Well somehow or another we continue to make sausage in the Healthcare political factory. And 
despite the commentaries it's substantial progress that over time will do the country and a great deal of good. At the same time it perfectly illustrates the problems with tackling substantive change we've been talking about. The problem with getting interest groups to surrender some of their immediate advantages for the broader benefit to society and in their own longer-term self-interest since they need a viable industry that's funded. The problems with getting partisan politics to take a back seat to the public interest the sheer size scope and complexities of this topic and the combination of confusion hostility and fear among the voters. Not to mention the punditry's thinking this was going to be a slam dunk and looking for the latest headline. Despite all that we've had the House pass out a reasonable bill while the Senate not only is out of committee but has gotten its bill to the floor. This farther with more substantive progress than we've gotten since Medicare was passed in 1965.
Let's refresh our memories about where we want to got with the accompanying graphic. The chart portions are one set of data telling us why doing something constructive is a vital national interest - briefly put otherwise we'll drive everyone bankrupt. The lower-right text chart is borrowed from Uwe Reinhardt in the NYT and so summarizes the strategic requirements in terms of provision operations and incentive management with the bottom capturing the essence of the charts. Setting aside the partisan bickering and a lot of the interest group posturing the better commenters still applauded the existing bills for expanding coverage and avoiding some of the worst problems while not directly attacking the longer term structure of cost growth. Actually we think they're wrong about that last for reasons we've discussed but let's come back to that.
One "minor" problem - aside from emotional appeals and fear-mongerings of course - is that people are still struggling to be KISSed with a kept it simple explanation of why they care and how they'll be impacted. We've been taking our best shots at trying to help out with all that to some limited avail we hope. Let's add one more immediate argument. Aside from impacting business competitiveness raising costs thru the roof and now headed for the moon exposing people to financial catastrophe spending more and getting relatively less than any other developed country health cost directly impact everyone on a day-to-day basis.
This chart (courtesy of out buddy Jake over at EconPic) is so clean clear and straight-forward it speaks for itself. But let's put it in the bigger context. Since 1980 more and more of the gains from growth have gone to fewer and fewer of our society. There are a lot of reasons for that a primary one being the lack of new jobs beyond just keeping up with labor force growth. But another being is that total wages and benefits have been rising as employers see them. By huge amounts too. It's just that all the increases have been going to benefits and not wages. So in addition to all the other reasons for needing desperately to get HC$ under control there's the minor matter of wanting to return to some sort of prosperity for most of us!
A major problem with the pundits critiques is that they don't see how the rate of increases in costs comes under control because they don't see direct rules and regulations in the existing bills that are specifically targeted at that problem. Actually they're there in ways that create a long-term virtuous cycle of structural changes. And they have two key components. One is the Health Exchanges where folks without insurance can go. Over time do you really think assuming they work reasonably well that everybody who thinks they're over-paying won't want to go there? Or that businesses will eventually? The other deep change is the notion of bundled payments where reimbursement rates are set or at least suggested by national standards groups ba
Just before the holidays major changes in certain cancer screening techniques were recommended for adoption ba
But judge for yourselves - please. PBS had a very good set of interviews just before the holiday weekend that had some very qualified and sensible sounding folks on.
Aside from the intrinsic merits though what we really find interesting is that there really isn't a better example of evidence-ba
After the break you'll find a whole bunch of readings that touch on most of these issues from costs to policies to politics to partisans. We strongly suggest you at least skim them. The ebbs and flows of interest group politics (especially the Insurance industry's last minute attempts to derail things) as well as the very long history of behind-the-scenes coalition building by the Administration that got us here are textbook. Welcome to the Sausage Factory!
Costs of Employment Up... Just Not in Wage FormThis American Life's most recent podcast More is Less discusses one of the many implications of higher healthcare costs; the fact that less of the increase in costs associated with staffing is actually passed through to the worker in the form of wages (think broken system greed and the demand for procedures that may not be necessary from the patients themselves).As can be seen below while income has been stagnant in real terms costs to employers has risen steadily due to the increase in the cost of benefits (i.e. healthcare). Wages vs Benefits Graphic
The Perils of Inaction and the Promise of Effective ActionWith health care expenses at an all-time high and some of the proposed congressional health care reform bills threatening to add hundreds of billions to government spending many are debating the cost of health care reform. In this paper Business Roundtable turned that idea around and asked:What is the cost of doing nothing?To answer this question Business Roundtable commissioned a report from Hewitt Associates to explore the cost of inaction and to identify ways to build an improved more efficient structure. Without significant marketplace reforms if current trends continue annual health care costs for employers will rise 166 percent over the next decade from $10743 per employee today to $28530 by 2019[1]. These runaway costs combined with a $56 billion cost shift to payors from uncompensated care would cripple the employer-ba
Poll: Most Americans support public option A new Washington Post-ABC News poll shows that support for a government-run health-care plan to compete with private insurers has rebounded from its summertime lows and wins clear majority support from the public. Americans remain sharply divided about the overall packages moving closer to votes in Congress and President Obama's leadership on the issue reflecting the partisan battle that has raged for months over the administration's top legislative priority. But sizable majorities back two key and controversial provisions: both the so-called public option and a new mandate that would require all Americans to carry health insurance.Overall 45 percent of Americans favor the broad outlines of the proposals now moving in Congress while 48 percent are opposed about the same division that existed in August at the height of angry town hall meetings over health-care reform. Seven in 10 Democrats back the plan while almost nine in 10 Republicans oppose it. Independents divide 52 percent against 42 percent in favor of the legislation.There are also deep splits in the new poll over whether the proposed changes would go too far or not far enough in expanding coverage and controlling costs. Twice as many see the plan as leaning toward too much government involvement but since last month there has been a nine-point increase in the number who say government should be more involved.On the issue that has been perhaps the most pronounced flash point in the national debate 57 percent of all Americans now favor a public insurance option while 40 percent oppose it. Support has risen since mid-August when a bare majority 52 percent said they favored it. (In a June Post-ABC poll support was 62 percent.)If a public plan were run by the states and available only to those who lack affordable private options support for it jumps to 76 percent. Under those circumstances even a majority of Republicans 56 percent would be in favor of it about double their level of support without such a limitation.
