Republican Cut, Cap, Balance Plan Exempts Medicare, Social Security, War on Terror From Spending Limits


The thinker?

At the end of last week, House Republicans offered up yet another debt-limit deal in the form of a bill dubbed "Cut, Cap, and Balance." In theory, it allows the debt ceiling to be raised while preventing future deficit fiascoes by simultaneously requiring Congress to pass a constitutional amendment mandating a balanced budget and yearly spending caps set to predetermined percentages of total GDP: Under the proposal, spending would be limited to 21.7 percent of GDP in 2013 and ratcheted down to 19.9 percent of total economic output by 2019.

But Republicans have also exempted a number of their own priorities, including some of the biggest long-term debt drivers, from the proposed spending limits. As The Hill reports, "There is an exception for operations related to the global war on terrorism of $126 billion." So are two of the biggest entitlements: Page five of the legislation lists exemptions exemptions for Social Security and Medicare, as well as military retirement, veterans health care, and interest on the debt.

Lots of conservatives back the plan, and balanced budget requirements typically poll well across the political spectrum. But a spending cap that quietly exempts Medicare, Social Security, military health care (which has also been beset by exploding costs in recent years) seems awful convenient, and unlikely to be all that effective in the long run.

No matter what, its prospects for passage are minimal: House Speaker John Boehner seems interested in the bill only as a way to placate conservatives: At a Friday news conference, he didn't exactly offer a full-throated defense of the bill. "The cut, cap and balance plan that the House will vote on next week is a solid plan for moving forward. Let's get through that vote, and then we'll make decisions about what will come after," he said, according to The Huffington Post

Meanwhile, there are still political and procedural hurdles: Democrats don't like it, so there's little chance it would pass in the Senate. And even in the unlikely event that the legislation made it all the way through Washington, amending the constitution would still require ratification by two thirds of state legislatures.

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  1. You're writing these headlines with the EXPRESS intent of raising my blood pressure, aren't you, Peter?


    1. You want infuriating?

      Check out some of the recent AARP ads. They start with something stoopid the govt spend money on, like, "They spent $40,000 to see how fast a gerbil will exit Richard Gere's ass." Then they go on to claim that someone, somewhere wants to cut SS and Medicare. So, we should cut waste and fraud(har,har) before cutting SS.

      The ads roll out the same scare tactic tropes that we've seen for years: waste, fraud, abuse, "I paid in!", fixed income(teh horror!), old people getting bullied by evil pols, but they're going to fight back dammit. They're tough. They're the Greatest Generation(of parasites).


      1. Yeah, I did see some of those.

        That my TEEVEE remains operable after that is a certified miracle. I just couldn't find anything to throw before the rage dissipated.

        1. I've started aiming for the window behind my TV. Satisfying crash of glass but way cheaper.

          1. Thanks for the tip, Brett!

      2. i thought the greatest generation was almost all dead (those born early enough to fight in WWII. Now we're entering the "Expensivest Generation"

        1. Just because your dead doesn't mean you can't vote.

          ...or collect SS for that matter.

          1. True dat!

  2. "amending the constitution would still require ratification by two thirds of state legislatures."

    Isnt that three-fourths?

    1. Another troublemaker who actually reads the Constitution. There goes your chance to be on the Supreme Court.

      1. Somehow I don't think I'd get along too well with them.

  3. Speaking of entitlements has anyone seen that AARP commercial where the old fart encourages all the geezers to get together and "fight" any cuts to "the benefits we earned"? As if anyone is proposing to change any current programs for those already retired, or close to it.

    If the AARP had their way I guess everyone would bury their head in the sand and just let Medicare and AA collapse.

    1. er, ah, I meant SS, not AA.

    2. Damn you, Paul!

      I should of f5'd.

