I guess I have something to say....
I've been practically ill over the healthcare debate over the last week or so.
Not because Joe Lieberman killed the Medicare buy-in, not because the public option is dead, but because liberals and progressives all over the internet are so incensed over those two items, on top of all of the other stuff that's gone on over the last few months, that they'd rather kill this bill which would bring coverage through the exchanges to approximately 30 million Americans than go forward.
I think that Ezra Klein summed up the situation pretty well this morning: Joe Lieberman's reckless decision to blow up last week's compromise has had exactly the impact many of us predicted. Much of the left has flipped into vicious, angry opposition to the bill. Is that because the Medicare buy-in, a good but limited policy, has disappeared from the bill? Ostensibly. But not really. If you don't believe the bill has cost controls, Medicare buy-in was not an answer to your concerns. If you believe the mandate is bad policy, letting the small slice of exchange-users between 55 and 64 choose public insurance did not answer your fears.
But progressives had compromised plenty already. Single payer became a strong public option, a strong public option became a weak public option, a weak public option became Medicare buy-in, and Medicare buy-in became Joe Lieberman's revenge. Progressives are submitting to conservative means, an industry is laughing all the way to the bank. All this amid the first year of a president they elected, a Democratic majority they built.
And it's not just the policy that galls. It's the precedent they fear. Continual compromise with swing senators who are willing to kill good legislation for bad reasons is not a path they want to continue down. They saw the results in the stimulus, a too-small bill that was made yet smaller by, among others, Joe Lieberman, Ben Nelson and Susan Collins. And now, health-care reform is being weakened too, with the subsidies coming in beneath what experts believe we need and the public option erased from the bill.
Worse, it all feels divorced from detectable policy principles. Medicare buy-in was a policy Lieberman supported. It was a compromise that had been communicated to him directly. It emerged from meetings that he was invited to attend. He didn't bother to wait for the Congressional Budget Office's report, or even to offer a coherent argument against the policy. He had the power, he knew it, and he used it. Now he's giving happy, triumphant interviews to any camera and reporter he can find. My personal favorite was his comment to the New York Times. “My wife said to me, 'Why do you always end up being the point person here?’ ” Did Lieberman say this somberly? Did he seem weighed down by the responsibility? No. He was "flashing a broad grin."
I understand the frustration. I understand the Punish Lieberman urge. I personally was incensed when he said his rationale was that since Representative Anthony Weiner from New York--an avid advocate for single payer--liked it, it must be bad. Donate to the Democratic party in Connecticut. Educate your friends and family on healthcare. Make funny videos mocking Joe Lieberman.
But don't declare the bill in the Senate to be a "bad bill".
The problem is this: When the public option was on the block back in the summer, and the Obama administration said that it wasn't crucial to the bill, they weren't kidding. The public option is nice, and I supported it, but it's not going to save the most lives. 40 something million people in this country do not have health insurance. The public option was going to be available to at most four. At the same time, the words "public" or "government run" scared the shit out of a lot of people. While liberals hung their hat on it as the closet thing they were going to get to single payer, conservatives started muttering about the DMV.
Enter the Medicare buy-in. It seemed like an elegant solution to the problem. A new plan did not have to be built out of whole cloth, population from 55-64 tended to be the population in most need of healthcare, and best of all, it is familiar and beloved. It seemed like a good idea, but the CBO score hadn't come out when the deal died. And there were a couple of concerns. While Medicare is a pretty reliable payer with fewer administrative costs, it has lousy reimbursement rates. Your plumber makes more per hour than your cardiologist does under Medicare. Again, liberals liked it because it was kind of sort of close to single payer. And Joe Lieberman hated it because he's a petty, petty man who is taking petty, petty revenge on the liberals.
But these aspects of the health-care bill are teeny tiny in comparison to the rest of the bill. Again 40something million people do not have health insurance. They can be denied health insurance because of pre-existing conditions. The individual market is really, really expensive. This is because it's cheaper to cover many people than it is to cover a single individual. The risk is spread out and it's cheaper for everyone.
This is where the exchanges come in. These are the heart and soul of the health care reform. The exchanges turn all of those individuals into a much larger group. And they're heavily regulated. I defer, again, to Ezra Klein, to explain how they work: Imagine that Blue Cross Blue Shield prices according to this monopolist logic. Their policy would normally cost $11,000. But people have to buy in, right? So they price at $13,500. For, say, Kaiser Permanente, whose policy costs $10,500, this is an opportunity. The market leader just jacked their prices up. So Kaiser begins advertising aggressively. Our policy, they say, is $1,500 cheaper than "our competitor's plans." The next year, people log onto the insurance exchange Web site to confirm their insurance plan for the year. Scrolling through the options, they notice that BCBS is way more expensive than Kaiser, or frankly, than everyone.
