The ‘doc fix’ goes corporate

Until Tuesday much of what congressional Republicans were proposing had been crafted behind the proverbial closed door. What came out is a mish-mash of policies that coincide with what is now a perennial demand from the American Medical Association concerning the Medicare Sustainable Growth Rate, also known as SGR or, more commonly, the “Doc Fix.”

As a matter of policy, SGR dates back to the Congressional Balanced Budget Act of 1997, which restructured the reimbursement formula for doctors treating patients enrolled in the federal Medicare program. Every year since, the rate has been adjusted upward because the formula produces numbers so unrealistically low that doctors would stop seeing Medicare patients, because they would actually lose money doing so. As the costs of healthcare delivery continue to increase year after year, so does the total amount of the adjustment.

Congress needs to make the “Doc Fix” permanent, but in the right way and for the right reasons. The permanent fix must be grounded in market-based principles that account for what things really cost and, most importantly, in the light day, through regular order and with a full and vigorous debate in the proper committees on the House floor.

That’s not how the SGR was done this year. Reserving judgment on the merits of the legislation that Speaker John Boehner and House Minority Leader Nancy Pelosi crafted together, it is full of special interest carve-outs and riders that only a well-funded lobbyist and his or her clients could love. And they are in the bill because none of them could pass on their own.

This sort of sausage-making still happens too often but can bring powerful allies to a piece of legislation and its sponsors for reasons of politics, not policy.

The UnitedHealth Group, the country’s biggest insurer, is aggressively pushing one such provision it has pushed before, which would let the company create its own rules to enter the lucrative health insurance market for federal employees. The UnitedHealth proposal, which was originally pushed by a former senior member of House Minority Whip Steny Hoyer’s staff (how’s that for insider access?) would create a new Regional PPO that would allow the company to cherry-pick federal employees in only states and cities they want to service.

Pricing on a regional basis would give UnitedHealth a huge competitive advantage over their competitors, who have to price to an average nationwide cost. It could also exclude the oldest, poorest and sickest populations out of the region — health insurance gerrymandering, so to speak.

Note that this provision has no impact whatsoever on physician reimbursement rates, except insofar as the congressional leadership needs the support of UnitedHealthcare’s army of lobbyists and allies to pass the “Doc Fix” bill.

Americans of all political parties are tired of late night deals and poorly written bills crafted by crony capitalist lackeys who owe their allegiance to the people signing their paychecks. Let’s have the debate, on the House floor, over this idea of opening up the FEHB to the benefit of one and only one company (that is frankly trying to play catch up, because they didn’t want to play in the federal employee market when it was first created).

The American people should never again be put in the position of waiting for Congress to pass a bill so that, in the immortal words of former House Speaker Nancy Pelosi – they can know what’s in it.

Peter Roff is a senior fellow at Frontiers of Freedom, an organization that advocates freedom of choice in healthcare and market-based solutions to the problems of increasing costs. He appears regularly on the One America News Network. Thinking of submitting an op-ed to the Washington Examiner? Be sure to read our guidelines on submissions for editorials, available at this link.