Today’s early morning highlights from the major news organizations, including the latest on the looming fiscal crisis as well as market developments and health policy news from the states.
: Hot Rhetoric Aside, There鈥檚 Overlap In Competing Fiscal Offers That Could Form Basis Of A Deal
Both sides now concede that tax revenue and reductions in entitlement spending are essential elements of any deal. If the talks succeed, it probably will be because House Speaker John Boehner yields on raising tax rates for top earners and the White House bends on how to reduce spending on Medicare and accepts some changes in Social Security (12/4).
: Governors Urge Obama, Lawmakers To Avoid 鈥楩iscal Cliff鈥
Although some federal programs especially key for states 鈥 notably Medicaid 鈥 are exempt, many other federal grants to states would be cut. The Pew report said 18 percent of federal grant money would be subjected to the automatic hit. That includes Title I funding, which covers education programs for the poor and the disabled, medical research money, and health and human resource programs (Fletcher and Helderman, 12/4).
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: Republicans Drop Ryan Budget Plan In 鈥楩iscal Cliff鈥 Negotiations
The austere federal budget plan drafted by Rep. Paul D. Ryan and embraced by Republicans as a sweeping reimagining of government has hit a roadblock on the way to the so-called fiscal cliff. Top Republicans, including Ryan, insisted this was not the end of the plan and pledged to “support and advance” its principles. But by sidestepping the plan, the House leadership sidelined the push for a transformative overhaul of federal entitlements 鈥 a move that quickly sparked dissent from the party’s conservative wing (Mason and Mascaro, 12/5).
: GOP Deficit Plan Irks Conservatives
The conservatives’ attitude could nonetheless complicate Mr. Boehner’s mission as he strives to negotiate with a re-elected Democratic president without losing so many Republican votes that his leadership would be in peril. GOP leaders said the criticism underscores how much Mr. Boehner’s proposal was an attempt at compromise, while Mr. Obama’s proposal, which would raise $1.6 trillion in new taxes, was not (Bendavid and Lee, 12/4).
: As Budget Talks Continue, Markets Change Little
Stocks closed little changed Tuesday on Wall Street as budget talks continued in Washington. 鈥 Investors are waiting for developments on the budget talks, which are aimed at avoiding the government spending cuts and tax increases that would begin to arrive Jan. 1 and could eventually cause a recession. 鈥 Republicans, led by Mr. Boehner, have balked at Mr. Obama鈥檚 proposal of $1.6 trillion in additional taxes over a decade, and called on Monday for increasing the Medicare eligibility age and lowering cost-of-living increases for Social Security benefits (12/4).
: 鈥楩iscal Cliff鈥 Warnings Yet To Faze Wall Street
The markets鈥 sense of confidence 鈥 or, arguably, complacency 鈥 is rooted in two strains of thought. One is that all the tough talk from the negotiators is mere posturing, nothing more than a signal to their allies that they are taking a stand in advance of real dealmaking closer to the deadline. Investors and executives have repeatedly seen brinkmanship out of Washington 鈥 including over raising the cap on government borrowing in the summer of 2011 鈥 conclude with an agreement at the last possible moment (Irwin, 12/4).
: Health Stocks A Port In Market Storm
Some investors believe they have found a remedy for the volatile market: health-care stocks. Money managers are embracing the group following the Nov. 6 U.S. presidential election, which ensured that the health-care overhaul championed by President Barack Obama will survive. While the overhaul of the U.S. health-care system creates winners and losers within the industry, investors say the newfound certainty heightens health care’s overall allure (Jarzemsky and Kiernan, 12/4).
: The Perilous Politics Of The Health Insurance Tax Break
There’s not much in health care that economists agree on. But one of the few things that bring them together is the idea that excluding the value of health insurance from federal taxes is nuts. “It just doesn’t make sense,” says Jonathan Gruber, an MIT health economist and author of Health Care Reform. “And it’s important to emphasize in this world where economists seem to agree about nothing, this is something where there’s just broad and universal agreement” (Rovner, 12/4).
