Kent Conrad: 'This (health care) bill is ... not the status quo'

  • Article by: JILL BURCUM , Star Tribune
  • Updated: September 21, 2009 - 11:45 PM
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Sen. Kent Conrad

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Working behind closed doors all summer was the U.S. Senate's so-called "Gang of Six,'' a small group of Democratic and Republican senators who became the last, best hope to fashion a bipartisan health reform bill. North Dakota Sen. Kent Conrad, a Democrat, was a member of this select group, the proposals of which are expected to become the blueprint for any reform passed this fall. The committee is led by Montana Democrat Sen. Max Baucus, who released the bill last week. All 23 members of the Senate Finance Committee are set to weigh the legislation this week. Editorial writer Jill Burcum followed up with Conrad via e-mail:

QCritics contend the Senate Finance Committee's health care reform bill doesn't go far enough to increase coverage and cut costs, that it's simply the "status quo on steroids.'' Is that fair?

AThat is not a fair assessment. This bill is certainly not the status quo. The Baucus health care reform proposal is fully paid for. It expands coverage to 94 percent of Americans and, most importantly, it begins to bend the health care cost curve in the right way.

The independent analysis of the Congressional Budget Office shows that the Baucus health reform bill would reduce the deficit by $49 billion over the first 10 years and would save about half a percent of GDP over the second 10 years, which translates into over $1.3 trillion dollars in deficit reduction. For those who are insured, this bill dramatically improves insurance markets by banning preexisting conditions [as a basis for denying coverage], barring plans from dropping coverage or charging higher premiums based on health status, capping out-of-pocket liability, and getting rid of lifetime or annual limits on coverage.

QCan you provide more detail on how $500 billion in savings will be wrung from the Medicare program over the net decade?

AThe bill saves money by reforming our reimbursement system to focus on quality, rather than simply rewarding more procedures even when they don't do anything to improve health care. It eliminates excess payments to insurance companies in Medicare Advantage, where some plans charge the taxpayers one and a half times as much to take care of each senior as it would cost if those seniors were in the regular Medicare program. And, because health providers will get a huge infusion of new revenue from the 30 million new patients who will have insurance under the bill, they have agreed to accept modest cuts in Medicare reimbursement to help pay for health reform.

QShould seniors worry about a reduction in benefits? And could cuts in Medicare payments, which are typically less than what private insurers pay, unfairly penalize already efficient Midwestern providers?

ANo. The bill does not cut any benefits that seniors receive in Medicare. In fact, by making Medicare more efficient, this bill actually will reduce Part B (physicians' services) premiums and extend the life of the Medicare trust fund, which will help keep this critical program in place for seniors for years to come. On providers, it makes no sense that our [Midwestern] providers provide above-average care but get below-average Medicare reimbursement. That's why I've fought to ensure that the plan we are developing would reward high-quality, low-cost, efficient providers more commonly found in the Midwest.

By rewarding value instead of volume, this bill will begin to erase some of the inequities in current Medicare formulas that have hurt our efficient providers. Reforms that pay for quality outcomes, instead of simply utilization, are a key piece of the Baucus reform bill. I have maintained from day one that this is the direction our nation needs to be going. That's the kind of reform our nation needs.

QOne of the bill's key components involves allowing cooperatives, rather than the federal government, to sell insurance in competition with private industry. The Congressional Budget Office's Doug Elmendorf recently said of them: "They seem unlikely to establish a significant market presence in many areas of the country." Do you agree, and do you continue to believe that cooperatives deserve to be part of the bill's key reform strategies?

AI do not agree with the Mr. Elmendorf's assessment on co-ops. Based on the advice of leading actuaries, we are providing enough federal seed money for these co-ops to insure 12 million Americans. That means that they collectively would be the third-largest health insurer in the country and would certainly have a significant market presence. In fact, one expert has stated he believes co-ops would have an 8 to 10 percent premium pricing advantage over existing health insurers.

One of the most divisive issues in health reform is whether Americans should have the option of a new government-run health plan. Whatever its merits, the so-called public option cannot get 60 votes in the Senate [the number needed to overcome a filibuster]. Its inclusion could doom the larger health reform effort, and wipe out the insurance market reforms, cost savings and coverage expansion it promises. As a result, I was asked to develop a compromise. My proposal would create health care cooperatives to provide competition for the private insurance industry. The co-ops would be a public-interest alternative, but consumer-controlled, not government-run.

QThis so-called "bipartisan bill" doesn't appear to have bipartisan support. Will you vote for it? And, given that even the Republicans on the "Gang of Six" appear unlikely to vote for it, should Democrats consider a new strategy, one that basically goes for broke, putting back in elements such as the public option that were sacrificed in the name of compromise?

AHealth care is an issue that impacts all Americans, Democrats and Republicans. So the best bill would be a bipartisan bill. Because Democrats don't currently have the 60 votes needed to pass a reform bill under the normal order, every effort must be made to garner support from both Democrats and Republicans. I have said repeatedly that the mark Chairman Baucus put forth earlier this week was a very good start. Like each of my colleagues, I'll wait to see what the legislation looks like after we complete the amendment process before committing my support for it.

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