Coalition Proposals Aim To Reduce Health Care Spending, Boost Revenue

TOPIC ALERT:

On Thursday, the National Coalition on Health Care – which consists of insurers, unions, providers, patient advocates and other stakeholders delivered a 50-page report outlining a series of proposals to cut federal health spending and raise revenue, the Los Angeles Times' "Politics Now" reports.

Coalition Members

Members of the coalition include:

  • AARP;
  • The American Heart Association;
  • The Blue Cross Blue Shield Association;
  • The California Public Employees' Retirement System;
  • Giant Food;
  • The Motion Picture Association of America; and
  • Verizon (Levey, "Politics Now," Los Angeles Times, 11/8).

Goals of Proposals

The plan pairs $220 billion in federal health spending cuts with $276 billion in tax-generated and health-related revenues, as well as broad "game changers" that the coalition says would have a "transformative effect" on federal and private-sector spending, according to CQ HealthBeat.

Coalition leaders said the proposals aim to improve health care industry performance, reduce waste and increase value. The plan also serves as an alternative to "bluntly cutting payments to providers or beneficiaries" that could be proposed during the upcoming deficit-reduction talks, CQ HealthBeat reports.

Details of Proposals

The proposals to raise revenue include:

  • An increase in federal taxes on most tobacco products, with the exception of cigarettes;
  • An increase on cigarette taxes by $1 per pack;
  • A penny-per-ounce federal excise tax on sweetened beverages; and
  • An increase in the federal liquor tax, and similar taxes on beers and wines.

The group's recommendations for spending cuts include:

  • Equalizing Medicare payments between hospital outpatient and physician offices;
  • Raising penalties for hospitals that do not eliminate avoidable readmissions; and
  • Expanding the use of competitive bidding programs to include Medicare and Medicaid durable medical equipment.

Finally, the four "game changers" the group recommends include:

  • Permanently repealing the sustainable growth rate formula used to calculate Medicare physician payments, and transitioning from a traditional Medicare fee-for-service model to a system that bases payments on the value of services;
  • Shifting to a value-based insurance model through which consumers will be urged to select treatments that are higher in value by reducing copays or cost-sharing for those services;
  • Investments in training a broader range of providers who would be able to participate in team-based primary care; and
  • Altering medical liability laws and expanding "safe harbor" polices for providers who follow evidence-based guidelines (Norman, CQ HealthBeat, 11/8).

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