Many people on DU, while initially skeptical of mandated private insurance w/o a competing public plan have read Ezra Klein's rebuttal of Jane Hamsher's "Top 10 Reasons..." and found themselves swayed. DUers have been following Ms. Hamsher for a while and know that she has tracked the details of the proposals and wants real relief for Americans. Most of us don't know who Mr. Klein is other than that he works for the Washington Post. I looked into what Mr. Klein has written during the debate, and found another article for his WaPo column containing at least two major points that make me leary of his opinions. The article is
Five cost controls in the Senate health-care bill.
Among what Ezra Klein considers cost controls is one of the most dangerous provisions in the Senate bill. Medicare has stood as a relatively intact effective program with a solid public portion b/c it is so massively popular that Congressmembers have not been able to reduce its coverage or whittle away the public portion w/o risking their re-election. The "cost control" that Ezra Klein finds so useful is a provision to create a group of medical "experts" (some members can be from private insurers and/or Big Pharma) appointed by each incoming President but unrecallable, who would produce a package of changes to Medicare regulations each year that would automatically become law unless vetoed by Congress w/i 30 days w/o debate or amendment. The package can include essential cost and/or elegibility adjustments along w/ poison pills, for instance, phasing out the public portion for people above a certain income. Can you imagine what the last administration's appointees would have done to the public portion of Medicare w/ this power? Can you imagine who Pres. Obama will pressured to appoint?
He also thinks the very best "cost control" in the Senate bill is the excise tax on high value health insurance. For some reason, in the atmosphere of mandated coverage, he thinks this will cause insurers to lower the price of their best plans, not simply to replace good, taxable plans w/ plans that cover less, have more deductibles and copays and thus avoid the unpleasant taxation. He calls this "competition" (?).His analysis in rebutting Hamsher's "10 Reasons" is very misleading. Yes millions more will be put into Medicaid, but he doesn't seem to know the downside of having to use Medicaid. It's no longer a "public program" in that in most places its been outsourced to private insurance cos. It reimburses providers at such a low rate, that only in urban centers are the #s of primary care physicians adequate. There's a critical shortage of specialists everywhere, so that people die waiting to be properly diagnosed and treated, and a serious shortage of even primary MDs outside the urban centers. This leads to long waits in clinics and rushed 2nd-rate care--an inequality that does not exist in other 1st World nations. Then there's the question of just who is going to pay for this expansion of the new, privatized Medicaid (w/ a cut going to private insurers)? That's right, the same people who are forced to pay for everything in this country--the middle class through their taxes. The same goes for the subsidies for the middle-class. There is nowhere near enough bloat in Medicare to pay for them, so what is given w/ one hand will be taken away by the other in the form of increased taxes to subsidize exhorbitantly priced private plans. (As in "we're going to give you a tax break of $5K for health insurance but your taxes are increased by $7K".)
As for those w/ coverage now, there is a large disincentive for private insurers to continue offering the full-coverage plans some currently have. With a mandate they can and will charge for inadequate plans w/ large out-of-pocket costs what they previously charged for the better plans. When the current plan your employer gets now is priced out of existence, you will get the overpriced inadequate kind. So, Mr. Klein, the "you" who are already covered will be affected. If taxes on good coverage is the best cost control in the bill, there are no effective cost controls.
The status quo is that if insurers price their coverage too high, people and businesses don't buy any. This "cost control" will be abolished in 2014 w/ the mandate. This is one way the situation after the law goes into effect will be worse than if it hadn't passed. In this economy, more and more employers have to drop coverage to stay afloat. If they are not allowed to drop coverage, some will go out of business altogether. Tying health insurance to employers continues to be a ball and chain around the economy of the U.S. leading to more unemployment.
The scenario Klein invented, of someone paying the 2% fine then becoming ill or getting injured and, poof!, buying insurance in time to cover the medical costs is LUDICROUS. Instead the person whose finances were so tight that they resorted to paying a fine rather than buying insurance will face eonormous financial stress and possibly medical bankruptcy, because in addition to the bills accumulated while he/she was uninsured, the insurer will charge up to 300% more for coverage than they would for someone w/o a "pre-existing condition".
As for insurance ditching its worst practices, this bill does nothing to stop insurers from fraudulently declaring an expensive treatment "experimental" or "elective". There is no agency created to monitor these practices. Sure you're allowed to appeal a denial in court but you're more likely to run out of money and/or time than to get relief.
The bottomline is that given the inadequate price controls and lack of clear definition of "medical costs" to use in the medical loss ratio requirements, the costs will rise astronomically while providing little to citizens for their money, as happened in Massachusetts. Medical bankruptcies will continue among the nominally insured as well as the remaining uninsured.
The most erroneous part of Klein's article is claiming that passing this will lead more quickly to better regulation and reforms than not passing it. The way it will actually play out is that if passed, a)Congress will consider their job done until at least 2015 (probably later) when the entirety of the dreadful flaws in the law are begin to manifest, and b)the hugely increased revenue stream to the private insurance companies will give them even more vast sums w/ which to buy the favors of Congress. This cartel will use its influence to reduce rather than increase regulations on them and block the creation of structures to enforce compliance. Instead of this being a step toward a solution, the faux reform will have successfully stymied real reform. On the other hand, if the bill is defeated because progressives in Congress declared it a step away from a solution and voted "nay", the pressure from the grassroots for real reform will not decrease. Congress WOULD revisit it in the next session b/c the public would stand for no less. Some serious consideration of ways to limit costs and gaming the system would have to be done to get those progressives on board. His description of the politics of the situation was written to fit his predetermined conclusion, not the political reality.
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