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.

CEI is a non-profit, non-partisan
public interest group that studies the intersection of regulation, risk, and
markets.