Cost Containment and Trust in “Bipartisan Reform”

(9 am. – promoted by ek hornbeck)

Posted at Progressive Blue

If the hearing word bipartisan makes you want to commit senseless acts of violence, chances are that you are probably one of those pacifist liberals. Just like so many words in American politics, bipartisan no longer means what we think it means. It would also seem that “progressive action” has come to mean being in the constant state of erasing lines in the sand.

All this time so many Democratic supporters were thinking that Social Security and Medicare represented the backbone of the Party of FDR but in the spirit of bipartisanship our Democratic president recently appointed a Republican as the chairman of the euphemistically named National Commission on Fiscal Responsibility and Reform. That way the former Republican Senator from Wyoming can “save” the United States from “insolvency” by hacking away at Social Security and Medicare.  

Now I’m feeling a bit naive because working to get Barack Obama elected, I was under the impression that health care reform was about a government run insurance option to keep the murder by spreadsheet gang honest. I was optimistically thinking that “no mandates” meant Americans would not be mandated into supporting Wall St. dividends. There was the “Hope” that Obama’s only mandate was mandating quality health coverage. I had this odd notion that there would be no back room deals with special interest groups and Americans would get drug price controls. I seem to remember that the Republican candidate wanted to do away with the tax exempt status of employee contributions and that Barack Obama was going to repeal Bush’s tax cuts for the wealthiest Americans, using that money to pay for health care reform.  

Yesterday there was this story by James Ridgeway and he seems to have understood what to expect from the beginning. It really helps to redefine bipartisanship and understand where progress will be going under “bipartisan Democrats.”  

James Ridgeway wrote Obama’s Speeches May Be “Fiery,” But His Health Care Reform Is Still Lukewarm.

It was widely known from the start of the so-called health care debate that a baseline goal would be to stop insurance companies from denying people coverage because of pre-existing conditions, or knocking people off the rolls when they got sick. (The public option, as everyone should by now have realized, was never much more than a bargaining chip.) And that’s just what’s likely to happen. The insurance companies might have to endure a few insults along the way, but in the end they will get the deal they’ve always been promised: They’ll make a few concessions in return for a boatload of new, government-mandated customers.

It was also well understood that any health care reform must genuflect before the alter of the free market. That has been a given since Reagan took office in 1981 and the conservative Heritage Foundation came up with its health care reform plan–which quite resembles the one now being promoted by Obama and many other Democrats.

The part about genuflecting before the freest of free markets was clear and becoming clearer every day because the insurance industry not only gets 30 million new government-mandated customers, they also gets to keep an antitrust exemption.

As the president went from publicly supporting a public option, to privately supporting a public option and then “Public option, what public option?” that carrot on a string seems more like a capitulation chip than a bargaining chip. It seems that Obama has been sabotaging his own campaign promise since being elected so when Obama promised to push for public option after the bill is passed Adam Green pointed out that “Obama is telling America, ‘No, we can’t.'”

So we the people are left with a “bipartisan” alternative to the public option that was designed by the Heritage Foundation? An exchange where the industry doing the exchanging is allowed to preform anti-competitive practices.    

The Heritage plan is based on the Federal Employee Health Benefits program (FEHB). (See Stephanie Mencimer’s earlier piece on the subject, as well as mine.) It supports a vending machine type “exchange” to sell private insurance across the country to one and all, thereby achieving a supposed twofer: affordable universal health care and preservation of the free market. The problem, of course, is that there is no free market when it comes to health insurance, and the FEHB is becoming more expensive by the day. So the exchanges will do nothing but bring mediocre and criminally overpriced insurance to a slightly larger pool of people.

“Criminally” now there’s another word that dosen’t mean what most people think anymore. Criminal would imply that a crime has been committed but when lawmakers condone “criminally overpriced insurance” and make these practices legal than no crime has been committed. It’s so confusing in this political atmosphere of assertive Republicans and Blue Dogs vs. milquetoast Democrats from blue states and a corporate president. Immoral works better than criminal, fitting for both the insurance companies and the elected officials.  

