The Incidental Economist’s Don Taylor embraces some parts of Stephen Parente’s so-called grand bargain on the debt ceiling — which includes 1) ending the tax preference of employer paid insurance, 2) transitioning Medicare to defined contribution program for those under age, 3) block granting Medicaid, 4) adjusting several aspects of the ACA (lessen subsidy triggers, end taxes imposed on device makers, etc.) — noting it probably makes a lot sense to end the huge government subsidy to employer sponsored coverage. “Capping or ending the tax exclusion would greatly improve the cost-saving potential of the newly passed reform. And such a policy is flexible, and would work well alongside any imaginable change (either to the right or left) to the framework enacted by the Senate bill,” he writes.

A lot of people would agree that tying health care coverage to employment is probably not the most efficient way to pay for services and results in all kinds of inefficiencies and economic costs. But the fact of the matter is that most Americans still receive coverage through their jobs — and will continue to do so even after the Affordable Care Act is fully implemented. And even though I see the argument which says that the exchanges are a better structure for connecting people to insurance, I’d argue that this kind of change should probably be put off until after the exchanges are up and running. You want to give states and the federal government an opportunity to work out all of the kinks in the new system before you end a subsidy that encourages employers to provide stable and quite satisfactory (if you ask them) policies to their employees and force those employees to look elsewhere for insurance.

After all, if you want to learn about the consequences of sudden change, look no further than the 2003 Medicare Modernization Act, which established Medicare Part D. During the initial enrollment period, “there was confusion about which prescriptions would be covered by the enormous number of plans from which an enrollee could choose” while the “intricacies of choosing a plan and the transition of medical information overwhelmed the government computers,” which was never actually tested prior to the transition.

As a result, “Sacramento resident Randi Sanford, 50, who has cystic fibrosis, had to go without the antibiotic infusions she needed to fight an infection because the new Part D prescription drug benefit would not cover the procedure when administered at home.” “Patricia Franks, 69, of Gerber in Tehama County had to borrow blood pressure medication from a brother-in-law after her pharmacist refused to fill her prescriptions,” and “San Francisco’s Johnny Wilson, 49, who is HIV-positive, had his medication only because he had laid in a three-month supply before the new program started.” By the time he got his Medicare drug card, however, “he was down to his last pills.”

You can see these kinds of problems occurring with any sudden change of benefits, especially with something as large as the phasing out or eliminating the employer tax credit for health insurance.

ThinkProgress filed this report from a campaign event in Derry, New Hampshire

Since President Obama signed the Affordable Care Act into law last March, former Massachusetts Gov. Mitt Romney (R) has struggled to distance himself from it while also touting the strikingly similar health reform plan he signed into law while governor. Romney has attempted to paint his plan as a state solution to a state problem, saying the federal government has no role in helping the states address rising health care costs.

Romney took that criticism a step farther Thursday in New Hampshire, where he told attendees at his town hall that the federal government has “made a real mess” out of health care, causing widespread economic problems for the country:

I happen to think that around this country, by and large, where there are problems in the economy, it’s where the government has played too heavy a hand. And that’s in health care, for instance. We’ve got problems in health care. Why have we got problems in health care? Well, because government buys about half of health care. Medicare, Medicaid, government employees, they buy about half of health care. And they set the rules. And I think they’ve made a real mess of things. And now that Obamacare is starting to get (inaudible).

Watch it:

What Romney ignores in criticizing the government for buying “half of health care,” however, is that his Massachusetts plan relied on the federal government to pay for half of its own costs. He admitted as much last April, when he told Fox News’ Bill O’Reilly, “Actually, from the beginning the plan was a 50/50 deal between the federal government and the state government. The feds fund half of it, they have from the very beginning.”

Romneycare, meanwhile, remains both successful and popular in Massachusetts. More businesses are offering insurance, the state has the lowest uninsured rate in the nation, and more than 60 percent of Bay Staters support it. And despite Romney’s new-found opposition to federal involvement, none of it would have been possible without assistance from the federal government.

Health policy wonks agree that the key to controlling health care costs is moving toward a system that reimburses and encourages providers to keep patients healthy and moving away from the current fee-for-service structure that pays providers for every single procedure or pill they dispense. The problem is that nobody knows which alternative payment structures work or how exactly to structure them.

