Health Care Bill Going Over a Cliff
While I confess that health care reform legislation has made it further than I would have anticipated, it nonetheless seems an almost certain failure at this phase, with at least four Democrats committed to killing it in a Senate cloture vote and Republicans united in opposition to ANY health care reform. So do they now pick themselves up and start over again? Highly unlikely. Aside from the fact that an election year is coming and lawmakers always play defense on election years, the complexities of comprehensively reforming health care give lawmakers few realistic alternatives. While I lament the latest failure to reform health care and the continuation of America's de facto execution policy of the growing ranks of uninsured, I won't cry too many tears about the death of this mess of a reform bill (be it the Senate or the House bill...both suck beyond comprehension) which, if enacted, would be wildly unpopular and ineffective in reducing costs.
So what specifically is wrong with the two variations of the bill. Where to start....
1) The taxes start in 2010 but the benefits don't start until 2013 or 2014. That means Americans have three years of financial incentive for disliking this legislation before one person sees any benefit. Perhaps this would occur with any health care bill, but if Uncle Sam is gonna tax people for three years in advance of a new program, the program had better damn well deliver. Most people are unlikely to see any benefits from this one.
2) The existing health care system's unsustainable economic model will persist even after passage. The two best ways to reduce health care costs would be to salary doctors rather than pay them per procedure, and to ration care, particularly end-of-life care. Neither one of these is politically possible. Congressional leaders got the seal of approval from the AMA because they carefully avoided language about salarying doctors, a practice which has made Minnesota's Mayo Clinic the most cost-efficient medical facility in the country, but which most doctors fiercely oppose. Similarly, just the talk of shifting "cost rations" from the insurance companies who currently practice them on working-age Americans to geriatrics on Medicare invokes language of "death panels" run by the government to euthenize grandma.
3) Along those same lines, those privileged enough to receive reliable health care coverage for themselves are unwilling to make a single sacrifice to help out somebody else. And given the economics of health insurance, which requires either enlarging the risk pool or reducing coverage in order to cover more people, most of the haves will need to sacrifice some to empower the have-nots. We don't do that in America.
4) Rather than shifting the risk pool up the age ladder and requiring more financial contributions from the older Americans responsible for the vast majority of health care costs, the bill contains language that will push even more of the cost responsibility on young people. A stipulation to getting AARP support for this bill was language mandating that seniors pay more than twice the premium that able-bodied young people pay. Bottom line: young people will pay higher premiums for health insurance they don't use while older people will pay less for health insurance they use all the time. Sound like a realistic formula to cost sustainability?
5) The Democrats are lying to us about costs.....and everybody knows it. As gullible as we often are, even Americans aren't buying into the insane cost prognosis of this bill that pretends the deficit will SHRINK if only we create a new health care entitlement that covers scores of millions of high-risk people. Every time a Democratic politician tells us this health care bill will save us money, he or she is taking us for fools. And nobody enjoys being taken for fools. Even if costs stay within projected levels, and they very rarely do, the budgetary sleight-of-hand that allows for 10 years worth of taxes to pay for five years worth of benefits will not apply in subsequent decades, where this plan will run up huge deficits. Americans know it....and the Democratic lawmakers trying to con them know it as well.
6) The public option will either be too big or not big enough to work as advertised. The "public option" is an intriguing concept but I struggle to envision any scenario where it could either force insurance companies to become more competitive or to be an effective insurance option for the millions who lack it. Republicans allege that private insurers will dump millions of high-risk customers into the public option, simultaneously hyperinflating costs and forcing people out of their private plans. Not so fast, respond public option supporters. The public option will be very limited in scope and only 4-6 million people will qualify, thus making it impossible for insurance companies to dump high-cost customers into the public option. Unfortunately, supporters can't have it both ways. If only a small number of people qualify for the public option, there will be no legitimate measure of competition against private insurance companies since the 290+ million that don't qualify for the public option will still have to work within the exploding cost structure of the private health insurance industry.
Despite all these glaring downsides, I'm tempted to agree with most Congressional Democrats that either the Senate or the House reform bill is still better than nothing, but the more I study specifics, the less inclined I am to even given this bill a lukewarm endorsement. Ideal health care reform would either be a Canadian or British-style single payer system or a heavily regulated private system like that of Germany or Switzerland. But the reforms needed to engineer the formation of either system would be politically impossible in America, so instead we are left with lawmakers trying to operate both a private AND public health care system, neither of which can contain costs. Seems like the worst-case scenario. On top of already dysfunctional private health care system with costs spiraling out of control, we're asking taxpayers to continue propping that up and simultaneously fund a public health care system operating in tandem with it. How on Earth could this possibly work?
