Expert Advice

We hosted a conference call on Tuesday with the former parliamentarian of the Senate, Robert Dove, so colleagues and journalists could ask the authority with 36 years of experience in Senate procedures about using reconciliation to pass health reform legislation.

Dr. Dove concluded it would be a long, exhaustive process that would likely produce a Swiss cheese of legislation because reconciliation simply isn’t designed for such complex policymaking.

The Hill’s Jeffrey Young tells the story in this excellent post about the call:

The budget reconciliation process, with its arcane rules and potential for political chicanery, is not suited to healthcare reform, according to the Senate's former parliamentarian.

Reconciliation is enormously appealing to Democratic lawmakers and the White House because it would let them finish up healthcare reform by a simple majority in the upper chamber, where passing major bills usually requires 60 votes. Indeed, since Senate Democrats hold 59 seats and no Senate Republican appears eager to help the governing party pass its legislation, reconciliation could be the only way to advance the bill, which has been a year in the making and was supposed to be President Barack Obama's landmark achievement.

Not so fast, said Robert Dove, who was the chief Senate parliamentarian for 12 of his 36 years working in the office, during a conference call hosted by the conservative Galen Institute.

Though the Senate has employed reconciliation for a number of bills over the past few decades — including major economic measures backed in their time by President Ronald Reagan, President Bill Clinton and President George W. Bush — the procedural rules will not work well for healthcare reform, said Dove, now a professor at George Washington University. Dove retired from his Senate post in 2001.

"This process is not designed to do a lot of policy making and it would be very difficult to achieve a number of things that people want to achieve" in the healthcare reform legislation, Dove said. "This could be a very long, exhausting process."

Not only was budget reconciliation created and modified as a means to enact laws to reduce the deficit, which means all the provisions must result in a change in budgetary outlays, but the parliamentarian wields considerable authority to strip anything from the bill that he or she deems to be extraneous, Dove said. Dove oversaw some budget reconciliation measures in his time and, he notes, ruled out around 300 provisions from a 1995 budget reconciliation bill.

The parliamentarian can rule any provisions as "incidental" and remove it from the bill if he or she judges that its purpose is to write new policy not simply to alter the federal budget. "The 'incidental' test is a very difficult test because it is very subjective," Dove said. "You are trying to judge peoples' motives," he said. The Senate can overturn the parliamentarian's rulings with 60 votes — but if Democrats had 60 votes, they would not be using reconciliation. Dove also noted that Vice President Joe Biden, in his Constitutional role as President of the Senate, is the ultimate authority and could overrule the parliamentarian. He added, though, that "no vice president, frankly, since Nelson Rockefeller in 1975, has exercised that right.

Senators are also entitled to offer as many amendments as they choose during reconciliation. Though Democrats have a large enough majority to beat back GOP attempts to alter the bill, neither they nor the parliamentarian can limit the number of amendments introduced, Dove said.

The nonpartisan Alliance for Health Reform issued a primer on reconciliation rules Tuesday that includes links to source material prepared by the Congressional Research Service and other experts.

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Death Spiral: The Wall Street Journal gets it right with its editorial today on “The WellPoint Mugging:”

WellPoint's California unit, Anthem Blue Cross, recently informed nearly 700,000 individual insurance customers of premium increases of up to 39%. President Obama jumped on the announcement, claiming in a pre-Superbowl TV interview that the hikes were a "portrait of the future if we don't do something now."

With Congress and the administration piling on, the Journal says that Congress instead “ought to subpoena California's political class because Wellpoint's rate hikes are the direct result of the Golden State's insurance regulations — the kind that Democrats want to impose on all 50 states.”

Under federal Cobra rules, the unemployed are allowed to keep their job-related health benefits for 18 to 36 months. California then goes further and bars Anthem from dropping these customers even after they have exhausted Cobra. California also caps what Anthem can charge these post-Cobra customers.

This is an absolute prescription for a death spiral. Younger, healthier people drop coverage, leaving more older and sicker people in the pool, forcing premiums ever higher.

Anthem has postponed its rate hike pending a review. But this episode shows that there is nothing simple and easy about “health insurance reform,” as the president likes to call his plan, and that political interference is likely to make problems even worse.

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Lessons in the Snow: The crippling back-to-back snowstorms that hit Washington this month have given us some new insights into how government might respond if we expand its role in running health care:

  1. The health reform bill that passed the Senate would give huge new responsibilities to the agency that runs the health benefit program for federal employees. The bill will charge the Office of Personnel Management (OPM) with clearing health benefit plans for new health insurance purchasing exchanges that the states would establish.

