CBO Scoring Shortchanges Preventive Healthcare Spending

Rep. Michael Burgess (R-TX) has a bone to pick with the Congressional Budget Office, the independent, nonpartisan agency that performs economic and budget analysis for government programs.

Congress relies on the CBO's analyses in making policy decisions. But the physician-turned-congressman is unhappy with the way the CBO scores legislation that deals with preventive healthcare spending.

In a telephone conversation, Burgess explains that by law, the CBO must only look 10 years out when it develops cost estimates on how a piece of legislation will affect spending and revenues.

The problem is that the advantages of preventive healthcare spending for chronic diseases do not always fit neatly into that time frame. Programs to reduce the obesity rate, or to trim the increase in diabetes cases, or to keep diabetic blood sugars under control may need longer than 10 years to begin to demonstrate their full economic value.

Burgess notes that chronic disease care accounts for 70% of healthcare spending, or about $1.6 trillion annually. In this era of care coordination and care management, he explains, the savings from preventive care is "undisputed" by experts.  Now, Burgess says, it is time for CBO analysis to reflect how preventive healthcare spending can begin to contain costs and provide long-term savings.

His concerns are echoed by the Partnership to Fight Chronic Disease (PFCD), a coalition of advocates, providers, business groups, and health policy experts, which has identified three areas in which it says additional information is needed for policymakers to fully assess the effect of prevention programs:

• Baseline assumptions. Healthcare expenditure estimates depend on baseline assumptions, including the current health status of a population and the impact of those trends. The CBO needs to be more transparent in indentifying its baseline for analysis.
  For example, the PFCD contends that it is not clear how the rise in obesity is factored into the baseline for current or projected spending, although research has shown that Medicare spending is directly affected by the obesity status of people entering the program.
• Broader perspective on impact. CBO scoring does not currently include analysis of the broader impact a policy change will have on healthcare and the economy. PFCD notes that because Medicare is the largest payer for healthcare services, changes to Medicare policy will likely impact the entire healthcare system. But for CBO purposes, only the impact on federal Medicare spending is captured. Wellness and prevention programs that impact population health affect healthcare spending in the private sector and have overall effects on the economy. Providing analysis of the overall impact of Medicare changes would provide lawmakers with important information.
• Long-term analysis. The CBO scoring windows cannot sufficiently capture the long-term value of population health improvement programs. Without an understanding of the long-term value legislation may provide, lawmakers are not able to distinguish between federal spending without expectation of a return and federal spending as an investment.

Last week, Rep. Burgess and Rep. Donna Christenson (D-VI) submitted HR 6482 (Preventive Health Savings Act of 2012), which would allow the CBO to collect and analyze scientific data past the current 10-year window.

The bill defines preventive health as an action to avoid future healthcare costs "that is demonstrated by credible and publicly available epidemiological projection models, incorporating clinical trials or observational studies in humans."

The bill already has 16 co-sponsors, including some Democrats. Other supporters include the Healthcare Leadership Council, whose president, Mary R. Grealy, released a press statement praising the legislation.

"Congress needs to see the full picture of how wellness programs improve population health and not just the initial price tag," she said. "We shouldn't ignore the long-term savings to our healthcare system just because they don't show up within an arbitrary period of time."

This is the second time Rep. Burgess and Rep. Christenson have addressed this issue. A similar bill presented in 2009 died in committee. Back then the role of preventive services in healthcare was not as much a part of the national dialog as it is now.

It may seem like tilting at windmills to present a bill this late in the session with Congress focused more on elections that legislation, but HR 6482 will hopefully generate some interest in a topic that deserves our attention.

The CBO, which prides itself on its nonpartisanship, declined to comment.