by Jonathan Cohn
The White House just put out a statement, making clear that President Obama still supports including a voluntary public option as part of health reform:
I am pleased by the progress we're making on health care reform and still believe, as I've said before, that one of the best ways to bring down costs, provide more choices, and assure quality is a public option that will force the insurance companies to compete and keep them honest. I look forward to a final product that achieves these very important goals.
Separately, a high-ranking administration official privy to recent negotiations with the hospital industry told me that the administration in no way backed down from a public option in exchange for the industry's agreement to sign off on $155 billion in reduced Medicare and Medicaid fees.
(On the other hand, according to the Washington Post, the White House did promise not to let the public plan use the relatively low reimbursement rates of Medicare and/or Medicaid. But those two things aren't mutually inconsistent)
The main impetus for this push, I gather, is a new Wall Street Journal story:
WHITE HOUSE OPEN TO DEAL ON PUBLIC OPTION
By Laura Meckler and Janet Adamy
It is more important that health-care legislation inject stiff competition among insurance plans than it is for Congress to create a pure government-run option, White House Chief of Staff Rahm Emanuel said Monday.
"The goal is to have a means and a mechanism to keep the private insurers honest," he said in an interview. "The goal is non-negotiable; the path is" negotiable.
...
Mr. Emanuel said one of several ways to meet President Barack Obama's goals is a mechanism under which a public plan is introduced only if the marketplace fails to provide sufficient competition on its own. He noted that congressional Republicans crafted a similar trigger mechanism when they created a prescription-drug benefit for Medicare in 2003. In that case, private competition has been judged sufficient and the public option has never gone into effect.
Notwithstanding the White House statement and private assurances administration officials are giving reporters, I assume Emanuel's statement is an accurate reflection of the administration's thinking on the matter. Remember, this isn't Joe Biden talking as he's walking to his car, with a bunch of microphones stuck in his face. This is Emanuel, who always chooses his words carefully, speaking in a sit-down interview with reporters from one of the nation's most influential media organizations.
Besides, it's not as if the White House push actually contradicts what Emanuel said to the Journal. In other words, that fact that Obama supports a public plan and hasn't bargained it away yet doesn't mean that, at the end of the day, he wouldn't embrace a compromise on it.
Obama has said as much himself, by making clear he wouldn't draw a "line in the sand" on the public plan. Since Obama has in fact drawn a line in the sand on at least two other issues--a plan must not inflate the deficit, he's said, and it must make progress on reducing costs over the long run--it's fair to assume he and his advisers don't feel as strongly about the public insurance option.
Update: Karen Tumulty notes that notes that the trigger option Emanuel describes sounds a lot like the idea that Republican Senator Olympia Snowe, among others, has floated. Source: The Treatment
The nation's largest insurers, hospitals and medical groups have hired more than 350 former government staff members and retired members of Congress in hopes of influencing their old bosses and colleagues, according to an analysis of lobbying disclosures and other records.
The tactic is so widespread that three of every four major health-care firms have at least one former insider on their lobbying payrolls, according to The Washington Post's analysis.
Nearly half of the insiders previously worked for the key committees and lawmakers, including Sens. Max Baucus (D-Mont.) and Charles E. Grassley (R-Iowa), debating whether to adopt a public insurance option opposed by major industry groups. At least 10 others have been members of Congress, such as former House majority leaders Richard K. Armey (R-Tex.) and Richard A. Gephardt (D-Mo.), both of whom represent a New Jersey pharmaceutical firm.
The hirings are part of a record-breaking influence campaign by the health-care industry, which is spending more than $1.4 million a day on lobbying in the current fight, according to disclosure records. And even in a city where lobbying is a part of life, the scale of the effort has drawn attention. For example, the Pharmaceutical Research and Manufacturers of America (PhRMA) doubled its spending to nearly $7 million in the first quarter of 2009, followed by Pfizer, with more than $6 million. Read it all at washingtonpost.comYou know that all that lobbying money comes from premiums paid to deliver health care - and they have it by denying care. Why are they still in the game?