: 鈥極bamacare鈥 Saves Consumers Nearly $1.5 Billion
Consumers saved nearly $1.5 billion in 2011 as a result of rules in President Obama’s healthcare law that limit what insurance companies can spend on expenses unrelated to medical care, including profit, a new analysis shows. Much of those savings 鈥 an estimated $1.1 billion 鈥 came in rebates to consumers required because insurers had exceeded the required limits. The study by the New York-based Commonwealth Fund also suggests that the Affordable Care Act forced insurers to become more efficient by limiting their administrative expenses, a key goal of the 2010 law (Levey, 12/5).
: Study: Prescription Drug Coverage Under Obama Health Care Law could Vary Markedly By State
A new study says basic prescription drug coverage could vary dramatically from state to state under President Barack Obama鈥檚 health care overhaul. That鈥檚 because states get to set benefits for private health plans that will be offered starting in 2014 through new insurance exchanges (12/4).
: SCOTUS Asks Tough Questions On Hospitals鈥 Medicare Claims Lawsuit
A majority of Supreme Court justices on Tuesday sounded skeptical of a suit brought by hospitals to reopen Medicare claims as much as 25 years old because of calculations that were found to have underpaid them. The justices heard oral arguments Tuesday in the case of Sebelius v. Auburn Regional Medical Center, a challenge brought by 18 hospitals that are seeking compensation from claims dating to 1987 (Norman, 12/5).
: Women Notch Progress
Women account for a third of the nation’s lawyers and doctors, a major shift from a generation ago when those professions were occupied almost exclusively by men, new Census figures show. Women’s share of jobs in the legal and medical fields climbed during the past decade even as their share of the overall workforce stalled at slightly less than half (Mitchell, 12/4).
: Olive Garden Parent Darden Suffers From Bad Specials, 鈥極bamacare鈥
The Olive Garden, Red Lobster and LongHorn Steakhouse parent lowered its profit and revenue projections for the quarter ended Nov. 25, blaming sour promotions in its eateries, Superstorm Sandy, its purchase of the Yard House USA chain and even its efforts to mitigate the coming costs of healthcare reform, also known as “Obamacare” (Hsu, 12/4).
: Obamacare Press Hits Olive Garden
Harsh press coverage of how the Olive Garden and Red Lobster are implementing Obamacare depressed earnings, the restaurants鈥 owner says. The company offered a lower earnings estimate for fiscal year 2013 on Tuesday, citing in part the media鈥檚 reporting on the company鈥檚 handling of the new health care law (Glueck, 12/5).
: Justice Dept. Recovers Record $5 Billion Under False Claims Act
The Justice Department鈥檚 civil division recovered a record $5鈥塨illion in the past fiscal year from companies that defrauded taxpayers, with much of the abuse occurring in the health-care and mortgage industries (Finn, 12/4).
: U.S. On Alert For Canadian Drugs
The White House has alerted police and border agents to prepare for a possible influx of addictive pain drugs from Canada, where cheaper, generic versions of OxyContin will soon become available. U.S. drug czar Gil Kerlikowske also called Canada’s health minister last week to discuss the issue and offer assistance to address the wave of prescription-drug abuse sweeping both countries, Mr. Kerlikowske’s office said (Barrett, Catan and Vieira, 12/4).
: For Tea Party Activists In Florida, The Health Care Battle Goes On
President Obama’s re-election sent a message to state capitals: The war over the president’s health care overhaul is finished. Even in Florida, where Republican leaders led the legal battle against Obamacare, there’s recognition now that the state has to act fast to comply with the new law (Allen, 12/4).
: Changes To California Children鈥檚 Healthcare Won鈥檛 Be Delayed, Official Says
A top official in Gov. Jerry Brown’s administration said Tuesday that California will begin transferring poor children into a cheaper healthcare plan on Jan. 1, despite concerns from some lawmakers and advocates that the state’s plan is inadequate (Megerian, 12/4).
: Oklahoma Court Rules Anti-Abortion Laws Pertaining to Ultrasound, Drugs Are Unconstitutional
Oklahoma laws requiring women seeking abortions to have an ultrasound image placed in front of them while they hear a description of the fetus and that ban off-label use of certain abortion-inducing drugs are unconstitutional, the state Supreme Court ruled Tuesday (12/4).