    Well, the snowstorm has given us a glimpse of the OPM’s attitude toward actual people.

    OPM Director John Berry made a decision to require federal employees to return to work in Washington on Friday, even though many roads were still impassible after the blizzard two days before. The rush hour was, as a result, the nightmare commute of all time, with the city virtually gridlocked all day.

    The Washington Post reported that Berry made the decision based upon his belief that federal workers could “operate safely.”

    Convenience does not factor into this decision,” Berry said. “I knew this would be an ugly commute.”

    So here we have an admission from a Washington bureaucrat who would be making decisions about health care for tens of millions of people admitting that our “convenience” is not his concern? Sounds just like the IRS and the DMV.

  2. The City of Alexandria, Virginia, requires residents to shovel their sidewalks after a snowstorm. There is a small city park in Old Town Alexandria a short distance from the Galen Institute’s offices. This sidewalk never has been shoveled, making it virtually impassable with two feet of ice and snow, forcing people to walk in the street — which is neither safe nor convenient.

    The city isn’t going to give a ticket to itself of course, and therefore, it doesn’t have to comply with its own rules. Meanwhile, the rest of us (or our loved ones) spend hours and hours shoveling.

Just a couple of examples of government in action — or not. It still astonishes me that some people believe that government s
hould be in charge of decisions as personal and consequential as access to health care, for Heaven’s sake!

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CLIP OF THE WEEK

ObamaCare Doesn't Help Young Adults

Among the groups most significantly impacted by the Obama administration’s health reform proposal are young people, who would not only face mandates requiring the purchase of insurance, but higher health care premiums. Paul Winfree, a senior policy analyst at The Heritage Foundation’s Center for Data Analysis, looks at the economic impact of Obamacare on young people, and the resulting effects on health consumers of all ages.

GALEN IN THE NEWS

A Primer on Problems with Congress’ Health Reform Bills and a Preview of Possibilities with Patient-Centered Reform

Grace-Marie Turner
Galen Institute, 02/18/10

Turner provides a primer that may be useful to those attending the Blair House summit to answer those who still insist the Democratic leadership’s bills must be passed so they can “do something” on health reform. Independent studies show that legislation before Congress fails to achieve its most basic goals of lowering costs, allowing stability of coverage, and improving the country’s economic outlook. Turner recommends that Congress take a step-by-step approach to reform that supports what works and makes careful changes that give doctors, patients, employers, and the economy time to adjust. Read More »

HEALTH SPENDING

“Bending the Curve”: What Really Drives Health Care Spending

Jason Fodeman, M.D., and Robert A. Book, Ph.D.
The Heritage Foundation, 02/17/10

Contrary to their stated intent, the health care reform bills passed by the House and Senate would substantially increase health care spending if either became law, Fodeman and Book write. Indeed, they would make the American health care system even more inefficient and more costly by saddling an already burdened system with more mandates and higher taxes, and by exacerbating perverse economic incentives that insulate both patients and producers from normal market incentives to reduce prices and spending, and matching costs of services with value to patients. Real health reform to control costs and improve care would empower patients to purchase their own care and expand their menu of choices, and create a national market for health insurance. Read More »

HEALTH REFORM

Report Cited by Obama on Hospitals Is Criticized

Gardiner Harris
The New York Times, 02/17/10

For much of the past year, President Obama has relied on data from the Dartmouth Atlas of Health Care to lavish praise on a few select hospitals for delivering high-quality care at lower costs, but an analysis published this week suggests that the president’s praise may be unwarranted, Harris writes. The analysis, written in The New England Journal of Medicine by Dr. Peter B. Bach, suggests that much of the Dartmouth Atlas is flawed and that it should not be used to compare the relative efficiency of hospitals. The arguments are arcane, but were health overhaul legislation ever to pass, they could have profound effects on how medicine is delivered and paid for in the United States. “We are about to embark on a huge transformation of our health care system,” Dr. Bach said. “If we start with a bunch of flawed measures, it will be as devastating as putting in the wrong coordinates before a moon shot.” Read More »

Laying the Foundation for Catalytic Change

Susan Dentzer and Mark D. Smith
Health Affairs, 02/10

California HealthCare Foundation president and CEO Mark D. Smith reflects on the organization’s successes and failures in areas where market interest and public interest converge. “The policy world has built enrollment barriers for people in an incremental fashion. Every time a new program is created, there’s a new set of eligibility rules and enrollment processes and procedures…We said, ‘There’s got to be a better way.’” CHCF brought together software developers and policy experts to create web-based applications that guide low-income families through the complex process of applying for a full range of health and social service programs. These systems have built-in error checks, so applicants are prompted to make on-the-spot corrections, reducing errors by 40% and consequently speeding up the paperwork process and subsequent enrollment. Read More »

