Committee for Economic Development

Health care is simultaneously a deeply personal issue and a more mundanely economic one. The personal consequences are known to all of us. Economically, many households fear the financial risk of a prolonged illness or serious injury. Health care costs are the most frequent cause of personal bankruptcy. And, from a national perspective, growing health care costs have profound implications for the country’s long-term fiscal health.

Because of health care’s very central role in our personal and economic wellbeing, CED believes strongly that:

• Every American should have access to health care.
• Care should be of high quality.
• Care should be affordable.

The Patient Protection and Affordable Care Act of 2010 (known informally as the ACA) was a well-intentioned attempt to deal with these issues, but in CED’s view, it has fallen short. Further reform is necessary to retain the ACA’s positive elements, while simultaneously improving upon it to build a better health care system for all Americans.

Our vision for Health Care builds on the ACA’s advances by strengthening and broadening the new law’s use of those market incentives to drive innovation for higher quality and lower cost, while maintaining an appropriate role for government to facilitate access and ensure that markets work. We believe that this truly would be the achievement of all three objectives of quality, affordability, and access that policymakers have sought for many years. 

CED believes policymakers have an opportunity to transform the ACA into a system driven by market incentives that decrease costs, improve quality, and promote innovation—while increasing access to coverage. Our research also explores the best path forward for Medicare, which is projected to be the strongest cost driver in the federal budget.

CED Members play an instrumental role in forming CED research findings, policy statements and recommendations for reform. Members take an active role in raising awareness about the need for reform through local forums, op-eds, and media appearances. Our members and staff routinely briefs lawmakers about how its recommendations benefit patients, providers, and government.

CED Policy Recommendations

CED has developed recommendations that harness market forces under both the Affordable Care Act and Medicare. 

Affordable Care Act:

• Replace the ACA’s complex subsidy mechanism, which puts a heavy compliance burden on and may mislead families with modest incomes and has proved difficult to administer accurately. 
• Restructure the ACA exchange system to align more closely with cohesive geographic health care market areas.
• Broaden the exchange populations to increase the numbers of enrollees and also the risk diversity, especially in small geographic areas.
• We would expand the ACA’s increase in consumer choice of insurance plans—which is the key to competition and innovation. 
• Remove the ACA’s unpopular mandates—and their complex exemptions—to compel the purchase of insurance.
• Replace the ACA’s income-conditioned premium subsidies with a “fixed-dollar” refundable tax credit, usable only to purchase insurance. 
• Eliminate the unnecessary individual and employer mandates. 
• Reform the tort system, using new data and analysis to formulate rebuttable standards of sound practice. Create specialized expert courts to facilitate more timely and less costly decisions.

Medicare:

• Eliminate the Medicare Advantage price benchmark based on traditional Medicare’s fee-for-service cost, and provide enrollees with a premium subsidy. 
• Increase the income-conditioning of Part B and Part D premiums, including a temporary Part B premium reduction for lower-middle income seniors. 
• Risk-adjust premium revenue for plans. 
• In rural areas, allow Medicare beneficiaries to enroll in traditional Medicare at no additional out-of-pocket cost, until Medicare Advantage plans meet a minimum threshold of availability.