      1. Yeah the threaded comments are a pain. Would just prefer chronological order myself.

        1. I blame threaded comments for me fucking up your name as well.

          *shakes fist at sky in rage over nesting*

  4. Few politicians will dare to touch the 3rd rail - too many votes are at stake.

    A few days ago I had the odd (and probably paranoid) thought that the Democrats _want_ the Republicans to win the next cycle or two since they 'pubs will be stuck with the responsibility of fixing the mess - actually making the necessary cuts to the welfare state.

    Afterward, the Democrats can demagogue the 'Pubs, using it to an advantage. Once they gain power, they start expanding the money pit, er welfare state again since their hands will be clean.

    But I doubt any politician thinks that long-term.

    1. Only the Democrats would think there would be any bond buyers left after the next couple of election cycles

    2. just like republicans wanted the dems to win in '06 to show America what a bad choice it would be? I'd like the opportunity to see what would happen if they all lose.

  5. Boehner is one of those jackasses who got to his position solely because it was his turn; he's an utterly inept waste of space. Which is good; politicians who can "get stuff done" are dangerous as hell.

  6. Will bet cash money the Rs can't/won't cut more than just the *growth* in spending, as opposed to actually reducing spending.

  7. it allows the debt ceiling to be raised while preventing future deficit fiascoes by simultaneously requiring Congress to pass a constitutional amendment mandating a balanced budget

    I don't know much about congressional procedure, but this seems impossible. How do you require a bill's implementation be dependent upon a nonexistent constitutional amendment? What if the amendment doesn't pass, is the bill null and void? Can the c&b bill be implemented before the amendment is passed? Is this an empty gesture?

    I'm not being sarcastic, if anyone could explain this I would appreciate it.

    1. Again, right there with you. I completely don't understand 1) how this would work 2) what difference it makes.

      1) being the bigger question - we know it's all for show, which actually answers #2...

    2. I think all they are saying is that the amendment has to be passed out of Congress. I don't think even the Repubs are stupid enough to make the entire bill contigent on ratification by the states.

  8. Dear God, I am so sorry my brain keeps having visions of hitting Boner in the head with a Louisvil...no, not a good bat...that shitty old Adirondack baseball bat I've had in the garage since I was a kid. That's one bat I'd be willing - even desirous - of breaking.

    I know that's wrong of me, and I ask your forgiveness. FUCK I hate Boner.


    1. I found one of those bats at the field one day after practice when I was a kid.

      It was in really bad shape so I spray painted it silver and woodburned a shitty lightning bolt into it ala The Natural. It broke into a flying mass of stabby splinters the third time I used it.

  9. But a spending cap that quietly exempts Medicare, Social Security, military health care (which has also been beset by exploding costs in recent years) seems awful convenient, and unlikely to be all that effective in the long run.

    This is true, but apparently we can't count on the Democrats to want to cut any of those things either, not even military spending.

  10. In theory, it allows the debt ceiling to be raised while preventing future deficit fiascoes by simultaneously requiring Congress to pass a constitutional amendment mandating a balanced budget and yearly spending caps set to predetermined percentages of total GDP

    "Daddy, daddy, what is the difference between 'In Theory' and 'In Practice'?"
    "Well, it means... It means... Uh, OK let me show you with an example. Ask your sister and your mother if either would sleep with Brad Pitt for a million bucks. Go on, ask and then come back!"
    "Sis, sis, would you sleep with Brad Pitt for a million bucks?"
    "Uh, well, he is a bit old even if he's hot... But yeah, sure! I would. For a million bucks, sure!"
    "Mommy, mommy! Would you sleep with Brad Pitt for a million bucks?"
    "Did your father tell you to ask me this? Well, fine - IN A HEARTBEAT! And especially for a cool million! Go tell your daddy that!"
    "Daddy, daddy! Both said they would!"
    "OK, son: Now, in theory, we have 2 million bucks! In practice, however, we have ourselves a couple of whores in this house!!!"

    And we have several whores in the other house.

  11. here's what I am missing and I am open to explanations: the idea is to balance the federal budget since 49 states do that. Except that states don't typically respond to natural disasters beyond their borders. Or bear the cost of wars.