So without a public option what cost containments are left in the health insurance company expansion bill? If I was looking at Paul Krugman’s Blog The Conscious of a Liberal a year ago to find a link to a Wall Street Journal Op-Ed I would have been shocked. Not anymore, Mr. Krugman points out that the CBO is probably wrong and then offers up Health Reform Passes the Cost Test.  

Over the past year of debate, 10 broad ideas have been offered for bending the health-care cost curve. The Democrats’ proposed legislation incorporates virtually every one of them. Here they are:

Form insurance exchanges. These would help curb underwriting and inefficient marketing practices that raise costs in the small-group and individual insurance markets. This is addressed in all the House and Senate bills, and the president’s proposal. Grade: Full credit.

Reduce excessive prices, including those of supplemental plans enrolling Medicare beneficiaries. The president’s proposal reduces these Medicare Advantage overpayments and others to different providers, even in the face of Republican claims that reducing such overpayments is tantamount to rationing care for seniors. Grade: Full credit.

Moving to value-based payment in Medicare. Both Democrats and Republicans have called for moving from a system where volume drives reimbursement to one where value drives reimbursement. The president’s proposal includes virtually every idea offered for doing this. Grade: Full credit.

Tax generous insurance plans. Health-insurance benefits are excluded from income taxation, providing incentives for excessively generous insurance. Many economists have proposed capping the tax exclusion to reduce these incentives. The president’s proposal taxes some of the most generous policies, though it has deferred the date by which these taxes take effect. Grade: Partial credit.

Empower an independent Medicare advisory board. Interest-group politics intrudes too deeply within the mechanics of Medicare policy, raising program costs and hindering efforts to improve care. Despite powerful opposition, the president proposes this independent board and a process for fast-tracking such recommendations through Congress. Grade: Full credit.

Combat Medicare fraud and abuse. The administration has started an active task force to combat these problems. Other ideas to reduce fraud and abuse were presented at the recent health-care summit, and were incorporated in the president’s proposal. Grade: Full credit.

Malpractice reform. Defensive medicine is a small but important driver of medical spending. The reform proposal makes some headway, encouraging states to experiment with alternative mechanisms to reduce malpractice burdens. More could be done-for example, specialized malpractice courts and a safe harbor for physicians practicing evidence-based medicine-but the president’s proposal makes a start. Grade: Partial credit.

Invest in information technology. Many studies suggest savings in the tens of billions of dollars from IT investment. The stimulus bill passed a year ago contains funds to wire the medical system over the next few years, and the administration is supplementing this with significant funds to analyze the comparative effectiveness of different treatments-even in the face of “death panel” claims. Grade: Full credit.

Prevention. The president’s proposal includes significant public-health investments, provides new incentives for physicians to focus on preventive and chronic care, and opens Medicare to finding new ways of supporting prevention. The only area of weakness is the lack of a junk food tax or tax on sugar sweetened beverages. Grade: Partial credit.

I left off David M. Cutler’s tenth point because that was the now defunct public option that gets no grade from him. That was the option that was going to save some money for the public. Now there are some good things to be found, we are not totally screwed but the insurance companies are not suffering. There seems to be some savings for government but without the public option where are the savings for the people?

It seems to me that during all those years where all we ever got from Democrats was “We can’t do anything with Bush in office,” it seems there were more than just those “10 broad ideas for bending the health-care cost curve.” It seemed like the insurances companies were going to be forced to pay a price. It seemed like the interest of the people were being voiced on C-SPAN. Now it seems like forcing people to buy private health insurance guarantees many billions in new business for the insurance companies and there is even a little promise that states will be banned from passing single payer.  