A good look at the Dutch and French health care systems, which are much closer to what the U.S. would move to than the Canadian and British systems so frequently referenced. Read it at The Boston Globe
During a townhall in Waukon, IA Tuesday, Sen. Chuck Grassley (R-IA) was asked by a constituent of his: “Why is your insurance so much cheaper than my insurance and so better than my insurance?” When Grassley struggled to explain the details of his own health care plan, the elderly man followed up, “Okay, so how come I can’t have the same thing you have?” Grassley said, “You can. Just go work for the federal government.”
Grassley has been at the forefront of railing against Obama’s health care plan, declaring, “We need to make sure that there’s no public option.” As Igor Volsky notes, there is an irony in government workers like Grassley complaining about “government-sponsored health care.” If Grassley wants to stand on principle, he could abandon his government-sponsored insurance and try his luck in the individual health insurance market. Source with video: Think Progress
Get more or less universal coverage, that is. The CBO scoring on an incomplete bill sent everyone into a tizzy — and also led to an avalanche of bad reporting, with claims that it said terrible things about the public option. (There was no public option in the bill.)
Now the real thing has been scored — and it’s OK. Something like 97 percent coverage for people already legally here, at a total cost somewhere in the $1 trillion range. Bear in mind that the Bush tax cuts cost around $1.8 trillion over a decade. We can do this — and have no excuse for not doing it. Source NYTimes.com
by slinkerwink
Here are the major points of the public option in the Senate HELP Bill:
• HHS-based plan: The Community Health Insurance Option would be run by the Department of Health and Human Services. The government would pay for the first three months of claims as a way to capitalize it; this would be a loan to be repaid over time. For the first two years and longer if necessary, this strong public option would also qualify for “risk corridor protections” which offset or reclaim excessive losses and gains which could result during the start-up period (identical to those in Medicare Part D). Subsequently, its premiums would be set to make it self-sufficient. This would make the public health insurance option quickly available in all areas of the country.
• Plays by the same rules: The public option would be one of the Gateway choices. It would follow the same rules as private plans for defining benefits, protecting consumers, and setting premiums that are fair and based on local costs.
• Provider payments and participation:
• Pooled purchasing power: This public option can pool the purchasing power of its enrollees nationwide to leverage lower prices to compete with private plans. Similar negotiation power has been used by states to get drug rebates in Medicaid beyond the statutory minimum. It has been used by large businesses to drive delivery system change. This negotiation would be backed by a ceiling of paying no more than average local rates.
• Flexibility and incentives to innovate: Unlike administered pricing, the negotiation for payment rates gives the Secretary the ability to quickly and aggressively promote payment policies that promote quality and best practices. In addition, the State Advisory Councils would tailor delivery system reform for the public option, with a financial bonus for success.
• Lower administrative overhead: The public option would not need to raise premiums to support shareholder profits, extensive marketing, and extra risk reserves required by require to protect enrollees from plan insolvency or mismanagement of funds.
Here are the major drawbacks to the public option in the Senate HELP draft:
1. It's not open to all Americans, only to the uninsured and to those with small businesses with 50 and below employees. For example, you wouldn't be allowed to choose the public option if you were currently in group employer health insurance. You'd have to go without a job or convince your employer to eat the $750 fee to drop your coverage in order to choose the public option.
2. The national insurance exchange is weaker in the HELP draft than it is in the Tri-Committee House draft.
3. It doesn't use Medicare bargaining rates and the Medicare provider network. Basically, doctors and medical providers aren't required to participate in the public option so hospitals and doctors could refuse to take you on if you're on the public option.
4. States would be allowed to require extra health benefits and to bear the costs for that on top of the basic health benefits currently required in the HELP legislation. So that means if you live in a red state, you wouldn't get the extra coverage afforded by those in blue states.
5. Employers are required to pay 60% of the premium costs.
I just submitted this as a question to Ezra Klein over at his live chat today and he says the public option in the Senate HELP bill is weaker than in the House Tri-Committee version:
Ezra Klein: No, it's a lot weaker. The Tri-Committee draft uses Medicare bargaining rate and the Medicare provider network and is open to everyone through a robust national health insurance exchange. The HELP plan can't partner with Medicare and is in a much weaker health insurance exchange -- CBO predicts that only 27 million people will have access to it by 2019. Right now, we're in a better position today due to having two bills, one from the House Tri-Committees, and one from the Senate HELP Committee, with a good public option. If the Senate HELP Committee makes it through the Senate intact with its public option, and is the one supported over Max Baucus's Finance Bill, then it'll have to be reconciled with the House Tri-Committee version. So theoretically the public option in that could be made stronger in the conference process.
