Health Care Reform

I wanted to highlight some import developments in the health care reform debate. Here is the New York Times on Chuck Schumer’s proposed compromise on including a public government option in the health care reform bill:

The proposal was made Monday by Senator Charles E. Schumer of New York, the third-ranking member of the Senate Democratic leadership, in a bid to address fears that a public program would drive private insurers from the market.

Calls for a new public plan have provoked more political passion than any other issue in discussions of how to revamp the nation’s $2.5 trillion health care system. The Senate Finance Committee begins to wrestle with the idea at a meeting on Tuesday, where it will examine ways to expand coverage.

President Obama campaigned on a promise to create a public plan, in an effort to compete with private insurers and keep them honest. But insurance companies and Republican lawmakers say a government-run plan could drive private insurers out of business and eventually lead to a single-payer system run by the government.

Scorched by Republican opposition to the idea of a new public program like Medicare, Senate Democrats are looking for a middle ground that would address the concerns of political moderates. One way they propose to do that is by requiring the public plan to resemble private insurance as much as possible.

“The public plan,” Mr. Schumer said Monday, “must be subject to the same regulations and requirements as all other plans” in the insurance market.

Democrats in Congress hope to shift the debate from the question of whether to create a public health insurance plan to the question of how it would work.

Health care isn’t my main focus as I think I told people, but I nonetheless I think there is a lot of interesting stuff going on here.

Firstly we’re seeing some real backbone from Senate Democrats, including the usual frustrating Max Baucus. Schumer is talking the talk and appears to be walking the walk and standing up to insurers.

On the negative side I’m confused by why government health care needs to be made worse, and what exactly this compromise entails. I mean so what if this leads to a single payer system, if the reason it leads to a single payer system is a private health insurance isn’t as good as the single payer system then why not adopt a single payer system? Since when is better health care a problem?

I’m interested to know what people think the key to understanding this is and what aspects of the issue you would like to see addressed by Congress?

-Chris

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8 comments so far

  1. Bronwyn on

    I think the private sector needs to suck it up and stop complaining about having to deal with real competition from a different model (instead of a handful of companies all running small variations on the same two models–PPOs and HMOs.) If a public option would drive them out of business, then maybe they should ask themselves why and be honest (at least within doors, out of the public eye) about the answers. Then they should look at ways to *alter their business models to make them more competitive*–instead of just griping that they can’t have the entire insurance market arranged to give them everything on a platter.

    This rant submitted with the caveat that I, too, am not a health care expert.

  2. Bronwyn on

    In case it wasn’t obvious, my answer to your question, Chris, is that better health care is a problem because it seriously inconveniences the health insurance industry, which is wedded to one way of doing business–understandably, since that way is arranged to give them maximum profit.

  3. Jeremy on

    First of all Chris, I’m not exactly sure why Schumer’s talk of a “compromise” is all that problematic. They’re doing what they have to do to throw the idiotic “moderates” their bone so they can say they did something to make the bill more “moderate”. Take a look at the four concrete points Schumer mentioned:

    1) The public plan must be self-sustaining. It should pay claims with money raised from premiums and co-payments. It should not receive tax revenue or appropriations from the government. This is an accounting gimmick. If they do the financing with a targeted voucher or whatever, that is a separate issue from how the public plan is designed

    2) The public plan should pay doctors and hospitals more than what Medicare pays. Medicare rates, set by law and regulation, are often lower than what private insurers pay.I have no problem with paying doctors more if that’s what it takes to keep more of them accepting the plan. The last thing we would want is a situation like Medicaid where many doctors are better off not accepting those patients.

    3) The government should not compel doctors and hospitals to participate in a public plan just because they participate in Medicare. I agree. Again, for this to be sustainable, you have to have the buy-in from doctors. The previous point would hopefully make this one rather irrelevant.

    4) To prevent the government from serving as both “player and umpire,” the officials who manage a public plan should be different from those who regulate the insurance market. They shouldmust also be different from people who profit from the insurance market, but this makes sense.

  4. Jeremy on

    Also, I think the foot-dragging defenders of the status quo are really shooting themselves in the foot with that slippery slope talking point. By saying including a public option would inevitably lead to single payer, it directly implies that a government run system would economically be better than the private insurance market. Any economist with half a brain can tell you that, but it’s odd for the industry guys to admit it so openly.

    Defenders of the public plan should be repeating this point loud and often.

    • bronwyn41 on

      I think they’re assuming that they’ve successfully framed the terms “single-payer” and “government-run program” as synonymous with “socialism” and “the government taking your money and telling you what you can and can’t buy.”

      I take it you feel that Schumer’s compromise is actually beneficial and not another attempt to cave to industry pressure?

    • bronwyn41 on

      Sounds like you think Schumer is being smart and cleverly giving them the appearance of compromise without giving anything essential away.

    • carrotsandsticks on

      By saying including a public option would inevitably lead to single payer, it directly implies that a government run system would economically be better than the private insurance market. Any economist with half a brain can tell you that, but it’s odd for the industry guys to admit it so openly.

      That’s what’s confusing, since when did anyone in the middle or right wing start admitting that the government would be potentially offer a service so much better it would bankrupt the private sector? But I think you need to be really mindful of what changes they accept because you could a situation where the government sector is crippled because of Ben Nelson’s idea of fair playing field.

      -Chris

      • bronwyn41 on

        Any chance we can trade Nelson for a draft pick? Now that we’ve picked up the other team’s expensive free agent from PA… 🙂


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