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The Question About HCR is Not…

2010 March 23
by Ian Welsh

whether it will help some people, or harm some people.  It will do both.

Some people will get care they wouldn’t have otherwise.  People on Medicare will have half the “donut hole” for drug coverage covered, some people will get insurance who would have otherwise been refused.  Etc…

But here’s something which WILL happen as a result of this bill: some people who are not on Medicare will not be able to afford their medicine, due to the ban on reimportation and the increase in time before generics are allowed on the market. Many of them will die, others will go bankrupt.

Others will be forced to buy insurance they can’t afford, and will be fined if they don’t.  That money will have been money they would have used to buy out-of-pocket health insurance.  They will be harmed by this bill.

The excise tax will inexorably make employer provided health care plans worse, meaning more and more things won’t be covered by good plans (aka: plans that cover what you need.

Some women who need abortions won’t be able to afford them, and some of them will wind up bearing children they don’t want or will go to back alley abortion methods, and some of them will die or be permanently injured by so doing.

The point is that while there is no denying that some people will be better off under this bill there is also no denying that some people will be worse off. People will die who wouldn’t have without this bill, people will live who wouldn’t have without this bill. People will not go bankrupt because of this bill, people will go bankrupt because of the bill.

The question is not “will some people benefit” or “will some people be harmed”, the question is “on the balance does this bill do more good than harm?”

I come down on the side that says it does more harm than good. I may be wrong, I may be right. We won’t know for a good 10 years or so.

If I’m wrong, I’ll admit it and eat crow.

But I think I’ll be missing a meal.

And whether it does more good than harm, having the Federal government mandate that people buy a private product that costs as much, in many cases, as their tax bill, or the IRS will fine them, sets a bad precedent.  Saving a private industry which was in a death spiral (the insurance companies were only maintaining profits by cutting customers) sets a horrible precedent.  And refusing to do the right thing, which would have cost less, well, doesn’t set a precedent, but does continue a very tiresome trend of the US being unwilling to do the brain dead simple thing that has worked everywhere else, because its government is captured by moneyed interests.

33 Responses
  1. March 23, 2010

    The question is not, does it do more good than harm right now, or any time soon. The question is, does it go in the right direction? No. Obama, once more, has decided that using tax revenue to prop up “private sector” players to provide “solutions” for a problem is the Right Way. If you combine mandates, tax-funded subsidies, and a dysfunctional health insurance industry that has been saved by a preventive bailout courtesy Obama, you once more have a “dom loop”. Health care will continue to fail, and, in the not too far future, fail again catastrophically, just at higher expense. Obama has failed to remove profit and care denial bureaucracy related costs, has aided and abetted further inflation of prices for medication, and has utterly failed to “bend the cost curve” anywhere but up by preventing anti-trust measures and any functional Medicate-E by-in alternative to create competitive pressure.

    It will be deja vu all over again. But then, nothing ever got resolved in this country this side of the civil rights struggle. Compared to Eisenhower’s hot potato (military-industrial complex aka National Security State), health care is a “recent” problem.

  2. March 23, 2010

    Medicare-E buy-in

    sigh

  3. March 23, 2010

    Every appearance from this round is that the driving objectives of the legislation were to save the health insurance and pharmaceutical industries from their respective death spirals. For the Family (Stupak/C-Street et el), it was about restricting access to abortion. Providing care to people who actually need it was barely above sea level in the stack of priorities. In short, the alleged reform is nothing more than the usual rentierism designed to protect well-connected industries.

    The American government is structurally incapable of producing policy outcomes that benefit its people rather than its rentier class.

  4. Marsha permalink
    March 23, 2010

    Isn’t there a legal challenge to be made about forcing people to buy a private “product”?

    It seems to me that you can’t mandate that type of expenditure – particularly when some people will, as Ian points out, be bankrupted by this requirement.

    Another harm….nothing “good” even happens for four years – so every year from now until that time, another 45,000 people who don’t have health insurance will die because they are uninsured.