Post-ABC News Poll Data
State’s health system popular Public support for Massachusetts’ closely watched health insurance overhaul has slipped over the past year a new poll indicates but residents still support the path-breaking 2006 law by a 2-to-1 ratio.Amid a severe recession that has led to cuts in state programs and unrelenting job losses 59 percent of those surveyed said they favored the state’s multimillion-dollar insurance initiative down from 69 percent a year ago. The poll by the Harvard School of Public Health and The Boston Globe found that opposition to the law stands at 28 percent up slightly from 22 percent in a June 2008 survey.Percolating throughout the poll findings is a gnawing concern over rising health care costs suggesting that support could erode further if the state fails to slow the growth of medical spending.With key features of the state law at the heart of the blistering national health care debate in Congress architects and observers of the Massachusetts plan say the poll findings indicate that a national overhaul is not only possible but politically viable.“Three years in operation and with 97 percent of people covered you have a majority of support and that is a lesson for Washington’’ said Robert J. Blendon a health policy professor at the Harvard School of Public Health and the poll’s co-director.The poll found that 79 percent of those surveyed wanted the law to continue though a majority said there should be some changes with cost reductions cited as the single most important change that needs to be made.Only 11 percent of state residents favored repealing the law similar to last year’s finding.Drew Altman president of the Kaiser Family Foundation a nonprofit health care think tank said Washington is paying more attention to cost control up front but ultimately Massachusetts may get there faster. He said that although the various proposals in Washington contain measures to slow costs much of the national savings won’t be realized for years to come.“The fact that Massachusetts led with coverage and then turned aggressively to cost control will do more for costs in the next five years than national legislation will do in ten’’ Altman said “because in Massachusetts you are staring a real affordability issue in the face.’’
FACT CHECK: Health insurer profits not so fat Quick quiz: What do these enterprises have in common? Farm and construction machinery Tupperware the railroads Hershey sweets Yum food brands and Yahoo? Answer: They're all more profitable than the health insurance industry. In the health care debate Democrats and their allies have gone after insurance companies as rapacious profiteers making "immoral" and "obscene" returns while "the bodies pile up."Ledgers tell a different reality. Health insurance profit margins typically run about 6 percent give or take a point or two. That's anemic compared with other forms of insurance and a broad array of industries even some beleaguered ones.Profits barely exceeded 2 percent of revenues in the latest annual measure. This partly explains why the credit ratings of some of the largest insurers were downgraded to negative from stable heading into this year as investors were warned of a stagnant if not shrinking market for private plans.Insurers are an expedient target for leaders who want a government-run plan in the marketplace. Such a public option would force private insurers to trim profits and restrain premiums to compete the argument goes. This would "keep insurance companies honest" says President Barack Obama.The debate is loaded with intimations that insurers are less than straight when they are not flatly accused of malfeasance.They may not have helped their case by commissioning a report that looked primarily at the elements of health care legislation that might drive consumer costs up while ignoring elements aimed at bringing costs down. Few in the debate seem interested in a true balance sheet.But in pillorying insurers over profits the critics are on shaky ground. A look at some claims and the numbers:
What Role Should Private Health Insurance Play?Private Health Plans: Where Is the Value? What Is the Point?Senate Pressing Insurers on the Amount of Premiums They Spend on Care The health insurance industry likes to cite figures showing that 87 cents of every dollar in premiums is spent on medical claims. But a new Senate analysis suggests that for-profit insurance companies are spending much less than that especially for policies sold to individuals and small businesses. Instead as little as 66 cents of each dollar paid in premiums goes toward doctor and hospital bills while the rest covers administrative expenses marketing and company profits according to the analysis.The percentage of premiums spent on medical claims is known in industry jargon as the “medical loss ratio.” According to the Senate analysis the for-profit insurers’ average ratio in 2008 was 84 percent in policies offered to large employers and 80 percent for small employers — those businesses with 50 or fewer workers. Individuals and small businesses have long complained they get less value for their money. But insurance companies generally do not disclose how much they spend in different segments of the market. The Senate analysis of the figures does not include information from California because that state’s filings are not available through the National Association of Insurance Commissioners.The Defining Moment O.K. folks this is it. It’s the defining moment for health care reform.Past efforts to give Americans what citizens of every other advanced nation already have — guaranteed access to essential care — have ended not with a bang but with a whimper usually dying in committee without ever making it to a vote.But this time broadly similar health-care bills have made it through multiple committees in both houses of Congress. And on Thursday Nancy Pelosi the speaker of the House unveiled the legislation that she will send to the House floor where it will almost surely pass. It’s not a perfect bill by a long shot but it’s a much stronger bill than almost anyone expected to emerge even a few weeks ago. And it would lead to near-universal coverage.As a result everyone in the political class — by which I mean politicians people in the news media and so on basically whoever is in a position to influence the final stage of this legislative marathon — now has to make a choice. The seemingly impossible dream of fundamental health reform is just a few steps away from becoming reality and each pla