Maybe that's because Kaiser is worse? But consumer ratings, which are now available, show that Kaiser has a comparable satisfaction rating. Maybe it's because BCBS offers more? But no, the insurers have to list their benefits in a standard way, and it's pretty clear that BCBS isn't giving you more for your money. Ten minutes later, BCBS has lost a customer and Kaiser has gained one.
That's the market's solution to this problem. But the exchanges actually have a fail-safe solution, too. Rewind the tape to BCBS's decision to jack up premiums. Imagine that BCBS insures 420,000 people in California's exchange. As directed by law, they duly submit a notice to the Exchange Board saying they're increasing premiums. The exchange sends a letter back noting that underlying health-care trends don't justify that increase, which they're allowed to do under the law. BCBS says it doesn't care. The exchange, which doesn't much feel like being bullied, says fine, you're decertified. BCBS loses more than 400,000 customers, and has to reapply the next year.
And then, of course, there's the excise tax. Jack up your prices enough and suddenly you're paying a 40 percent surtax on the plan you're offering. Now you're way more expensive than the competition, and you're hemorrhaging customers.
Health-care reform isn't creating a monopoly market. There are other industries where people need to patronize some for-profit company. Food, for instance. But if there are a variety of companies competing for customers, monopoly problems don't emerge.
Under health-care reform, there are at least three bulwarks against the monopoly-profits scenario: Inter-insurer competition, regulators, and the tax on excessive premiums. Two of these mechanisms don't exist in the current market. One -- the market itself -- is much weaker and more opaque, and individuals have a far harder time navigating it.
At this point, I should have a macro on my keyboard for this concluding line: Is it perfect? No. Is it good enough? Maybe not, even. Is it better than what we have?
Absolutely.
Update: Some have responded that this might all be well and good, but in some states, insurers already have near-monopolies. This is true, though it's not true in most states. But the point of the exchanges is that those monopolies are easier to break. Right now, it's very hard to switch insurers. It's hard to compare plans. Hard to shop for new plans. Hard to figure out whether one plan is better than another. And in a lot of states, there aren't many insurers offering plans.
Not so in the exchanges. It's easy to shop, to compare. The benefits are listed in a standardized format and accompanied by consumer ratings. Add in the presence of national plans, both for-profit and non-profit, and you should see a lot more competition. And if there isn't much competition, a state can link its exchange to that of its neighbors. Delaware might not be much of a market, but Pennsylvania is. That may not reduce the stranglehold a single insurer has over existing businesses, but the exchanges can only serve those who can access them. That's why I've long argued the importance of opening them up to larger employers.
For all that, it's still possible that the exchanges won't be sufficiently competitive, and we will want to do more down the road (like opening them!). But, again, it's a lot better than what we have now.
On top of all of this, the current plan expands Medicaid substantially, so the poor are better covered, and there are $100 billion in subsidies to help Americans pay for the health insurance.
My favorite plan of the year has been the Wyden-Bennett Amendment, also known as the Healthy Americans Act. Because this would open the exchanges to everyone, not just people who don't have insurance through their jobs, thereby making them even more competitive. I think, though, that having the exchanges in place is a good first step.
There are arguments by liberals about the mandates and how they don't work in the absence of a public option or the Medicare buy-in. Again, these two plans were intended for a very small portion of the uninsured population. Most people getting health insurance under health reform would not be getting insurance from either one of those options. They'd be going to the open market, which ironically enough, under regulation would be more open.
As for lack of cost-controls, there are a lot of arguments that these are not sufficiently built into the bill. That is not true. First enough the mandate is cost control. This was a sticking point in the primary, and Paul Krugman demonstrated in several op-eds, why the mandate was crucial to reduce premiums. (This is one example, but he harped on this for most of the primary.) Additionally, Ezra Klein demonstrated that in the absence of a mandate, health care reform was a failure in Massachusetts. Secondly, there are other cost controls in the bill. See the excise tax example in the Ezra Klein exceprt above for one such control. Also, the bill has a lot of demonstration projects built in to reduce costs on the provider side, like bundling payments. The Medicare Commission is another such creature. Finally, the exchanges themselves are cost control. They give transparency and present the options to consumers in an easy to understand manner. Does anyone reading this post really know what their insurance covers? The people buying insurance on the exchange will.
