First Edition: July 13, 2011

Today's headlines detail the next moves in the ongoing budget discussion, including a "last-choice option" proposed by Senate Minority Leader Mitch McConnell,  R-Ky., and reports about how the health industry is lining up against possible cuts.

Kaiser Health News: PhRMA Chief Says Support For Health Law 'Was Right Decision' - The KHN Interview
Kaiser Health News' Bara Vaida recently spoke with John Castellani. He said that, even though his organization opposes a current Democratic proposal in the budget talks that would require drugmakers to pay rebates to the Medicare program for beneficiaries who qualify for both Medicare and Medicaid, and that it would "do serious harm to the industry," it doesn't cause regrets about his industry's support for the health law (Vaida, 7/13).

KHN's Capsules: Insurance Commissioners Back Away From Broker Bill
Also posted on the blog: Phil Galewitz reporting on House Majority Leader Eric Cantor's take on President Barack Obama's position in the ongoing debt negotiations… Bara Vaida on the Cleveland Clinic's estimate of what's at stake in the deficit talks… And a list of much-talked about potential Medicare and Medicaid cuts.

The New York Times: Hopes Dwindling For Compromise In Budget Talks
From the White House and Congress to financial centers, pessimism spread on Tuesday about the prospects of a debt-limit deal between President Obama and Republicans, prompting the Senate Republican leader to propose a "last-choice option" that piqued the administration's interest but angered conservatives in his own party. … Administration officials welcomed the McConnell initiative for at least signaling that both parties' leaders were committed to averting a potential economy-shaking government default; many Democrats in Congress saw it as a way to avoid the sort of deep cuts in Medicare, Medicaid and Social Security that Republicans have sought as the price of their votes for a debt-limit increase (Calmes, 7/12).

Los Angeles Times: Obama Gives Social Security Warning In Debt Debate
The proposal offered by Sen. Mitch McConnell (R-Ky.) would essentially flip the debt ceiling process on its head. Rather than vote on measures to raise the debt limit, members of Congress would vote on bills that would forbid increases. Obama's presumably certain veto of the measures would allow the ceiling to rise. Politically, Republicans could claim to be voting to hold the line against a higher limit, safe in the knowledge that there would be no catastrophic default on federal borrowings. But the plan would essentially abandon the GOP quest to use the debt ceiling as a mechanism to force deep cuts in the federal budget, and was widely criticized by conservatives (Parsons and Mascaro, 7/13).

The Wall Street Journal: Cuts Would Only Shift Health-Care Costs
The $350 billion or so in potential cuts to Medicare and Medicaid over 10 years that were identified in budget negotiations would shift the cost of medicine to public hospitals, the states and individuals, but wouldn't do much to tackle rising health-care costs themselves (Burton, 7/13).

The New York Times: Agree On Debt Talks: Health Groups Dislike Proposals
Budget negotiators have not found a way to avert a government default on federal debt obligations, but with their ideas to cut Medicare and Medicaid they have managed to provoke opposition from almost every major group that represents beneficiaries and health care providers (Pear, 7/12).

The New York Times: In Effort To cut U.S. Deficit, New York Teaching Hospitals May Lose Aid
New York State's prestigious teaching hospitals could lose more than $1 billion a year as part of plans under negotiation in Washington to reduce the federal deficit that the hospitals say will lead to drastic service reductions (Hartocollis, 7/12).

The Wall Street Journal: Employers Lobby To Weaken Insurance Mandate
It is three years before most of the new health-care law kicks in, but already some of America's largest employers are peppering the Internal Revenue Service with concerns that making the changes will be far more complex than they anticipated. At issue is one of the law's central requirements: employers with 50 or more full-time workers must offer affordable insurance or pay a penalty. It sounds simple enough. But in crafting the rules, the IRS and two other federal agencies are now tackling basic yet messy questions, such as who counts as a full-time worker and how do companies measure whether insurance is "affordable" (Adamy, 7/13).

The Associated Press: Poll: Upbeat Baby Boomers Say They're Not Old Yet
Baby boomers say wrinkles aren't so bad and they're not that worried about dying. Just don't call them "old." The generation that once powered a youth movement isn't ready to symbolize the aging of America, even as its first members are becoming eligible for Medicare. A new poll finds three-quarters of all baby boomers still consider themselves middle-aged or younger, and that includes most of the boomers who are ages 57-65 (Cass and Anderson, 7/13).

USA Today: Feds, Medicare Crack Down On Medical Scooter Fraud
The federal government is cracking down on medical-equipment providers who either overcharge Medicare for motorized wheelchairs or obtain them for people who don't need them, Medicare and Justice Department records show (Kennedy, 7/12).

The Wall Street Journal: AIDS Drugs Can Prevent Infection, Studies Show
Two new studies released early Wednesday show that AIDS drugs can prevent heterosexuals from acquiring HIV, adding to a growing number of new methods to slow the spread of the virus world-wide. Many researchers now believe that science has developed sufficient tools to contain the pandemic. But tight budgets may limit their deployment (Rockoff, McKay and Schoofs, 7/13).

Los Angeles Times: Prison Doctor Gets Paid For Doing Little Or Nothing
The highest-paid state employee in California last year, a prison surgeon who took home $777,423, has a history of mental illness, was fired once for alleged incompetence and has not been allowed to treat an inmate for six years because medical supervisors don't trust his clinical skills. Since July 2005, Dr. Jeffrey Rohlfing has mostly been locked out of his job — on paid leave or fired or fighting his termination — at High Desert State Prison in Susanville, state records show. When he has been allowed inside the facility, he has been relegated to reviewing paper medical histories, what prison doctors call "mailroom" duty (Dolan, 7/13).

The Wall Street Journal: Health Cut Hits Hurdle
In response to safety warnings, the Cuomo administration has pulled the plug on an effort to pressure hospitals to perform fewer cesarean sections. Earlier this year, the state approved a plan that would have reimbursed hospitals at a lower rate for performing unnecessary procedures on Medicaid-enrolled mothers. The goal was to cut in half the percentage of Medicaid-funded C-section deliveries, to 15% from 31% (Gershman, 7/13).