Cost Savings Myopia

Making the numbers fit the script

The Hill’s Alexander Bolton gave us a glimpse of the budget games some members of Congress will happily play to ensure that one of their favorite strategies for controlling medical expenditures yields the savings they’d like to see. Bolton’s piece was stellar; any journalist covering the unfolding debate in which cost containment will be a major flashpoint would do well to read it, along with Louise Russell’s Excluded Voices interview. Russell, a Rutgers University research professor and an expert on the subject, points out that preventive care actually increases medical costs.

That, of course, is not what advocates of preventive care as a cost saving measure want to hear. Preventive care sounds good—and, more important, it’s politically palatable, since it doesn’t cut into stakeholders’ incomes. So it’s important that supporters get the numbers they need from credible government agencies to back up their beliefs. Bolton explains the rules of the game: If at first you don’t succeed in getting forecasted savings from preventive care, try, try again until you find an agency that gives the results you want. He says that some Dems are bickering about whether to use cost savings estimates from the Congressional Budget Office (CBO), as credible an agency as you can find.

Some members think they may get a more favorable number from the Office of Management and Budget (OMB), which is controlled by Obama acolyte Peter Orszag. A more generous savings estimate would, of course, give Comgress hundreds of billions of additional dollars to work with when figuring the amount available to pay for subsidies for the uninsured.

Bolton reports that things are getting downright testy. California Sen. Barbara Boxer insists:

“We’re going to look at OMB and CBO and make our own decision as to who is right. I haven’t seen (the CBO score) but if they don’t take into account prevention, I certainly won’t. I will not follow it—we just heard from the CEO of Safeway who said his insurance costs went steadily down since they instigated incentives for prevention. Any scoring that doesn’t understand that is not relevant to the way we work.”

Hmmm. Safeway instigating incentives for prevention? Doesn’t sound very scientific to me, and it certainly doesn’t take into account the issues Russell raised in the accompanying post. Yes, certain members of Congress may legislate by listening to the pleas of the last lobbyist who paid them a call. But after all the talk this year about using evidence to make the best choices about treatment and care and doctors and health plans, Boxer’s remarks require press scrutiny.

Boxer wasn’t the only member of Congress with whom Bolton had a chat. He called on Sen. Max Baucus, who, as Campaign Desk readers know, is key to any legislation emerging from the Senate. Baucus told The Hill that he estimates roughly 50 percent of the cost of reform would be covered by savings generated from reforms such as greater emphasis on preventive medicine, improvement of information technology, and coordination of health care. His spokeswoman added: “It’s true that health care reform will save money for families, businesses and the American economy that won’t show up in federal budget scorekeeping.” But how do we know it’s true? What’s the evidence? More anecdotes from Safeway?

Bolton then explored the dilemma faced by Senate Budget Committee Chairman Kent Conrad, explaining that Conrad had the power to ignore any CBO cost estimate and issue his own, in a process called directed scoring. Conrad told Bolton he wouldn’t do it. “If this system is going to have integrity, you’ve got to have some scorekeeper,” he said. Bolton also talked to one member of Congress who refused to be quoted. Mr. or Ms. Anonymity said the CBO should not be allowed to interfere with a once-in-a-lifetime opportunity. Those darn facts again!

This anonymous lawmaker suggested that Conrad could be persuaded to use a different set of projected savings if enough colleagues leaned on him. Maybe one of them will be Alaska Sen. Mark Begich, who explained that “Prevention is an actual savings. I’ve seen it in my own city and what we did there.” He urged the Democrats to push back against a CBO estimate that would show only a modest level of savings.

The integrity of health care reform is also at stake. The public deserves to know what’s fact and what’s fiction, and a good place for reporters to begin sorting all that out is by asking whether preventive care saves any money. Next, they need to keep an eye on the potential funny business that Bolton so carefully laid out.

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Trudy Lieberman is a longtime contributing editor to the Columbia Journalism Review. She is the lead writer for The Second Opinion, CJR's healthcare desk, which is part of our United States Project on the coverage of politics and policy. She also blogs for Health News Review. Follow her on Twitter @Trudy_Lieberman.