^{Posted on April 30, 2009}

Subcommittee Members Spar Over Cost Control Tactics

By Jane Norman
CQ HealthBeat Associate Editor
CQ HEALTHBEAT NEWS
April 23, 2009

The lack of a middle ground among lawmakers on an approach to the health care overhaul was on full display Thursday as the Health, Employment, Labor and Pensions Subcommittee of the House Education and Labor Committee probed witnesses on how to cut U.S. health insurance costs now exceeding $2 trillion annually.

“We spend too much on our health care system relative to our national income and do not get the results we should,” said Subcommittee Chairman Robert E. Andrews, D-N.J. He said that he wanted to encourage a “dynamic interchange” at the hearing on how to curb costs that are rising for workers at three times the rate of their paychecks, and keeping many Americans from obtaining insurance at all.

Andrews and the subcommittee heard solutions offered that included a single-payer system similar to Canada’s; a system of “employee benefit cooperatives” that would allow small employers, employees and families to band together to buy access to affordable coverage; choices between private and public plans within a national insurance exchange; expansion of Medicaid; and making changes to increase affordability while continuing traditional group employer plans.

But Democrats John Tierney of Massachusetts and Dennis J. Kucinich of Ohio, both of whom back a single-payer plan, strongly objected that not enough time was being spent discussing private insurers and their role in rising costs. “The 800-pound gorilla in this room is unspoken, and it’s insurance companies,” said Tierney. “Everybody’s trying to find a way to keep insurance companies in business.” Congress should “find the gumption” to order insurers to spend a set percentage on providing care as opposed to administrative costs, he said.

Kucinich said that “our effort in Congress should be about health care, not insurance care,” and pointed out 70 members of the House have signed on to the single-payer plan. Yet he said from all he is hearing and reading about the debate over an overhaul, “I am deeply concerned Congress is going to miss a rare opportunity to adopt a single payer health plan.”

Ron Pollack, executive director of liberal-leaning Families USA, said it is “not likely” that insurance companies will vanish but more could be done to rein them in, including establishment of standardized benefits and reforms in the ways pre-existing conditions among patients are treated.

Another witness, David U. Himmelstein, a primary care doctor and associate professor of medicine at Harvard University who testified in favor of a single-payer plan like Canada’s, retorted: “The problem is actually the private insurer wants not to pay.” Himmelstein said lesser reforms, including a widely discussed public option accompanying private plans, could not realize the same kind of savings in administrative costs as a single-payer plan.

“While reforms that maintain a major role for private insurers may be politically attractive, they are economically and medically nonsensical,” he said.

On the Republican side, Rep. John Kline of Minnesota said, “we have wonderful health care in this country” and Canadians who can’t get health care they need wind up in his border state. Group employer plans cover 160 million Americans, he said. “We may be changing the paradigm, but we need to be very careful to do no harm and pull a thread on the sweater that is ERISA,” he said, referring to the Employee Retirement Income Security Act, which covers employee benefit plans.

Rep. Phil Roe, R-Tenn., said he wants to see access to health care improved, and care should be made portable and less costly. But he expressed the fear that’s heard often among Republicans that a public plan will lead private employers to drop their own coverage, and the government will become the primary player in health care. “If you like the way government has managed AIG, you’re going to love the way they manage your health care,” said Roe, a physician.

Rep. Phil Hare, an Illinois Democrat, extracted some agreement from the witnesses that most Americans like their health care.

“They’re happy generally until they get sick,” said Himmelstein.

Hare expressed interest in Himmelstein’s point of view and praised the veterans’ health care system as a model, while also observing “at times you swear the federal government can’t do anything right.” Whatever is done, “we’ve got to be bold and we better do it right,” he said.

Rep. David Wu, an Oregon Democrat, said it would be difficult to change health care “in a way that’s perceived as taking these health plans away.”

The discussion was a beginning, said Andrews, of how to provide a system with high quality and access for all. “This committee, the House, the Congress, the country are going to struggle with these questions,” he said.

Kline said, “There is obviously a great deal of disagreement and diversity here. . .we’ve got a long way to go here.”