Healthcare Coalition Building: Cost Control vs Interest Groups
The 5 Big Health Care Dilemmas And yet there are signals coming from Capitol Hill back rooms and corporate boardrooms that suggest things could be different this time. In recent weeks health-care-industry leaders have pledged to cut their own costs by $2 trillion over the next 10 years (though they have yet to fill in the specifics). The insurance industry now says it is willing to make concessions it never would have considered before - like agreeing to set prices on policies without regard to an individual's health history - in exchange for the access to the vast new market that would come with universal coverage. "Nobody here in our industry is defending or wants the status quo" says Karen Ignagni who heads the leading insurance lobby group. Perhaps most important there is more agreement than ever before that for any health-care system to work everyone - or nearly everyone - has to be covered.It is now possible to glimpse the outlines of a Grand Deal among insurers providers business labor and patients that would put most of its focus on lowering costs and establish a foundation for expanding coverage in years to come. But even amid signs of a new consensus there are at least five questions that must be settled before there can be meaningful reform: The problem with American health care those who have studied the system will tell you is not that we get too little care but that we use too much. By some estimates as much as 30¢ of every health-care dollar is spent on medical treatment that is unnecessary ineffective duplicative or even harmful. Changing all that is going to require revamping health care from top to bottom starting with the way health-care providers are reimbursed. While the current system pays them for the amount of care they provide real reform would put more emphasis on the quality of that care and the outcomes it achieves. If there is an ideal out there Baucus says it can be seen in the kind of medicine already being practiced by Kaiser Permanente the Mayo Clinic Intermountain Healthcare and Geisinger Health System which manage to hold down costs and get better results. Their operations have fostered closer teamwork among care providers. Also important will be electronic record-keeping that saves time and avoids errors and comparative-effectiveness research that gives doctors and patients a better sense of which treatments work best. And a reformed health-care system would put more emphasis on preventive care and managing such chronic conditions as asthma heart disease and diabetes that now account for 75¢ out of every medical dollar spent. All these things would force a cultural and economic revolution on the health industry - and the patients who depend on it. Can this country really afford to reform health care? What everyone seems to have concluded in the past five years is that we can't afford not to. When Washington punts on health care it only becomes more difficult to fix the system the next time it tries. "The reason why we're going to pass it" Baucus says "is we're not going to have this opportunity again."
Getting Real About Healthcare The central health care problem is not improving coverage. It's controlling costs. In 1960 health care accounted for $1 of every $20 spent in the U.S. economy; now that's $1 of every $6 and the Congressional Budget Office projects that it could be $1 of every $4 by 2025. Ponder that: a quarter of the U.S. economy devoted to health care. Would we be better off? Probably not. Countless studies have shown that many tests surgeries and medical devices are either ineffective or unneeded.Greater health-care spending forfeits any superior moral claim on our wealth by slowly crowding out other national needs. For government higher health costs threaten other programs -- schools roads defense scientific research -- and put upward pressure on taxes. For workers increasingly expensive insurance depresses take-home pay as employers funnel more compensation dollars into coverage. There's also a massive and undesirable income transfer from the young to the old accomplished through taxes and the cross-subsidies of private insurance because the old are the biggest users of medical care. It is widely assumed that health care like most aspects of American life shamefully shortchanges the poor. This is less true than it seems. Economist Gary Burtless of the Brookings Institution recently discovered this astonishing data: on average annual health spending per person -- from all private and government sources -- is equal for the poorest and the richest Americans. In 2003 it was $4477 for the poorest fifth and $4451 for the richest. Probably in no other area notes Burtless is spending so equal -- not in housing clothes transportation or anything. Why? One reason: government already insures more than a quarter of the population including many poor. Medicare covers the elderly;
