Answering Questions on Health Care Reform

So a buddy of mine from the Salem Gathering wrote a damn fine piece on the pending health care reform bill along with the numerous questions that have surfaced in its wake. Paul writes with clarity and reason, and thus I'm listing it below. Hope you enjoy.


"We all know that no legislation is perfect, but with all of the furor surrounding the current health reform bill, you’d think it will be the destroyer of worlds. As a Republican friend of mine commented, opponents of reform are “playing on people's fear of uncertainty." So, to stay grounded, let’s keep the facts in view as we walk through some objections together.

Here are the topics in order. I’ve tried to be brief, so if you don’t see your question or wish to chase a question further, just let me know.

-Cost?
-Abortion & Euthanasia?
-Public Plan = crappy/government-run HMO?
-Won’t I be forced off my insurance and onto government insurance?
-Is the public option really necessary?

(Or, if you’d rather just skip all this and have a good laugh, here’s a Daily Show clip.)

Cost: can we afford it?

The House bill costs just over $1 trillion over ten years, but pays for all its reforms. (So, it would NOT add $1 trillion to the deficit, a claim already debunked). This is the strongest reform bill under consideration, so it’s proof that we can pay for real reform. The only question is: is it important enough for us to make it a budgetary priority?

Abortion & euthenasia: government death panels?

1. The House bill does NOT allow federal funds to be used for abortions. The plans on the exchange may cover an abortion but must use funds from the beneficiary, not government subsidies, to do so. Pro-life lawmakers intend to try and restrict this even further as discussions continue.


2. Many conservatives themselves have already repudiated talk of euthanasia or death panels as bogus “scare tactics.” So has AARP. The coverage for end-of-life planning is in most private plans and was introduced into the bill by a pro-life Republican from Georgia! In his own words, it “empowers you to be able to make decisions at a difficult time rather than having the government making them for you.”

Will the public option essentially be a barebones HMO run by a government health commissioner?

No, for three key reasons:

1. Page 27 of the House bill clearly states the benefits level in the exchange is to be “equivalent to the average prevailing employer-sponsored coverage," not to be determined by the health commissioner. All the commissioner does is make sure that insurers in the exchange are offering basic benefits and adhering to the regulations (similar to how the government already does so with employer-based insurance).


2. What the bill actually specifies for the public option are “medical homes," which are recommended because they provide coordinated care (something shown to enhance care). But they are optional anyways. Choice retained.


3. Unlike HMOs, there would be protection against receiving poor care from the lump sum per patient payment method. As Tim Foley points out, "[t]he practice that’s using the medical home model has to prove that it’s offering coordinated care through establishing clear guidelines and backing that up with hard data, preferably through electronic medical records.”

Won’t we all be forced off our private insurance and onto government insurance?

This is the lynchpin in the fears of many, so let’s take a good look:

1. First and foremost, there is no provision in the legislation that calls for this. If an employer is small enough to be allowed on the exchange, they may choose to switch to a plan there, but that would be a business decision made by the employer, not the government. The only changes that could be made to an existing insurance plan would be to upgrade it to meet a standard level of benefits. So the only possible way to get to the doomsday scenario is to assume it would follow as a necessary side effect: businesses dropping insurance in droves to the point of total collapse.


2. Ah, but an important safeguard in the bill is the employer mandate that requires businesses to provide insurance to their employees. So not only does the legislation not call for a forcible removal of employer-based insurance, there is a mechanism that guards against it!


3. Plus, the single precedent we have shows mandates are effective: in Massachusetts, which has a similar exchange but a weaker employer mandate, employer-based coverage still grew rather than declined.


4. But don’t take my word for it. The CBO’s official estimates rebuff the notion that there would be a collapse of employer-based insurance. Instead, they show a net increase of persons insured by their employers by 3 million! In fact, they predict only about 10 million would even be on the public option (since, again, there would be private plans in the exchange as well). And remember, when it comes to legislative numbers, the CBO = umpire.


5. By contrast, the wilder numbers used by critics come from clearly biased sources. The main example is the "120 million" number from Mark Shields & the Lewin Group, which is owned by a major health insurance company: UnitedHealth! (This has been exposed many times, but even Business Week is calling attention to this, and they are “not exactly a bastion of anti-capitalist sentiment” (to use Al Pacino’s words from The Insider).

Thus, as even many reform critics point out, the notion that this reform will somehow cause an inexorable slide into government insurance for all seems quite unfounded. This means even if the public option ends up being the worst insurance plan ever to be crapped out, it’s NOT YOUR PROBLEM if you or your small business don’t sign up for it. It’ll be the “problem” of persons who would otherwise not have any insurance. (So, really it would be the solution to their problem).

Yes, but why must there be a public option at all? Couldn’t regulations have the same effect?

Well, this question may deserve fuller treatment, but the short answer is: not likely. The single example in the US of a regulated health insurance exchange is again, Massachusetts, where there is no public option and unsurprisingly, insurance costs fluctuate greatly between plans. As pointed out by a retired World Bank employee I know, some industries like utilities (and to a lesser degree the financial industry) are more easily regulated than health insurance because they are much more centralized. The public option would organically induce competitive practices by its mere presence in the exchange, but even if it fails to do so for some reason, it would itself be an affordable option, available everywhere. Thus, it is the best way to ensure price control, given the health insurance industry’s muscle and lack of scruples.

So, I guess I just don't find most of these or other objections to be terribly grounded. As such, I am running out of concrete reasons to oppose reform that, as we have seen, is sorely needed."