Here's Christy Hardin Smith from Firedoglake who just got off a conference call with the Senate HELP committee:
For consumers to buy into the public plan, there is a firewall built-in if you are already part of an employer-based health plan. If your plan costs more than 12 1/2% of your annual salary, then you can contemplate switching to the public option. If not, then you are stuck with your employer-based plan, whether or not you are satisfied with it. It's a cost containment decision, with the hope that competition from the public plan will, over time, shift the operations of private insurers.
Sen. Brown emphasized that this plan is designed to reward "best practices" for insurers -- and that each state will have an advisory council to monitor local competition in an effort to keep insurers more competitive and, hence, he says, more honest. He used the stuent loan industry as an example. I'm not certain that was the best example, frankly, given the profit-grubbing nature of any number of lenders in that industry, but there you are.
It's why we have to support the progressives in the House and to KEEP on cracking the whip on them for the public option! Read it all at Daily Kos
Independent Senator Bernie Sanders has been making a splash on progressive blogs with his very public advocacy for including a strong public plan in health care reform. Sen. Sanders told Ezra Klein that he was going to “try and form a Coalition of the Unwilling. People prepared to stay strong for a strong public option.”
David Waldman at Congressmatters.com doesn't think Sen. Sanders will go so far as to actually filibuster a health care bill if it doesn't include a public option. But thanks to the reconciliation measure adopted as part of this years budget, Sanders' “Coalition of the Unwilling” doesn't need to. If there is no bill by October 15th health care reform must go through reconciliation.
Former Senate majority leader Tom Daschle believes that a health care reform bill that goes through reconciliation will probably contain a “pure public option.”
Bernie Sanders' coalition doesn't need to filibuster health care reform without a public plan. They don't even need to vote against any bill without a public option. All they need to do is slow down the whole process. (a process which is already very much behind schedule) There are only 12 legislative weeks left before reconciliation is triggered. By dragging their feet and delaying the bill until October the "Coalition of the Unwilling" wins. Source: The Walker Report
Democrats on a key Senate Committee outlined a revised and far less costly health care plan Wednesday night that includes a government-run insurance option and an annual fee on employers who do not offer coverage to their workers.
The plan carries a 10-year price tag of slightly over $600 billion, and would lead toward an estimated 97 percent of all Americans having coverage, according to the Congressional Budget Office, Sens. Edward M. Kennedy and Chris Dodd said in a letter to other members of the Senate Health, Education, Labor and Pensions Committee. The AP obtained a copy.
By contrast, an earlier, incomplete proposal carried a price tag of roughly $1 trillion and would have left millions uninsured, CBO analysts said in mid-June.
The letter indicated the cost and coverage improvements resulted from two changes. The first calls for a government-run health insurance option to compete with private coverage plans, an option that has drawn intense opposition from Republicans.
"We must not settle for legislation that merely gestures at reform," the two Democrats wrote. "We must deliver on the promise of true change."
Additionally, the revised proposal calls for a $750 annual fee on employers for each full-time worker not offered coverage through their job. The fee would be set at $375 for part-time workers. Companies with fewer than 25 employees would be exempt. The fee was forecast to generate $52 billion over 10 years, money the government would use to help provide subsidies to those who cannot afford insurance.
The same provision is also estimated to greatly reduce the number of workers whose employers would drop coverage, thus addressing a major concern noted by CBO when it reviewed the earlier proposals.
Kennedy, D-Mass., and Dodd, D-Conn., circulated their letter a few days before lawmakers return from their July 4 vacation, with the Health Committee one of several panels expected to take action on health care legislation that President Barack Obama has placed atop his domestic agenda.
Kennedy, the committee chairman, was diagnosed with a brain tumor more than a year ago and has been absent from the Senate for weeks, although he and his aides have been heavily involved in the deliberations on a health care bill. Dodd, the next senior Democrat on the committee, has presided at committee sessions and taken an increasingly public role.