    And….people with pre-existing conditions will be made to pay outrageous rates because of their risks – so they will be forced to buy shit insurance for a lotta bucks.

  5. Jim permalink
    March 23, 2010

    Anyone who worked for wages has always subsidized for-profit companies through the surplus value the corporations took (any profit over and above what meager wages it cost them to get the employees to return to work the next day.) Now, because the for-profit system is internally broken, they come back to us and demand (with our reduced wages) that we buy a product that adds only profit for the few…and we still die and we still go bankrupt. How is this a win-win?

    Ian will not eat crow! The for-profit system is broken; if it were not they would not have to kill people all over the world in for-profit wars, demand bank bailouts, lay off thousands, go trillions in debt, fill the prisons as profit centers, and call an insurance industry bail out “health care.”

    Will things be better in ten years? No. Something new has to come out of this mess and the process will be very painful.

  6. March 23, 2010

    The question is not whether things will be better in 10 years. The question is whether they will be better in 10 years than the hypothetical world in which this bill did not pass. That question is not answerable. There is no crow to eat.

    The real criterion is whether more opportunities for improvement have been preserved than not. It’s a bit more measurable. I, for one, have little doubt that more opportunities have been preserved than not.

  7. March 24, 2010

    Hey, wait a minute! I like some crows.

    But more seriously, yes, just so. A bill could have been written which did no harm, but this was not done. I hope, eventually, the problems of this “system” will be fixed. But people are going to be harmed on the way to doing so. And that was not necessary.

  8. BDBlue permalink
    March 24, 2010

    Am I right in my understanding that while there is a “ban” on insurers declining people with preconditions (children initially and adults several years from now), there is no control on premiums? If that’s so, then I don’t know how much the precondition ban is worth because there’s not much difference in being prohibited from buying something and not being able to afford to buy it (although for the latter folks, there will still be additional payments made to the IRS).

    If my understanding is right, then this is one area where I think people are likely to be very upset with the bill. Because they’ve been essentially promised they will be able to get insurance despite preconditions and that may end up not being true in a very big way.

    I think that’s the real political damage done to Democrats. It’s not just that the bill is insufficient. It’s that the Democrats have sold it as something it isn’t and, by doing so, raised supporters’ expectations.

  9. March 24, 2010

    Indeed, BDBlue, a lot of people who are happy as a pig in shit about this “historic” moment right now aren’t going to be so happy when it goes into effect and they see what history looks like up close.

    I even noticed in some pictures from the pro-HCR gatherings in DC this past weekend that the WH handed out signs saying things like “Insurance Reform”. We can now watch the mandarins walk the context back from “health care” reform to discussions about insurance.

    And we all know that insurance is not the same as health care…or maybe too many of us don’t.

  10. March 24, 2010

    BDBlue writes:

    Am I right in my understanding that while there is a “ban” on insurers declining people with preconditions (children initially and adults several years from now), there is no control on premiums?

    That’s my understanding.

    One “tell” is that the career “progressives” are waving their pom poms over coverage (in itself a bad enough argument) and not cost control (or strong regulation). IIRC, there are a ton of little experiments on cost control, since, because America is, like, a total exception, all the experience of other countries is teh suxx0r and we don’t need to look at it, especially when we’ve got the opportunity to pick up some grant money.

    A second tell is that the bankster mindset of IBGYBG (“I’ll be gone, you’ll be gone>”) seems to have permeated all of Versailles. The 2014 and later implementation dates of the organ exchanges — oh, I’m sorry, the health exchanges — kick in long after Obama’s become the Leno to Oprah’s Carson.

