It’s Time to Change Course

Posted September 3, 2009 at 12:17pm

Over the August recess, many Members of Congress discovered the voters are not happy with the state of play back in Washington, D.C. There were a number of vocal — and even inappropriate — protests organized at selected town hall meetings centered on derailing health care reform proposals. But we cannot let this recent drama distract us from the real and legitimate concerns that Americans have about the costs behind the current plans. [IMGCAP(1)]There is a strong base of Americans that support the need for health care reform — I saw some of them firsthand at a speaking engagement with Sen. Susan Collins (R-Maine) just last week. However, most Americans have no idea what the long-term costs of expanding coverage will be, and a growing percentage of voters are greatly concerned with the increased overall federal spending levels.  Public opinion surveys in leading national publications over the past month have made it clear that the general public is growing increasingly concerned with escalating federal deficit and debt levels and America’s increased reliance on foreign lenders. In fact, most surveys show that voter concern over these issues is second only to the current state of the economy and far ahead of health care, climate change, the wars in Iraq and Afghanistan, and even proliferation of weapons of mass destruction. Their concern will only increase based on the updated deficit projections issued this week by the Congressional Budget Office and the Office of Management and Budget. Voters are tired of politicians who promise more than they can deliver, don’t tell the whole truth and fail to practice what they preach. Despite American citizens’ demands to reduce costs and address our increasing deficit, health care reform efforts are largely punting on these issues. When will Washington wake up and get serious about taking the necessary steps to keep runaway health care costs from bankrupting more American families, and even America itself? When will policymakers stop worrying about their popularity and start making tough choices for the good of the public? The American people are already catching on to the hard truth: The current health care system is unsustainable in its present form, and more of the same is not appropriate. We must first work to reduce costs within the current structure, if we hope to afford a system that can ultimately support expanded coverage.  Some health care reform proponents claim that you must expand coverage in order to control costs. The truth is, you can’t reduce costs by expanding coverage. In fact, expanded health care coverage will serve to increase both overall costs and the costs to the government.  Some health care reform proponents say you must expand coverage in order to gain political support for the tough choices that will be necessary to control costs. That may be true, but so far, the Congress has shown little willingness or ability to take the type of steps that will be necessary to reduce health care costs and bend the health care cost curve downward rather than upward. Reducing health care costs will require some unpopular, but necessary, choices, such as moving away from fee-for-service payment systems, reducing tax preferences for employer-provided health care and decreasing taxpayer subsidies to middle- and upper-income individuals who voluntarily enroll in Medicare’s Part B (physician payments) and Part D (prescription drugs). It will also require adoption of evidence-based practices, procedures and treatments that have proven cost effectiveness, integrated practice approaches, alternative treatments, reduced administrative paperwork, electronic medical records that are owned by patients and a range of other steps can also help reduce costs, improve incentives and enhance accountability in the system over time.  It is true that we should achieve universal health care coverage for all legal residents, but what level of coverage is appropriate? It is clearly in our broad-based societal interest to have universal prevention/wellness and chronic care. Individuals also need protection against financial ruin from an unexpected catastrophic accident or illness. However, health care reform efforts propose far more generous universal coverage than this.Washington has a long track record of promising more than it can deliver and charging the difference to the nation’s credit card. Remember the Medicare prescription drug bill that was sold with a price tag of $395 billion over 10 years?  Because of exploding costs beyond the 10-year budget window, more than $8 trillion in new unfunded obligations on a discounted present value dollar basis were added by the bill. Medicare now has about $38 trillion in unfunded obligations, and this amount increases with the passage of time. Will Washington make the same mistake again in connection with the current and future rounds of health care reform? It’s time to slow down and change course on health care reform. Specifically, policymakers should scale back their health care reform efforts to proposals that can receive bipartisan support (e.g., health insurance reform). They should also enact a Fiscal Future Commission that will hold meaningful town hall meetings with truly representative samples of citizens in at least a dozen cities across the United States. This should be supplemented by a robust Web and social networking effort. This type of citizen education and engagement effort has greater integrity and a much better chance of resulting in meaningful, successful and sustainable reforms in connection with health care, tax and other key reform efforts. The time has come to state the facts, speak the plain truths, take the heat and talk about the tough but necessary actions that are needed to put our health care system as well as our nation on a more prudent and sustainable path. Americans have grown too used to hearing from elected officials that they can “have it all— and not pay for it. We must reject this siren call because it will put our ship of state on the rocks.David Walker is president and CEO of the Peter G. Peterson Foundation and former comptroller general of the United States.