Health Care For America Now

The argument conservatives use against a public health insurance plan is essentially a "slippery slope" argument. If we create a public health insurance plan, the thinking goes, it will eventually become so big as to swallow up all other health care plans. Never mind that this is the same argument conservatives made about Medicare and SCHIP and it didn't happen. That's the line and it always will be.

In the past, these arguments had a whiff of reality to them. Health care reform proposed by Bill Clinton, for example, did have restrictions on people's choices, giving these arguments purchase. But Barack Obama changed that by running on a health care plan that was different. By starting with the premise that you can keep your health insurance if you like it, individual choice is not threatened.

That fact won't stop conservatives and insurance industry status-quo defenders from trying out the argument anyway. They say, so what if you can technically keep your private insurance. The public health insurance plan will be so powerful, private insurance won't be able to compete, meaning that people will be moved onto the public health insurance plan whether they want to be or not.

First, they complain that a public health insurance plan would pay doctors too little, like Medicare. Today, Joseph Paduda, the principal of Health Strategy Associates and an expert in the health insurance field, deftly destroys that argument:

First, physicians don't have to accept Medicare or Medicaid, and wouldn't have to agree to any 'public option' pricing. In fact many docs don't accept Medicare today. As participants in the free market, they are able to opt out if they feel the compensation is too low - and many do.

The other factor is just as simple - pricing is but one component of the health cost equation. The others are utilization and frequency. 'Utilization' is the number of a specific type of services used by a patient, while 'Frequency' is the percentage/number of patients that use that type of service.

Here's an example. For MRIs, the total cost calculation might be 10 million patients (frequency) X 1.2 MRIs per patient (utilization) X $800 per MRI (price).

Sure, price is a factor - but it is not the most significant factor - not by a long shot. By keeping patients out of the hospital, a private plan would eliminate utilization and prevent price from ever becoming a factor. So, even if a service area was dominated by a public plan, a private plan that did a really good job of keeping members healthy and out of the hospital would deliver lower costs - even if their hospital stays, when they did occur, were more expensive.

Those lower medical costs would enable the private plans to offer lower premiums, which in turn would attract more members, and those members' dollars. The private payers that could deliver better health would also deliver better returns to their investors, while taking share from both the public plan option and other, less successful private plans.

In other words, it would be possible for a private health care plan to run a business with lower costs than government, even if government were paying a lot less for care. All the private plan would need to do is, as Paduda says, be so good at keeping its customers healthy that it keeps them out of the hospital. Now, this would require innovation on the part of the insurance industry, and a realigning of their chief objectives from defending their turf to keeping their customers healthy. Seems like that's something Americans would want to see.

Next, Paduda goes further, pointing out that the "health care market" right now doesn't really function like one:

As noted previously, there's another reason the arguments against a public plan don't stand up. Opponents complain that the government's market power would allow it to dominate a market, thereby making it impossible for a private plan to compete.

The reality today is that almost every market is already dominated by a very few health plans, so much so that in most markets, there really is very little market competition amongst health plans.

Paduda concludes that, "If anything, a robust public plan would add competition to many markets, competition that would, if anything, increase consumer and provider choice."

And that's exactly the point. Yes, regulation on the insurance industry is necessary, but if we're looking for an American solution to the health care crisis, shouldn't we be looking for something that increases choice and competition?

Really, the insurance industry is most worried about a strong competitor, a plan that would force them to run leaner operations and (gasp!) keep their customers healthier. Like any business, they are opposing that competition by any means necessary. That doesn't mean we should accept their spin, however. These are inefficient businesses that have gotten away with monopoly power for way too long. It's time they were forced to earn their keep.

NEWS

Insurers shun those taking certain meds - Miami Herald

Trying to buy health insurance on your own and have gallstones? You'll automatically be denied coverage. Rheumatoid arthritis? Automatic denial. Severe acne? Probably denied. Do you take metformin, a popular drug for diabetes? Denied. Use the anti-clotting drug Plavix or Seroquel, prescribed for anti-psychotic or sleep problems? Forget about it.

