I was looking over Tim's statement and think it's a pretty good idea. I agree 
with some of it, though not all. I don't have time to really think about 
politics just now but I'll probably reply later and maybe even make a similar 
post. A lot of words are getting put in my mouth that don't belong there. 

Meanwhile, this story caught my eye and I'd like to hold it up as a prime 
example of the sort of thing that should NOT go on. This is wrong and it is 
wrong, Sam, regardless of the political affiliation of the parties involved. 

Dana

GOP Negotiators Criticized for Change In Measure on HMOs

By Jonathan Weisman
Washington Post Staff Writer
Tuesday, January 24, 2006; Page A01

House and Senate GOP negotiators, meeting behind closed doors last month to 
complete a major budget-cutting bill, agreed on a change to Senate-passed 
Medicare legislation that would save the health insurance industry $22 billion 
over the next decade, according to the nonpartisan Congressional Budget Office.

The Senate version would have targeted private HMOs participating in Medicare 
by changing the formula that governs their reimbursement, lowering payments $26 
billion over the next decade. But after lobbying by the health insurance 
industry, the final version made a critical change that had the effect of 
eliminating all but $4 billion of the projected savings, according to CBO and 
other health policy experts.

That change was made in mid-December during private negotiations involving 
House Ways and Means Chairman Bill Thomas (R-Calif.), Senate Finance Committee 
Chairman Charles E. Grassley (R-Iowa) and the staffs of those committees as 
well as the House Energy and Commerce Committee. House and Senate Democrats 
were excluded from the meeting. The Senate gave final approval to the 
budget-cutting measure on Dec. 21, but the House must give it final 
consideration early next month.

The change in the Medicare provision underscores a practice that growing 
numbers of lawmakers from both parties want addressed. More than ever, 
Republican congressional lawmakers and leaders are making vital decisions, 
involving far-reaching policies and billions of dollars, without the public -- 
or even congressional Democrats -- present.

The corruption scandal involving Republican former lobbyist Jack Abramoff and 
the bribery plea of former congressman Randy "Duke" Cunningham (R-Calif.) have 
prompted calls for a restructuring of lobbying rules and congressional 
practices that make lobbying easier.

A prime target for changes are the closed-door negotiations known as conference 
committees, where members of the House and Senate hash out their differences 
over competing versions of legislation. House and Senate Democrats last week 
proposed that all such conference committees meet in the open and that any 
changes be made by a vote of all conferees.

"It happens in the dead of night when lobbyists get a [Republican lawmaker] in 
the corner and say, 'We've got to have this,' " said Rep. Fortney "Pete" Stark 
(Calif.), the Democrats' point man on Medicare issues. "It's a pattern that 
just goes on and on, and at some point the public's going to rise up."

Grassley disputed the CBO's interpretation of the change as "ridiculous," 
dismissing what appears to be a major insurance industry victory as merely a 
mistake in CBO calculations, not a substantive policy change. He said he 
accepted the policy change because he "didn't see a big difference from the 
Senate position and the conference position."

But other lobbyists and aides said too much important work is being done in 
these closed-door conclaves. That is especially true with the budget-cutting 
bill containing the change in the Medicare reimbursement formula that is 
nearing final passage.

"I have worked many [budget] bills, and this was the most closed that I've ever 
seen," said one prominent Republican health care lobbyist, who spoke on the 
condition of anonymity for fear of jeopardizing his access to Congress.

Another health care lobbyist, not involved with the issue, said the result was 
a major victory for health insurers: "That's a $22 billion difference; $22 
billion is a lot of money."

If no one can say which lawmakers made the change, there is no doubt who 
instigated it. Last month, as House and Senate negotiators sat down to finalize 
the budget-cutting bill, the insurance industry moved to thwart the Senate's 
"risk adjustment" provision.

Closed-Door Deal Makes $22 Billion Difference
"It is our understanding that CBO is scoring significant savings from this new 
adjustment," officials from America's Health Insurance Plans (AHIP) wrote in 
urgent talking points sent to Capitol Hill. "The savings . . . are best viewed 
as a new and unanticipated payment reduction."

Since managed-care companies first began working through Medicare in the 1990s, 
the government has recognized an issue in the way the companies are paid for 
their participation. Private insurers attract healthier seniors than the 
traditional government-run Medicare system, so their payment rates -- based on 
the elderly population as a whole -- exceed the actual cost of treatment.
 
In 2003, the government began lowering payments to Medicare HMOs to account for 
their healthier population of beneficiaries. But to keep those HMOs from 
fleeing the system, the Bush administration added a "hold harmless" payment 
that negated that cut.

The White House intended to phase out that payment through 2010, a plan written 
into law by the version of the budget-cutting bill that passed the Senate in 
November. But to secure those savings, the Senate also required yearly audits 
to account for "coding creep" or "upcoding" that health policy experts say 
physicians and hospitals working for the HMOs have used that, wittingly or 
unwittingly, make their patients appear sicker than they are.

The insurance industry lobby has denied such a problem exists, saying that the 
huge savings that CBO and other health care analysts have projected would never 
materialize. Even so, the industry fought the changes tooth and nail, said 
health care aides in the House and Senate.

Karen Ignani, chief executive of AHIP, said the industry would have liked the 
yearly audit provision to be removed. Instead, it got what the CBO sees as a 
strict time limit. According to the final bill language, the results of a risk 
adjustment analysis are to be "incorporated into the risk scores only for 2008, 
2009 and 2010."

The original Senate measure was supposed to reduce payments to Medicare HMOs by 
$2.9 billion in 2010, $3.3 billion in 2012 and $4.5 billion in 2015. Now, CBO 
scorekeepers think savings will peak at $2.9 billion in 2010. By 2012, the 
government will be paying the HMOs $100 million more than now scheduled, and 
$900 million more by 2014.

Republican aides involved in the change dismiss its significance, saying the 
CBO is reading too much into it. The Bush administration had planned to phase 
out "hold harmless" payments through 2010, and negotiators wanted to make the 
audit adjustments coincide with that time frame, the aides said.

Grassley agreed: "If CBO continues to say there needs to be a legislative 
requirement to conduct the analyses past 2010, then I look forward to passing 
legislation continuing the reports and achieving even bigger budget savings."


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