(Pet peeve about cost-controls. Many of the same people who were bitching about the mammography recommendations that came out last month are the same people who are now pissed about the lack of cost controls in the healthcare bill. We, as a society, need to get over our insatiable demand for marginally beneficial cutting edge healthcare. The CT scan scandal that's going on right now should be indicative of this. But we've become so emotionally attached to procedures and tests that we don't pay attention to whether or not we actually need them. I'm not surprised that people are going to get cancer from the radiation exposure in CT scans. They were offering them in fucking malls for christs' sake.)
Nate Silver has a lot more on health care reform as it stands now in a discussion with Markos Moulitsas at Daily Kos and Jon Walker at FireDogLake. It is a very long discussion, and there's a lot of policy wonkery in this piece, but at least liberals are actually talking about the details of the bill instead of harping on a small aspect of it.
The thing is this: I understand it's a hard pill to swallow. I realize that we've been fighting hard on this over the last eight months, some of us much, much, much longer than that. But there are a lot of very good things in this bill, things that we will never see again if it is allowed to die. More people will be covered than ever before, and there are plenty of studies that demonstrate that people die without healthcare insurance.
There is no starting over. There is no killing this bill and starting from scratch next year. When this is over in a few days or weeks it will be over, one way or another. Every time healthcare reform has failed, it failed for a long time. We are never going to get consensus on every point, and no, the bill isn't perfect. But if it passes, we can build upon it, and bring in the good ideas that have come up but been tabled or died in this process.
Senators Jay Rockefeller and Chuck Schumer and Ron Wyden and Christopher Dodd and John Kerry and Sherrod Brown and many others could have just as easily killed this bill fighting for the stuff on the liberal side. They all put more work into this than any of us can imagine, and yet they are all pushing to support it, even without the things that are dear to liberals. Any one of them could have been the one.
No, it's not perfect. Yes, it grates beyond telling that a pissant like Joe Lieberman can be this petty and take this much power. Probably, a different strategy should have been taken on a lot of aspects of this. Maybe, reconciliation would have been the better avenue. But all of those things are in the past now, and there's nothing we can do about them except learn from the mistakes and build upon the good things that have happened in the last year. This is so much better than the status quo that it actually pains me to see so many liberals riling against it.
Millions and millions of Americans will get afforadable heath care if this bill passes. How can that be a bad thing?
Not because Joe Lieberman killed the Medicare buy-in, not because the public option is dead, but because liberals and progressives all over the internet are so incensed over those two items, on top of all of the other stuff that's gone on over the last few months, that they'd rather kill this bill which would bring coverage through the exchanges to approximately 30 million Americans than go forward.
I think that Ezra Klein summed up the situation pretty well this morning: Joe Lieberman's reckless decision to blow up last week's compromise has had exactly the impact many of us predicted. Much of the left has flipped into vicious, angry opposition to the bill. Is that because the Medicare buy-in, a good but limited policy, has disappeared from the bill? Ostensibly. But not really. If you don't believe the bill has cost controls, Medicare buy-in was not an answer to your concerns. If you believe the mandate is bad policy, letting the small slice of exchange-users between 55 and 64 choose public insurance did not answer your fears.
But progressives had compromised plenty already. Single payer became a strong public option, a strong public option became a weak public option, a weak public option became Medicare buy-in, and Medicare buy-in became Joe Lieberman's revenge. Progressives are submitting to conservative means, an industry is laughing all the way to the bank. All this amid the first year of a president they elected, a Democratic majority they built.
And it's not just the policy that galls. It's the precedent they fear. Continual compromise with swing senators who are willing to kill good legislation for bad reasons is not a path they want to continue down. They saw the results in the stimulus, a too-small bill that was made yet smaller by, among others, Joe Lieberman, Ben Nelson and Susan Collins. And now, health-care reform is being weakened too, with the subsidies coming in beneath what experts believe we need and the public option erased from the bill.
Worse, it all feels divorced from detectable policy principles. Medicare buy-in was a policy Lieberman supported. It was a compromise that had been communicated to him directly. It emerged from meetings that he was invited to attend. He didn't bother to wait for the Congressional Budget Office's report, or even to offer a coherent argument against the policy. He had the power, he knew it, and he used it. Now he's giving happy, triumphant interviews to any camera and reporter he can find. My personal favorite was his comment to the New York Times. “My wife said to me, 'Why do you always end up being the point person here?’ ” Did Lieberman say this somberly? Did he seem weighed down by the responsibility? No. He was "flashing a broad grin."
