The Big Shift In Health Policy You Haven’t Heard About

Throughout the health care reform debate, proponents of what eventually became the Affordable Care Act regularly complained about the Congressional Budget Office’s strict accounting standards and methods — arguing that the federal government’s accountants routinely underestimated the savings that could be achieved through delivery reforms and behavior change. The disagreement still exists today, with conservatives touting actuarial studies that don’t account for efficiency or delivery savings as proof that the health law will drive providers out of business and proponents of the law insisting that not crediting delivery changes with savings only discourages lawmakers from pursuing them (and truly reducing health care costs).

Well, last week, speaking before a conference sponsored by the U.S. Chamber of Commerce, CBO head Douglas Elmendorf suggested that the office is developing models to account for delivery efficiencies and behavior modifications, signaling what could very well be a seismic shift in how lawmakers develop health policy (via CQ Health):

“[W]e have a significant project under way at CBO around tobacco in particular, to look more carefully at the way that changes in tobacco and cigarette taxes or other sorts of federal policy toward tobacco use affect smoking, and then how those changes in smoking filter through all the aspects of the federal budget,” [Elmendorf said]

“We view that as a very important piece of work and one that we plan to apply to other sorts of policies in the behavioral area,” Elmendorf said at the July 12 conference. [...]

CBO also is analyzing demonstration programs at the Centers for Medicare and Medicaid Services testing different approaches to paying for health care, including those that aim to better manage the costs of the chronically ill.

“It turns out to be pretty hard to take ideas that seem like they ought to work, or that do work in certain contexts, and just proliferate that throughout the health care system,” he said.

CBO is “in the process of writing a review of the set of demonstration projects that Medicare has done and the results are discouraging. And that doesn’t mean that these experiments shouldn’t be tried. It does mean that just because an idea works in a certain context, or has been shown to be effective by certain groups of providers, that it can necessarily be spread throughout the health care system with the same level of effectiveness.”

The new approach will hopefully begin to recognize what lawmakers and real world experiences in some health care systems have long demonstrated: even if the CBO doesn’t see savings in delivery reform, they still exist.