The Health-Care Crisis Hits Home When you've been strong and fit your whole life it can be easy to discount your body's first whispers of sickness as merely the side effects of daily living. Looking back over the past three years my older brother Patrick now understands the meaning of his increasingly frequent bouts of fatigue his fluctuating appetite and the fact that his blood pressure had crept up to 150/90. Finally last July my brother's doctor insisted that he see a specialist who quickly ordered a biopsy. That's when Pat who is now 54 learned that his kidneys were failing. The diagnosis was only the first shock. Kidney failure would seem to be one of those disastrous "unexpected illnesses" that Pat thought he was insuring himself against. But apparently he was wrong. When my mother panicked called to tell me that the insurance company was refusing to pay Pat's claims I told her not to worry; bureaucratic mix-up I assumed. I said I'd take care of it bringing to bear my 15 years of experience covering health policy sitting through endless congressional hearings on the subject and even moderating a presidential candidates' forum on the issue. Confident of my abilities to sort this out or at least find the right person to fix the problem I made some calls to the company. I got nowhere. That's when I realized that the national crisis I'd written so much about had just hit home. The previous four weeks had left my brother with more than $14000 in bills from hospitals doctors and labs. And that was just to figure out what was wrong with him. Actually treating his disease was going to be unimaginably more expensive. Patrick needed help quickly and we didn't have a clue where or how to start looking for it. When we talk about health-care reform we usually start with the problem of the roughly 45 million (and rising) uninsured Americans who have no health coverage at all. But Pat represents the shadow problem facing an additional 25 million people who spend more than 10% of their income on out-of-pocket medical costs. They are the underinsured who may be all the more vulnerable because until a health catastrophe hits they're often blind to the danger they're in. In a 2005 Harvard University study of more than 1700 bankruptcies across the country researchers found that medical problems were behind half of them - and three-quarters of those bankrupt people actually had health insurance.
Medical bills underlie 60 percent of U.S. bankruptcies: studyMicrocosm of Health-Care Fears The people who live around the pretty courtyard and well-kept lawns of Linden Hall Lane in Gaithersburg are like much of America. They have glaucoma and asthma. They've had foot surgeries aneurysms and heart attacks. They've become disabled or never been sick a day in their lives. Their children have potentially life-threatening breathing problems and run-of-the-mill ear infections colds and broken arms. Their health issues have been covered by gold-plated insurance plans capricious for-profit firms HMOs Medicare and nothing. When it comes to their health care no one is completely happy. Everyone has a complaint. And nobody understands the way the current system works only that it doesn't work very well. These are the people President Obama counted on to give his signature health-care reform effort the grass-roots oomph it needs to get through Congress. But no one on this cul-de-sac in Montgomery County has taken his or her private frustrations to a public meeting; no one has lobbied a lawmaker. The lawyers architects doctors teachers retirees and federal government employees living in the $300000 light-filled homes of Linden Hall Lane agree on the moral imperative of providing health-care coverage to all Americans including the 46 million currently uninsured. But beyond that the wonky chatter about "bending the curve" of health-care expenses and the noise of "You lie!" outbursts have left them cold. The messy and complex debate in Washington though only 29.4 miles south of their quiet courtyard might as well be taking place on a distant planet for all it seems to have to do with the needs of their own lives. All they know is something's got to give.
Insurers mount attack against health reform After working for months behind the scenes to help shape health care reform the insurance industry is now sharply attacking the emerging plan with a report that maintains Senate legislation would increase the cost of a typical policy by hundreds or even thousands of dollars a year.A spokesman for Sen. Max Baucus D-Mont. whose 10-year $829 billion overhaul plan faces a final Finance Committee vote Tuesday was quick to react Sunday questioning the credibility of the industry's late-in-coming cost estimate."It's a health insurance company hatchet job plain and simple" said the spokesman Scott Mulhauser.The health insurance industry has been working until recently to help draft legislation while publicly endorsing President Barack Obama's goal of affordable coverage for all Americans. The alliance has grown strained as legislation advances toward votes in Congress.Late Sunday the industry trade group America's Health Insurance Plans sent its member companies a new accounting firm study that projects the legislation would add $1700 a year to the cost of family coverage in 2013 when most of the major provisions in the bill would be in effect.Premiums for a single person would go up by $600 more than would be the case without the legislation the PricewaterhouseCoopers analysis concluded in the study commissioned by the insurance group.
The Insurance Industry's Deceptive Report In the hallowed tradition of the tobacco and energy industries the health insurance industry has commissioned a report (pdf) projecting doom and despair for those who seek to reform its business practices. The report was farmed out to the consultancy PricewaterhouseCoopers which has something of a history with this sort of thing: In the early-'90s the tobacco industry commissioned PWC to estimate the economic devastation that would result from a tax on tobacco. The report was later analyzed by the Arthur Andersen Economic Consulting group which concluded that "the cumulative effect of PW’s methods … is to produce patently unreliable results." It's perhaps no surprise that the patently unreliable results were all in the tobacco industry's favor. He who pays the piper names the tune and all that.All that makes it a bit hard to respond to this analysis. Seriously engaging with its methodology probably gives it more credit than it deserves making this seem like an argument between two opposing sides as opposed to a predictable industry hit job. But totally ignoring its claims means some of them might live unchallenged. So rather than a full tour through the "analysis" here are a couple of its more representative moments.