  11. Steve permalink
    March 24, 2010

    There’s something in the bill that has gone completely overlooked. The fact that HHS Secretary’s will have enormous power – http://www.washingtonexaminer.com/politics/HHS-would-become-federal-giant-under-Senate-plan-8586777-73718162.html

    Whether we like it or not a Republican will become President. And naturally, their HHS Secretary will do whatever it takes to screw up the whole system because it would be in their political interests to do so (they’re Republicans, what do you expect, responsible governance?). Then when the public sees their coverage go down and their costs, deductibles and co-pays go up, the President will trot out his/her Press Secretary who will blame Obama, the Democrats and their “2010 big government take over of health care.”

  12. elgringocolombiano permalink
    March 24, 2010

    One of the supposed great benefits of this health care bill, HR #4872, is that starting in 2014, pre-existing conditions & rescission will be made illegal.

    However, there is some articles claiming these customer protections are bogus, insofar as a health care insurer could still do rescission existing customers or deny existing customer for pre-existing conditions because

    1 No strong enforcement – firedoglake http://fdlaction.firedoglake.com/2010/03/22/signed-sealed-but-not-delivered-six-big-flaws-need-fixing-to-make-new-law-meaningful-health-care-reform/

    My sense is that without strong regulation, a sick broke consumer will not get justice, fighting a health ins co & its army of lawyers.

    or

    2 Weak fine on health ins co, will be viewed as “cost of doing business” http://www.dailykos.com/story/2010/3/22/849097/-want-to-improve-the-ban-on-pre-existing-conditions

    This article claims Michael Moore claims the ins co fine is $100/day. So for costly treatments, such as cancer, an ins co could just say wait 1 year for the patient to day, & pay the $36.5K fine, as opposed to the $50K or $200K or whatever cost of actual health care treatment.

    There was another article (don’t recall source) claiming this fine was a flat $5K.

    I’ve not been able to figure this out. I searched online. I called my House Rep, & Public Citizen. In each case the operator transferred me to the relevant “expert”, which went directly to voicemail.

    Do any of you know? If so could you indicate whether

    1 the illegalizing of pre-existing conditions & rescissions is true or bogus?

    2 Point to the specific page nbr(s) of the bill with the relevant evidence, along with a url link to said bill

  13. alyosha permalink
    March 24, 2010

    I tend to see this as a beachhead. It was the best that could be done right now, given the current set of inept politicians in a corrupt system, while faced with costs (human and financial) that were spiraling out of control. I know there will be winners and losers as Ian suggests.

    The next step is for people to organize over the shortcomings, and the crappy products they’ll be forced to buy – thus bringing about a public option. Alan Grayson has already started on this project.

  14. Lori permalink
    March 24, 2010

    It’s all about the primary and Hillary Clinton. Obama had to do it now, now, now because Clinton said it couldn’t be done until the second term. She was right, of course.

    Until we get honest about the fact that Obama was given the necessary delegates for the nomination by the CEO of health insurance company and that the CEO has gotten the exact health care plan that he asked for, we aren’t having a real world discussion. We’re still looking the other way at the corruption.

    We have the bill that we have because that’s the deal that Obama made to become the Democratic nominee. You can’t turn a bill built on that kind of corruption into a good bill. But acknowledging the corruption at the base, and dealing with it aggressively, will allow us to do something positive. If we decide to just sweep this under the rug, we’ll have a botched up health care system for a long, long time. Get it out in the open. Investigate it. Charge people if necessary and we can fix things in a real way.

  15. BDBlue permalink
    March 24, 2010

    It had to be done now because the health insurance industry is failing. That’s the dirty little secret nobody in Washington wanted to talk about. This is essentially a bailout masked as “reform”.

  16. March 24, 2010

    Not only failing, but failing with nothing to replace it. I can’t understand why people seem to think that single-payer would fall from the heavens the moment Aetna crashed.

  17. gmanedit permalink
    March 24, 2010

    BDBlue, it turns out that children’s care for pre-existing conditions can’t be denied so long as the family already has health insurance (http://www.correntewire.com/children_pre_existing_conditions_will_not_all_automatically_be_covered). The rest will have to wait till 2014.