I understand the frustration. I understand the Punish Lieberman urge. I personally was incensed when he said his rationale was that since Representative Anthony Weiner from New York--an avid advocate for single payer--liked it, it must be bad. Donate to the Democratic party in Connecticut. Educate your friends and family on healthcare. Make funny videos mocking Joe Lieberman.
Click to viewBut don't declare the bill in the Senate to be a "bad bill".
The problem is this: When the public option was on the block back in the summer, and the Obama administration said that it wasn't crucial to the bill, they weren't kidding. The public option is nice, and I supported it, but it's not going to save the most lives. 40 something million people in this country do not have health insurance. The public option was going to be available to at most four. At the same time, the words "public" or "government run" scared the shit out of a lot of people. While liberals hung their hat on it as the closet thing they were going to get to single payer, conservatives started muttering about the DMV.
Enter the Medicare buy-in. It seemed like an elegant solution to the problem. A new plan did not have to be built out of whole cloth, population from 55-64 tended to be the population in most need of healthcare, and best of all, it is familiar and beloved. It seemed like a good idea, but the CBO score hadn't come out when the deal died. And there were a couple of concerns. While Medicare is a pretty reliable payer with fewer administrative costs, it has lousy reimbursement rates. Your plumber makes more per hour than your cardiologist does under Medicare. Again, liberals liked it because it was kind of sort of close to single payer. And Joe Lieberman hated it because he's a petty, petty man who is taking petty, petty revenge on the liberals.
But these aspects of the health-care bill are teeny tiny in comparison to the rest of the bill. Again 40something million people do not have health insurance. They can be denied health insurance because of pre-existing conditions. The individual market is really, really expensive. This is because it's cheaper to cover many people than it is to cover a single individual. The risk is spread out and it's cheaper for everyone.
This is where the exchanges come in. These are the heart and soul of the health care reform. The exchanges turn all of those individuals into a much larger group. And they're heavily regulated. I defer, again, to Ezra Klein, to explain how they work: Imagine that Blue Cross Blue Shield prices according to this monopolist logic. Their policy would normally cost $11,000. But people have to buy in, right? So they price at $13,500. For, say, Kaiser Permanente, whose policy costs $10,500, this is an opportunity. The market leader just jacked their prices up. So Kaiser begins advertising aggressively. Our policy, they say, is $1,500 cheaper than "our competitor's plans." The next year, people log onto the insurance exchange Web site to confirm their insurance plan for the year. Scrolling through the options, they notice that BCBS is way more expensive than Kaiser, or frankly, than everyone.
Maybe that's because Kaiser is worse? But consumer ratings, which are now available, show that Kaiser has a comparable satisfaction rating. Maybe it's because BCBS offers more? But no, the insurers have to list their benefits in a standard way, and it's pretty clear that BCBS isn't giving you more for your money. Ten minutes later, BCBS has lost a customer and Kaiser has gained one.
That's the market's solution to this problem. But the exchanges actually have a fail-safe solution, too. Rewind the tape to BCBS's decision to jack up premiums. Imagine that BCBS insures 420,000 people in California's exchange. As directed by law, they duly submit a notice to the Exchange Board saying they're increasing premiums. The exchange sends a letter back noting that underlying health-care trends don't justify that increase, which they're allowed to do under the law. BCBS says it doesn't care. The exchange, which doesn't much feel like being bullied, says fine, you're decertified. BCBS loses more than 400,000 customers, and has to reapply the next year.
And then, of course, there's the excise tax. Jack up your prices enough and suddenly you're paying a 40 percent surtax on the plan you're offering. Now you're way more expensive than the competition, and you're hemorrhaging customers.
Health-care reform isn't creating a monopoly market. There are other industries where people need to patronize some for-profit company. Food, for instance. But if there are a variety of companies competing for customers, monopoly problems don't emerge.
Under health-care reform, there are at least three bulwarks against the monopoly-profits scenario: Inter-insurer competition, regulators, and the tax on excessive premiums. Two of these mechanisms don't exist in the current market. One -- the market itself -- is much weaker and more opaque, and individuals have a far harder time navigating it.
At this point, I should have a macro on my keyboard for this concluding line: Is it perfect? No. Is it good enough? Maybe not, even. Is it better than what we have?
Absolutely.
Update: Some have responded that this might all be well and good, but in some states, insurers already have near-monopolies. This is true, though it's not true in most states. But the point of the exchanges is that those monopolies are easier to break. Right now, it's very hard to switch insurers. It's hard to compare plans. Hard to shop for new plans. Hard to figure out whether one plan is better than another. And in a lot of states, there aren't many insurers offering plans.
