You know what a thousand times more frustrating than trying a homeschool kids who think they’re on vacation? Following the debate among progressives on the Senate giveaway to health insurance companies. It’s making me downright Grinch-y.
I’ve been trying to find a way to imagine that the good will outweigh the bad in the Senate bill. I’ve looked at supportive arguments coming from Ezra Klein and Jeff Fecke and Jill Filipovic and a bunch of other people I respect. I’m all for the expansion of Medicaid, the banning of recission, etc. Yet none of the bill’s progressive proponents has convinced me that the reforms would outweigh the impact of the mandate on the folks who are too well off for Medicaid, yet would be required to buy insurance.
The bottom line is that this bill will guarantee that people have health insurance. It doesn’t guarantee that they’ll have access to health care. The premiums will be pricey enough that many people will not be able to afford to actually use their insurance, since they won’t have enough money left to cover the out-of-pocket expenses. Marcy Wheeler of Emptywheel has run the numbers for a couple of hypothetical middle-class families. Here’s her scenario for a family of four at 301% of the poverty level, or an annual income of $66,370, who experience a “major medical event” that would force them to max out their out-of-pocket payments:
Federal Taxes (estimate from this page, includes FICA): $8,628 (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): $9,065 (14% of income)
Home (assume a straight 30% of income): $19,275 (30% of income)
Health Care: $14,477 ($7,973 out-of-pocket + 9.8% of income; totals 22% of income)
Total: $52,750 (79% of income)
Remainder for all other expenses (including education, clothing, existing debt, transportation, etc.): $13,620 (or 21% of income)
Barring a “major medical event,” that family is likely to minimize their use of health care, to the detriment of their actual health. This will be fine and dandy with the insurance companies, who still rake in their premiums, and with our congresscritters who’ve sold their souls to Cigna and Aetna.
And if that family does end up spending the full out-of-pocket amount? If they’ve already got any significant debt, or a rapacious mortgage, or college education expenses – well, they might very well land in bankruptcy.
There are lots of other problems with the bill, too. Marcy provides a good rundown of how it falls short of Obama’s campaign promises. Even some of the remaining, modest reforms are partly hollow. For instance, people who are older or sicker can be charged premiums that are 300% of those for young, healthy folks, and the protections for those with pre-existing conditions won’t kick in for another four years. Even the language barring rescission is leaky, since it allows insurers to deny claims based on “fraud” or “an intentional misrepresentation of material fact”:
SEC. 2712. PROHIBITION ON RESCISSIONS.
A group health plan and a health insurance issuer offering group or individual health insurance coverage shall not rescind such plan or coverage with respect to an enrollee once the enrollee is covered under such plan or coverage involved, except that this section shall not apply to a covered individual who has performed an act or practice that constitutes fraud or makes an intentional misrepresentation of material fact as prohibited by the terms of the plan or coverage. Such plan or coverage may not be cancelled except with prior notice to the enrollee, and only as permitted under section 2702(c) or 2742(b).
Don’t insurance companies already deny claims based on allegedly undisclosed histories of anything from cancer to acne? And would someone please tell me why the industry would need such a loophole if “pre-existing conditions” are going to be irrelevant?
So this is a real pickle of a bill. Calls from the left to “kill the bill” are beside the point, since it looks like it’ll be passed tomorrow anyway. The 60 votes in favor of cloture pretty well sealed the deal for the bill’s passage.
All that left is hope that the reconciliation process will leave us with something closer to the House bill. After all, I can’t remember where it says in the Constitution that only the Senate’s legislation really counts.
I really like Cenk Uygur’s idea that the two bills could be reconciled – and vastly simplified – by allowing anyone to buy in to Medicare.
You only need 51 senators to pass a bill through reconciliation. But theoretically the main problem with reconciliation is that it can only be used for legislation that affects the budget. So, a public option or Medicare buy-in would definitely affect the budget, but getting rid of insurance practices like barring people for pre-existing conditions or denying them care through rescission could not be handled through reconciliation.
So, if you just want one bill you can’t go through reconciliation because you can’t keep many of the important elements of health care reform. That’s conventional wisdom. But here is a radical new idea – how about we just do Medicare buy-in for anyone who wants it and not bother to pass any regulations about pre-existing conditions or rescission or anything else.
(More here.)
I don’t know if I agree that it’s pointless or unnecessary to include regulations designed to prevent abuses. Even if everyone had the Medicare option, the insurance market is intransparent enough that competition won’t solve all of its ills. But for months, now, Badtux the Penguin has been arguing that “Medicare for All” would fix our broken system. (See here, for example – but also everything under his label “health care.”) He’s right. It would also be a miracle of backroom negotiations.
I’d like to think it’s the season of hope and miracles, but they will only happen if progressives get beyond the “kill the bill” rhetoric and start pushing to fix the bill when the House and Senate get into reconciliation.