  18. dandelion permalink
    March 24, 2010

    Mandos — I don’t think anyone expected single payer to fall from the sky. Because we already have single payer in this country — it’s called Medicare. All the infrastructure for single payer already exists. And in fact insurance companies are deeply involved in the administration of Medicare, so the idea that single payer would single-handedly wipe out an industry and therefore jobs is just not true.

    The problem isn’t a technical problem, it’s a political one.

  19. March 24, 2010

    The problem isn’t a technical problem, it’s a political one.

    Yes, that’s the point, there’s no Constitutional or technical reason against single payer. There are only political ones. But those are the hardest ones.

    There are two political problems at stake:

    The Democratic blackmail is effective because it is true. If you do not vote for them, you will obtain a government that is noticeably worse at that present time. It doesn’t matter that the Democrats also represent a downward trend. It could, in fact, always be worse.
    The Republicans are consistently able to play the role of bête noire. They are able to do so, because there is a not insignificant segment of the American population that is comfortable with viciousness in various forms; for example, they are definitely happy to tell us that they don’t think that people dying at home in untreated agony is a problem.

    If you want single payer, you have to successfully address one problem or the other. Otherwise, the private insurance industry is going to be able to assure its survival. And it would be better that it did than not.

    This is why the negotiation model of politics is broken when it comes to health care, if not everything else.

  20. Lori permalink
    March 24, 2010

    Mandos,

    Negotiation was irrelevant. We have this bill because that’s the bill that Roosevelt wanted. You think he just randomly gave Obama all of the uncommitted delegates in Michigan? There was no logic behind that. Obama chose to take himself off the ballot to delegitimize Clinton’s expected win there. And for denying people the right to vote for him, he gets all of the uncommitted delegates?

    The logical response is to allow Clinton to keep all of the delegates that she won because she abided by all the rules. Allow the uncommitteds to vote for whomever they want because Obama chose to take himself off the ballot. Allow all the delegates to be seated because all of the Democrats in the legislature ultimately voted against the bill to move the date up. In Florida, recognize that there would never be an honest election again without paper trails, and let their delegates be seated. How can you expect Democrats in the legislature to walk away from the possibility of having honest elections in that state?

    Had those things happened though, Clinton would have been the nominee. So, instead, the Rules and Bylaws Committee, chaired by the CEO of a healthcare organization, deducted delegates from Clinton and gave them to Obama – enough to make sure he had the nomination.

    And in return, James Roosevelt got the exact health care plan that he is on record as wanting. He was opposed to the public option – there is no public option and there never was a public option.

    We have this lousy bill because Obama is completely corrupt – beginning, middle and end. The Republicans will run against it, and promise to repeal it but will do everything they can to protect it because they don’t want the health insurance industry spending hundreds of millions of dollars against them.

    We’re going to have to wait until the meltdown is so bad that even the promised $600 million ad campaign against real reform cannot slow progress. This bill is a net loss because a lot of people are going to have to die before it will be changed.

  21. March 24, 2010

    Thank you Ian, for your moral courage in treating this subject. In the ol’ US of A, moral courage is fast becoming an oxymoron. Your courage is combined with logic and common sense. Any legislation that allows Drug and Medical Insurance companies to maintain the “Whip Hand” is basically flawed. They are the equivelent of violent squeegee men.
    Anyone can wax anecdotes – hell, I’ve been fighting bone marrow cancer for > 7 years! That the Bill will help millions (including me!) is but a Phony Paradigm. Someone must pay the extortion to these drug, insurance and medical device companies.
    I fear that Obama totally mis-read the admittedly garbled message sent by Massachusetts voters. Those people were begging someone, somewhere to stand up for them versus all pervasive corruption. By large majorites, the polls (in Mass.) indicated that people wanted a robust Public Option. They saw the Public Option being scuttled, and many voters protested in illogical & visceral fashion. I also fear that Obama’s reaction to the Massachusetts senatorial contest is the product of reaction, panic and short-term political thinking. Trying to get a Bill – Any Bill – passed in order to avoid the (feckless) image of Bill Clinton, vintage 1994.