In Kennedy’s absence, Baucus’s healthcare power worries left - The Hill

Senate Finance Committee Chairman Max Baucus (D-Mont.) has emerged as the Senate’s point man on healthcare reform in Edward Kennedy’s absence, prompting concern among some liberal senators who remember Baucus’s history of cutting deals with Republicans.

Healthcare reform vital, U.S. health agency says - Reuters

Reform of the U.S. healthcare system is vital this year because of growing costs and worsening care, the Health and Human Services Department said in a report on Monday.

Sebelius: Inaction not an option - Associated Press

Kansas Gov. Kathleen Sebelius said Tuesday that if confirmed as health and human services secretary, "health reform would be my mission."

Reform advocates plan lobby blitz - Politico

If April showers bring May flowers, then lawmakers are looking at a storm of health care lobbying during the April recess.

Fox News invokes Canadian health care bogeyman in talking about Richardson's death - Media Matters

Summary: In talking about Natasha Richardson's death, Betsy McCaughey and Martha MacCallum misrepresented a health-care provision in the recovery act and baselessly suggested the United States might be headed "down the same path" as Canada with regard to health care.

David Lazarus in the Los Angeles Times identifies another reason why the "concessions" agreed on by big business and the insurance industry on health care reform is really much less important than their press releases make it sound:

The insurers are saying that they'll treat all people fairly in return for a government requirement that everyone buy their product.

Yet if you read the fine print in their plan, it turns out that they're reserving the right to charge different prices for different levels of coverage — a practice that would effectively keep us where we are, with sick (or potentially sick) people paying more for insurance.

…But Ignagni [of AHIP] and Serota [of Blue Cross] go on to say, almost in passing, that "benefit design" will be needed to keep policies affordable.

That's insurance-speak for offering bare-bones coverage at relatively low prices and more complete coverage at higher prices — basically the same sort of system we have now.

"We're telegraphing that if people are allowed to buy more, then it will cost more," Ignagni told me. "You wouldn't charge the same for a Cadillac as you would for a Ford."

The danger, however, is that younger, healthier people would probably gravitate toward the cheaper basic policies, while older people with more health issues would feel compelled to buy the more comprehensive plans.

"It's a very potent way of segregating sick people from healthy people," said Karen Pollitz, a research professor at Georgetown University's Health Policy Institute. "It's essentially a way of continuing to charge more based on people's health."

Which is exactly what the insurers are saying they won't do in return for that much-desired government mandate.

That was supposed to be the big breakthrough, that the insurance industry agreed they wouldn't charge you more if you were sick. But clearly, that's not even the case.

As Richard Kirsch, our national campaign director, said, "They've moved the health care debate forward a few inches." And maybe they didn't even do that.

That begs the question, why would the industry and big business participate in these talks and even look for breakthroughs? As I argued last week, it's because they are scared:

The fact, however, that the industry is making these meaningless gestures shows how genuinely scared they are of reform. They know the public is against them. They know they make a shoddy product. And they know reform is coming. They want desperately to stay at the table, and they think - wrongly - that offering meaningless concessions like this will ensure their voices are still heard.

Even those participating in the so-called "Health Reform Dialogue" think the process is a lot of talk and not much action:

"A day late and a dollar short," said one participant who spoke on the condition of anonymity so as not to jeopardize continuing participation.

The industry is intent on blurring the lines between real reform and the status quo. They are clearly scared of being cut out of the negotiating process in Congress, but as they've shown by agreeing to meaningless "concessions," they're not nearly scared enough.

If Health Care for America Now has anything to say about it, they will be soon enough.

NEWS

A Lesson on Health Care From Massachusetts - New York Times

In any effort to restructure American health care, two interconnected goals inevitably compete for primacy. One is providing health coverage to the uninsured, counted in 2007 at 46 million, or 15 percent of the population, and almost certainly more now. The other is slowing the relentless and unsustainable growth of health costs, which threaten virtually every family, in imagination if not in fact.