In Massachusetts, Gov. Deval Patrick’s efforts at experimenting with global payments — “in which insurers give doctors an annual budget for each patient’s ‘global’ care” — has produced mixed results and only a “modest slowing of spending growth and improved quality of care.” Still, as Dr. David Pickul, medical director of the Lowell General Physician Hospital Organization, and Dr. Philip Gaziano, president and CEO of Accountable Care Associates in Springfield — two physicians who have two years of experience with these kinds of models — argue in a post on the invaluable CommonHealth blog, the concept holds great promise, if it’s structured correctly:

Unlike so-called capitation plans of the past, it’s not a matter of an insurer saying, “We’re putting you on a budget with less money than before, so you’d better figure out how to do less.” Instead, a well-designed global payment program offers doctors and hospitals assurance that if they provide ever-higher standards of care while reducing waste and inefficiency, they will have the time and money they need to deliver better outcomes for their patients and invest in the people, systems, and technology required to continuously improve the way they practice. [...]

With timely information about our patients and relief from the piecework pressures of fee-for-service, the care team can spend more time reaching out to patients, helping them with wellness, prevention, and the management of chronic diseases or other serious medical conditions.

Some examples:

– We now pay extra attention to our patients’ medications so that they avoid adverse reactions or complications.

– We look for ways to help patients get through an illness as quickly as possible, keep them from having to be hospitalized or readmitted unnecessarily after they’re discharged, and avoid disabilities.

– We make sure that information about patients follows them when they encounter different parts of our care system so that they can get the right care more quickly, and avoid unnecessary or duplicative tests and procedures.

– Our physicians spend more time than in the past trying to help patients get their care in the most appropriate setting, and in explaining to patients what they want them to do and why.

– With monthly data available on how often tests and procedures are done, where they are done, and how much they cost, we can help direct our patients to where the care is most effectively and efficiently provided.

Under the Affordable Care Act, the Center for Medicare and Medicaid Services (CMS) will be investing in demonstration projects across the country to experiment with how different reimbursement models can help lower the costs of delivering health care services. These real-world examples and results will help shape those programs.

NPR’s Julie Rovner has a bone to pick with President Obama’s description of a proposal requiring higher income Americans to pay more for their Medicare benefits as means testing. Obama endorsed the somewhat controversial idea during his Friday press conference, but as Rovner explains, “a means test is a test to determine whether you get a particular benefit, not how much you pay for it” — Obama is “talking about something else entirely”:

Medicaid is a means-tested program. So are Food Stamps. If Medicare actually was means-tested, then wealthier people wouldn’t get the benefit at all. The context of the President’s comments make it fairly clear that he’s talking about something else entirely. It’s called “income relating.” That’s when people with higher incomes pay more but get the same benefits as people who earn less.

Medicare currently has income-related premiums for Part B of the program and, under last year’s Affordable Care Act, will begin income-relating premiums for Medicare’s prescription drug program this year.

Call it what you want, but Food Stamps and Medicaid have at least one thing in common — they’re constantly on the chopping block. That is, because these programs predominately benefit lower-income Americans who don’t have much political clout in Washington and tend to vote in smaller numbers than their higher-income counterparts, they are more vulnerable to cuts than broad based entitlements like Medicare and Social Security. “Income relating” Medicare would undercut political support for the program and help build momentum for the kind of Paul Ryan reforms that would privatize and destroy it as a government program.

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.

Anti-choice lawmakers in Kansas have “passed bills that set new licensing requirements for medical facilities that provide abortions; banned abortions after 21 weeks based on the disputed notion that fetuses can feel pain then; required minors seeking an abortion to obtain the notarized written consent of both parents or a legal guardian; restricted private insurance coverage for abortions; and redirected federal family planning funds from Planned Parenthood to other health care agencies.” Now, conservative forces in the state are pushing two more restrictive abortion measures that seek to challenge Roe v. Wade:

A petition has begun circulating for Gov. Sam Brownback to convene a special session this fall to consider a so-called “heartbeat bill” that would ban abortions when a fetal heartbeat is detected.

Another group plans to introduce a bill calling for a state constitutional amendment guaranteeing the rights of personhood to every human being from the beginning of biological development, including fertilization.

Both measures would defy Roe v. Wade, the 1973 U.S. Supreme Court decision that affirmed a woman’s right to have an abortion until the fetus would be viable outside the womb, usually at 22 to 24 weeks.

The Kansas City Star’s Fred Mann reports that both efforts stand little chance of passing, as anti-choice groups are still divided over strategy and see the bills as an overreach that could lead to setbacks in the courts. Personhood petitions, for instance, are now active in all 50 states, but no state has yet approved the measure. Proponents “were soundly defeated in Colorado twice, in 2008 and 2010″ and the measure is up for a vote in November in Mississippi.

Still, the ongoing abortion wars will continue to undermine women’s reproductive health and tax the state’s economy. Already, as Kansas slashes spending, Attorney General Derek Schmidt has hired two law firms that will be paid up to $300 an hour to defend lawsuits brought by two Kansas City area abortion providers and another filed by Planned Parenthood challenging the state’s restrictive abortion licensing laws.