  22. Es-tonea-pesta permalink
    March 24, 2010

    Others will be forced to buy insurance they can’t afford, and will be fined if they don’t. That money will have been money they would have used to buy out-of-pocket health insurance. They will be harmed by this bill.

    It’s too bad that people can’t afford to buy health insurance that they want to buy because they are being fined for not wanting to buy health insurance. Wait, what?

  23. March 24, 2010

    It’s not mysterious. “Out of pocket health insurance” means paying for one’s own medical care. Now, go back and re-parse.

  24. DancingOpossum permalink
    March 26, 2010

    alyosha, give up the Grayson dream. He is nothing but a talker with no action who wants your money and, like Obama, will happily take it and give you nothing in return.

    Now comes word that Obama is lifting the moratorium on commercial whaling. This is a direct contradiction to the promise (lie) that he made while a candidate. Greenpeace is aghast; of course it foolishly supported him on the basis of this promise and others that he quickly broke — like giving West Virginia some MTR mining in retaliation for that state’s daring to vote overwhelmingly for Hillary in the primary. (Yeah, that’s my theory, and I’m sticking to it). Obama is corrupt, vicious, and has a vindictive streak a mile wide. I wonder what Greenpeace did to deserve getting thrown under the bus? Or is it just, as a poster at TDO put it, just that he “hates the world”?

    Tell me again how a Republican would have been worse. Please. Tell me.

  25. March 26, 2010

    With or without a Republican congress?

  26. kenmeer livermaile permalink
    March 26, 2010

    FWI, it wasn’t that long ago that driving a motor vehicle w/out insurance was a legal option. It’s interesting how interested people become in an issue when they are required to participate via their daily bread.

    Health care payment has been a looming train wreck for quite some time. (Some Dem prez and his bossy wife were concerned about this, oh, 16 years ago.) The train wreck still looms.

    Difference with this bill now is that we the people are forced to look at it.

    Some people think of democracy as a freedom-enhancing form of government. Whatever. we tell ourselves what we feel we must to deal with reality. Democracy isn’t about freedom, although it’s sold that way. It’s about efficiency, about increasing government fidelity to the needs of the populace as necessarily governed beings. (Ungoverned human beings are like swarms of flying cockroaches; government at least clips their wings and slows down their worst depredations, although modern technology and capitalism have increasingly turned government into a wing manufactory.)

    One thing a democracy can do is pass a bill that forces the people to deal with the people.

    Think of it as a *framed* train wreck. We can’t help but see it coming now because it has a square around it — like TV! — and like TV, we can’t help but look at it and have to pay attention and money if we want decent reception and channel variety.

    So now it’s law, and some of that law shows us how good health care can be and some shows us how bad health care can be. But either way, it shows us that from now on for the reasonably foreseeable future, health care is LAW, and so we must deal with it.

    My family has what most people think of as good — really good — insurance. Not A-plus but at least a B-plus. Along with premiums that rise as regularly as the national train wreck schedule, our deductible increased 50%, both procedures and prescription drugs. These policies were written *before* HCR went into law.

  27. kenmeer livermaile permalink
    March 26, 2010

    As for whaling moratoria: if politicians are fools to believe their rhetoric, how about us?

    I read at http://www.campaign-whale.org/research-reports/whaling-industry/why-commercial-whaling-must-end :

    “Since the indefinite commercial whaling moratorium was introduced in 1986, the whaling nations have killed around 15,000 whales between them. At the time of writing, the Japanese whaling fleet has just returned from Antarctic waters where a further 300 or so minke whales have been killed for so called ‘research’, in open defiance of world public opinion and the IWC which has never validated the Japanese programme. The meat from those dead whales will end up on sale in Japanese restaurants and on supermarket shelves. Japan is not only defying the global moratorium on commercial whaling, it is killing whales in a sanctuary agreed by the IWC in 1994.