Do these highly unpersuasive pieces of health care reform legislation currently being debated mean our lawmakers are idiots? Not necessarily. Regardless of all the ignorant knuckleheads out there saying "why can't we just do this and this and forget about doing this?", health care policy is like a series of dominoes where if one falls it impacts everything. Lawmakers knew going in that the only truly effective ways of reforming health care would be politically impossible, so they devised a bill that they figured would be the best arrangement given what is politically possible. They have fallen short by my measure, but nobody should convince themselves that if this plan is deep-sixed, a more viable reform plan will emerge. This is it, folks. It's taken a year for lawmakers to get to where we are now. If better solutions existed and were politically doable, we would be debating them on the Senate floor now.
As for Republicans, what are the alternative plans of the party that stands to benefit politically from the Democratic majority's incompetence? Well, they'd love to see an expansion of health savings accounts, which allows uninsured Wal-Mart part-timers to invest as much of their disposable income as possible in company-sponsored accounts, pretending that the $200 in the pot at the end of a year is the same thing as health insurance. They also want to end medical malpractice by enacting "tort reform"....where the scores of millions of uninsured Americans not only continue to remain uninsured with no viable options, but when the ER doctor leaves a can of Altoids in their chest cavity, they are restricted from suing for pain and suffering that resulted from the malpractice.
In other words, any meaningful health care reform has to happen at this brief snapshot in time when Democrats control every level of government with supermajorities. When Republicans are rewarded for their obstructionism at the polls next year, any hope of fixing the worst-run health care system in the world goes along with it.....at least until a generation from now when the next batch of naive "reformers" tries to take on this cause again. As I've said before, until the ranks of the uninsured hits 51%, reform is very unlikely. The trouble is, we'll be there before we know it if current trendlines continue.
So what specifically is wrong with the two variations of the bill. Where to start....
1) The taxes start in 2010 but the benefits don't start until 2013 or 2014. That means Americans have three years of financial incentive for disliking this legislation before one person sees any benefit. Perhaps this would occur with any health care bill, but if Uncle Sam is gonna tax people for three years in advance of a new program, the program had better damn well deliver. Most people are unlikely to see any benefits from this one.
2) The existing health care system's unsustainable economic model will persist even after passage. The two best ways to reduce health care costs would be to salary doctors rather than pay them per procedure, and to ration care, particularly end-of-life care. Neither one of these is politically possible. Congressional leaders got the seal of approval from the AMA because they carefully avoided language about salarying doctors, a practice which has made Minnesota's Mayo Clinic the most cost-efficient medical facility in the country, but which most doctors fiercely oppose. Similarly, just the talk of shifting "cost rations" from the insurance companies who currently practice them on working-age Americans to geriatrics on Medicare invokes language of "death panels" run by the government to euthenize grandma.
3) Along those same lines, those privileged enough to receive reliable health care coverage for themselves are unwilling to make a single sacrifice to help out somebody else. And given the economics of health insurance, which requires either enlarging the risk pool or reducing coverage in order to cover more people, most of the haves will need to sacrifice some to empower the have-nots. We don't do that in America.
4) Rather than shifting the risk pool up the age ladder and requiring more financial contributions from the older Americans responsible for the vast majority of health care costs, the bill contains language that will push even more of the cost responsibility on young people. A stipulation to getting AARP support for this bill was language mandating that seniors pay more than twice the premium that able-bodied young people pay. Bottom line: young people will pay higher premiums for health insurance they don't use while older people will pay less for health insurance they use all the time. Sound like a realistic formula to cost sustainability?
5) The Democrats are lying to us about costs.....and everybody knows it. As gullible as we often are, even Americans aren't buying into the insane cost prognosis of this bill that pretends the deficit will SHRINK if only we create a new health care entitlement that covers scores of millions of high-risk people. Every time a Democratic politician tells us this health care bill will save us money, he or she is taking us for fools. And nobody enjoys being taken for fools. Even if costs stay within projected levels, and they very rarely do, the budgetary sleight-of-hand that allows for 10 years worth of taxes to pay for five years worth of benefits will not apply in subsequent decades, where this plan will run up huge deficits. Americans know it....and the Democratic lawmakers trying to con them know it as well.
6) The public option will either be too big or not big enough to work as advertised. The "public option" is an intriguing concept but I struggle to envision any scenario where it could either force insurance companies to become more competitive or to be an effective insurance option for the millions who lack it. Republicans allege that private insurers will dump millions of high-risk customers into the public option, simultaneously hyperinflating costs and forcing people out of their private plans. Not so fast, respond public option supporters. The public option will be very limited in scope and only 4-6 million people will qualify, thus making it impossible for insurance companies to dump high-cost customers into the public option. Unfortunately, supporters can't have it both ways. If only a small number of people qualify for the public option, there will be no legitimate measure of competition against private insurance companies since the 290+ million that don't qualify for the public option will still have to work within the exploding cost structure of the private health insurance industry.