Lobbyists Fight Efforts to Save on Health Care As the health care debate moves to the floor of Congress most of the serious proposals to fulfill President Obama’s original vow to curb costs have fallen victim to organized interests and parochial politics.And now the last two initiatives with real bite that are still in contention — a scaled-back “Cadillac tax” on high-cost health plans and a nonpartisan Medicare budget-cutting commission — are under furious assault.Most economists’ favorite idea for slowing the growth of health care spending was ending the income tax exemption for employer-paid health insurance to make lower-cost plans more attractive. But that would hurt workers with big benefit plans and a labor-union lobbying blitz helped kill that idea by the Fourth of July.Lobbying by doctors hospitals and other health care providers meanwhile dimmed the prospects of various proposals to cut into their incomes including allowing government negotiation of Medicare drug prices and creating a government insurer with the muscle to lower fee payments. “The lobbyists are winning” said Representative Jim Cooper a conservative Tennessee Democrat who teaches health policy.Total health care costs in the last 20 years have doubled to about 16 percent of the economy with no signs of tapering. Along with universal coverage Mr. Obama has made controlling those costs a central pillar of his health care overhaul calling the current course “unsustainable.” The effort is a pivotal test of his campaign promise to break the stranglehold of special interests.In an interview Peter R. Orszag the White House budget director and the official most associated with the drive to cut costs singled out the proposed Medicare commission and the “Cadillac tax” as evidence of progress. “A key priority now” Mr. Orszag said “is to make sure cost containment holds up as we move through the legislative process."Neither element appears in any of the other four health care bills on Capitol Hill and both face dug-in resistance in the House.
The Lobbyists in the Health Care Fray (5 Letters)New DatabaAndrew M. Cuomo the New York attorney general on Tuesday announced the details of a new national databa
AARP AMA Endorse Health Bill House Democrats' health bill got a boost Thursday with endorsements by AARP and the American Medical Association which President Barack Obama seized on to push for support with hours ticking down before a scheduled vote Saturday evening on the House floor.House Speaker Nancy Pelosi (D. Calif.) battled to gather the 218 votes she needs to ensure passage. Asked if she has the necessary votes Ms. Pelosi told reporters "We will."Democrats hailed the backing of the AMA the nation's largest doctors' group as especially significant since its position had been in doubt. But the group's statement of support was lukewarm saying the measure is "not the perfect bill." AARP the largest senior citizens' organization officially endorsed the bill citing the fact that it would help lower drug costs for seniors and make it easier for older Americans who don't yet qualify for Medicare to buy insurance policies.Although seniors have been vocal critics of the health-care overhaul AARP's backing didn't come as a surprise since the group has been publicly promoting the House bill for months. AARP Chief Executive Barry Rand praised the legislation Thursday for strictly limiting how much more insurance companies can charge seniors ba
In Poll Wide Support for Government-Run Health Americans overwhelmingly support substantial changes to the health care system and are strongly behind one of the most contentious proposals Congress is considering a government-run insurance plan to compete with private insurers according to the latest New York Times/CBS News poll. The poll found that most Americans would be willing to pay higher taxes so everyone could have health insurance and that they said the government could do a better job of holding down health-care costs than the private sector.Yet the survey also revealed considerable unease about the impact of heightened government involvement on both the economy and the quality of the respondents’ own medical care. While 85 percent of respondents said the health care system needed to be fundamentally changed or completely rebuilt 77 percent said they were very or somewhat satisfied with the quality of their own care. That paradox was skillfully exploited by opponents of the last failed attempt at overhauling the health system during former President Bill Clinton’s first term. Sixteen years later it underscores the tricky task facing lawmakers and President Obama as they try to address the health system’s substantial problems without igniting fears that people could lose what they like. Across a number of questions the poll detected substantial support for a greater government role in health care a position generally identified with the Democratic Party. Republicans in Congress have fiercely criticized the proposal as an unneeded expansion of government that might evolve into a system of nationalized health coverage and lead to the rationing of care. But in the poll the proposal received broad bipartisan backing with half of those who call themselves Republicans saying they would support a public plan along with nearly three-fourths of independents and almost nine in 10 Democrats.
