Health Care Reform Bill Update

Posted on January 19, 2011

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I am not a policy expert, and I chime in very rarely on legislative issues that affect healthcare. However, at the Virginia Rural Health Association’s (VRHA) Annual Meeting I heard from a lobbyist who is deeply involved with the healthcare legislation.  Her name is Maggie Elehwany and she shed some interesting light on the bill, breaking it down into terms that non-lobbyists and policy experts can understand.  Click here for the link to her presentation’s transcript.

What I found most interesting is how the money is spent.  Maggie reported that 70% of the total bill is for “entitlement” programs like Medicare and Medicaid. Very quickly you can see that only leaves 30% with any wiggle room, or as it is termed “discretionary” spending to-be-determined through the Appropriations Committee. Therefore, all the people asking for handouts (lobbyists) are fighting for a very small part of the pie.

The good news for the VRHA and National Rural Health Assocation (NRHA) is that provisions for rural health are in that 30%. The bad news is Congress will be under pressure to cut costs and will be looking for ways to cut spending in the Appropriations Committee to lessen the financial blow of the bill. Much like the U.S. budget, you can see the majority of the spending goes to entitlements (Social Security, Medicare / Medicaid), so everyone else has to fight for a tiny sliver of what is left.

My only point here is that balance is the key to helping everyone.  When so much money is tied up in so few resources (the Pareto Principle is likely in effect here:  80% of spending tied up in 20% of programs), the inequity is very apparent and resentment grows when the majority of help keeps going to the same populations.  The large gamble in this case is that by providing healthcare insurance for more people, costs will go down for everyone. This is a very big bet with a very big pot of money, and I hope it goes well for everyone’s sake.

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