The horizon is not so far as we can see, but as far as we can imagine

Category: health care Page 31 of 35

Destroying the Democratic Majority

By now you’ve probably heard about the Stupack amendment, which would make it illegal for any insurance offered on the exchanges set up by the health care reform bill to cover abortion services.  It is being allowed to the floor by the leadership, and indications are that there may be enough votes for it to pass.  If it were to remain in the final bill, it would strip practical access to abortion from millions of women, a number which would increase when the exchanges open to businesses.

Recently we have also seen the proposal to tie prices for procedures to Medicare +5% fail.  The Congressional Budget Office (CBO) has reported that the public option will likely only get 6 million enrollees and will cost more than private offerings because it will get more sick people than private plans since it won’t anti-select, has no auto-enrollment, and won’t have any scale advantages for bargaining since it will have so few people and not be linked to Medicare.

Meanwhile the bill itself will force people to buy insurance, provides inadequate subsidies, and falls hardest on the middle class and young people—forcing them to spend a huge chunk of their discretionary income on average, and doubtless pushing many families into bankruptcy (plenty are on the verge, it is impossible to imagine that this won’t push them over the edge).

And yet it is still supported by the same people who supported it all along.  Apparently nothing can happen which would cause them not to support it.

This is the sort of “deal at any cost” thinking which bloggers used to decry.  I find it amazing.  Absolutely amazing.  For any provision which is called “public option”, no matter how weak, folks are apparently willing to swallow hard and get over any number of deficiencies.

At this point, I’m wondering if the Democrats will even maintain control of the House in 2010.  It’s looking like a close run thing.  The jobs recovery will probably start in Spring, but it’s going to be slow, and most people who lost jobs are not going to find new ones (the recovery will probably not even keep up with population gains).  The legislative record of Congress and Obama will stink.  And they’re willing to pass a bill which falls hardest on the young (who can’t afford the cost of buying insurance) and on child-bearing age women, two extremely strong Democratic voting cohorts.  This behavior seems designed to depress turnout in 2010 and 2012.

I can only conclude that both Democratic politicians and many progressive bloggers want to be back in the opposition, since they keep being willing to swallow bad policy.  Policy so bad, in fact, that it seems designed to hurt Democratic electoral prospects.  Forget doing the right thing morally, I don’t expect that of Democratic politicians.  But apparently they are also incapable of acting in a way designed to make sure they keep their majority.

Remarkable.

Corrected: Support for Public Option (Does Not) Collapse If Real Public Option Polled

winged_caduceus

Edit: oops.  I’m full of it.  Misread the poll.  In fact it indicates the opposite of my title.  Ignore the below.  Perhaps the public option will be fantastically popular.

The problem with public option polling is that the questions imply strongly that everyone has access to it.  In fact, most people don’t have access to it (if, for example, your employer offers insurance you can’t opt out and go to the public option.)  Kip Sullivan did a bit of investigating and found a poll which actually did inform Americans of this fact (h/t Corrente):

“Would you support or oppose having the government create a new health insurance plan to compete with private health insurance plans?”
Support: 55%
Oppose:42%
Unsure: 3%

If oppose/unsure: “What if this government-sponsored plan was available only to people who cannot get health insurance from a private insurer? In that case, would you support or oppose it?”
Support: 21%
Oppose: 24%

That’s quite the difference, don’t you think?  As I noted in my last post, voters are going to be furious with Democrats if they pass any of the current proposed health care “reform” bills. The public option in all of them is crippled and the subsidies are low, such that they will eat as much as 1/3 to a half of many people’s disposable income.

Because the public option proposed in any of these bills is not robust, since they won’t have enough enrollment to have market pricing power, and thus won’t be able to force down costs, there is no reason to believe that health care reform will actually contain health cost increases below inflation, let alone below wage increases.

Since the bills also force people to buy insurance, that means voters will be forced to buy insurance whose cost will rise faster than their wages.  This is particular pernicious when it comes to 20 and 30-somethings, fresh out of College, with huge student loans already, and few good job prospects.

This is horrible policy. It is also political suicide.  The people in the progressive blogosphere who are pushing for a “public option” without insisting on an actual robust option (again, none of the options being considered are robust and even if linked to Medicare rates none of them will be because they are not large enough) are pushing for a law which is a massive giveaway to insurance companies—a regressive tax on the middle class.  It is worse than immoral, though it’s terribly immoral, it is a horrible mistake the price for which will be paid at the ballot box.

I have warned on this repeatedly, as have others.  We have not been listened to.  I am not looking forward to having the last laugh on this, because it is a laugh which will be purchased in the suffering of Americans, but I will have the last, bitter, laugh.

Progressives need to learn how to analyze policy.  The reason you elect a particular party, Senator, President or Representative, let alone a Congress, is to implement good policies, not to pass something bad for the sake of saying they passed something.

When you pass good policy (say a stimulus bill which actually improves the job situation, instead of a stimulus bill to weak to do more than slow the bleeding) the population, aka: voters, receive good results. That makes voters happy. When they’re happy, they vote for you again.  When they aren’t happy, they don’t.  This is how LIBERAL government works.  Do good things, reap the benefits.