Welcome to Morning CheckUp, ThinkProgress Health’s 7:00 AM round-up of the latest in health policy and politics. Here is what we’re reading, what are you?

Senate’s debt ceiling plan: “The emerging Senate compromise would build on a McConnell proposal to allow the president to raise the debt ceiling by $2.5 trillion in three increments over the next year. It would be linked to a Reid proposal to set up a bipartisan, House-Senate committee to devise a deficit-cutting plan—probably by the end of 2011, certainly before the 2012 elections, according to aides familiar with the bill.” [WSJ]

Governors worry about the consequences of default: “If the federal debt limit is not raised, several governors said as they gathered here on Friday for the semiannual meeting of the National Governors Association, the ensuing default will harm the economy, make it difficult for states to borrow money and delay some of the vital federal payments that states count on for everything from Medicaid to unemployment benefits.” [NYT]

Medicaid is still vulnerable to cuts: “Medicaid advocates remain worried that the state-federal program for low-income Americans remains on the chopping block as debt ceiling negotiations enter the final stretch,” particularly since the “Democratic leadership has at times left out any mention of Medicaid when vowing to fight entitlement cuts.” [Julian Pecquet]

Obama pushes for means testing: During his press conference on Friday, Obama said, “You can envision a situation for somebody in my position—me having to pay a little bit more on premiums or co-pays—would be appropriate, and that could make a difference,” the president said regarding means-testing for Medicare beneficiaries.” [Modern Healthcare]

Drug cuts are also on the table: “I think that it’s very important for us to keep in mind that…the drug companies, for example, are still doing very well through the Medicare program. And although we have made drugs more available at a cheaper price to seniors who are in Medicare through the [health law], there’s more work to potentially be done there,” Obama said on Friday. [Kaiser Health News]

Will IPAB ever get off the ground? “The more interesting question is whether it will ever get off the runway,” said economist Robert Reischauer, one of the public trustees overseeing Medicare finances. “Can they find 15 people willing to serve under the conditions laid out in the legislation? Will the Senate confirm them?” [AP]

Mini meds receive more waivers: “The Department of Health and Human Services in June approved 39 one-year waivers—mostly for mini-med plan sponsors—from meeting a health care reform requirement that first restricts and ultimately eliminates annual dollar limits for essential benefits. HHS said on Friday that through the end of June, 1,471 waivers had been approved for plans with about 3.2 million enrollees.” [Business Insurance]

Medicare Part D costs falling: “Cheaper generic drugs will continue to hold down costs for the U.S. government, insurers and patients enrolled in the federal prescription drug benefit, according to a report released Friday.” [Business Insurance]

State bonuses for generics: “A bipartisan group of senators on Friday introduced a bill that would offer states extra Medicaid matching funds if they increase generic drug use in the program. The bill comes as HHS pushes states, which are grappling with ongoing budget deficits, to increase their use of generic drugs to help lower Medicaid expenses.” [Inside Health Policy]

Leavitt calls for Republicans to support exchanges: “Former Utah Gov. Mike Leavitt, a top supporter and adviser of Republican White House hopeful Mitt Romney, strenuously backed the core piece of President Barack Obama’s health-care law and urged the states to move forward together in adopting health insurance exchanges.” [WSJ]

Trouble receiving primary care: “Children with public insurance are 22 percent less likely to receive comprehensive primary care than those with private insurance, according to new research from the University of Michigan Medical School.” [Medical News Today]

Crisis pregnancy center bill introduced: Rep. Carolyn Maloney (D-NY) and Sen. Robert Menendez (D-NJ) have introduced a bill entitled the “Stop Deceptive Advertising in Women’s Services Act” (SDAWS), which would crack down on clinics (so-called crisis pregnancy centers) which falsely advertise themselves as a honest providers of information and services for women facing unintended and untenable pregnancies. [RH Reality Check]

Kansas’ abortion laws are costing taxpayers: “At a time when the state is slashing spending, Kansas Attorney General Derek Schmidt is hiring outside legal guns to defend state efforts to regulate abortion. Schmidt has enlisted two law firms that will be paid up to $300 an hour to defend two lawsuits, one brought by two Kansas City area abortion providers and another filed by Planned Parenthood.” [Kansas City Star]

Grocery stores won’t eliminate food deserts: New research finds that “access to a grocery store did not affect residents fruit and vegetable consumption or the overall quality of their diet. The researchers suggest subsidizing the cost of healthy foods and reducing the number of fast food chain restaurants.” [Kaiser Health News]