Not so in the exchanges. It's easy to shop, to compare. The benefits are listed in a standardized format and accompanied by consumer ratings. Add in the presence of national plans, both for-profit and non-profit, and you should see a lot more competition. And if there isn't much competition, a state can link its exchange to that of its neighbors. Delaware might not be much of a market, but Pennsylvania is. That may not reduce the stranglehold a single insurer has over existing businesses, but the exchanges can only serve those who can access them. That's why I've long argued the importance of opening them up to larger employers.
For all that, it's still possible that the exchanges won't be sufficiently competitive, and we will want to do more down the road (like opening them!). But, again, it's a lot better than what we have now.
On top of all of this, the current plan expands Medicaid substantially, so the poor are better covered, and there are $100 billion in subsidies to help Americans pay for the health insurance.
My favorite plan of the year has been the Wyden-Bennett Amendment, also known as the Healthy Americans Act. Because this would open the exchanges to everyone, not just people who don't have insurance through their jobs, thereby making them even more competitive. I think, though, that having the exchanges in place is a good first step.
There are arguments by liberals about the mandates and how they don't work in the absence of a public option or the Medicare buy-in. Again, these two plans were intended for a very small portion of the uninsured population. Most people getting health insurance under health reform would not be getting insurance from either one of those options. They'd be going to the open market, which ironically enough, under regulation would be more open.
As for lack of cost-controls, there are a lot of arguments that these are not sufficiently built into the bill. That is not true. First enough the mandate is cost control. This was a sticking point in the primary, and Paul Krugman demonstrated in several op-eds, why the mandate was crucial to reduce premiums. (This is one example, but he harped on this for most of the primary.) Additionally, Ezra Klein demonstrated that in the absence of a mandate, health care reform was a failure in Massachusetts. Secondly, there are other cost controls in the bill. See the excise tax example in the Ezra Klein exceprt above for one such control. Also, the bill has a lot of demonstration projects built in to reduce costs on the provider side, like bundling payments. The Medicare Commission is another such creature. Finally, the exchanges themselves are cost control. They give transparency and present the options to consumers in an easy to understand manner. Does anyone reading this post really know what their insurance covers? The people buying insurance on the exchange will.
(Pet peeve about cost-controls. Many of the same people who were bitching about the mammography recommendations that came out last month are the same people who are now pissed about the lack of cost controls in the healthcare bill. We, as a society, need to get over our insatiable demand for marginally beneficial cutting edge healthcare. The CT scan scandal that's going on right now should be indicative of this. But we've become so emotionally attached to procedures and tests that we don't pay attention to whether or not we actually need them. I'm not surprised that people are going to get cancer from the radiation exposure in CT scans. They were offering them in fucking malls for christs' sake.)
Nate Silver has a lot more on health care reform as it stands now in a discussion with Markos Moulitsas at Daily Kos and Jon Walker at FireDogLake. It is a very long discussion, and there's a lot of policy wonkery in this piece, but at least liberals are actually talking about the details of the bill instead of harping on a small aspect of it.
The thing is this: I understand it's a hard pill to swallow. I realize that we've been fighting hard on this over the last eight months, some of us much, much, much longer than that. But there are a lot of very good things in this bill, things that we will never see again if it is allowed to die. More people will be covered than ever before, and there are plenty of studies that demonstrate that people die without healthcare insurance.
There is no starting over. There is no killing this bill and starting from scratch next year. When this is over in a few days or weeks it will be over, one way or another. Every time healthcare reform has failed, it failed for a long time. We are never going to get consensus on every point, and no, the bill isn't perfect. But if it passes, we can build upon it, and bring in the good ideas that have come up but been tabled or died in this process.
Senators Jay Rockefeller and Chuck Schumer and Ron Wyden and Christopher Dodd and John Kerry and Sherrod Brown and many others could have just as easily killed this bill fighting for the stuff on the liberal side. They all put more work into this than any of us can imagine, and yet they are all pushing to support it, even without the things that are dear to liberals. Any one of them could have been the one.
No, it's not perfect. Yes, it grates beyond telling that a pissant like Joe Lieberman can be this petty and take this much power. Probably, a different strategy should have been taken on a lot of aspects of this. Maybe, reconciliation would have been the better avenue. But all of those things are in the past now, and there's nothing we can do about them except learn from the mistakes and build upon the good things that have happened in the last year. This is so much better than the status quo that it actually pains me to see so many liberals riling against it.
Millions and millions of Americans will get afforadable heath care if this bill passes. How can that be a bad thing?