- The Washington Times - Monday, April 26, 2010

What’s it going to cost me?

That’s the single biggest unanswered question about President Obama’s new health care overhaul law - and its weak spot.

Many analysts say the law falls short on taming costs, and that will force Congress to revisit health care in a few years.

While it seems hard to believe now, Republicans might want to participate in a debate over costs, perhaps opening the way for limits on malpractice lawsuits and other ideas they’ve advocated.

“Now that the base-line question of coverage has been answered, it would be irresponsible if we didn’t come back and try to do more on costs,” said Sen. Mark Warner, Virginia Democrat, who voted for the bill and led efforts to squeeze more savings.

“I think there is going to be a debate in the Republican Party on whether they should waste all their energy on repeal or make an effort to do something on cost containment,” Mr. Warner said.

For now, the political parties are too polarized - and lawmakers too exhausted - to contemplate health care 2.0. Conservatives are planning court challenges, and some Republican leaders hold out the promise of repeal. But economic reality probably will bring lawmakers back to the table.

Insurance premiums are likely to keep going up over the next few years. Analysts predict that the law’s early benefits - such as expanded coverage for children and young adults - could nudge rates a little higher than otherwise would have been the case. Also, insurers and medical providers could try to raise their prices ahead of big shifts set for 2014.

Under the 10-year, $1 trillion plan, 2014 is when competitive insurance markets for individuals and small businesses are expected to open, and tax credits start flowing to help millions of middle-class households now uninsured. Medicaid will expand and pick up millions of low-income people. Most Americans would be required to carry health insurance, except in cases of financial hardship. Insurers no longer could turn away those in poor health.

More than 30 million previously uninsured people would gain coverage quickly - and they’ll start going to the doctor for care previously postponed. Increased demand will push up health care spending, putting more pressure on premiums.

The cost controls in the bill are unlikely to provide much of a counterweight. Democrats scrambling to line up votes for the final bill weakened a provision that would have enforced austerity through a hefty tax on high-cost employer coverage.

Other savings in the law - mainly Medicare cuts - may prove politically unsustainable, according to the government’s own analysts.

The problem isn’t that the 2,700-page law is devoid of ideas for curbing costs. Many mainstream proposals are incorporated in some form. But what will work?

While the law creates a commission to keep pursuing deeper Medicare savings, there’s no overall cost control strategy and no single official to coordinate many experiments seeking greater efficiency.

“This bill takes a sort of spaghetti approach to cost control,” said Jonathan Gruber, an economist at the Massachusetts Institute of Technology who supports the broad goals of the overhaul. “You throw a bunch of stuff against the wall and see what will stick. Health care, Round Two, is when we will make a serious effort at cutting costs down, based on what this law has shown us.”

If the law gets a B-plus for expanding coverage to 95 percent of eligible Americans, it probably deserves a C-minus or D for cost control. The U.S. spends $2.5 trillion a year on health care, with some results worse than what other developed countries get by spending far less.

“Most people who have problems with health care costs now are not going to see much change in the next few years,” said Mark McClellan, who ran Medicare under the Republican administration of President George W. Bush. “Hopefully, some of these ideas will work, but it’s not automatic. I do hope we can revisit this in a more bipartisan manner.”

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