With its government option, the proposal is unlikely to gain any bipartisan support in the committee.
Separately, Democrats and Republicans on the Senate Finance Committee are at work trying to reach agreement on an alternative that calls for creation of nonprofit cooperatives to sell insurance in competition with private industry. Agreement has been elusive on that and other issues, and it is not clear whether a deal is possible before Democrats opt for a more partisan approach.
In their letter, Kennedy and Dodd said the Congressional Budget Office "has carefully reviewed our complete bill, and we are pleased to report that CBO has scored it at $611.4 billion over 10 years, with the new coverage provisions scored at $597 billion. ...The completed bill virtually eliminates the dropping of currently covered employees from employer-sponsored health plans.
"In addition, our bill, combined with the work being done by our colleagues in the Finance Committee, will dramatically reduce the number of uninsured — fully 97 percent of Americans will have coverage, a major achievement."
Three committees in the House have been at work for weeks on a plan expected to come to a vote by the end of July. Source: The Associated Press
From the Associated Press:
The percentage of Americans with private health insurance has hit its lowest mark in 50 years, according to two new government reports.
About 65 percent of non-elderly Americans had private insurance in 2008, down from 67 percent the year before, according to preliminary data released Wednesday by the U.S. Centers for Disease Control and Prevention.
"It's bad news," said Kenneth Thorpe, a health policy researcher at Emory University.
In the 1970s and early 1980s, nearly 80 percent of Americans had private coverage, according to CDC officials.
Some experts blamed the faltering economy and corporate decisions to raise health insurance premiums _ or do away with employee coverage _ as the main drivers of the recent data. They say coverage statistics for 2009 may look even worse.
However, public coverage of adults is rising in some states, due to programs like Medicaid expanding eligibility. So not all the adults without private coverage are uninsured, Thorpe said.
Indeed, the CDC estimated that about 44 million Americans were uninsured last year _ nearly the same as CDC estimates for other recent years.
The CDC is one of at least three U.S. agencies that estimate the number of Americans without health insurance. The U.S. Census Bureau puts out what is perhaps the best-known number, but that agency's 2008 estimate is not due out until August.
Like the Census Bureau, the CDC's estimate is based on a survey. The CDC interviewed about 75,000 Americans last year, asking if they were uninsured at the time. About 15 percent said yes, leading to the estimate that about 44 million Americans were uninsured.
The drop in non-elderly adults with private health insurance was statistically significant, but the drop in children without private coverage was not. Health officials noted that public coverage of children has risen dramatically in the last ten years, and now more than one in three children are covered by a public plan.
The CDC also reported on insurance coverage in the 20 largest states, and found the percent of uninsured people ranged from 3 percent in Massachusetts to 23 percent in Texas. Lack of health insurance was greatest in the South and West.
Private coverage rates for people under age 65 ranged from 79 percent in Massachusetts to 56 percent in Florida, the CDC reported. Source
Sen. Olympia Snowe thinks President's health care proposal is a bad idea because it will make health care too affordable. Sam Seder tries to figure out what she means.
"In America, we strictly ration health care. We've done it for years," says Dr. Arthur Kellermann, professor of emergency medicine and associate dean for health policy at Emory University School of Medicine. "But in contrast to other wealthy countries, we don't ration medical care on the basis of need or anticipated benefit. In this country, we mainly ration on the ability to pay. And that is especially evident when you examine the plight of the uninsured in the United States." Kellermann still remembers the young mother of two who came into his emergency room more than 15 years ago, suffering from a hemorrhagic stroke.
"We worked for 90 minutes to save her life, but basically she had burst a blood vessel in her head. She didn't have a chance," he says. "She had no health insurance, and when the money got tight, she had to make a choice — she could either buy the groceries for her kids, or she was going to buy the three blood pressure medicines she had to take every day."
