I am attending theWorld Health Care Congress in D.C., a confab of healthcare executives from all over the industry (government, payers, big health systems).Obviously, their attendee screening process needs work because I got in.

Doug Elmendorf, the Director of the Congressional Budget Office, kicked off the meeting. You know Doug and his team are the people who ‘score’ legislation, telling us what a law will cost and will save. I’d love to see the size of that spreadsheet.

First, I want to give the guy credit. In the most political place on the planet, he does a great job of being the referee trying to stay out of the way of the game. Both sides of the isle love him when their results support the cause, and then label him an idiot when the numbers do not break the way they wanted. And he seems pretty unflappable about it all. A true data dork, who is I am sure even more taken to the non-emotional nature of the numbers given the rancor this town can generate.

He talked a bit about how they scored the Patient Privacy and Affordable Care Act (turns out calling it ‘ObamaCare’ is so gauche, so middle America).  This guy is pretty with it, because here is hislong blog post that summarized his talk and it was up the very same day.  Oh, if the rest of Washington was this efficient.  Send this to your friends, if just for this link.  It is a good summary of his talk.

Remember, they don’t get to set or question the assumptions. They just plug them into the model and report the results back to Congress.

Here is something that caught my attention. It was not new news, but hearing it straight from the guy who really, really knows made it a little more real.

PPACA, as I call it now that I’ve come back and been dunked in the holy water of the Potomac, assumes a 30% cut in physician reimbursement from Medicare over the next decade. The presumption, there is that word again, is that it will be offset by physician productivity gains. No really, they weren’t laughing when they said that.

The Wall Street Journal says Medicare pays physicians just shy of $400 billion a year.30% of that is a big number.

Four thoughts…

First, do the math on that. Divide that number by ten years, and then divide that by the 700,000 physicians in the country. By the way, only about 550,000 of those physicians submit claims and not all of them participate in Medicare, so it is worse.

Second, the CMS demonstration projects are proving that actually realizing big productivity gains, even after major investments in IT and the development of patient centered medical homes models, is far more difficult than writing a paragraph into the legislation. Turns out most practices aren’t carrying around a ton of non-value added waste. Fifteen years of flat reimbursement can do that to you.

Third, based on the track record, do you really think Congress will actually make those cuts?  But this is a key part of the ‘savings’ that Elmendorf and team scored.

Fourth, imagine what happens if Congress actually does make cuts at this level to physician reimbursement.  Can you say 'access problem?' Can you say 'seniors marching on Washington?'

Maybe that was why he finished his talk with some ideas for Congress, some cuts and changes to consider if they want to pay for PPACA in the long run.