Business Roundtable May Oppose Health Bill Unless Greater Cost Containment Measures Are Adopted

Business RoundtablePolitico is reporting that the Business Roundtable — a group of large businesses that have been fairly supportive of the health care reform — is pressing the administration to adopt greater cost containment measures. The group is threatening to publicly criticize the effort if the legislation is not improved. “We are going to be much louder and much more insistent on improving” the legislation, Roundtable President John Castellani told Politico in an interview on Friday.

Some of the concerns outlined below by Castellani would actually improve on the existing legislation and are already being addressed by a package of amendments offered by 10 Democratic Senate freshmen. Here is what the Roundtable wants:

Access to data collected by the Centers for Medicare and Medicaid Services that can be used to identify cost-effective treatments, efficient hospitals and best performing physicians, which could help businesses develop more efficient and effective private insurance packages for their employees.

An expansion of the authority of the proposed Independent Medicare Advisory Board so that it can search for cost savings in all health care sectors . The current legislation exempts some groups from scrutiny, including hospitals. In addition, the board [now called IMAB] should be charged to search for efficiency measures in the private sector that can replicated in the Medicare system.

An acceleration and expansion of pilot programs aimed at changing the way Medicare reimburses doctors and hospitals by providing bundled payments to cover patient testing and consultations rather than paying for each service delivered, which critics say leads to unnecessary treatment.

An exemption for self-insuring employers from a tax imposed on all insurance providers. The levy emerged at the 11th hour in the Senate deliberations.

– An adjustment or bridge that would ease the cost squeeze caused by the timing of new fees and insurance reforms and the onset of new customers.

The ‘freshmen package’ package strengthens Medicare’s ability to weed out system inefficiencies and strongly encourages the private sector to follow suit. The amendments require HHS to modernize Medicare’s data systems so they can be used by providers better coordinate care. Medicare will also be allowed to implement pay-for-performance for more providers – including hospices, ambulatory surgical centers, psychiatric hospitals and others – by 2018, and adopt greater payment flexibility for accountable care organizations.

The amendments also broaden the scope of the Independent Medicare Advisory Board (IMAB) by pushing the board to consider total health system spending and make system-wide recommendations to ensure that cuts in Medicare don’t result in cost shifts to other parts of the health system.

Like the latest CMS report, which criticized the Senate bill for not doing enough to control the growth in health care spending, the Roundtable’s “threats” should be treated as opportunities to improve the bill. Again, their concerns are valid. They should be addressed.

Rather than complain about the Senate bill’s insufficient cost containment measures, ‘moderate’ lawmakers should use this opportunity to insert even more stringent cost-control mechanisms into the final bill. Take on the providers by giving IMAB the authority to recommend payment adjustments to doctors and hospitals — after all, the health industry has already admitted to inefficiencies and pledged to reduce the growth rate in annual health spending by 1.5 percentage points a year over the next 10 years. Allow IMAB to hold them to that pledge.