separate public/private health care provisioning (not just payers)? Right now, the Democrats are trying to scapegoat the insurers for our high prices. Once we get some public insurance in place, we'll have to scapegoat the providers. We already have some public providers, like the VA, based on the ridiculous supposition that former soldiers need their own hospitals. As many have suggested, it's a short step to start expanding that network and opening it up to Medicare and Medicaid subscribers, especially as traditional providers are driven out of business as there are fewer privately insured individuals to keep them afloat.

Of course, one approach that drives costs down (HSAs where patient shops for value) is being systematically legislated out of existence because it threatens the dream of public hospitals to go with our public schools and uses the "money is finite" line of thinking where we don't spend millions of dollars to extend a human life for a couple of years.

Posted by: staticvars | July 7, 2010 10:38 AM | Report abuse

"But with the agency facing new responsibilities to protect seniors’ care under the Affordable Care Act, there’s no time to waste with Washington game-playing."

True, but it is always worth remembering that there is a longevity trade-off to accept with every recess appointment. The post will automatically become vacant again at the end of the next session of Congress. Berwick's challenges will be to hit the ground running and to leave a lasting mark within a relatively short time at the helm.

Posted by: Patrick_M | July 7, 2010 11:11 AM | Report abuse

--"Rationing happens today! The question is who will do it?"--

In a free country, individuals make the choices.

The holiday just past ought to be dispensed with as some quaint joke.

Posted by: msoja | July 7, 2010 11:22 AM | Report abuse

FastEddie knows the score.

Posted by: msoja | July 7, 2010 11:25 AM | Report abuse

Actually, Ruth Marcus doesn't "argue" that we can't balance the budget just by raising taxes on the rich, she just declares it. Argument would require marshaling facts in a coherent framework; instead, her response to Trumka is to say little more than "yes, the current state of affairs seems unfair, but the idea of reversing the policies that made it so is insane." (She doesn't even mention that the tax rates she describes as "insane" are less than those in effect during one of our country's periods of greatest prosperity.)

The vast majority of our current record deficits were produced by massively expensive unfunded wars, tax cuts tilted to the highest earners that were deliberately unfunded based on the twin fantasies that either they would magically pay for themselves or that they would "force" cuts in spending without the proponents having to actually make the cuts themselves, coupled with disastrous economic policies. Those who claim to be "deficit hawks" but insist that the solution is to cut non-military spending and Social Security are the ones who should be derided as insane, not those who call for reversing the policies that produced the problem.

Posted by: jimeh | July 7, 2010 1:25 PM | Report abuse

Liberals like "jimeh" are very dumb.

Setting tax rates is like setting the price of food in a restaurant. A restaurant owner can't decide, "I need more money to expand my business" and just raise his prices.

When the government raises rates there is less economic growth in subsequent years and thus less revenue overall flowing to the government.

There is an optimum price for maximizing revenues. A sweet spot.

That is how the REAL WORLD works.

Posted by: FastEddieO007 | July 7, 2010 5:16 PM | Report abuse

"Setting tax rates is like setting the price of food in a restaurant. A restaurant owner can't decide, "I need more money to expand my business" and just raise his prices."

If there is a line of customers out the door every night, you don't think the restaurant owner might edge up the price just a bit?

But of course there is no analogy to be made between a profit-driven business and the role of government. Decisions about revenues and expenditures in each case are driven by entirely different factors, but sadly FastEddieO007 does not have a handle on either, as his comment reveals.

Posted by: Patrick_M | July 7, 2010 6:38 PM | Report abuse

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Posted by: surinderoberoi28 | July 7, 2010 6:42 PM | Report abuse

--"If there is a line of customers out the door every night, you don't think the restaurant owner might edge up the price just a bit?"--

Yeah, because having a line of customers waiting to get in is such a bad thing, right, Patrick? A restaurateur definitely doesn't want to have people clamoring to get into his establishment.

No, I think the restaurant owner doesn't want to take a chance at making his customers mad by appearing to want to milk them. The business is too ephemeral and there's too much competition.

But thanks for giving us another peak into your tiny collectivist mindset, Patrick.

And your "there is no analogy to be made between a profit-driven business and the role of government" is telling, too. The point wasn't that decision making in business and government is the same, but that reaction to economic incentives or disincentives are the same, with the added complication that people don't like handing over their hard earned money for a product or service they don't want while being threatened with impoverishment or incarceration for it, and having to listen to all the hooey about it, too.

Posted by: msoja | July 7, 2010 9:09 PM | Report abuse

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