Patron cat of Kittywampus (1985-2001)
That post by Emptywheel was really good. But I think what it really needs is a comparison to the status quo. If no health bill is passed, and we just keep on going as we are, then how will that family with a medical catastrophe and income at 301% of the poverty line do?
I’m not saying that they might not be better off under the status quo; I don’t know if they’d be better off or not. But without that direct comparison in Emptywheel’s post, it’s impossible for be to judge if HCR is making things better or worse for that family. It’s not as if the status quo is wonderful for families like that now.
You’re right that the status quo is definitely not good, and I agree that a comparison would probably show that many lower-middle-class families may see more harm than good from the Senate bill. But I suspect that the picture would be pretty mixed for such families, with some being clearly worse off. Here are a few hypothetical examples that might shake out pretty differently:
1. The family has a medical catastrophe. Under the present regime, they go bankrupt. They’re clearly better off with almost any reform that limits their potential losses.
2. The family is relatively healthy, without any serious medical problems. Under the current system, they pay 100% out-of-pocket for medical expenses, which come to $3000 per year. Under reform, their premiums alone will be higher than their current expenses.
3. The family has some chronic but manageable medical problems. Whether they’re better off will depend on how much they’re now paying, and whether they avoid seeing the doctor post-reform because their budget is too pinched.
So it’s complicated – and I agree we don’t know if they’ll be better off if the Senate bill becomes the law of the land.
But I think Marcy’s post shows that there’s a real issue that needs to be addressed. The comparison that actually matters most now is not the Senate bill versus the status quo; it’s the Senate bill versus change that will guarantee health care and not just “coverage.” And that’s why we progressives need to keep pushing. I don’t think that the “kill the bill” rhetoric has been terribly helpful, but I also think it would be a big mistake to take the crumbs the Senate has thrown us.
The mandates are definitely a sticky issue. The question is how good the subsidies end up being after conference, what poverty level they kick in at, and how the regulations work in practice after conference (I agree the “fraud” loophole to deny claims is incredibly dangerous).
In a note of good news, Bernie Sanders got an amendment for another $10 billion for community health centers, giving another 25 million Americans access to true, affordable health CARE. (source: http://j.mp/8L2013) There really are a lot of good things about the bill, and it’s a solid step forward.
Harkin is promising they’ll revisit the public option – and presumably other aspects of reform – next year. That’s definitely a slippery slope, and “we’ll fix it later! we swear!” is certainly not reassuring, and Harkin promised there’d be a public option in the bill to begin with. (source: http://j.mp/5e5T5M)
Don’t get me wrong – I’m pissed. It’s not half of what it should be, Joe Lieberman should be punched in the face, Ben Nelson should have been ignored completely, and the White House and liberal Senators should have started with a Medicare-for-all or some sort of single-payer system to negotiate from.
For some good reading regarding the options of what can happen next, check out today’s post on Congress Matters: http://j.mp/6JD6pn
And for some good reading regarding reconciliation, it’s possible uses and shortfalls, here’s a link to every post on Congress Matters with the tag of reconciliation. http://www.congressmatters.com/tag/reconciliation
Nice to hear from you Rence – you may be gone but you’re sure not forgotten! If your political travels ever take you close enough to Lieberman to throw that punch, I promise I will personally come and bail you out.
I agree that there are some good things about this bill – the Medicaid expansion is not trivial, by any means. As far as I understand, people on Medicaid often don’t have a very free choice of doctors, since many won’t accept Medicaid’s low reimbursement rates, but having some coverage is certainly preferable to none.
Harkin has also expressed support for modifying the filibuster rules – I’d like to see him succeed on both scores. I’m not holding my breath but it’s good to hear that he’s still standing up for the public option. If Nancy Pelosi has really written it off, though, I can’t imagine it’s got a real chance.
Yeah, we’ll see what conference produces. I’ve got a long wish list!
I’m pretty much the opposite of a progressive (never eat vegetables, Che-style posters of Reagan on the wall) but I agree with you 100%. The current bill isn’t reform that makes most people better off, and that’s what we need to have.
Too bad about the vegetables, Robert. The sweet potatoes we had at dinner yesterday were pretty darn good – and the marshmallows topping them were strictly non-partisan.
I’m pretty sure we don’t agree 100% – I do think we need to try to fix this bill so that the mandates don’t become a rip-off, especially for the lower-middle-class folks who might be most squeezed by them. Unlike you, I’m not opposed to the mandate in principle. Without a mandate, you end up with disproportionately sick and elderly people voluntarily buying into the system, and costs will skyrocket into infinity. However, I believe that mandates must be counterbalanced by a commitment to ensuring that people get health care for their money, and not just health insurance. That’s a political and ethical imperative.
[...] 25, 2010 by Sungold A few weeks ago I floated the idea – which I swiped from Cenk Uyger – of using reconciliation to pass meaningful health [...]