Despite all these glaring downsides, I'm tempted to agree with most Congressional Democrats that either the Senate or the House reform bill is still better than nothing, but the more I study specifics, the less inclined I am to even given this bill a lukewarm endorsement. Ideal health care reform would either be a Canadian or British-style single payer system or a heavily regulated private system like that of Germany or Switzerland. But the reforms needed to engineer the formation of either system would be politically impossible in America, so instead we are left with lawmakers trying to operate both a private AND public health care system, neither of which can contain costs. Seems like the worst-case scenario. On top of already dysfunctional private health care system with costs spiraling out of control, we're asking taxpayers to continue propping that up and simultaneously fund a public health care system operating in tandem with it. How on Earth could this possibly work?
Do these highly unpersuasive pieces of health care reform legislation currently being debated mean our lawmakers are idiots? Not necessarily. Regardless of all the ignorant knuckleheads out there saying "why can't we just do this and this and forget about doing this?", health care policy is like a series of dominoes where if one falls it impacts everything. Lawmakers knew going in that the only truly effective ways of reforming health care would be politically impossible, so they devised a bill that they figured would be the best arrangement given what is politically possible. They have fallen short by my measure, but nobody should convince themselves that if this plan is deep-sixed, a more viable reform plan will emerge. This is it, folks. It's taken a year for lawmakers to get to where we are now. If better solutions existed and were politically doable, we would be debating them on the Senate floor now.
As for Republicans, what are the alternative plans of the party that stands to benefit politically from the Democratic majority's incompetence? Well, they'd love to see an expansion of health savings accounts, which allows uninsured Wal-Mart part-timers to invest as much of their disposable income as possible in company-sponsored accounts, pretending that the $200 in the pot at the end of a year is the same thing as health insurance. They also want to end medical malpractice by enacting "tort reform"....where the scores of millions of uninsured Americans not only continue to remain uninsured with no viable options, but when the ER doctor leaves a can of Altoids in their chest cavity, they are restricted from suing for pain and suffering that resulted from the malpractice.
In other words, any meaningful health care reform has to happen at this brief snapshot in time when Democrats control every level of government with supermajorities. When Republicans are rewarded for their obstructionism at the polls next year, any hope of fixing the worst-run health care system in the world goes along with it.....at least until a generation from now when the next batch of naive "reformers" tries to take on this cause again. As I've said before, until the ranks of the uninsured hits 51%, reform is very unlikely. The trouble is, we'll be there before we know it if current trendlines continue.
posted by Mark at 2:54 PM
6 Comments:
The current bill HAS to pass in the Senate. Democrats simply dont have any other choice. The public option will likely be dropped in favor of a trigger in order to please the four obstructionists and liberals will be forced into line.
Democrats know that they have to do something before their majority is washed away to the dustbin of history and will do anything to get a bill that they can call reform.
The person who needs this the most is Obama. He is looking like a failed and beaten man and if he doesnt get an accomplishment, he is finished. The Democratic base wont forgive him like they did Clinton. I know I wont.
My fear is that a terrible bill, which I sense is what will come out of Congress, will ultimately hurt Obama and the Dems more than doing nothing. A bad health care bill could be the Dems' equivalent to the war in Iraq...something that haunts them as a "what were they thinking?" moment for generations to come. So while I'm sympathetic to your argument that they have to do something or they'll never get another chance, the bills I'm seeing get advanced seem unlikely to work and poised to be very unpopular.
Until health care reformers are brave enough to take on true cost-cutting measures, I'm not sure it's in their best interest to take on health care reform.
They have to do it at this point. Even if the final bill is a piece of crap, they have to support and pass it.
Look at what happened in 1994. When Democrats failed to pass healthcare reform, it haunted them for twelve years.
They have boxed themselves in so badly that they have to pass anything.
I honestly think we are better off letting Obama sink in 2012 and then using that defeat to rebuild the party under President Mitt Romney. If Obama is reelected, Democrats will spend a generation in the minority.
If no health care bill is passed, the base is likely to stay home in 2010. If an unpopular health care bill is passed, the independents will consolidate around Republicans. So ultimately I think it's a wash.
Ditto for party building, where no health care bill means a disillusioned party base while a bad health care bill means generations of independent voters associating the Democrats as the party who ruined health care.
Passing an unpopular bill is likely the softer blade of the double edged sword. It would probably help Democratic turnout and many independents may not even show up to vote because they are so disgusted.
Interesting discussion, without the rancor I almost always see in any mention of the health care debate on both sides.
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