POLITICS
03/18/2010 05:12 am ET Updated May 25, 2011

Orszag Calls Senate Health Care Bill Biggest Cost-Container Ever Considered

The health care bill before the Senate would cut costs and reform health-care delivery more than any piece of legislation in American history, White House budget director Peter Orszag declared on Wednesday.

"The bottom line is the bill that is currently on the Senate floor contains more cost containment and delivery system reforms in its current form than any bill that has ever been considered on the Senate floor period," the Office of Management and Budget director told reporters during a conference organized by the publication Health Affairs.

Orszag's assertion of historic budget savings ups the ante a bit as the Senate moves through the critical stage of debating and amending its version of the legislation. At the very least, it makes it a bit harder for fiscally conservative Democrats to attack.

The OMB director cited four key aspects of the bill: its deficit neutrality and the inclusion of a commission that would restrain Medicare spending, an excise tax on high-cost insurance plans, and delivery system reforms.

Budget observers say Orszag is technically correct, at least when it comes to health care related legislation. While the Balanced Budget Act of 1997 included a 12 percent cut in Medicare spending, it would have saved fewer nominal dollars overall than the legislation being debated right now. It also lacked the "delivery system reforms" that Orszag conspicuously included as a clause.

"It depends what you mean by cost containment. If you are talking about attempts at reform of the overall healthcare system, not just government system but the overall healthcare system I think that's true," said Josh Gordon, policy coordinator at the Concord Coalition, a non-partisan federal budget analysis organization. "Congress has never done anything to try and restrain the growth of healthcare costs. We've never tried to change the healthcare delivery system from fee for service -- the Congress has never considered that."

"If you're looking at cost containment as being lowering healthcare inflation through delivery system reform, this bill reforms that more than any other bill prior," Gordon added. "Though relatively few bills ever make it onto the floor of the Senate, so this jumps to the top of the pack just for that procedural reason."

Critics of the Senate legislation, however, are skeptical that Congress will restrain itself from spending more money down the road and are unsure that delivery system reforms will produce desired savings.

Orszag addressed those concerns unprompted on Wednesday, noting that there are pay-go provisions that dictate what the government can do and undo and arguing that the Medicare Commission provision would "always [put] forward proposals to improve quality and reduce costs over time."

Reminded that the House rejected both the Medicare commission and the excise tax on high-end plans, Orszag insisted that time remains to change the legislative language.

"I don't know that I would use the word 'rejected' as opposed to 'not included' in their bill," he said of the House effort. "There is a bill on the floor of the Senate. The next stage after the Senate passes the bill is there will be a conference between the House and the Senate. Let's let that play out."