Health report ignores contentious issues - The Hill

A broad coalition of business, healthcare and consumer groups issued a report Friday outlining its consensus views on health reform, though it bypassed the most contentious issues and lost two big labor unions along the way.

Congress Is Buying Time for Health-Care Savings - Wall Street Journal

Congress this week took a big step toward clearing the way for passage of President Barack Obama's ambitious plan to overhaul the health-care system. But questions remain over how to pay for it.

Lemon Capitalism - Slate

In a March 26 press conference, House Speaker Nancy Pelosi said that health care reform "should have a public option in it for it to really be substantial." This statement puts her more strongly behind creating a new government health insurance program than President Obama, who proposed such a program during the campaign but mostly avoided discussing it and has lately been cagey about how hard he'll fight for it. Five Senate Republicans, including Minority Leader Mitch McConnell and Charles Grassley, ranking member of the Senate finance committee, have put Obama on notice that they will oppose any health care reform that includes a public option because, they fear, private health insurers will not be able to compete with a government health insurance program. They're probably right about that. It might be worth losing sleep over if private health insurers were today doing a halfway decent job of keeping costs down and/or providing an acceptable level of coverage to policyholders. But they aren't. Even as Republicans scream their heads off about government bailouts for Wall Street banks and Detroit automakers, they're maneuvering to shore up the severely dysfunctional market for private health insurance.

More lies from CPR:

The Conservative Patients' Rights Action Fund — the first group out of the box opposing Obama's healthcare plan — has launched a second round of its campaign on the issue, a source involved in the group says.

The campaign focuses on Obama's proposal to set $634 billion in the federal budget aside for healthcare reform, and links the issue to the Congress's treatment of bonuses for AIG executives.

Think Progress has the fact check:

Not surprising, given that CPR's head, Rick Scott, is the Bernie Madoff of health care.

It comes down to this: Do you think health care reform should get a straight majority vote in Congress? Or should a few Senators be allowed to single-handedly block reform?

As we speak, the Senate is working on President Obama's budget. At stake is something called "budget reconciliation," a Senate rule that forces Senators to take a simple majority vote on the budget. In other words, the budget cannot be filibustered.

The bill the House Budget Committee passed yesterday includes "reconciliation instructions" for health care, which means health care reform, according to the relevant committee in the House, should be passed with the budget and by budget rules. The question is, will the Senate committees do the same? Or will we repeat the mistake Bill Clinton called his worst one?

It goes without saying that having a majority vote on health care, as opposed to needing 60 votes to overcome a filibuster, makes passing health care reform easier. The argument that this is "not bipartisan" doesn't hold much water. George Bush passed his tax cuts this way. And as Mike Lux points out in The Progressive Revolution, not a single Republican in the House voted for Social Security under FDR.

But there is principle to this argument, too. The American people voted for Barack Obama - largely because of his health care plan - and we only needed a majority vote to elect him. Shouldn't the Senate only need a majority vote to pass this major piece of his agenda and bring to America the change we need?

We missed this opportunity to do health care reform last time around:

In 1994, the Clintons wanted to use reconciliation to pass health care, but Robert Byrd, the Senate's hallowed parliamentarian, said no. Clinton has said that his worst mistake in health care was not fully appreciating the blow his strategy had been dealt.

Let's not make the same mistake again.

If you think a couple Senators should be able to block reform, if you think health care deserves a straight majority vote, then click here to call your Members of Congress. Tell them you want to give health care reform a majority vote.

NEWS

Hoyer sets health care reform 'target' - Politico

With all signs suggesting that health care will be the next major legislation out of the gate for President Barack Obama and his Democratic allies on Capitol Hill, Majority Leader Steny H. Hoyer (D-Md.) is setting an August target for the House to approve its version of the measure.

Democrats Agree on Budget's Outline - Washington Post

Congressional Democrats have advanced a streamlined version of President Obama's first budget request, as committees in both chambers endorsed a $3.5 trillion spending plan that clears the way for lawmakers to pursue the president's most ambitious and costly initiatives.