Document Reader: Complete Poll ResultsWhitehouse Forum on HC Reform: Stakeholders Ideas (CSpan) Nancy-Ann DeParle the White House Director of the Office of Health Reform met with representatives of healthcare companies & community organizations. They discussed health care issues as part of the Obama Administration's ongoing effort towards health care reform.President’s Speech Allays Some Fears in the Health Insurance Industry During the summer’s heated discussions over health care when Democrats seemed quick to portray the health insurance companies as the system’s main villains the industry seemed to be in policy makers’ cross hairs. But as the specifics of Washington’s proposed overhaul have emerged in recent days some industry analysts say insurers may not have much to fear. “The outlook is moving away from the worst case” said Les Funtleyder who follows the industry for the investment firm Miller Tabak & Company in New York. Even Mr. Obama who had recently stepped up his criticism of the industry seemed to soften his stance on Wednesday. He recounted a few insurance horror stories — as might be politically necessary when arguing the need for a system makeover. But as he outlined his plans for health care which focused mainly on a revamping of the nation’s insurance system he was careful to point out that the executives who run those companies were not “bad people.” Mr. Obama also made clear that the industry’s biggest worry — the specter of a government-run health plan competing with commercial insurance plans — was not a necessary ingredient to the legislation he seeks. Additionally he emphasized that he did not want a drastic move away from the current system under which private companies provide coverage to the bulk of working Americans who are insured. “Under my plan” said Mr. Obama in a departure from his position during the campaign “individuals will be required to carry basic health insurance — just as most states require you to carry auto insurance.” The requirement which would be coupled with subsidies to help those who could not otherwise afford coverage is likely to result in tens of millions of new customers for the industry. The insurers have also argued that they need to have everyone covered if the industry is going to stop controversial practices like denying policies to people with pre-existing medical conditions or charging sick people much more in premiums than the healthy.“From the insurers’ standpoint that was a very positive turn of events” said Rick Weissenstein a health care policy analyst in the Washington Research Group at Concept Capital which follows developments for investors. Many of the changes to the insurance system now under discussion are the ones that have been advocated this year by the insurance companies themselves said Karen M. Ignagni the chief executive of America’s Health Insurance Plans the industry trade group.
Seducing Olympia Snowe: The Key to Health Reform I caught up with Snowe in the chandeliered reception room adjacent to the Senate chamber as she was racing from the Finance Committee's first drafting session for its health-care bill to a vote on the Senate floor and then to a luncheon with her Republican colleagues. She sounded almost rueful as she discussed a political environment in which her brand of bipartisan dealmaking sets her apart. "I understand politics plays a role in this process but it should not be to the exclusion of our foremost obligation to the American people which is to govern" she said. "You can't allow your differences to overtake your ability to solve problems. In a lot of ways it's stunning that we're at a point in America a time when our elected officials and our political institutions should be rising to the occasion to grapple with the monumental issues of our time and we can't muster the political capacity to get it done." Snowe has been working behind the scenes to remedy a problem that she was among the first to identify and that is now at the heart of the debate: how to make coverage affordable. Snowe began arguing months ago with Baucus — and with President Barack Obama — that if the government was going to require people to buy health insurance it had better also make sure they had the means to do so. Early on say those who are familiar with talks Snowe was the lone voice in Baucus' bipartisan "Gang of Six" negotiating group complaining that the federal subsidies his bill would provide to help individuals buy insurance were far too skimpy. When Baucus made his bill public her complaint was echoed by many Democrats. As a result Baucus agreed to make the bill's tax credits for low- and middle-income Americans more generous. Even if the Baucus bill bears Snowe's stamp that does not mean it will get her vote. She stood with Republicans when they demanded that Baucus submit his vast measure to full scoring by the Congressional Budget Office to ensure that everyone knew what it would cost. Nor has she said she will support the bill's individual mandate which would require people who are not covered by their employers or by government programs to buy coverage for themselves just as car owners in nearly every state must have auto insurance. Without such a requirement the bill is likely to fall significantly short of ensuring universal coverage. Little surprise that Snowe may turn out to be at the bridge. "I understand about winning elections because that's what we do" she says with a sigh. "But it should be a competition of good ideas not erecting barriers to solving the problems of a great nation." Her biggest challenge will be convincing more of her colleagues to think the same way.
'A Lot to Like' Indeed The strangest aspect of the debate over a public option for health coverage is that the centrists who oppose it should love it. It doesn't involve a government takeover of the health-care system. The idea is that only consumers who want to enroll in a government-run health plan would do so. Anyone who preferred private insurance could get it. The public option also uses government exactly as advocates of market economics say it should be deployed: not as a controlling entity but as a nudge toward greater competition. Fans of the market rightly oppose monopolies. But in many places a small number of insurance companies -- sometimes only one -- dominates the market. The public option is a monopoly-buster. Centrists tell us they want to hold down spending and fight deficits. Strong versions of the public option as the Congressional Budget Office showed in its scoring of Sen. Jay Rockefeller's proposal cut the costs of insuring everyone. Unfortunately the debate over the public option has rarely concentrated on the substance of the idea. Instead it has been almost entirely ideological. Because opponents know from polling that the public wants the chance to choose a government plan they move the discourse to abstract and often demagogic ground. The most revealing "argument" during the Senate Finance Committee's public-option debate on Tuesday came from Sen. Chuck Grassley."The government is not a fair competitor" Grassley said. "It's a predator." Grassley was then forced to explain how he felt about Medicare. Is it predatory for government to pay health bills for the elderly? Is Social Security which lives side by side with private pension and savings plans predatory? Is it predatory for government to regulate well predatory lenders or stock swindlers or bank boodlers?
