From the October 20, 2009 National Review Online Corner Blog
October 20, 2009
by Tevi Troy
The Hill has reported that the White House and Democratic leaders have offered up a new health-care deal, this time to the doctors. The deal apparently calls for a ten-year freeze in scheduled physician payment cuts — known as the SGR, or sustainable growth rate — in exchange for the doctors' support for Democratic health efforts and dropping of tort reform.
The so-called “doc fix” is, as Jim Capretta described in his helpful post yesterday, a budget busting gimmick that will mask the cost of the Democratic health bill. But this is not the doctors' problem. The doctors should oppose this deal for a number of reasons, including the fact that it does not get them very much. The Democrats appear likely to pursue the doc fix anyway, and in any event, the threatened cuts the SGR lays out, while incorporated into budget projections, never manage to take place. In fact, the AMA lobbies successfully every year against the cuts, and honest legislators recognize that the cuts are essentially theoretical rather than actual.
In exchange for the Democrats addressing an issue that they have to deal with, the AMA would have to agree to support a bill that may not help their constituents very much, and would have to give up an issue — tort reform — that would both generate significant savings and is one of their top priorities.
The other reason to be wary of this deal is to look at the treatment of others who have entered into similar deals. The pharmaceutical industry has signed a deal with the administration, but Henry Waxman feels that he is not bound by it. Furthermore, the deal only survived in the Senate Finance Committee when Max Baucus convinced Chuck Grassley to generate Republican support for the agreement when most of the Committee's Democrats voted to abrogate it. It remains unclear whether this agreement will survive on the Senate floor.
The insurers, for their part, have played ball with the Democrats most of the way, only to have Nancy Pelosi call them villains and immoral, and that was when they were working together. When the insurers got uncomfortable, and released a study with admittedly awful timing criticizing the Baucus bill, they were hit with torrents of criticism from the president on down about how dishonest and greedy they are.
This new doc deal is a bad deal for docs. They don’t get much for it; there are serious concerns about whether these deals will stand up under political pressure; and the doctors face the likelihood of a severe backlash if they end up criticizing the final product. If I were advising the AMA, I'd tell them to practice some defensive medicine and take a pass.
Tevi Troy is a Visiting Fellow at Hudson Institute and served as the Deputy Secretary of the U.S. Department of Health and Human Services from 2007 until 2009.
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