Health Care Solutions Still Depend on State Efforts

Peter J. Nelson, J.D.
Center of the American Experiment, 02/15/10

While there are certainly some health care initiatives that benefit from federal leadership (tax code reform is one), states are generally better at testing new policies and programs, Nelson writes. Though it may seem that we’ve given state laboratories of democracy more than enough time to sort this out, states are only just beginning to embark on more holistic solutions. Further, there’s enough difference among the states to warrant different approaches versus a centralized federal solution. Differences in health care delivery systems, medical education, legal environments, and cultures all point to the fact that what works in Minnesota might not work in Florida or Massachusetts. The primary role for the federal government should be to remove federal barriers that block state efforts to adopt comprehensive reforms. Read More »

Why Anthem’s Rate Hike Makes the Case for Free Market Reform

Philip Klein
AmSpecBlog, 02/12/10

The news that Anthem Blue Cross, California’s largest for-profit health insurer, was planning rate increases of up to 39% for March 1 proves why we need to scrap the liberal vision of health care legislation and move toward a market-based approach offering real choice and competition, Klein writes. Anthem’s policyholders are held hostage by the company’s rate increases as a result of existing barriers put in place by government. If you were to change the tax code, allow interstate purchasing of insurance, and remove the barriers to entry for smaller players, it would create a lot more competition in the market, and Anthem wouldn’t be able to get away with hiking rates so dramatically in California. Read More »

Impermissible Ratemaking in Health-Insurance Reform: Why the Reid Bill is Unconstitutional

Richard A. Epstein
Manhattan Institute, 12/18/09

The House health overhaul bill imposes sharp limitations on the ability of health insurance companies to raise fees or exclude coverage. This action is not only a source of real anxiety but also a decision of constitutional proportions, for it systematically strips the regulated health insurance issuers of their constitutional entitlement to earn a reasonable rate of retu
rn on the massive amounts of capital that they have already invested in building out their businesses, Epstein writes. Moreover, it forces on these regulated firms onerous new obligations that they will not be able to fund from their various revenue sources. The squeeze between the constricted revenue sources allowable under the House bill and the extensive new legal obligations it imposes is likely to result in massive cash crunch that could drive the firms that serve the individual and small-group health insurance markets into bankruptcy. Read More »

MEDICARE

Chronic Conditions Account for Rise in Medicare Spending From 1987 to 2006

Kenneth E. Thorpe, Lydia L. Ogden, and Katya Galactionova
Health Affairs, 02/18/10

The causes of Medicare spending growth have changed dramatically over the past two decades, write Thorpe et al. Twenty years ago, most of the increases were due to inpatient hospital services, especially for heart disease, but recent annual increases are the result of outpatient treatment of chronic conditions such as diabetes, arthritis, hypertension, and kidney disease. These conditions are chiefly not treated in hospitals but in outpatient settings and by patients at home with prescription drugs. Health reform must address changed health needs through evidence-based community prevention, care coordination, and support for patient self-management. Read More »

Events

Saving Freedom From ObamaCare: It Isn’t Over Yet
CPAC 2010 Panel Discussion
Friday, February 19, 2010
11:15 am
Washington, DC
Grace-Marie Turner will moderate this panel discussion.

Would the Senate Health Care Bill Keep the Poor Poor?
Cato Institute Policy Forum
Monday, February 22, 2010
12:00 pm
Washington, DC

From Crunch to Crisis: State Budgets, Medicaid and the Economy
Alliance for Health Reform Briefing
Monday, February 22, 2010
12:15 pm – 2:00 pm
Washington, DC

Why Medicare Costs So Much and How We Can Do Better for Seniors and America
Health Affairs, Peter G. Peterson Foundation, Partnership to Fight Chronic Disease, and Emory University Event
Tuesday, February 23, 2010
9:00 am – 10:00 am
Washington, DC

Are Your Medicines Safe?
Stockholm Network Event
Tuesday, February 23, 2010
12:30 pm – 2:30 pm
Brussels, Belgium

Health Care Roundtable
The Heartland Institute Event
Thursday, February 25, 2010
9:00 am – 12:00 pm
Richmond, VA

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