Future Direction for

1
Future Direction for Federal Health Policy Is
Help On the Way? Kansas Legislative Health
Policy Orientation W. David Helms,
Ph.D. President and CEO January 19,
2005 www.academyhealth.org
2
Bush Agenda Big Issues

• Social Security Reform
• Tax Reform
• Likely to be pushed to second half of the term
  Administration may appoint a Commission to come
  up with a reform proposal
• Budget Deficit
• Reduce Medicaid and Medicare
• Cuts in discretionary spending likely to reduce
  funding for safety net
• Shaping the Judiciary
• Tort Reform

3
Republican Health Care Agenda
4
Commonwealth Fund Health Care Opinion Leaders
Survey

• Expand coverage to the uninsured
• Improve the quality and safety of medical care,
  including increased use of IT
• Medicare reforms to ensure long-run solvency
• Enact reforms to moderate the rising costs of
  medical care for the nation
• Medicare payment reform to reward performance on
  quality and efficiency
• Control rising cost of prescription drugs
• Address racial/ethnic disparities in care
• Malpractice reform
• Administrative simplification and standardization
• Medicaid reforms to improve coverage
• Improve the quality of nursing homes and
  long-term care
• Control Medicaid costs

5
Gail Wilensky CommentaryRealistic
Opportunities for Progress

• Little new federal (or state) money for major
  expansions in coverage
• Most important priority will be implementing MMA
• Bipartisan agreement to improve patient safety
  and reduce medical errors
• Bipartisan agreement on integrating information
  technology with health care
• While tax credits may not be thought of as a
  viable or even a valid option, there is
  opportunity to experiment and further explore the
  ramifications of such policies
• Buying into FEBPH (or similar program) may be
  another opportunity for exploring the policy
  ramifications at the State level

6
What Voters Cared About in 2004
Source NBC News/Wall Street journal Poll,
December, 2004
7
Tax Burden Historical Perspective

• Average Federal and State/Local Tax Share Over
  Time

Data Source Tax Foundation
8
Tax Burden USA Compared to Other Countries
Source OECD Revenue Statistics 1965 - 2002
9
Federal Budget Outlook
Medicare and Medicaid
Medicare Spending
Medicaid Spending
Data Source CBO 2004 Baseline Budget
Projections, September, 2004.
10
Medicaid Solution to Coverage Challenge or
Target in Budget Reduction?

• Likely to be part of Presidents deficit
  reduction proposal
• Governors will play important role in
  adjudicating Federal-State roles for health
  coverage for low income adults, mothers and
  children and for long-term care
• Governors take on potential Medicaid cuts
• We agree that maintaining the status quo in
  Medicaid is not acceptable, however, it is
  equally unacceptable in any deficit reduction
  strategy to simply shift federal costs to states
• National Governors Association
• I certainly understand the need to balance the
  federal budget, but people need to remember that
  to balance the federal budget off the backs of
  the poorest people in the country is simply
  unacceptableYou dont pull the wheelchair out
  from under the child with muscular dystrophy
• Governor Mike Huckabee (R), Arkansas

11
State Challenge Steering Through Uncertain Times

• Number of uninsured continues to increase. When
  do middle income Americans lead charge for
  significant national and state reforms?
• Health care costs continue to rise. When will
  employers apply pressure on the national
  government to address major health reform?
• States will feel this pressure sooner and more
  intently
• States left holding the bag until the national
  government addresses the call for national reform