    I'm all for getting a handle on spending, but the amendment part sounds like political pandering. But, I could be wrong which is why the first part says "open to explanations".

    1. I have a feeling that it's all for show. A way for republicans to keep spending like it's 2003, but move the debt problem even further down the line. And also to cover their asses with their TP constituents.

      Business as usual, in other words.

    2. Except that states don't typically respond to natural disasters beyond their borders.

      I bet you can find a large contingent here that says the US shouldn't be doing that either.

      1. But what would we do with all of those new missiles?

        We need to lob them at someone. It's in the constitution or something.

        1. I don't see how lobbing a Tomahawk at a hurricane is useful, but that's probably why I'm not one of the Top Men. No vision.

      2. Yep. I mean, I think the American people will voluntarily give quite a bit when those disasters occur, but it's not really the responsibility of the government. A shareholder lawsuit might be in order, to put it in a way that minge might understand.

  12. It sounds vaguely like these "limits" aren't going to be spending limits so much as spending floors.

  13. Peter Suderman we can't wave a magic wand and make military health care less expensive. Costs are expanding because we have increased the number of troops and the amount of time they spend in hostilities. The way you talk about it, it sounds like you want to renegotiate deals with people who have already put in their side of the bargain. That's a loser issue for our team.

    1. Wait, soldiers getting sold out by civilian leadership once they're used up? Inconceivable!

  14. Improving Our Ability to Assess Health Care Services:
    A Suggestion for the Joint Select Committee and CBO Consideration

    The need ?

    This week the Commonwealth Fund released its National Score Card Analysis report, based on 2009 data, that shows a decline in the number of insured. As newer 2010 data are analyzed and reported, changes in the results of Score Card measures will be closely watched. The Affordable Care Act (ACA) was implemented to reverse these trends and provide nearly universal health insurance coverage for Americans. Studies show that health insurance is the gateway to access and use of appropriate health care services. Also this week, Health Affairs held a conference to identify "Saving Money and Improving Patient Care in Medicare: Ideas for the Joint Select Committee. With these events as a backdrop and the need the Joint Select Committee to identify "scoreable" improvements in healthcare delivery, we offer the following:

    1. Improvement in access to healthcare services relies on the political will of the U.S. to fully implement the Affordable Care Act (ACA).

    2. Healthcare costs are now approaching 17% of GNP (or $2.5 trillion). The affect of the ACA on health care costs is a subject of vitriolic debate. Identifying scoreable improvements are urgently needed.

    The problem?

    3. CBO estimates that as much as 33% of healthcare expenditures are wasted.

    4. Chronic medical care is the main driver of our health care system. Eighty percent of health care costs are being spent on those who suffer from chronic conditions and therefore perhaps as much as $660 Billion ($2.5 Trillion x 80% x 33%) is wasted on inappropriate or harmful treatments for chronic conditions.

    5. Although access to healthcare remains the focus of the current political debate, understanding "what works in medicine" will also have a significant impact on improving patient outcomes and reducing both overuse of services and healthcare costs.

    6. Contributing to the waste are treatments used in mainstream medicine that have not been proven by valid scientific evidence. Robert Smith, Editor BMJ (BMJ, 1991) estimates that only 20% of procedures are supported by valid evidence. In the absence of valid scientific evidence, providers rely on the normal heuristic i.e., treat patients to "normal" values (e.g., physiologic parameters, lab values, etc.). However, this tendency also introduces overuse leading to treatment side effects that cause adverse outcomes.

    A recent example of the solution, translation of research findings into policy?

    7. A case in point is epoetin therapy for chronic dialysis related anemia. Medicare has spent as much as $2.5 billion per year for this drug therapy without evidence of clinical benefit or improvement in quality of life. Based on recent reviews of the existing evidence-based literature, both CMS and FDA made changes in 2011 to their epoetin policies that will result in a 25-50% reduction in use of epoetin in 2011. Elimination of overuse of epoetin also improves both patient survival and reduces adverse events.