Can Obama and Orszag Deliver on Health-Care Reform's Promised Savings? Way back in January Barack Obama asked his health-care advisers for a simple number. "I want to know how clearly and how unequivocally I can tell the American people their costs are going down when this is done" he said according to someone at the meeting. During the campaign Obama had promised to "lower health-care costs by $2500 for the typical family" helping him make the sale on Election Day; the question he knew was going to be whether he could deliver on that specific number. It has not been easy. His advisers told him the number ba
Americans United on Health Care’s Ills Not Remedy: Albert Hunt -- Uwe Reinhardt the eminent Princeton University economist says dueling political claims notwithstanding the health-care overhaul that Americans want is clear. Patients should make their own decisions and insurance companies and the government shouldn’t interfere under the guise of “cost-effectiveness.” Families’ out-of-pocket payments should be limited and premiums and taxes kept low. Also insurance should be provided to all Americans with no mandates and Medicare’s spiraling costs must be controlled without curbing payments to hospitals or doctors. And of course health care should never be rationed; that is “un-American.” Every one of those choices would poll well and many are common refrains from politicians in the current debate. Together they comprise the proverbial free lunch that would bankrupt the government insurance companies and hospitals. Congress is close to passing an overhaul of the nation’s health-care system a monumental task since it would be achieved in such a blizzard of misinformation that it’s no wonder the public has such unrealistic expectations. Few contest the inadequacies of the current system. America has the most expensive health care in the world rising at an unsustainable pace and is the only major country where millions aren’t covered by insurance and thousands of families declare bankruptcy every year because of out-of-control costs. In general outcomes are worse than for citizens of our major economic competitors who enjoy considerable advantages for their more effective and efficient health-care system. The Business Roundtable calculates that U.S. businesses face a 23 percent health-care “value gap” -- when performance is weighed against cost -- relative to companies in Japan Germany the U.K. France and Canada. That gap doubles the Washington-ba
Lobbyists Fight Last Big Plans to Cut Health Care Costs As the health care debate moves to the floor of Congress most of the serious proposals to fulfill President Obama’s original vow to curb costs have fallen victim to organized interests and parochial politics. And now the last two initiatives with real bite that are still in contention — a scaled-back “Cadillac tax” on high-cost health plans and a nonpartisan Medicare budget-cutting commission — are under furious assault. Most economists’ favorite idea for slowing the growth of health care spending was ending the income tax exemption for employer-paid health insurance to make lower-cost plans more attractive. But that would hurt workers with big benefit plans and a labor-union lobbying blitz helped kill that idea by the Fourth of July. Lobbying by doctors hospitals and other health care providers meanwhile dimmed the prospects of various proposals to cut into their incomes including allowing government negotiation of Medicare drug prices and creating a government insurer with the muscle to lower fee payments. “The lobbyists are winning” said Representative Jim Cooper a conservative Tennessee Democrat who teaches health policy. The proposed Medicare commission aimed at providers instead of consumers is becoming a case study in the political difficulty of reducing medical payments. The commission was intended to side-step the interest-group pressure that often stymies Congress. Modeled after the nonpartisan commission for military ba
Obama Cites G.O.P. Officials in Call to Action on BillPresident Obama said Saturday that he saw an “unprecedented consensus” around Congressional plans to overhaul the nation’s health care system citing the recent statements of a string of Republicans — most of them former elected officials — who have issued their own calls to action. The White House has been pressing Republicans who are in favor of passing health legislation to issue the statements and circulating them to reporters. On Saturday a few more added their names to a list that already included Bill Frist and Bob Dole both former Senate Republican leaders; Tommy Thompson and Louis Sullivan both former health secretaries; and Gov. Arnold Schwarzenegger of California. Four former surgeons general — two who served Democrats and two who served Republicans — issued a statement that stressed the importance of lowering health costs and improving preventive care and said the “approaches that Congress is considering will help achieve these goals.” And Chuck Hagel the former senator from Nebraska wrote: “Congress and the administration are working on bipartisan practical solutions to improve our health care system. I urge all members of Congress to put aside their narrow partisan differences and seize this moment for health care reform.” The White House effort has irked Republican leaders in Congress who argue that the statements are bland ex
How Health Care Reform Won The biggest story in health care reform this year has not been the town hall meetings or President Obama’s big speech on health care. It’s that the Senate Democrats have decided they’re going to pass a bill. You just haven’t heard much about this story because it’s mostly taken place behind closed doors. (Click here [1] to read Michelle Cottle's devastating and definitive take on health care reform scourge Betsy McCaughey.) Yesterday’s Roll Call [2] has some details. Here’s what I think is the key passage:
As a fallback Senate Democratic leaders have stepped up their pressure on centrists to stick with the party on procedural votes. At a minimum leaders have asked all 60 Democrats to allow them to bring a health care bill to the floor in order to make sure Republicans cannot filibuster it.Democratic Senate aides familiar with the thinking of Conference moderates said centrists want to vote for a health care reform bill — even one that is politically problematic — because it appeals emotionally to their inner Democrat.
