HHS Secretary Leavitt urges lawmakers, public to 'start now' to make changes to Medicare

HHS Secretary Mike Leavitt said Tuesday that it is "simply unreasonable" to think Medicare can maintain its solvency without changes to the program and that if "we start now, the change can be made over time and with genuine fairness," CQ HealthBeat reports.

Leavitt, speaking at a Medicare forum hosted by the American Enterprise Institute, the Heritage Foundation and the Galen Institute, urged lawmakers and the public to join together to make changes to Medicare to ensure the program's solvency as millions of baby boomers begin to enter the program in 2011. He said that changing Medicare will be difficult because Congress has only three methods -- raising taxes, reducing benefits or lowering payments to providers -- for revising the program.

Leavitt suggested that a commission handle policy changes because the legislative process "won't ever produce enough bipartisanship" to revise the program. Leavitt said that such a commission could resemble the military base closure commission, which must accept or reject a whole set of recommendations.

Leavitt also said that Medicare legislation should include "trigger points" so that lawmakers could prepare "contingent plans if things go beyond a predetermined point" instead of voting on specific measures. He added that Congress should change how it "scores" Medicare policy initiatives to account for savings in addition to their initial cost.

Leavitt recommended putting more emphasis on coordination of medical care in Medicare and paying providers based on quality. He also advocated changing Medicare to resemble the program's prescription drug benefit because it "provides a good example of how better transparency and competition can drive change." In addition, Leavitt supported "rebalancing the generational obligation" to shift more costs to current beneficiaries instead of relying on payroll taxes from current workers.

Members of a health care panel who also spoke at the forum "generally agreed" that Medicare requires modifications but did not come to a consensus on how to alter the program, according to CQ HealthBeat. Stuart Butler of the Heritage Foundation said that higher-income beneficiaries should pay more in premiums and that a commission should handle changes to Medicare. Robert Berenson of the Urban Institute said that the Bush administration's support of higher Medicare Advantage payments limits its credibility to warn about Medicare spending concerns. "We don't have a Medicare crisis," Berenson said, adding, "I think there's plenty of opportunity if we had the political will to get Medicare spending under control" (Carey, CQ HealthBeat, 4/29).

A webcast of the forum in available online at kaisernetwork.org.

Presidential Candidates

Leavitt on Tuesday before speaking at the forum said that the health care proposals of Democratic presidential candidates Sens. Hillary Rodham Clinton (N.Y.) and Barack Obama (Ill.) would increase the rate at which the entitlement program moves toward insolvency.

Leavitt said, "One of the plans is to give everybody access" to the Federal Employees Health Benefits Program, adding, "What is it they like about that? Is it the subsidized portion or the price-fixing portion?" He said, "Medicare covers a relatively small percentage of the total population, but you add everybody else to that and it just accelerates the nature of the (fiscal) problem." In addition, Leavitt said, "Successfully changing Medicare will change health care. Now that'd be better news if changing Medicare was not politically or bureaucratically complicated."

Before the speech, Leavitt told reporters, "I don't see anyone (in the Democratic party) talking about the bigger problem. I see people talking about how we can make it worse, but I don't see anybody talking about how we could make it better" (Young, The Hill, 4/29).