Max Baucus and the "Public Plan" - Time

For the new issue of dead-tree TIME, I have written this short profile of Senate Finance Committee Chairman Max Baucus, a most unlikely figure to have emerged as the point man for health care reform in the Senate. (The print version also has a chart detailing the highlights of Baucus' own health reform proposal, which you can read about in detail in the White Paper that he produced last November.)

Universal Confusion - Slate

The Republican alternative "budget" unveiled Thursday is getting ridiculed for what it lacks: numbers of any kind. But there's plenty to mock that's actually in the budget, too. Take the phrase "universal access to affordable health care," which the document uses no fewer than seven times.

Stand with Dr. Dean - Democracy for America

Give America a choice. We support healthcare reform that allows individual Americans to choose either a universally available public healthcare option like Medicare or for-profit private insurance. A public option is the only way to guarantee healthcare for all Americans and its inclusion is non- negotiable.

Baucus, Pelosi clash on health care - Politico

House Speaker Nancy Pelosi says she's still committed to using a procedural trick to fast-track health care reforms this year — despite opposition from Sen. Max Baucus, the powerful chairman of the Senate Finance Committee.

A couple things have come together today to point to what we may be looking at as models for health care reform. Some are good, and some are pretty bad.

First, there has been a great debate going on over at The New Republic over the Massachusetts health care plan. Diane Archer from the Campaign for America's Future argues that Massachusetts is not a model for national reform, mostly because it doesn't include a method to control costs. Jonathan Gruber, who helped architect the Massachusetts reforms, argues that doing coverage first leads to cost control in the future, and that Massachusetts got it right.

I've argued before that I'm not sure the notion that costs follow coverage makes sense. The best, and maybe only way to control costs is to have a competing public health insurance option, and if that option is as non-negotiable as the insurance industry says it is, then getting them on board for coverage doesn't mean it will be any easier to control costs with a public insurance option later on. In the meantime, you're just subsidizing poor-quality, expensive private insurance:

The public health insurance option is a bright line for opposition groups and it will always be. The insurance industry worries it will cut into their profits (and undoubtedly it will). Organized business groups are filled with ideological conservatives opposed to government anything, even if choice is preserved. And the AMA (which has been an enemy of health care reform since 1934 [pdf]) is worried that public insurance will pay them less. In other words, enemies of reform have been looking out for their profits for years, even at the expense of our health. I'm not sure why doing coverage first would change that incentive.

The public health insurance option is the big piece. Without that piece, any "health care reform" plan isn't really worthy of being called health care reform. And getting that piece will be just as hard in the future as it is now.

Today, Anthony Wright of Health Access California (an HCAN state partner) argues that the Massachusetts model may indeed not quite apply, mostly because Massachusetts is a pretty unique state, with a long history of health care spending, a relatively rich and educated workforce, and a different state insurance market that's already much more regulated. Instead, he points to California as a possible model:

NEWS

A Public Health Insurance Plan that Delivers Market Discipline - Center for American Progress Action Fund

The choice of a public health insurance plan and health insurance exchange will private insurance plans to innovate in ways regulatory enforcement will not.

Grassley hails stance on health premiums - Des Moines Register

"Anything you do that makes more uniform the payments, the premiums, and more uniform who can join and not join, then it is going to make it easier not to have a public option plan," Grassley said.

House Wants Shortcut On Health Care Reform - National Journal

The House Budget Committee this morning proposed moving President Obama's health care reform through Congress this year using fast-track procedures.

Reid open to fast-tracking health overhaul - Associated Press

Majority Leader Harry Reid indicated Wednesday he's willing to move sweeping health care legislation through the Senate with a procedural maneuver that would block a GOP filibuster. The prospect of the controversial tactic has already ignited Republicans' ire, and key Senate Democratic chairmen have said they don't want to do it.

Reid: Health reform increasingly important - Las Vegas Review Journal

Senate Majority Leader Harry Reid said Wednesday that reforming health care has become increasingly important as the economy has become more dire and that Congress must take up the issue.