    The opportunity ?

    8. As shown by the case study of epoetin therapy, the role of comparative effectiveness research is critical to deciding what works, what should be covered, and the value of covered services. As defined by the IOM and others, "Comparative effectiveness research (CER) is the conduct and synthesis of research comparing the benefits and harms of different interventions and strategies to prevent, diagnose, treat and monitor health conditions in 'real world' settings. The purpose of this research is to improve health outcomes by developing and disseminating evidence-based information to patients, clinicians, and other decision-makers, responding to their expressed needs, about which interventions are most effective for which patients under specific circumstances."

    9. A new focus of CER is patient-centered CER that involves the patient and other stakeholders in all aspects of the comparative effectiveness research from which questions to prioritize, which outcomes to examine, which populations to study, which interventions to include (e.g., medications, procedures, medical and assistive devices and technologies, diagnostic testing, behavioral change, and delivery system strategies), and finally which datasets to use and which comparative methods are most appropriate.

    10. Randomized controlled trials are important, but only provide insight into clinical effectiveness of a small group of patients in the "ideal setting," are very costly to conduct, and are very time consuming. Pragmatic clinical studies rely on existing "real-world" data, are comparatively much less costly, can be conducted in a short period of time, and can address many policy questions regarding coverage and reimbursement of existing and new services. Real-world data emanates from electronic patient records, patients registries, claims data etc..

    11. Expanded Medicare claims data containing treatment dose and physiologic response was the source used for three recent pragmatic clinical studies whose results catalyzed Congress, CMS, and FDA to act to further restrict overuse of epoetin therapy. Specifically, pragmatic clinical studies, using causal methodologic techniques led to findings that influenced Congressional decisions to implement the new ESRD Prospective Payment System (PPS) initiated in January 2011. As a result, preliminary data suggest that epoetin use has dramatically declined.

    How to score this opportunity ?

    12. Eighty percent of health care costs are attributable to treatment of chronic conditions. Imposition of a requirement to include treatment data (e.g. Medicare's requirement to include both treatment dose and physiologic response as demonstrated in our epoetin therapy example) on interventions used to other chronic disease conditions, will allow researchers to use expanded claims data to conduct pragmatic clinical studies to assess the value of such treatments. In the epoetin case, researchers were able to identify overuse (~ 50%) of the drug as well as an increased mortality risk of 32% among diabetic vs. nondiabetic dialysis patients. These CER results supported recent CMS and FDA changes in epoetin policy. Physicians and other providers have responded to these changes by reducing: epoetin doses, the number of patients exposed to epoetin, and the number of additional hospitalizations and other services need to treat the side effects from epoetin overuse. Table 1 below suggests criteria that could be used to identify overuse of drugs.

    Table 1. Criteria to identify overuse of drug interventions for chronic conditions:
    - Administering initial doses above the FDA recommended dosage range
    - Administering maintenance doses above the FDA recommended dosage range
    - Continuing to administer doses to hyporesponsive patients after the point at which FDA recommends stop using the drug
    - Titrating doses outside of the FDA recommended dosage range
    - Treating patients above the FDA recommended treatment target (physiologic response) range
    - Treating patients with complications/comorbidities, conditions that were used as exclusion criteria in FDA Phase III pivotal studies a/o approved labeling
    The result?

    13. As evidence-based medicine advances the understanding "what works in medicine," these studies will lead to more prudent use of other costly health care services, shown to be clinically effective, and ultimately lead to better healthcare for all Americans.

    Submit on 10/20/11 by:

    Dennis J. Cotter
    President, MTPPI
    Bethesda, Maryland

    MTPPI (www.mtppi.org) is a 501(c)3 non-profit institute, established in 1986, that studies the causal relationship between treatment and clinical outcomes for chronic conditions.

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