One of the key elements of the final negotiations is the problem on how to change compensation incentives to move away from payment based on service to payment based on quality of care.
The agreement is that
. . .the Institute of Medicine would complete a study by September 2011 recommending changes in the current fee structure. The administration would have 45 days to submit the report to Congress, and it would go into effect unless Congress blocked it by the end of February 2012.
This agreement will have a significant impact on the future costs of medicare and could bring the US sytem closer to European systems that have more incentives for outcome than the US pay for service system. Ironically the involvement of so called blue dog Democrats could result in a more economically sound bill that is also more progressive.
House Democrats clearing one health care obstacle
http://hosted.ap.org/dynamic/stories/U/US_HEALTH_CARE_OVERHAUL?SITE=VTBEN&SECTION=HOME&TEMPLATE=DEFAULTWASHINGTON (AP) -- Key House Democrats agreed Friday on steps designed to cut the growth of Medicare, clearing one of numerous obstacles blocking an early vote on health care legislation.
But even as Speaker Nancy Pelosi hailed the agreement as a "giant step forward" on President Barack Obama's top domestic legislation, leaders struggled without success to ease the concerns of moderate to conservative Democrats who have held up progress on the bill for a week. With the talks at a deadlock, a key committee chairman suggested an end run around the rebels.
At the White House, Obama met with senators in an attempt to speed completion of a bipartisan deal that has been under discussion for weeks.
The flurry of activity occurred as the administration and Democratic leaders fought back against the impression that the legislation was sputtering despite months of effort and negotiation.
Democratic officials in the House said late-night talks had produced agreement on changes in Medicare to try and reward doctors, hospitals and other providers for high-quality care. Critics argue the current system simply pays by volume - compensating providers regardless of whether additional medical procedures contribute to better health care.
This appears to remove a major problem that some conservative Democrats and some Republicans had with the current bill.
I may not understand the details very well but it seems to me that in this instance the Blue Dog Democrats point of changing the incentives of the health care system strenghten it and make it more progressive. I would be interested if those that are better informed about the nuts and bolts about health care agree.