    Japan has ‘recruited’ many countries to the IWC to support the resumption of commercial whaling using foreign aid packages. If the ban is lost it will be a disaster for whale conservation efforts.

    This report presents the many reasons why the ban on commercial whaling must be maintained and properly enforced. We cannot wipe away the tragic history of commercial whaling, but we can, and must, prevent its repetition.”

    Moratoria make for morally satisfying declarations, but try getting 15K dead whales to applaud them. When trying to bell a cat, the safest approach is to offer plenty of fresh, squirming, live mice to distract the beast from the collared alarm system one hopes to put in place. Dicey work.

    We live in a political world. Now that Obama is elected, we need neither champion nor crucify him: we need to try and understand why he does what he does. It’s the only way to ride a horse, especially a gift horse, and Obama is more than that: he is a gift pony. 1st black president. As political animals go, Obama is virtually a chimera.

  28. March 26, 2010

    I don’t think we need to try to understand why Obama does what he does. Rather, we need to succeed in getting him to do what we need him to do.

  29. March 27, 2010

    What on Earth makes you think you have any leverage over the man and the interest he represents? Rather, you might want for focus on immediate damage control by trying to disrupt the media narrative that Obama is a liberal – good luck with that, will go as well as challenging the “Bush was not a true conservative” rewrite – and in the unlikely event that you succeed at preventing the inevitable Obama backlash from also discrediting sensible policy proposals even further, and to do so in time for the 2012 primaries, try to find an actual challenger that could put these proposals on the record to lay the groundwork for, say, a 2020 election.

    You don’t have what would “make him do it”. Get over it.

  30. March 27, 2010

    You don’t have what would “make him do it”. Get over it.

    BINGO. Peculiar machinations and strategies to force compliance at some unspecified later date are unlikely to work as predicted. The People Who Matter know this.

    I would not consider the “inevitable Obama backlash” to be so inevitable as all that, though. We’ll see, but I’m betting that the public will be largely on Obama’s side in 2012, and that we’ll still see a Democratic House come January 2011. Some people are too convinced that because you can get the concept of single-payer to poll well, it will translate to behaviour at the ballot box in some straightforward fashion. I suggest that the right way to model ballot box behaviour vs. policy choices is through market research, not policy polling.

  31. jawbone permalink
    March 28, 2010

    CorrenteWire is hosting Yves Smith of Naked Capitalism today from 2-4 PM EDT to discuss her new book, ECONned!

    (Yeah, I’m late with invite, sorry.)

    Click on this link to post questions for Yves Smith, read responses. The full title of her new book is ECONNED: How Unenlightened Self Interest Undermined Democracy and Corrupted Capitalism.

    Her blog is Naked Capitalism, always interesting if only for her Antidote du Jour feature.

  32. March 28, 2010

    b. You’re right; I was tempted by an epigrammatic response (though I did say what we “needed” to do, as opposed to what was possible to do). What I was trying to get at was that there is this huge tendency to try to model the behavior of the political elite, sometimes as a way of affecting it, but most often as a way of identifying with it. I really don’t want to build a model of why Obama does what he does. Philosophers have only interpreted etc.

    I think investing time or energy in either legacy party has unacceptable opportunity costs. And 2020 is a long way off. Obviously, striking out in any kind of new direction can’t be shown to have any sort of guaranteed result, so for “pragmatists” and incrementalists that’s off the table. On the other hand, look where pragmatism has gotten us. The snow of ignorance remains untrodden…

  33. kenmeer livermaile permalink
    March 28, 2010

    “I don’t think we need to try to understand why Obama does what he does. Rather, we need to succeed in getting him to do what we need him to do.”

    Voodoo? Massive voter rallies not even midway through his first term? The former — understand Obama — does not exclude the latter — get him to do what we need him to do.

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