Alliance for Health Reform Briefing for Reporters

July 1, 2009

Dean A. Rosen, Partner

Where Things Stand, And Where They’re Heading

•Health Reform Goals •Reform Drivers•Key players

– Administration – Congress– Stakeholders

•Reform timing and process•Health reform focus areas•Opportunities for progress•Remaining challenges and party positioning

Four Federal Health Care Goals for 2009

Goal Status

Children’s Health Insurance Program Reauthorization 4.5 year extension

Public law – February 4, 2009

American Recovery and Reinvestment Act Substantial HIT investment Enhanced Medicaid match COBRA unemployed subsidies

Public law - February 17, 2009

Medicare Physicians face 20% cut Dec. 2009 Payment reforms to promote value

To do

Health Reform/Uninsured To do

What’s Driving Reform?

National Health Expenditures

Health Spending Will Nearly Double Over the Next Decade, Rising to Over 20 Percent of GDP by 2018

Source: Centers for Medicare & Medicaid Services, Office of the Actuary, January 2009.

Actual Projected

Dollars

in

tri

llio

ns

Three in four dollars spent on health care in the U.S. are for patients with one or more chronic conditions

Health care costs for patients with one or

more chronic diseases =

~$1.58 trillion

Source: Centers for Disease Control and Prevention. Chronic Disease Overview page. Available a http://www.cdc.gov/nccdphp/overview.htm. Accessed April 6, 2007.

Total U.S. health spending in 2006 = $2.1 trillion

* Number of uninsured nonelderly. The Census Bureau periodically revises its CPS methods, which means data before and after the revision are not comparable. Comparison across years can be made between 2000 through 2004, and 2004 though 2007.

SOURCE: Kaiser Commission on Medicaid and the Uninsured/Urban Institute analysis of 2001-2008 ASEC Supplements to the CPS.

Number of Uninsured Continues to Climb

The Obama Administration

The Obama Administration:Key Health and Economic Players

Health Care Team Health Care Team

WH OHR

DeParle

Budget & Economic TeamBudget & Economic Team

Budget

Orszag

Budget

Emanuel

NEC

Summers

Key White House AdvisorsKey White House Advisors

COS

Emanuel

Senior Advisor

Axelrod

DPC

Barnes

HHS

Sebelius

HHS/ OHR

Lambrew

Treasury

Geithner

The 111th Congress

Democrats Have Large Congressional Majorities, Including 60 In Senate

Senate: 60-40 Democratic Majority

House: 257-178 Democratic Majority

Senate and Health Committee Leaders

HELPRanking MemberChairman

BudgetRanking MemberChairman

LeadershipMinority LeaderMajority Leader

FinanceRanking MemberChairman

Enzi (R-WY) Kennedy (D-MA) Grassley (R-IA) Baucus (D-MT)

Gregg (R-NH)Conrad (D-ND)McConnell (R-KY)Reid (D-NV)

House and Health Committee Leaders

Education and Labor

Ranking MemberChairman

Ways and MeansRanking MemberChairman

BudgetRanking MemberChairman

Energy and CommerceRanking Member

Barton (R-TX)Waxman (D-CA) Spratt (D-SC) Ryan (R-WI)

Miller (D-CA) Kline (R-MN)Camp (R-MI) Rangel (D-NY)

Chairman

Stark (D-CA)

Health Subcomm. Chair

LeadershipSpeaker

Pelosi (D-CA) Boehner (R-OH)

Minority Leader

Stakeholders Shaping, Not Stopping, Health Reform Policy This Time Around

Building Blocks of Democrats’ Health Reform Strategy

Congress drafting legislation

Congress drafting legislation

Engaging stakeholders

Engaging stakeholders

Speedy timetableSpeedy timetable

Congressional Committees

cooperating closely

Congressional Committees

cooperating closely

White House support

White House support

Bipartisan consensusBipartisan consensus

Lessons learned from 1993-94

Lessons learned from 1993-94

Reformers, with very different reform visions

Moderates, willing to

compromise

GOP Positioning On Health Reform

Budget Hawks/Fiscal Conservatives

Undecided

Reformers, with very different reform visions

Moderates, willing to

compromise

GOP Positioning On Health Reform

Fault Lines• Individual mandate• Employer mandate• Medicare buy-in• Medicaid expansions• Government-funded

comparative effectiveness research

• Government-run public plan option

• Overall cost• Tax increases

Budget Hawks/Fiscal Conservatives

Undecided

Critical Factors That Will Shape Outcome

Budget NeutralityBudget

Reconciliation

Senate Health Reform Timeline

AprilApril MayMayJuneJune SeptemberSeptember

JulyJuly OctoberOctober

NovemberNovember

HELP and Finance

Bipartisan Working Groups

Finance Committee

Roundtables Begin

Finance Committee

Options Papers

Committee Markups ?

ConferenceCommitteeAgreement

Senate Floor Consideration ?

House Health Reform Timeline

Legislative Plan Release

Committee Markups July

Floor Consideration

ConferenceCommitteeAgreement

Committee Hearings

HearingsContinue

AprilApril MayMayJuneJune SeptemberSeptember

JulyJuly OctoberOctober

NovemberNovember

Reform Focus Areas

Health Health System ReformsSystem Reforms

Expanded Expanded Coverage Coverage Financing Financing

ohe

o Quality/pay-for- performance

oPublic reportingoPrimary care incentivesoWorkforce improvementoMedical homeoMedicare doctor

paymentoBundled paymentsoReduce readmissionsoAccountable care

organizationsoMedicare Advantage

payment reformsoComparative

EffectivenessoHealth information

technology

oHealth insurance exchange

oBenefit designoRating reformsoSmall business tax creditoMarket reformsoMandatesoPublic plan optiono Public program expansionoMedicaid reforms,

including expansion to 100% FPL

oHome and community based services

o Long-term careoHealth disparitiesoPrevention

o Health care tax exclusion

oOther sources of tax revenue

oMultinational corporations

oAlcoholoSugary drinks

oAdditional health system savings

oMedicaid rebateoPart D prescription drug

cost-savings

Health Reform: Opportunities for Common Ground

Expanding Coverage

System Reform and Quality Improvement

Fraud & Abuse

Prevention & Wellness

Health Reform: Major Challenges

Financing

Government-Run Public Plan

Medicaid Expansion

Most Important Economic Issues

Source: NBC/Wall Street Journal Surveyhttp://s.wsj.net/public/resources/documents/WSJ-NBC_Poll090617.pdf

Issue Percentage of Respondents

Unemployment 35%

The federal budget deficit 24%

The cost of health care 11%

Gas prices and energy costs 7%

The drop in the stock market 6%

Federal taxes 4%

Housing prices 3%

Pension security 2%

Source: ABC News/Washington Post Pollhttp://abcnews.go.com/images/PollingUnit/1091a1ObamaandPolitics.pdf

Source: ABC News/Washington Post Pollhttp://abcnews.go.com/images/PollingUnit/1091a1ObamaandPolitics.pdf

Source: ABC News/Washington Post Pollhttp://abcnews.go.com/images/PollingUnit/1091a1ObamaandPolitics.pdf

Alliance for Health Reform Briefing for Reporters

July 1, 2009

Dean A. Rosen, Partner