Sadly, Kellermann says, for less than the cost of that futile, 90-minute effort in the ER, the woman could have had all the blood pressure medication she needed for the rest of her life. It was not a government bureaucrat who decided she should forgo treatment until it was too late — it was her own lack of health insurance that led her to make that choice. It's not only the uninsured who are affected. Americans who do have health insurance tend to get a lot of procedures after they're sick — not because bureaucrats dictate that, but because that's what insurance and Medicare pay for. Rationing is not limited to the health care industry. No other country devotes as much of its economy to health care as the United States. While Americans might not think of that as a choice, it means they have less to spend on everything else. Government payments for health care come at the expense of schools, roads and other services. The extra money that employers have to pay for rising health insurance premiums is money they cannot put into workers' paychecks.
"No worker gets to say, 'You know what, make my premium $1,000 lower by getting me a more efficient health insurance package, and at the same time, give me $1,000 more in take-home pay,' " says Harvard economist Katherine Baicker, who has studied the impact of rising health care costs on employee compensation.
So while there is no government rationing board handing out coupon books for heart surgeries, more and more of the nation's resources are being gobbled up by health care, often with little choice for individuals, and often in ways that no sensible person would choose. Read it all at NPR
By Richard Stander and Nancy Galland
There are three camps in the Healthcare Reform movement here in Maine and across the country: the Republicans, who basically want to keep the status quo, the Democrats, who are promoting the "Healthcare for America Now" campaign, and those who support HR676, the House bill that lays out a single-payer model, which is the time-proven system in every other industrial democracy in the world where all citizens, without qualification, are covered from cradle to grave.
The single payer camp has been split between HR 676 supporters and the Public Option/Obama loyalists who claim passionately, "I support single payer with all my heart, I believe it's the best way, but we have to take baby steps to get there." They believe, as the Administration insists, that we have to work with the system we have "for now" and pass a bill out of political expediency, no matter how bad it may be.
But the ground rules for the debate on health care reform in Congress portend a dead end for the "baby steps." It is shaping up to be a wholesale exclusion of a single-payer option in favor of a health care financing hybrid which would include private insurance companies and a government-run insurance program, the "public option."
It keeps the for-profit insurance industry alive and well by actually forcing people to buy into it or be fined; the public option will be available only to those who cannot afford to buy for-profit insurance. If income or age is used as a qualifier to receive Medicare-style payments for health care (as is now the case), there will still be millions of middle-to-low-income Americans and small businesses slipping through the cracks.
The Obama Administration's decision to take single payer off the table for now and into the future has many serious, if not fatal, consequences. Most egregiously, it eliminates from consideration the largest sources of savings which a single-payer system would accomplish without affecting quality of care: eliminating the profits paid out to insurance company stockholders, the inflated salaries paid to corporate CEOs, the phenomenal cost of redundant administrative expenses, the cost to providers for billing to countless insurers (instead of just one), and finally the millions the industry pays out to lobbyists and their congressional targets, around $300 million at the last count.
The devil, of course, is in the details, and the details as now dictated by the insurance industry are that private and public insurers, "must compete on a level playing field." The President has recently signaled that he is willing to compromise on the public option, even as he launched a grassroots campaign (through Organizing for America) to promote HCAN and save the public option.
However, the insurance industry is committed to removing any advantage the public option may have that would threaten their competitive edge: specfically, any cost-saving devices, like public subsidies or negotiating more favorable terms for drugs and services, would not be permitted.
Another consequence of setting up two competing systems is to create, inevitably, a two-tier health care establishment with very different risk pools: one for the old, sick, poor and disabled (Medicare/Medicaid/ public option), and the second for the young, the healthy and the rich. The costs to the "public," high-risk pool is substantially higher, obviously, than the private, low-risk pool.
Since private insurers are accountable only to their stockholders, not to the consumer, they are bound by their fiduciary obligation to lower costs and maximize profit. The only way they can deliver on their obligation to their stockholders is to cut payouts and reduce risk.
This business plan is achieved typically by denying prior approval to subscribers for recommended procedures or selected prescribed drugs and by insuring only the healthy by removing the sick from their rolls, including those with “prior conditions.” This last point is on the table in congressional committees and may likely become one of the deal-breakers in the congressional negotiations on a final bill.