Reactionary government figures that if you give enough money to private interests and throw a few scraps to the population, you can buy the election.  But it doesn’t work.  Democrats received more money from special interests last election not because special interests decided they loved Democrats, but because the Republican brand was so sullied they knew the Republicans were toast.  So they gave money to the Democrats to protect their interests.  They bought in.

But the second Democrats are weakened, and Republicans look like they can win, they’ll go back to giving Republicans most of their money.

The right thing to do, passing good policy, isn’t just the right thing to do morally, it’s the right thing to do pragmatically.  It is clearly pointless to expect most Democratic legislators to do the right thing for moral reasons, but it would be nice if they understood they are cutting their own throats by continuously passing bad policy.

Yes, Health “Reform” is a Clusterf*** and those pushing for it are being taken

Digby gets it, noting that many middle class folks are going to be forced to spend 1/3 to a half of their disposable income to buy insurance.  This is something Dave Johnson and I have been screaming about for months.

I don’t care whether there’s a lousy, weak public option.  Even if there is (and even the House bill’s public option is weak, 12 million people will not provide sufficient market power to lower costs significantly) health care reform as currently suggested is profoundly stupid and venal.  It is a regressive tax on ordinary Americans which is funneled to private industry.  People are going to be forced to buy insurance they really cannot afford.

Digby is right to be worried about the backlash.  I wouldn’t want to have to defend this to someone whose discretionary income got slashed by a half or a third.  Who is worried about eating or paying tuition for their kids because they have so much less money. Or 20-somethings out of university, crushed by huge student loans, also being forced to buy insurance they can’t afford and realizing that means they’ll never, ever, be able to afford a house.

The people who are pushing a lousy public option as if it will fix the problems innate in an individual mandate system are welcome to take the “credit” for doing so.  Because this is insanity.  Absolute insanity.  And everyone pushing for it, whether they call themselves progressives or not, is aiding and abetting this insanity and will be bear responsibility for the backlash.

And there will be backlash.

That Horrible Canadian Health Insurance System

Went and renewed my Ontario Health Insurance Plan (OHIP) card today. Stepped into the OHIP office at 8:30, an office close enough to where I live that I could walk to it . A receptionist looked at my forms and documentation (a phone bill to show my address, my passport to show a signature with a picture, my old health card and a one page form.) She gave me a number, I sat down and was called less than 5 minutes later. The agent looked over my papers, chided me for not renewing it sooner, took a new picture of me, and gave me a letter to use along with my old health card so I can get care till I receive my new card in the mail.

Total elapsed time? Less than 15 minutes.

Now, to be fair, this is a lot better than my experience with OHIP in the early 2000’s when I was upgraded from a non-picture card to a picture card. That experience was a nightmare—long waits, an office almost 45 minutes from where I lived, unclear instructions so that I had to come back a second time, and a hostile and overworked agent. But in general my experiences with the OHIP bureaucracy, including the time I moved provinces twice in less than six months, theoretically making me covered by neither province, have been nothing but positive. In the case where I was covered by no one, a manager quickly made the right decision, on the spot: I had to be covered by someone, I was now living in Ontario, and therefore Ontario would cover me.

Simplicity is next to Godliness when it comes to bureaucracy, and from a patient’s perspective, the Canadian health care system tends to be simplicity itself.

The Reason Insurance Company Execs aren’t Scared of the Public Option

So, apparently an insurance company economist has admitted that private insurance could survive a public option, (h/t Digby):

“I believe the private system is important because it brings innovation, it brings energy, it brings change, it brings ideas that are often used in the public sector system as well,” said Richard Collins, senior vice president for underwriting, pricing and health care economics at UnitedHealthcare. “I think we can have both a public and private system.”

Predictably, progressive bloggers want to use this to sell the public option.  Fair enough.

But why aren’t executives scared of a public option any more?  Because the public option as written in the two bills which contain it is so weak that it will not have significant, if any, pricing power.

The public option originally proposed by Hacker would have had over 100 million people enrolled in it.  The current one would have, according the Congressional Budget Office, just over 10 million.  No one with an employer plan would be allowed to join, it has no pre-enrollment, reimbursement is not linked to Medicare, doctors are not required to take it if they also take Medicare, and so on.

It’s not a robust public option.  It is questionable if it’s even a viable public option.

I’d rather not have it if I were an insurance company exec, because once it exists it could always be improved, but in its current state, I certainly wouldn’t be scared of it.

The fact that at least one insurance company executive isn’t scared of the public option shouldn’t be a cause for celebration, it should tell you that the public option has been horribly compromised.

The Problem With Healthcare Reform Isn’t the American People

winged_caduceusEzra Klein has an article whose thesis is that as Americans don’t directly pay the full cost of their healthcare since employers pay a large chunk, or they’re on Medicare, Medicaid or some form of socialized medicine (the military and the Veterans administration) Americans aren’t for radical change.

The problem with this is simple enough.  Polls find that a super majority of Americans, from 70% to 80% want a public option.  A straight up majority want single payer.  That certainly qualifies as radical change.

