Biotech Firms Oppose the Independent Payment Advisory Board

Today’s Managing Health Cost Indicator is 3403

Today’s Boston Globe  highlights the full court press the Massachusetts biotechnology industry is making to convince Senator John Kerry to oppose the Independent Payment Advisory Board, Section 3403 of the Affordable Care Act.  The IPAB, which is opposed by drug companies, some physicians, and the biotechnology companies, would create an independent board which would make recommendations for lowering Medicare costs if those costs continued to increase.  Congress would have to vote these recommendations up or down without amendment – like military base closings. 

The current debt ceiling debate shows how hard it is for Congress to lower the cost of the federal government – and many of the necessary solutions to our escalating health care costs will be easily subject to demagoguery like claims of “death panels” and “bureaucratic government throttling private-sector innovation.”

Henry Aaron, in this week’s New England Journal, calls the IPAB “Congress’s Good Deed.”   He says

Among the most important attributes of legislative statesmanship is self-abnegation — the willingness of legislators to abstain from meddling in matters they are poorly equipped to manage.

If the IPAB is effective, it will lower potential profits in biotechnology.  It would be hard otherwise to control burgeoning health care costs.

Kerry’s spokeswoman said

If we’re going to protect taxpayers and control costs, it seems a little bonkers to eliminate something the experts say is our best hope of doing that before we even have a chance to evaluate it

I hope Senator Kerry will stand his ground. 

RomneyCare Works.

Today’s Managing Health Care Costs Indicator is 98.1%

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There has been a lot in the national press about how health care reform in Massachusetts has worked.  There's a lot of blather on both sides of the political spectrum, and the Boston Globe had a comprehensive article today reviewing how “RomneyCare” is working here. 

Conclusions:

1) Far more people are insured than before health care reform, despite the disastrous recession (98.1%)

2) More employers (up from 70 to 76%) are offering insurance, again despite the recession

3) The exchanges work for individuals - they haven't worked well for small employers yet

4) The cost of the care of the uninsured has declined.

5) There is inadequate primary care access, and ED visits have gone up rather than down.

6) The cost has been manageable - but the state has relied on some payments from the feds (stimulus dollars and Medicaid add-on dollars) that will not continue. The federal government has paid a disproportionate share of the total cost (as it will under the Affordable Care Act).

7) Health care reform promised incremental provider Medicaid payments that have not been funded. Hospitals say they must pass these costs on to other payers, which worries employers greatly.

8) Health care reform is actually pretty popular in Massachusetts.  The last Harvard School of Public Health poll said that 63% of residents support health care reform.