Healthcare Business News
David May, Assistant Managing Editor, Modern Healthcare

Maybe they'll see the light

Is it possible our gridlocked lawmakers can finally achieve a debt deal?

By David May
Posted: November 17, 2012 - 12:01 am ET

Black Friday is almost upon us.

Not the annual run-with-the-bulls, post-Thanksgiving spasm of retail mayhem that typically signals the start of the holiday shopping season. This year, in fact, much to the chagrin of the staff at many national retail chains, Black Friday will actually morph into Black Thanksgiving, with shopping commencing earlier than ever for all those who just can't wait until midnight to start maxing out their credit cards.

No, this time, if the worst-case scenario plays out, the real Black Friday will hit right before the New Year's holiday, the day when we stare into the darkness below us as we teeter on the edge of the “fiscal cliff.”

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For those of us who still need to be reminded, this fiscal abyss represents the expiration of income-tax cuts dating back to President George W. Bush's administration, the end of the Social Security payroll tax holiday and the imposition of $1.2 trillion in automatic budget cuts thanks to the failure of our leaders in D.C. to reach a debt deal in 2011. All of the above take effect in January. The automatic cuts, if triggered, will hit all sectors of healthcare hard, even though Medicare reductions are capped.

Without action from our elected officials in the final days of the 112th Congress, everyone is going to feel the pain. The good news is that there's still time for an effective intervention. And talks have already begun, with frequent mentions of “bipartisanship” and “reaching across the aisle.” It shouldn't take long to see if it's just talk, or if, post-election, there might be more incentive to cut a deal.

Defeated GOP presidential nominee Mitt Romney offered some conciliatory words in his concession speech on election night. “The nation, as you know, is at a critical point. At a time like this, we can't risk partisan bickering and political posturing. Our leaders have to reach across the aisle to do the people's work,” he said.

And just last week, President Barack Obama, in a wide-ranging news conference, stood firm on his demands for tax-rate fairness in negotiations to safely scale the fiscal cliff. But he also made it clear he was keeping an open mind on solutions. “Both parties voted to set this deadline, and I believe that both parties can work together to make these decisions in a balanced and responsible way,” Obama said. “There's only one way to solve these challenges, and that is to do it together. As I've said before, I'm open to compromise and I'm open to new ideas.”

Federal healthcare programs have to be on the negotiating table in some form, just because of the spending scale they represent and the trend lines that still need to be curved downward.

Former Senate Majority Leader Tom Daschle made that warning during a roundtable sponsored by the Institute for Healthcare Improvement a couple of days after the election, saying Medicare and Medicaid will take some hits. While he agreed with other prominent panelists that the controversial premium-support approach to Medicare is probably dead—at least for now—other changes are very much alive for providers and beneficiaries.

Daschle, who had been an early contender for HHS secretary in Obama's first term, said he expects heavy downward budgetary pressure on “virtually everything” in the department. And you can bet many members of Congress will continue to target spending under the Patient Protection and Affordable Care Act.

Elections do have consequences. While the outcome of this year's balloting is frequently referred to as an affirmation of the status quo, it still feels quite different. Balance of power didn't radically change, but it shifted. The bottom line for the nation has to be that the status quo of government gridlock is absolutely unacceptable.

David May , Assistant Managing Editor/Features

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