Americans may not pay the full cost of insurance, but they are well aware of the full cost of health care.  About 60% of all bankruptcies are caused by health bills, everyone who is self-employed knows the full cost, and people who get sick routinely had claims denied or lose coverage.  The full cost of healthcare becomes evident when you get sick, and the health care you thought your insurance provided doesn’t actually appear, or you have to fight tooth and nail for it.

Everyone may not have experienced these costs and problems directly, but I’d be willing to lay long odds that almost no Americans haven’t had them happen to a friend, co-worker or family member.

And so, contra-Ezra, in fact Americans are ready for radical change.  Even if you don’t consider the public option radical, single payer is, and a majority of Americans want it.  One might argue that that the intensity of desire for change is not there, that there haven’t been huge crowds in support of health care change, but the problem there is Obama has been rather wishy-washy. He isn’t offering single payer, which is what would get the hard left out in large numbers, and he isn’t even willing to say that his bill must have a strong public option.  His plan, and those offered by the House and Senate, have a mushy feel to them.  “Might pass this, might not, and we aren’t committed to it.”

It’s hard to get worked up for mush and so, by and large, people aren’t.

But still, it’s clear Americans want radical change of the health care system.  It’s the politicians who don’t.

Specifically Democratic conservative Senators like Baucus and Conrad, virtually every Republican Senator, and President Barack Obama, who ruled out radical change in the form of single payer and who won’t insist on even a bad public option, let alone a truly robust one, are the ones who don’t want radical change.

And yes, it’s probably because American politicians don’t feel the cost of health care: they’re fully covered, and virtually all of them are millionaires.

So, no, the problem isn’t American citizens not having the appetite for necessary radical change.  The problem is American politicians.

Obama Explains the “Rules of Reform”

Obama in his speech last night:

“I am not the first President to take up this cause, but I am determined to be the last.”

“…under my plan, individuals will be required to carry basic health insurance”

“I have no interest in putting insurance companies out of business.”

” we believe that less than 5 percent of Americans would sign up” (for the public option)

“Nothing in our plan requires you to change what you have.”

(editor note: or allows you to, if you have insurance through an employer.)

Clearer Obama:

As Health Secretary Sebelius said, we are determined to create a health system in this country which is designed so it can never become single payer.  My mandate system, forcing you to buy insurance from insurance companies with inadequate subsidies, will preclude that possibility and save the American consumer for the American insurance and pharmaceutical industries.

Rule 1: the best way to make money is to have the government force people to buy your product.

Rule 2: Any major industry with a revenue stream is entitled to that revenue stream forever, no matter how bad the service they provide is, or how much they overcharge.

Rule 3: Any failure of the system will be paid for by forcing ordinary people to pay to bail out the elites who failed.  Making the rich pay for their own mistakes is unacceptable.

Comparing the House Bill’s Cost to the Baucus Proposal

Emptywheel has crunched the numbers on the Baucus plan, and has come up with how much money it will leave families if they actually have to use the insurance for any significant health care problems.  Here are her numbers for a family of four earning 300% of the poverty levels or $66,150.

Federal Taxes (estimate from this page): $8,710 (13% of income)

State Taxes (using MI rates on $30,000 of income): $1,305 (2% of income)

Food (using “low-cost USDA plan” for family of four): $9,060 (13.5% of income)

Home (assume a straight 30% of income): $20,100 (30% of income)

Bad Max Tax: $20,610 (31% of income)

Total: $59,785 (89% of income)

Remainder for all other expenses (including education, clothing, existing debt, transportation, etc.): $7,215 (or 11% of income.

Now, the House bill stops subsidies at EXACTLY the same level, 400% of poverty level. We can use Emptywheel’s numbers for all of this.  The difference is that the House plan limits premiums to 10% of gross income at 300% (pg 137, pdf), and out of pocket expenses to $10,000 per family.

So that makes the House Tax: $10,000 + 6,615 = 16,615 or 25% of income (as opposed to 31%).

The difference between the House plan and the Baucus plan is $4,025. Total expenses are $55,7607, or   The remainder for all other expenses is $11,240 or 17% of income.

It’s not a meaningless difference, $4,025 a year is $335 a month.  But it’s not huge , either.

Now, one might say the real difference is that the House plan has a public option, which will drive down costs.  At best that’s questionable.  I don’t think so, neither does Taibbi, and neither do various other people.  Yes, a good public option would, but the House plan has a crippled public option.  I strongly expect that most people at 300% are going to be paying 10% of their income, because that’s what insurance companies are going to charge them, since that’s what they can charge them.

If you object to the Baucus bill because it will force families to buy insurance that will still financially cripple them, then there’s little reason not to object to the House Bill for the exact same reason.

Update: Dave Johnson points out the following (which would be true of Marcy and my numbers):

It seems you want to deduct the $20K insurance premium from gross income before you calculate the federal tax, so fed tax shouldn’t be $8710, it should be

$66,150 – 20,610 = 45,540 * 13% tax = $5920 tax.

The difference is $2,790 to both the Baucus and House plan numbers. Which is slightly better for both of them. I leave it to readers to decide if it’s enough better to make either of them a good deal.

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