November 2, 2015

Whitehouse: Let’s Give States an Incentive to Reduce Inefficient Medicare Spending

In Speech on Senate Floor, RI Senator Notes the Variation in Health Care Spending and Quality Performance, and Suggests Alternative Approach to Spur Improvements

Washington, DC – Last week, as the Senate prepared to vote on a two-year budget deal to avert a government shutdown and a default on our debt, U.S. Senator Sheldon Whitehouse (D-RI) spoke about how high health care spending continues to hamper our federal budget, and suggested a new approach to reduce spending.  While noting that he supports the new budget deal, he also described how we can do better in future budget discussions.

Using a series of charts, Whitehouse described how higher amounts spent on health care across OECD countries and within the United States is not associated with higher quality outcomes.  Rather, higher health care spending often corresponds with lower health care quality. Noting that the original sequester cuts attempted to control Medicare spending through “an across-the-board haircut” of two percent for Medicare provider reimbursements, he then outlined a new idea to target those cuts on the worst-performing states as an incentive to improve.

“I hope that anybody listening who is looking at the proposed cuts in the budget and who is looking at the need to manage this exploding health care cost curve that America has had for the last 50 years – steepening health care cost curve – starts to think about ways to do not just dumb and bloody cuts, but smart cuts – smart cuts that give the states that are costing us much more money than their peers the incentive to actually start behaving like their peers and bring down the cost for everyone,” Whitehouse said.  “That is what I would consider to be a serious win-win.”

Click here to watch Whitehouse’s full speech.


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