Senate Health Care Bill Will Bust the Budget and Hurt Patients

Washington, D.C., November 18, 2009—The Senate health reform proposal released today by Majority Leader Harry Reid contains no mechanisms that are likely to reduce the annual rate of health care cost inflation, but could jeopardize patient care, according to analysts at the Competitive Enterprise Institute. Despite claims to the contrary, most of the bill’s purported cost-cutting measures would be ineffective or would merely shift costs from the federal government onto the states or private payers, without affecting long-term health care inflation.

“Although the Senate Democrats’ bill appears to do more than the House alternative to rein in health care costs, looks can be deceiving,” said CEI Senior Fellow Gregory Conko. “Like the earlier bill reported out of the Senate Finance Committee, the only measures that could reduce the rate of growth in health care costs are those that erect government barriers between patients and their doctors, while jeopardizing long-term medical innovation.”

The Congressional Budget Office’s preliminary cost estimate for the Senate proposal suggests it would cost $849 billion over the 10-year budget window and reduce the federal deficit by $127 billion. But a review by CEI analysts shows that this estimate is based on “cost-shifting and accounting gimmicks” that even the CBO suggests will not significantly reduce federal expenditures or health care inflation. Two other measures in the bill, the creation of a “Medicare Commission” and a “Patient-Centered Outcomes Research Institute,” could prevent patients from receiving the care their doctors recommend.

“These programs are designed to adjust physician and hospital payment policies to keep patients from receiving costly and ineffective treatments,” said Conko. “But doctors know that what works for the average patient doesn’t always work for everyone. When it comes to medical treatments, doctors and patients need choices because one size definitely does not fit all.

“Eliminating genuine waste and inefficiency from government programs is a laudable goal, but centralized programs for comparative effectiveness, or ‘patient-centered outcomes research,’ run a substantial risk of becoming tools to control the practice of medicine in a way that puts patient health at risk,” Conko lamented.