The Users' Guide to the Health Reform Galaxy

CBO's scoring window: why it matters

Michael J. O’Grady, PhD, a senior fellow at the National Opinion Research Center at the University of Chicago, writes about the Congressional Budget Office and how it scores proposals.  The CBO recently issued a price tag for the Senate Finance bill on health reform that is being voted on right now.

The current debate our country is having about overhauling our health care has highlighted the sometimes challenging interaction between the worlds of budget policy and health policy.  One such interaction is the issue of scoring windows.  The Congressional Budget Office (CBO), the official scorekeeper of reform proposals, typically projects spending for a 10-year period.  However, on September 14, Senator Kent Conrad (D-ND), Chairman of the Senate Budget Committee, requested that CBO provide a twenty—year estimate of the Senate Finance Committee bill.  He was right to do so, and here’s why.

First, let’s talk about why CBO moved from the original 5-year window to the current 10-year window.  The shift occurred for a number of reasons.  The Budget Committees began looking at a longer time horizon.   In the FY 1994 Budget Resolution Congress established a 10-year budget “point of order” in the Senate.  Then in 1995, Speaker Gingrich introduced a seven year balanced budget plan, adding further momentum to estimate budget impacts beyond the five-year window.  By 1996, CBO released its first 10-year budget baseline.

Replacing the shouts of recess with the deliberations of research

Jim Marks continues the discussion about how prevention can be scored.  This post first appeared here as part of Jim's ongoing gig with the Huffington Post. 

During the August congressional recess much of the coverage on health care reform has been spent showing us the cacophony of shouts and yells heard around the country during Town Hall meetings.

But at the same time, with less fanfare and attention, a more measured and productive conversation has been occurring. One that actually has the potential to help make us a healthier country AND provide us with a more cost effective system of care.

Since my August 5 post, “What If Benjamin Franklin Ran the Congressional Budget Office?,” there has been growing interest and attention surrounding the methods of the Congressional Budget Office for scoring costs and savings in general and more specifically as it relates to health reform.

The path between the rock and the hard place

Arnold Milstein writes about the unnecessarily hard choice impeding health reform.  The views he expresses here do not represent those of any organizations with which he is affiliated.

Some Congressional observers are gloomy about the prospects for health reform legislation that could get most people covered. Bedeviling the current political debate is a belief that a “pay-go” Congress committed to debt control must make a choice between extending expanded health insurance coverage and avoiding unpopular tax increases or indiscriminate Medicare fee cuts.

The perception of an inescapable trade-off is flawed: there is a technically achievable and politically viable path between the rock and the hard place.  That path is incentivizing greater efficiency in how we deliver care without sacrificing quality improvement or biomedical innovation.

What if Benjamin Franklin ran the Congressional Budget Office?

Jim Marks writes about CBO scoring of prevention in health reform.  This post also appeared on The Huffington Post today.

While Congress is now its August recess, the country will continue to grapple with a health reform package that is likely to be significantly different from the earlier versions. Among the catalysts for the ongoing debate was the Congressional Budget Office (CBO) estimate of the projected price tag of over $1 trillion for the original proposal that almost ground the prospects of real reform to a halt. 

The CBO was established 25 years ago to “provide Congress with objective, non partisan, and timely analysis to aid in economic and budgetary decisions….” It has turned out to be a powerful voice in the discussions of many important bills.

Within its roles and responsibilities, however, lies a very significant limitation:

According to CBO’s cover letter to the original scoring report “Health Care Reform and the Federal Budget”, “the CBO does not provide formal cost estimates beyond the 10-year budget window because the uncertainties are simply too great.”

Let me repeat that, according to its mandate, the CBO does not look at any return on investment beyond 10 years.

Reading tea leaves, and what could happen next

I jog a lot but have never once been inspired to run a marathon, basically because I think 26.2 miles is an awfully long distance to drive, let alone cover on my two little legs, but if I was a marathoner, I kind of think that this point, where we are right now on the prospect of health reform legislation, this point is maybe like the 20th mile or so of a person's first marathon.  Right now, the terrain still feels familiar--we've covered this ground before, in our training runs--but we are bracing ourselves for that last grueling slog to the finish line, the distance that has been heretofore far unknown to us, despite all of our preparation.  The President's urging us all to keep going, the August deadline for legislation from Senate Finance is all but shot, and his budget director has administered what appears to be a gentle admonishment to the CBO, a place that he, lest anyone need reminding, once managed himself.  I can't quite figure out if I'm reading too much or too little into this:  Orszag stated that the CBO might have overstepped because it estimated long-term savings without an analytical basis for doing so, even though it might be in his boss's interest to cite those savings while selling a health reform package that many are arguing is too expensive.  Does arguing against the long-term savings also mean, by implication, that the long-term costs estimated by the CBO should also be viewed dubiously? 

Again, this may just be muscle fatigue talking.

On another note, trying to make a 2009 deadline for health reform legislation leaves very little time for folks to wonder what the post-legislation world might actually look like.  The folks from Massachusetts have some experience to offer the rest of the country on what happens when you try to get nearly everyone covered, especially on the payment and delivery side of the equation, but there are also some important discussions about implementation that came out of the health information technology provisions in the stimulus package. 

So today we're going to start a series of posts on that subject, especially on defining "meaningful use" of health information technology for those who give care and get care.  This series was written for us by a team of people at The Health Information Technology Resource Center (HITRC) at Brigham and Women's Hospital in Boston, which provides technical assistance to RWJF’s Aligning Forces for Quality program. David K. Ahern, PhD is the Director, Judith M. Phalen, MPH is the Associate Director, and D. Matthew Brothers, is the Program Associate.

Can the future of health care be scored?

Yesterday, the Congressional Budget Office released a preliminary analysis of the Affordable Health Choices Act, the draft legislation on health reform released by the Senate HELP committee.  Although the cover letter to Senator Kennedy was couched in the language of caveats—there’s even a section called, “Important Caveats Regarding This Preliminary Analysis”—an article in the New York Times offered this observation from the the preliminary analysis, “As the president spoke at the annual conference of the American Medical Association in Chicago, it became clear that one of the major health plans on the table would cost at least $1 trillion over 10 years yet leave tens of millions of people uninsured.”

How, exactly, did this become clear?  It’s true, these deficit and uninsured estimates stuck out as the headlines of the CBO’s preliminary analysis, but as the CBO also stated, these figures did not represent a complete cost estimate of the proposal, nor was it an estimate of all of the components of the proposal, just the ones related to health insurance, nor was the legislative proposal itself complete.