Remembering Tom Foley

October 18, 2013 at 2:21 pm

A giant fell today.  Tom Foley — former House Speaker, chairman of the House Agriculture Committee, and ambassador to Japan — and the man who, along with Senators George McGovern and Bob Dole, did more than any other lawmaker to build the modern food stamp program and thereby largely eliminate severe hunger and malnutrition in America — passed away.

In this era of political smallness, Tom Foley stands out as the polar opposite.  Erudite, thoughtful, respectful of members of both parties, willing to go the extra mile for an outcome that was both bipartisan and sound, even if it meant relinquishing a partisan advantage — those were his hallmarks. … Read more

Budget Crises Taking an Economic Toll

October 18, 2013 at 12:11 pm

My latest post for U.S. News & World Report’s Economic Intelligence blog warns that, while the latest budget crisis is over, the political dysfunction that produced it persists.  And that’s bad news for the economy as well as the budget.

We’ll face another government shutdown if policymakers can’t strike a deal to fund the government after January 16th, and another default crisis later in the year if they can’t strike a deal to raise the debt ceiling (or, better yet, eliminate it). … Read more

Lowering the Cost of Medical Devices

October 18, 2013 at 9:42 am

Health reform’s tax on medical devices has survived — at least for the time being — an intense lobbying campaign to repeal it.  But as Topher Spiro writes in yesterday’s New York Times, the high prices of some medical devices raise a number of other important policy issues.

The Times reported a couple of months ago about a Colorado man whose insurance company wouldn’t cover his hip replacement because it was considered a pre-existing condition.  The artificial hip itself costs about $350 to produce, we learned, but American hospitals typically pay $8,000. … Read more

Shutdown Deal Won’t Affect Health Reform Subsidies

October 17, 2013 at 4:09 pm

Let’s clear up any confusion:  yesterday’s deal to reopen the government and raise the debt limit doesn’t change the procedures for verifying applicants’ eligibility for new federal health insurance subsidies under health reform.  That’s appropriate, since these procedures are perfectly adequate as they now stand.

Instead, a provision in yesterday’s deal requires the Health and Human Services (HHS) Secretary to certify that the new health insurance marketplaces (formerly called exchanges) are verifying eligibility in a manner that’s consistent with the requirements of health reform (i.e., the Affordable Care Act); at that point, the subsidies can start. … Read more

Greenstein on the Shutdown-Debt Limit Deal

October 16, 2013 at 4:45 pm

CBPP President Robert Greenstein has issued the following statement on today’s agreement:

The budget agreement that Senate leaders announced today marks an important victory for the principle that shutting down the government and threatening national default aren’t acceptable ways for either party to pursue policy concessions and should always be rejected.  Congress should approve the agreement without delay, and President Obama should sign it.

Fortunately, those who helped engineer the shutdown and threatened a default failed to achieve their policy goals, and their approach met strong public disapproval. … Read more

5 Things That Health Reform’s Medical Device Tax Won’t Do

October 15, 2013 at 4:43 pm

Policymakers and lobbyists pushing for repeal of health reform’s medical device tax as part of a deal to reopen the government have made numerous claims about the tax, many of which are misleading or simply false.  Below are five things that the tax won’t do.

  1. It won’t apply to wheelchairs or any other medical device that the public generally buys at retail for individual use, such as eyeglasses, contact lenses, or hearing aids.  It applies, instead, to such devices as coronary stents, artificial knees and hips, cardiac pacemakers, irradiation equipment, and imaging technology.
Read more

Tax Holiday Would Be Bad Addition to Budget Agreement

October 12, 2013 at 12:15 pm

As part of ongoing budget talks, Senate Republicans have reportedly floated the idea of “paying for” repealing at least part of sequestration with a repatriation tax holiday — that is, allowing multinational corporations to bring profits held overseas back to the United States at a temporary, vastly reduced tax rate.  But a repatriation tax holiday can’t pay for anything because it would cost billions of dollars a year, as Congress’s Joint Committee on Taxation (JCT) has found. And the last time that Congress tried this policy, it failed miserably to deliver any economic benefits.… Read more

IPAB Provides Important Backstop Against Health Cost Growth

October 12, 2013 at 11:47 am

Some Republican senators suggest that upcoming budget legislation include changes to the Independent Payment Advisory Board (IPAB) — a presidentially appointed commission created by health reform that will help to slow the growth of Medicare costs.  But repealing or weakening IPAB would be bad for Medicare’s beneficiaries, as we have written.

IPAB provides an important backstop to the other cost control measures in the Affordable Care Act (ACA).  The ACA trims payments to health care providers under Medicare’s current payment mechanisms. … Read more

In Case You Missed It…

October 11, 2013 at 3:58 pm

This week on Off the Charts, we focused on the government shutdown and debt limit debate, health reform, and the safety net.

  • On the government shutdown and debt limit debate, Sharon Parrott explained that the impact of the shutdown will increase over time.  Robert Greenstein responded to various proposals from House Republicans concerning the government shutdown and debt limit:  he noted that an offer from House Republicans was anything but a reasonable and middle-ground compromise; explained that Rep. Paul Ryan’s recent proposal outlined in a Wall Street Journal op-ed is more of what got us to this impasse in the first place; and criticized a House Republican proposal to appoint a committee to recommend ways of reducing the deficit, without raising any revenues, while the government remains shut down.  
Read more

GOP Senators Revive Fake Offset for Medical Device Tax

October 11, 2013 at 3:40 pm

Republican Senators Collins, Murkowski, and Ayotte are reportedly pushing to repeal health reform’s medical device tax — which helps pay for extending coverage to millions of uninsured Americans — as part of the price for reopening the government.  As we explained last week when a similar proposal emerged in the House on a bipartisan basis, that’s a terrible idea for several reasons.

First, the tax is sound and the arguments against it do not withstand scrutiny.

Second, the proposal purports to pay for the real cost of repealing the tax (about $30 billion over the next decade) with a fake offset:  a timing gimmick that would bring in more revenue within the ten-year budget “window” but lose significant revenue after that.… Read more

Why the Shutdown Needs to End

October 11, 2013 at 10:09 am

House Republicans unveiled a plan yesterday to raise (or suspend) the debt ceiling for six weeks but leave the government shutdown in place, raising the specter that the shutdown could continue for weeks — maybe all the way until November 22, the GOP’s proposed new debt limit deadline.  There is growing support among policymakers on both sides of the aisle to reopen the government — and here’s why ending the shutdown sooner rather than later is so vital.

Day by day, the real-world problems that the shutdown causes will grow, and more and more of the “make do” steps that federal agencies and states have used to limit the damage will run out.… Read more

Potential GOP Demand to End Shutdown Would Undermine Health Reform

October 11, 2013 at 9:49 am

Some Republican senators reportedly will seek to include a House-passed bill to delay health reform’s premium and cost-sharing subsidies in legislation that (among other things) would reopen the government.  Proponents claim this House bill is an anti-fraud measure, but its real effect would be to undermine health reform.  The bill would prevent the new insurance marketplaces (or exchanges) from operating effectively starting on January 1 by keeping millions of lower- and middle-income uninsured Americans from obtaining subsidies for which they qualify — and which they need to afford coverage.… Read more