All of this begs the question: Why would an administration with so much political capital for "change you can believe in" want to set up a public option to compete with the private insurers on these terms? Terms which, in our view, carry the seeds of its own failure as it founders under the high costs of a risk pool overwhelmingly skewed towards the sickest and most vulnerable, while in the other pool "the water's just fine, thank you, why don't you just hop in, while we sweep in the profits. Just don't get sick."
The way things are shaping up in Congress now, the Obama people will either cave in to unreasonable conditions and amendments, which produces a compromise doomed to failure, casting a blot on anything "public," or risk not getting a bill passed this year at all, with diminishing chances, as in the Clinton era.
The Republicans and the insurance industry have a big stake in the failure of this legislation, and have no stake in compromise. The Obama people, on the other hand, seem to have a big stake in passing legislation, any legislation -- no matter how bad -- and have shown their willingness to compromise big, as in their bowing to a crippling amendment on the recent federal budget bill in order to gain merely three, count 'em, Republicans for the sake of "bi-partisanship" appearances.
This seems to add up to setting the stage for a final bill which fails altogether, or which so compromises a public option as to completely squander any opportunity for real change for another decade or more.
The last time a serious discussion of national (single- payer) health care occurred in Congress was in 1948, when Harry Truman choked and withdrew the bill. That was 61 years ago. It would be a tragedy if we have to wait that long again for another chance. Source
We're tired of hearing excuses from Senators Reid, Baucus, and others that they don't have the votes for a strong public option. They just got Al Franken as their 60th Democratic Senator. No more excuses. We can't afford any more excuses from this Senate while insurance premiums go up every year, and more Americans drop their health insurance coverage to keep food on the table and pay the gas and phone bills.
Real lives are at stake while Senators are busy playing the bipartisanship game to scuttlebutt the public option in order to be "fair to the private insurers." They have their priorities wrong. It shouldn't be about being fair to the private insurers, it should be about being fair to those who have been suffering for too long without health insurance due to pre-existing conditions, unaffordable insurance premiums, and junk insurance policies with few benefits. It's time to be fair to us for a change.
Right now, the insurance industry would love nothing more than Senator Baucus's bill to pass out of the conference committee without a strong public option, and only with a state-based co-op plan with very little bargaining clout. It'd be a mandated bailout for them with us being forced to buy their junk insurance plans. That's their dream and the worst nightmare possible for us. Senators like Baucus, Conrad, Landrieu, Wyden, Lincoln, Cantwell, and others need to drop their "bipartisan" fetish and start thinking about us for a change, instead of the private insurers. They need to stop saying, "No, We Can't," and say, "Yes, We Can," instead to the public option.
Please continue to call the White House, your Senators, Representatives, and even use President Obama's OFA phonebanking tool to call their Senator in support of [Single Payer or] a strong Medicare-like public option that that is immediately available, can deliver quality health care with affordable premiums, and help keep the private insurers honest by being available everywhere on day one as a competitive player. Read More....I urge you to keep asking for Single Payer as the best way to pressure for a good, working, affordable and sustainable public option.
Health insurance is supposed to offer protection — both medically and financially. But as it turns out, an estimated three-quarters of people who are pushed into personal bankruptcy by medical problems actually had insurance when they got sick or were injured. But patient advocates argue it is crucial for the final legislation to guarantee a base level of coverage, if people like Mr. Yurdin are to be protected from financial ruin. They also call for a new layer of federal rules to correct the current state-by-state regulatory patchwork that allows some insurance companies to sell relatively worthless policies.
“Underinsurance is the great hidden risk of the American health care system,” said Elizabeth Warren, a Harvard law professor who has analyzed medical bankruptcies. “People do not realize they are one diagnosis away from financial collapse.”
Last week, a former Cigna executive warned at a Senate hearing on health insurance that lawmakers should be careful about the role they gave private insurers in any new system, saying the companies were too prone to “confuse their customers and dump the sick.”
“The number of uninsured people has increased as more have fallen victim to deceptive marketing practices and bought what essentially is fake insurance,” Wendell Potter, the former Cigna executive, testified. Read it all at the NYTimes.com
Members of the International Brotherhood of Electrical Workers joined with hundreds of other union members and health care activists calling on Congress to make quality and affordable medical coverage available to every American on June 25.
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