Those 10 ideas don’t seem very broad at all. We have that meaningless exchange from the Heritage Foundation, and there’s that republican talking point, malpractice reform to make it bipartisan. Scaling down decent worker insurance policies to junk insurance instead of taxing the rich and making life harder on our senior citizens dosen’t seem like bipartisan ideas. Those seem like Republican ideas and it seems that the only reason Republicans are opposed to Obamacare is that they need to talk about something for the November election.

I wonder if Barack Obama remembers when 76% of the people supported a public option. That was before the president transformed it to “Not Politically Feasible.” Another misleading phrase in American politics that Noam Chomsky explained the new meaning of, the powers-that-be don’t want it, even if the people overwhelmingly and passionately support it. Well now as protests mount over health care a slight majority of the population want no part of Barack Obama reshaping health care.

I don’t think the people trust Barack Obama anymore, I know I don’t. But this is a two Party system and even if the people are invited to neither, you have to pick one don’t you? So as progressives tell us to pass this piece of shit so Barack Obama and his “bipartisan” Democrats can fix it later, please excuse my cynicism but I think that is placing the future of elected Democrats before the future of the people.  


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    • Eddie C on March 11, 2010 at 01:35

    I just don’t see it anymore.  

    • Eddie C on March 11, 2010 at 01:38

    Howard Dean is sounding like such an outcast.

    I’m going to fight for a public option until we get one. It really is that simple.

    The American people want the choice of a public option. I’m going to stand up for what the majority of the American people want again and again and again and I’m going to keep doing it until we win.

    Now is not the time to give up and accept less. With 40 Senators on the record in support of passing a public option by majority vote, we’ve proven that the majority of Senate Democrats are ready to get the job done. All it takes now is leadership. It only takes one senator to offer an amendment from the Senate floor to bring the inclusion of a public option to a vote this year.

    So today, we’re bringing back the bat.

    Democrats in Washington think that if they pass healthcare reform by the end of March, they’ll be done no matter what’s in the bill. But they’re wrong. If the bill doesn’t include a public option, we’re not going away and we will not forget. Send Washington a message that they understand.

    Oh please.

  1. While I still trust the President overall, there is no question that his managing of the health care insurance reform has been abysmal. If it was obvious to we lowly bloggers that there would never be bipartisan support for meaningful health care insurance reform, I am dumbfounded that the President continued to push for it until just recently.

    We can only hope that the HCR HIR debate has produced a very loud wake-up call for the President on future initiatives. If it hasn’t, then he just might become another one term president.

  2. For some crazy reason I let myself believe the bs during the election — desperation, I guess. Now it is obvious that we had no choice at all — and probably won’t have in the future, either. Like Mongo, we are all pawns in the game of politics.

    But, just in case it isn’t dismal enough, on Bill Moyer last week the head of the Nurses Assoc. spoke against passing the HCR bill as is. According to her, and agreed with by Moyer, the insurance companies will still be able to refuse to cover people, either by simply raising the rates so high they can’t afford the insurance (companies will be allowed to raise individual rates 3x above the baseline for older or sicker patients), or by refusing coverage and then paying a $300 fine per refusal. It is unclear if the individual would still be fined for not carrying insurance, even if they were refused coverage because that eventuality isn’t addressed.

    I am also more than a little concerned about this:

    Moving to value-based payment in Medicare. Both Democrats and Republicans have called for moving from a system where volume drives reimbursement to one where value drives reimbursement.

    That would seem to reward doctors for not treating patients who are seriously or terminally ill. It is already hideously difficult to find a doctor in some areas. (I haven’t been able to find a doctor that will take a new patient with BCBS in my state in two years.) As a person with a terminal condition, I am more than a little concerned when doctors start to be reimbursed for “valued” outcomes.

    The closer to death one gets, the more expensive the medical treatment becomes. That doesn’t mean we shouldn’t have access to care that can extend our lives. But if the reimbursement shifts to “value” rather than quality of care, I have a good idea of who will rapidly become less valuable. And if doctors face declines in reimbursement for treating the most ill patients, it could become very difficult for chronically ill patients to secure adequate non-emergency treatment.

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