Transcript: Health On The Hill – August 3, 2010

A Senate vote could come as early as Wednesday on a $16 billion Medicaid package for states. Meanwhile, a U.S. District Court judge has allowed a Virginia lawsuit challenging the health law’s requirement that individuals purchase health insurance to continue in the courts. A Missouri state ballot referendum to nullify the health law’s individual mandate is expected to pass today, although the measure is viewed as largely symbolic.

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Transcript:

LAURIE MCGINLEY: Good day. I am Laurie McGinley with Kaiser Health News, and this is Health on the Hill, where we discuss recent developments involving health care policy. Joining me today are Mary Agnes Carey with Kaiser Health News and Noam Levey with the L.A. Times/Tribune – Washington Bureau. Thank you both for joining us.

Mary Agnes, let’s start with you. Things have been pretty busy on the Hill, considering these are the dog days of August. There has been a lot of debate lately about Medicaid and whether Congress should provide the states with additional aid to Medicaid, considering the states’ budget problems, can you tell us where that stands at this point?

MARY AGNES CAREY: Senate Majority Leader, Harry Reid, is trying once again to pass a Medicaid package; we are talking about $16 billion that would extend the additional funding that was passed last year in the economic stimulus package for another six months.

Senator Reid had hoped to bring the Bill to a floor vote yesterday, but he found out a Congressional Budget Office score found that the bill would cost $5 billion more than they had realized. They are going to go back and they want to make it budget-neutral, so his hope is that he can bring the package to the floor as early as Wednesday for a vote.

LAURIE MCGINLEY: And if it comes to the floor, Noam, do you think it’s going to pass? How close will it be?

NOAM LEVEY: You know, they didn’t have the votes yesterday morning. They were working pretty hard to round them up. I think they think that they can get there if they come up with the offsets to actually make it budget-neutral.

The question then becomes when it goes, it has to go back to the House, can they round up the votes there? Because some of the offsets are going to be controversial with either liberals, cutbacks in some of the programs for helping the poor, or some of the taxes can be controversial as well, so I think that may be a big test as well.

LAURIE MCGINLEY: And if it doesn’t get wrapped up in the Senate this week, what is the likelihood it comes back in the fall after Labor Day?

MARY AGNES CAREY: I think it’s going to be a constant part of the discussion. I mean we have seen governors come to Washington, Democratic governors, Republican governors saying our budget started July 1st, we need this money. Several states have already included it in their budgets, and so you can continue the drum beat, the pressure from the governors to do this, and of course if it isn’t done before they adjourn for the elections, they being Congress, we could certainly see this in a lame duck session this fall.

LAURIE MCGINLEY: Noam, yesterday in terms of health care reform law, there was an important decision in Virginia, could you tell us a little bit about that court decision and what the implications are?

NOAM LEVEY: Sure. So this is the lawsuit that the state of Virginia filed challenging the new health care law, which is one of two legal challenges going on right now to the law. The decision yesterday was on a procedural question. The federal government, the Obama administration had moved to dismiss it, arguing that the state of Virginia didn’t have standing to challenge it, and that it was premature to do this.

Had the Obama administration prevailed in that, it sort of would have swept aside kind of this early legal test of the new law. The opposite happened. The judge in a fairly strongly-worded opinion said no. In fact, the state of Virginia’s case can go forward. The state has standing to do it. And there are some very big constitutional questions that this case raises.

Essentially what the judge signaled I think is that he doesn’t want to dismiss this case. He wants to have a full legal debate about whether congress can mandate people to buy health insurance, which of course is the central and very controversial question at the core of the health care reform bill.

LAURIE MCGINLEY: What was the reaction from both sides, from both supporters of the law and critics of the law?

NOAM LEVEY: Well, I mean, fairly predictable. The supporters, of course, the Virginia Attorney General, Ken Cuccinelli, who has sort of made himself into one of the leading critics of the bill, celebrated this as sort of a validation of his argument that this was constitutional overreach by the Obama administration and the Democratic congress.

The National Federation of Independent Business, a conservative advocate for small business groups, which has signed on to the second lawsuit I mentioned, which is going forward in a federal court in Florida involving other states, also celebrate it. The Obama administration interestingly sort of took I think two attacks.

One was to say look, this is just a procedural ruling, so let’s not get too excited, but I think almost more interestingly they made the argument against the overall lawsuit, arguing if this thing gets thrown out, here’s what is going to get thrown out as well, all of the benefits that we have sort of heart talked about in the past few months about aid for small business, helping people get insurance, so they are sort of I think trying to take a larger political view of this as well, perhaps in anticipation that this is going to be a long, drawn-out legal fight.