Health Care for America Now visits - The York Daily Record

The healthcare advocate is visiting cities across Pennsylvania to rally support.

Howard Dean To Announce Major New Campaign On Health Care Reform - Greg Sargent

Looks like Howard Dean is well on his way to finding a post-DNC niche, and he won’t be needing the Obama administration to find it for him.

If you were reading the headlines in the mainstream media yesterday, you probably thought the insurance industry made a huge concession. "Key Health Care Development, Insurance Industry Concession" writes Politico. "Health insurers offer shift on premiums" says the Los Angeles Times. "Insurers Ease Stance on Pre-Existing Conditions" says the New York Times.

Actually, the Associated Press got it closest, saying "Insurers offer to stop charging sick people more."
Here's what the insurance industry, as represented by Karen Ignagni of AHIP and Scott P. Serota of the Blue Cross and Blue Shield Association, actually offered, in a letter they sent to the Senate health care committees [pdf], in their own words:

Specifically, by enacting an effective, enforceable requirement that all Americans assume  responsibility to obtain and maintain health insurance, we believe that we could guarantee issue coverage with no pre-existing condition exclusions and phase out the practice of varying premiums based on health status in the individual market.

While we support transitioning to a reformed system in which health-status-based rating is no longer used, rating flexibility based on age, geography, family size, and benefit design is needed to maintain affordability.

I'm not sure the insurance industry should get a lot of credit for this "concession." They are offering to end the shameful practice of denying people coverage or charging them more if they have a pre-existing condition. This is something they should have been doing from the beginning. The fact that they are only now changing this awful practice is hardly cause for kudos.

And, as they admit, they will still discriminate in their premiums, charging more if you're older, live in the wrong part of the country, have a large or small family, or are a woman. And the proposal only covers the 11 million in the individual private health insurance market. It doesn't touch group or employer plans, and as such, does nothing for small business.

They spend the first half of their letter arguing against the competition of a public health insurance option:

Creating a new government-run plan would thwart the ability of the health care sector to
implement meaningful delivery system reforms, exacerbate the cost-shift from public programs to consumers and employers in the private market, and destabilize the employer-based system. In fact, studies show that more than 100 million people who currently have private coverage would move to the new government-run plan.

In effect, the private insurance industry is arguing that a public health insurance option would work so well, people would drop their private coverage, as if that were some great tragedy.

And in return for this huuuuuge, voluntary concession, they want an individual mandate, so everyone in America would be forced to by their poor-quality products.

This is not to say that increased regulation on the insurance industry isn't needed or important. But the key here is cost. The insurance industry has made no proposal for reigning in their costs, because that would mean lower profits. The only way to reign in costs, of course, is to introduce competition in the form of a public health insurance option, to hold all health insurance plans accountable and increase efficiency.

Instead, the insurance industry attempts to solve the cost issue by proposing the government subsidize people who can't pay the insurance industry's sky-high premiums. They want you to buy their sub-prime product, and when you can't pay the rates, they want the government to pay them for you. Do they care if you go bankrupt because of health care costs? Nope, that's not their problem. Do they care that they dictate to doctors what will and won't be covered, and therefore, what care you get? No, again, not their problem. It's all about protecting profits.

Though regulation is important, these "concessions" are nothing but a bailout for the insurance industry. They are laughable, nothing more than a smokescreen, and should be treated as such.

The fact, however, that the industry is making these meaningless gestures shows how genuinely scared they are of reform. They know the public is against them. They know they make a shoddy product. And they know reform is coming. They want desperately to stay at the table, and they think - wrongly - that offering meaningless concessions like this will ensure their voices are still heard.

And they should be scared, because the public hates them. And I mean real hatred. I've been out there, I've seen it. I work with our field organizers in 40 states and they feel it every day. I just don't think Karen Ignagni here in Washington, DC really appreciates that anger.

Now, I'm sure President Obama will listen to everybody in this debate, but as Richard Kirsch, our National Campaign Director, said, "We shouldn’t confuse President Obama’s having an open door with his being a doormat."