Senate Health Care Bill Released – Fines, Coops, But No Unicorn

Posted in General by TBartine on September 16, 2009 1 Comment

Of course, I will be spending the next day or so evaluating the Senate Health Care Reform bill, released by Senator Max Baucus today to the sound of one hand clapping…

…but I wanted to take a quick moment to provide first impressions on a bill that, prima facie, seems as bad or worse as most people feared it would be.  A few points for your immediate consideration, to be followed by more in-depth analysis in the very near future:

  • Former health insurance executive for Cigna (now a leading whistleblower) Wendell Potter warned us yesterday of what we might expect to see.  Speaking before the House Democratic Steering and Policy Committee, he argued that once you take the crucial reform elements out of the bill…and you take out the only measure that will serve to provide competition against the private insurance companies (ie. the public option, or some facsimile)…all you have left is a plan that GIVES BUSINESS to the insurance companies.  As Potter said, it might as well be called the “Insurance Industry Profit Protection and Enhancement Act.” Here’s an excerpt:.“  Here’s an except:H.R. 3200, America’s Affordable Health Choices Act of 2009, encompasses a comprehensive set of reforms that address the critical need for expanded coverage, lower health care costs, and greater choice and quality. Other legislative proposals, including the “Baucus Framework” being considered by the Senate Finance Committee’s “Bipartisan Six,” would benefit health insurance companies far more than average Americans.

“The practices of the insurance industry over the past several years have contributed directly to the growing number of Americans who are uninsured and the even more rapidly growing number of people who are underinsured.

H.R. 3200 would go a long way toward making many of the standard practices of the industry illegal while providing much-needed assistance to low and moderate income Americans who cannot afford the overpriced premiums being charged by the cartel of large for-profit insurance companies that now dominate the industry.

H.R. 3200 would provide premium and cost-sharing assistance through the Health Insurance Exchange it would create. It would require the Secretary of Health and Human Services to establish a defined package of “essential health services” that all plans, public or private, would have to cover.

It also would prohibit insurance companies from denying coverage or basing premiums on pre-existing conditions, gender or occupation. It would eliminate deductibles or co-pays for preventive care as well as the lifetime limits currently common in health insurance policies. The bill also would set an annual cap on out-of-pocket expenses that is more reasonable than in other proposals.

As important if not more important than those market reforms, H.R. 3200 would also create a public insurance option to compete with private insurers. Contrary to the misinformation being disseminated by the health insurance industry and its allies, the public insurance option would not have a competitive advantage over private plans. It would have to meet the same benefit requirements and comply with the same insurance market reforms as private plans.

  • Let me get this straight: the House bill…would allow people to buy from private insurers, buy the inexpensive government-run plan, or not buy insurance at all.  The Senate bill…would force EVERY American to buy plans from private insurers, or pay a fine.  Since about the only reforms left in the Senate version are that people with pre-existing conditions could not be denied, and premiums cannot be raised except for specific reasons including “age” and “tobacco use”…and since the only assistance anyone is going to get is in the form of subsidies for poor people to help buy overpriced private insurance, and caps for the middle class on how much they can be forced to pay out of pocket…it seems to me like Potter was right:  only the insurance companies are going to profit from this.  They will get a lot more business, they won’t have to stop their current practices (overcharging, rescission, spuriously denying claims), and EVERYONE is going to be forced to pay TOO much for policies that AREN’T WORTH IT…only to have their claims denied when they try to get reimbursed.
  • Again…let me make sure I’m getting this:  the plan proposes helping poor people with subsidies to buy insurance, but if they still can’t afford it (because they’re effing POOR)…we’re going to FINE them?
  • They claim the Senate version still contains “competition” because it calls for the creation of “co-ops.”  Ok fellas…here’s a little Business 101:  a “co-op,” where people form large groups to buy insurance plans and get a “group rate“…that isn’t competition…it’s just “collective bargaining” to take advantage of “volume pricing.”  You’re just forming a larger group so the insurance companies have a better incentive to offer you a lower price…it provides ZERO competition to the insurance companies.  Only another insurance provider offering better prices and service can do THAT.  And once again…it is ironic and patently hypocritical that Republicans would have a problem with the so-called “socialism” of a government insurance plan…but are perfectly ok with the “sort-of-communist” collective known as a co-op.  I would guess it is because the insurance industries LOBBYISTS have much less of a problem with co-ops.
  • It’s also noticeable that while real reform and competition are absent, everything the REPUBLICANS HAVE WANTED is in there.  Lower overall price tag: CHECK…strict measures to prevent illegal aliens from purchasing insurance (unnecessary since there isn’t a public option, and illegals already CAN’T BUY private insurance): CHECK…restrictions so federal money can’t be spent on abortions except in extreme cases (unnecessary because Medicare laws already explicitly prohibit it): CHECK!
  • Well, at least Baucus got something for all the compromises to the bill…exactly ZERO (zip, zilch, nada) Republicans say they’ll vote for it, and most are still complaining about the proposed cuts to Medicare costs (Medicare, being the GOP’s FAVORITE “socialist” program)…and the Democrats are also reasonably upset with the final product.  Representative Anthony Weiner (D-NY) said “The Senate and the president to some extent have been like a child looking for a unicorn. I don’t see it…

More details certainly to follow…at a minimum, the House bill and the Senate bill…well…have quite a bit of daylight between them.