Proposals: Health Care and the Federal Deficit

Here are some proposals being made to help the Super Committee reduce the federal deficit by $1.2 trillion.  Take a look, share with friends, and take our survey to let us know what you think about them!  

How can we cut federal health care costs while maintaining or improving quality and access to care for our patients?  Rate these ideas and share your own today.


#1: Decrease the new Prevention and Public Health Fund by $3.5b to $13.8b over ten years 

The ACA created a Prevention and Public Health Fund of $20 billion to prevent chronic diseases, of which $2.8 billion has already been spent on state and local prevention projects. The proposed measure reduces remaining funding amount to $13.8 billion, saving net $3.5 billion.

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#2: Require prior-authorization (computer-based and automated) for CT/MRI/Nuclear Medicine for Medicare beneficiaries 

Require physicians to obtain prior authorization for advanced imaging studies. Authorization would be automated via a computer program that assesses appropriateness based on defined criteria for the stated
indication, with radiologist oversight of ordering provider appeals. This measure is estimated to save $1.1billion over 10 years, although the efficacy of existent similar programs is controversial.

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 #3: Increase premiums for Medicare Part B & D by 15% for beneficiaries with incomes over $85,000 for individuals and $170,000 for couples 

Increase income-related premiums for Medicare Part B & D plans by 15%.  These would save an estimated $36 billion over 10 years while increasing premiums for beneficiaries with incomes over $85,000 for individuals and $170,000 for couples. 

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#4: Strengthen the independent payment advisory board’s power to change Medicare reimbursement rates to keep health inflation down to 0.5% above GDP 

Currently, Congress has to explicitly approve any proposed changes to Medicare reimbursement rates. To surpass the political friction that typically develops, the ACA created the Independent Payment Advisory
Board (IPAB), which would have authority to enact updates to Medicare reimbursement without direct Congressional approval with the explicit goal of reducing Medicare cost. Congress would retain ability to
override specific IPAB recommendations. The proposed measure is to strengthen IPAB, whose existence is a source of controversy, by lowering its target rate for Medicare cost growth to GDP + 0.5% (current target is GDP + 1%). Also, IPAB would be allowed to consider value-based assessment measures and enforcement.

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#5: Charge home health co-payments of $100 per service (PT, OT, wound care) that lasts for longer than 5 visits without a prior hospital stay.

 A $100 copayment would be added for home health visits. These copayments would apply for care sessions involving 5 or more visits and only when those sessions are not preceded by hospitalization or other inpatient stays.  For example, a patient who receives PT, OT, wound care, and IV antibiotics for 2 weeks would pay $400. This provision is estimated to save $400 million over 10 years.

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#6: Improve access to generic meds and biologics by a) preventing pharmaceutical companies from paying generic companies to delay release of generics and b) shorten the time period before generic biologics can be release from 12 to 7 years  Directly tackles the high cost of prescription drugs via two regulations designed to ease the flow of cheaper generic medications, particularly the often prohibitively expensive biologic medications often used by rheumatology and oncology patients. Currently, “pay for delay” agreements between pharmaceutical companies trade cash payments for the delayed release of generic drugs into the marketplace. Elimination of these agreements, alongside shortened exclusivity periods before generic biologics can be legally developed, may result in savings of $7.2b over 10 years.

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#7: Accelerate the state waiver program for states that devise programs as effective at increasing coverage as the ACA to begin in 2014 instead of 2017

Enables the states to opt out of ACA-designated federal insurance reforms in lieu of individual, state-driven insurance reforms per the ACA’s “State Innovation Waiver” program, moving up the start date to 2014. States must cover at least as many residents as the ACA would provide absent a waiver, using only funding already appropriated by the ACA. Budget neutral.

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#8: Blend the Medicaid and CHIP rates for the amount the federal government contributes to each state - creating one rate for all facets of both programs to decrease government administrative costs

Streamlines federal matching payments to the states for Medicaid and SCHIP coverage by shifting to a unified matching rate for each state, designed to fund both programs. May result in savings of $14.9b over 10 years.

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#9: Change payment to rural providers from current 105% back to 100% of the regular Medicare rates

Equalizes payments to hospitals and providers in rural and non-rural settings alike via elimination of certain overpayment to rural hospitals/providers above 100% of reasonable costs. Also refines the definition of Critical Access Hospitals to exclude hospitals within a 10mi radius of one another. May result in savings of $6b over 10 years.

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