LAURIE MCGINLEY: Which probably ends up in the Supreme Court.

NOAM LEVEY: Very well may.

LAURIE MCGINLEY: Mary Agnes, the health care law faces another type of test in Missouri today, can you tell us about this, about the ballot referendum on the law?

MARY AGNES CAREY: Right. It is the first state ballot referendum talking about the individual mandate, the same issue. They want to change state law to say that no individual in Missouri would have to purchase insurance, nor could you be fined if you didn’t purchase it. It is viewed as a largely symbolic measure. They expect very heavy turnout for the Republican primaries. They expect this ballot measure to pass, but at this point it is viewed by many as it won’t have any legal standing. It is more symbolic than anything.

LAURIE MCGINLEY: And there are several more of these referendums coming down the pike, I understand.

MARY AGNES CAREY: Right. There are going to be other states that will try to enact the same thing. I mean, I think it is part of the ongoing view, the political view of this, and what is the role of federal government, what is the role of the state government? As we know, states have this really broad role in implementing the health care law, and I think that you are going to see this discussion continue all over the country.

LAURIE MCGINLEY: Meanwhile, Noam, as the debate goes on about the law, there are things that are happening outside the bell way, on the ground, in the marketplace, you had a very interesting story out of San Antonio, Texas about hospitals and doctors getting together as a result of the health care law, can you tell us about that and what the implications are?

NOAM LEVEY: Sure. I mean, you may recall during the health care debate, there was a lot of talk about whether this bill would do enough to change the way health care was delivered to make it more efficient, to get doctors, hospitals, other providers to work together, and a common critique of the bill was that the efforts to do that in the bill were small. They were not far reaching at all, and they were ultimately inadequate. to make the system more efficient and to really improve the quality of care than Americans get.

Interestingly, out in health care world, outside of Washington, some interesting things I think have been going on, where hospitals and doctors are actually very aggressively sort of courting one another in this sort of courtship dance in which they are talking about can they work together, can they form partnerships? Can they form these what are called accountable care organizations where they can work together to coordinate care better. And you see physician practices selling out to hospitals, insurance companies even getting involved in this, and at a rate that is much more quick than I think many people thought, and ultimately we don’t know what the upshot of this will be. I mean, there simply may be more consolidation in the health care industry that may mean just higher costs, more monopolies, etc.

But on the other side, there are some people who sort of think you know what, this is actually a hopeful sign that people in health care are reading the tea leaves, seeing that the system is going to change and they should figure out a way to work together to potentially provide better, cheaper care. So, we will see what happens.

LAURIE MCGINLEY: Does this raise antitrust issues?

NOAM LEVEY: It may. It may very well and the Department of Justice has actually sort of looked at this, is beginning to look at this. There are a number of discussions underway by national law firms as well as consulting firms trying to advise hospitals and physician groups about how to avoid antitrust issues.

You mentioned I was in San Antonio, if you have a major hospital system in a city buying up all the primary care doctors or all the cardiologists, I mean you could very well end up with a situation where patients have less choice and ultimately that probably means higher costs.

LAURIE MCGINLEY: Well meanwhile, back in Washington, Congress is getting ready to pack its bags and go home for the August recess, and last year as everyone remembers there were a lot of raucous town hall meetings about health care. How big an issue will that be this year? Will it be an issue at all? Where will it register in the town hall meetings?

MARY AGNES CAREY: I think there will be a greater focus in town hall meetings about economy and jobs. I mean, the unemployment rate is still pretty high. People are very concerned about the economy, about employment. I think that will trump health care, and I think you will hear a lot more about that. You may hear some about the health care law.

Certainly, if you are in a state that has issues about the individual mandate, or you are going to have a ballot referendum, people will certainly get up and talk about that, or if they have strongly held views on health care, but I think for most people the economy and jobs is a big issue.

LAURIE MCGINLEY: Is it too early to have a sense of how the health care law may affect the midterm elections? Do you think that what is true for the town hall meetings is true for the elections in general, that the jobs issue has become so big that that will trump everything?

NOAM LEVEY: I mean it certainly seems that the jobs and the economy issue is issue #1, 2 and 3. I mean, I think one of the things which we are waiting to see is how much money are people going to throw at this issue in terms of advertising to try to make it and issue either on the plus side or the negative side, and I don’t think we have a really good sense of that yet.

There are discussions underway about how to strategize about this on both sides, pollsters I know on the Republican side and on the Democratic side are coming up with messages but I think we may not know yet whether or not it is going to be a really big focus.

LAURIE MCGINLEY: Well, thank you both very much for joining us. That is it for Health on the Hill. Please join us next time.