A month ago I wrote [3]that it’s nearly impossible to see health care reform failing because it would entail a Democrat voting to filibuster the central progressive goal of the last sixty years. That proposition was looking shaky for a while because there were some Democratic Senators who acted as if they actually wanted to kill health care reform. (Hi Senator Conrad.) But they’re all now pretty clearly acting like they really want to pass something. It’s very strange. We’ve had months of sturm and drang and massive attention focused on the question Whither health care reform? It’s just quietly turned into a fait accompli.
Exclusive: How Dems set stage for corporate-backed health care campaign At a meeting last April with corporate lobbyists aides to President Barack Obama and Sen. Max Baucus (D-Mont.) helped set in motion a multimillion-dollar advertising campaign primarily financed by industry groups that has played a key role in bolstering public support for health care reform.The role Baucus’s chief of staff Jon Selib and deputy White House chief of staff Jim Messina played in launching the groups was part of a successful effort by Democrats to enlist traditional enemies of health care reform to their side. No quid pro quo was involved they insist as do the lobbyists themselves.The result has been a somewhat unlikely alliance between an administration that came into power criticizing George W. Bush for his closeness to Big Business and groupssuch as the Pharmaceutical Research and Manufacturers of America and the American Medical Association.The previously undisclosed meeting April 15 at the offices of the Democratic Senatorial Campaign Committee led to the creation of two groups — Americans for Stable Quality Care and a now-defunct predecessor group called Healthy Economy Now — that have spent tens of millions of dollars on TV advertising supporting health reform efforts.In the most recent ad sponsored by Americans for Stable Quality Care Obama speaks directly into the camera for 60 seconds extolling the virtues of health care reform while text at the bottom of the screen encourages viewers to visit the websites of the White House and the Finance Committee which this week approved a 10-year $829 billion health overhaul.Both coalitions operate independently of the administration and Senate Democrats and spokesmen for both the White House and Baucus said that no pressure — implicit or otherwise — to join the pro-health-care reform groups was applied to industry representatives at the meeting.
Senate girds for historic debate on health bill After months of maneuvering the Senate stands at the brink of a historic battle over health care with President Barack Obama and his allies on one side and Republicans outnumbered but unflinching on the other.Obama and Democrats hailed the 10-year $849 billion measure that would remake the nation's health care system relying on cuts in future Medicare spending to cover costs as well as on higher payroll taxes for the well-off and a new levy on patients undergoing elective cosmetic surgery.Aides said the mammoth 2074-page bill would reduce deficits by $127 billion over a decade citing estimates by the Congressional Budget Office. For the first time most Americans would be required to carry health insurance and the bill would provide hundreds of billions of dollars in subsidies to help those with lower incomes afford coverage.Employers would not be required to offer coverage but medium and large companies would pay a fee if the government ends up subsidizing employees' insurance.Reid released his legislation more than a week after the House approved its more expensive version of the health care bill on a near party-line vote of 220-215.Reid pointedly declined to claim the 60 votes needed to clear a must-pass procedural hurdle before debate can begin. That vote could take place Saturday. Democrats hold 58 seats in the Senate and two independents generally vote with them but several moderate Democrats -- Mary Landrieu of Louisiana Ben Nelson of Nebraska and Blanche Lincoln of Arkansas -- have yet to commit to allowing debate to begin. Reid met privately with the three before releasing his bill Wednesday and Nelson later issued a statement strongly suggesting he would support fellow Democrats on the procedural vote.Beginning in 2014 Reid's bill would set up new insurance marketplaces called exchanges primarily for those who now have a hard time getting or keeping coverage. Consumers would have the choice of purchasing government-sold insurance an attempt to hold down prices charged by private insurers.
We can deliver health reformThe nation stands on the verge of achieving fundamental health-care reform. For the first time in history the House of Representatives has enacted comprehensive health-reform legislation and the Senate has begun its own debate. These bills will provide a bedrock sense of security and stability for Americans who have health insurance and quality affordable options for Americans without it.But health reform has an economic and fiscal dimension too. For more than 30 years health-care costs have risen much more rapidly than either inflation or the growth of the economy -- yet these higher costs are not delivering higher-quality care for Americans.Looking forward if we do nothing to slow the skyrocketing cost of health care the federal government will eventually be spending more on Medicare and Medicaid than all other government programs combined. It's time to move toward the high-quality lower-cost health system of the future and the reforms under discussion in the House and Senate will put us firmly on that path.For example bundled payments and accountable-care organizations as well as incentives to prevent harmful and avoidable readmissions and health-facility-acquired infections will induce physicians and hospitals to innovate and redesign the way they deliver care through better coordination that will keep people healthy and avoid unnecessary complications. As we enter the homestretch the greatest risk we run is not completing health reform and letting this chance to lay a new foundation for our economy and our country pass us by. We have the building blocks to construct a health-care system that provides the highest quality of care while embodying a process of continuous improvement -- a leap forward for the health of Americans and the fiscal health of the entire nation.
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