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.
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.
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.