Monday, September 6

Revealing the Stealth Public Option

Heading into the midterm elections, the level of vitriol and energy on the right continues to rise while those and the left feel demoralized, betrayed, and dispirited despite numerous legislative accomplishments by the Democratic Congress and President Obama.

Chief among those disappointments is the lack of single payer plan, or at the very least - a public option within the plan to allow people to avoid having to choose exclusively from health insurance agencies motivated entirely by profit, not patient satisfaction.

What many of us apparently don't know is the final version of the PPACA as passed actually does include something that functions as a public option, and in some ways may even be slightly better as scored by the CBO.

Here's one recent diary which wistfully pines for better non-profit options.
Where we should be talking about the future reforms we need - i.e., opening up Medicare to more Americans on an opt-in basis, creating a more powerful nonprofit option (whether it's negotiated on Medicare rates or not, putting patients ahead of profits), and reining in insurance company abuses and rate increases - instead, we're too busy attacking and ceding political turf to the Republicans, who did NOTHING to support reform and even lied about it to scare voters.
My point here is this nonprofit option already exists.

The final Health Care bill included the "Non-For-Profit Option" as overseen by the Office of Personal Management which scored just as well as the Public Option for Budget Reduction and Cost Savings according to CBO - so for those who desired downward pressure on costs, that's exactly what we have.

The Original Kennedy-Dodd Senate Bill did not include a Public Option and Scored at about $1 Trillion, but after the PO it was re-scored at $389 billion cheaper initially - but also that it's long term projection of over ten years would have increased the deficit by over half a billion

Indeed, according to CBO's July 2 score of the HELP bill, under the legislation, 21 million fewer Americans would be uninsured in 2019 than under current law. In a July 1 letter to members of the HELP committee, publicly released the following day, Kennedy and Dodd wrote that the "Congressional Budget Office has carefully reviewed our complete bill, and we are pleased to report that the CBO has scored it at $611.4 billion over 10 years, with the new coverage provisions scored at $597 billion" -- a cost they noted was a "significant reduction from earlier estimates." The preliminary score of the complete bill that the committee released stated that Title I of the bill would increase the deficit by $597 billion over 10 years.



See that? The Kennedy Bill with the PO included increased the deficit.

The final bill came in with a higher initial costs due to increased subsidies for low income insurance seekers, but long term deficit reductions were an almost $2 Trillion improvement over 20 years.

Comprehensive health care reform will cost the federal government $940 billion over a ten-year period, but will increase revenue and cut other costs by a greater amount, leading to a reduction of $138 billion in the federal deficit over the same period, according to an analysis by the Congressional Budget Office, a Democratic source tells HuffPost. It will cut the deficit by $1.2 trillion over the second ten year period.

The source said it also extends Medicare's solvency by at least nine years and reduces the rate of its growth by 1.4 percent, while closing the doughnut hole for seniors, meaning there will no longer be a gap in coverage of medication. The CBO also estimated it would extend coverage to 32 million additional people.

The Public Option was removed during negotiations with Sen. Joe Leiberman in the "Manager's Amendment". That amendment was scored by CBO here, where it showed that this option saves just as much of a cost savings as the Public Option did, in fact it came out $2 billion cheaper.

This estimate incorporates the effects of the manager’s amendment, which would make a number of changes to the Patient Protection and Affordable Care Act as originally proposed. The changes with the largest budgetary effects include: expanding eligibility for a small business tax credit; increasing penalties on certain uninsured people; replacing a "public plan" that would be run by the Department of Health and Human Services (HHS) with "multi-state" plans that would be offered under contract with the Office of Personnel Management (OPM); deleting provisions that would increase payment rates for physicians under Medicare; and increasing the payroll tax on higher-income individuals and families. Of the total deficit reduction of $132 billion projected to result from the legislation, the manager’s amendment accounts for about $2 billion, and the act as originally proposed accounts for the remaining $130 billion.

...

The proposal would call on OPM to contract for two national or multi-state health insurance plans—one of which would have to be nonprofit—that would be offered through the insurance exchanges.

Considering the intensity of the opposition against the public option, the Stealth Option was able to slip in under the wire without being noticed by the press, and largely without being noticed by the legislators themselves. As a result they haven't been able to respond back to their own constituents on the Left who loudly complain that they caved when the rubber met the road.

In the end, we got 90-95%% of what we wanted and needed.


One of the few Democrats I've even seen bring this provision up was Sen. Mary Landrieu (at 11:58) as she was being attacked and criticized by Howard Dean. (Some of Dean's long list of criticisms here especially the ability to charge older person were removed, along with the "Louisiana Purchase" and "Cornhusker Kick-back" via Reconciliation after the House passed the Senate version of the bill with the Manager's Amendment)




Landrieu: In the Bill that the Governor now says he's not for, there is a national non-profit option that gives the same choices that members of Congress and Federal Employees have...


In all the twists and turns of the legislation - this point was completely lost. We have something that is just as good as what most of us wanted, and maybe having it going through in the background was best, because otherwise if it had gotten more focus and more press - just like Single Payer, and just like the PO, it might have been stripped out too, but it wasn't.

Other issues criticizing the bill, which I've seen are arguments that it doesn't contain "cost controls" - this has especially been brought up by NYCEVE. in What happened to the promise to "control skyrocketing premiums"?!

However, the PPACA does have cost controls, it requires an 85% Medical Loss Ratio, which means that at least 85% of the money paid in as part of premiums has to go to actual care, not advertising, not overhead, not stock value.

NYCeve's next major complaint is that their aren't any limits on deductibles in "junk insurance" - but there will be for people buying employer based insurance outside of the Exchange through their employer.

(2) ANNUAL LIMITATION ON DEDUCTIBLES FOR EMPLOYER SPONSORED PLANS.—
(A) IN GENERAL.—In the case of a health plan offered
in the small group market, the deductible under the plan shall not exceed—
(i) $2,000 in the case of a plan covering a single
individual; and
(ii) $4,000 in the case of any other plan.
The amounts under clauses (i) and (ii) may be increased by the maximum amount of reimbursement which is reasonably available to a participant under a flexible spending arrangement described in section 106(c)(2) of the Internal Revenue Code of 1986 (determined without regard to any salary reduction arrangement).

Prior to the actual implementation of the full plan in 2014, it's not that surprising that some insurers would try to price gouge before they get hit with the ban on life time limits, the 85% medical loss ratio, and the limit on out-of-pocket cost, however they do so at their own risk of being punished for it because there are penalties for Insurers who issue exorbitant rate hikes.

The law allows states that have, or plan to implement, measures that require insurance companies to justify their premium increases to be eligible for $250 million in new grants. Insurance companies with excessive or unjustified premium increases may not be able to participate in the new health insurance Exchanges in 2014.

If the companies try to jack up prices now, as some appear to be doing - although these may be outliers according to the Kaiser Report which says that overall 2010 insurance rates have only increased between 3%-5% - before the exchanges come online if 2014, they either have to justify it or not get any access to the new customers available in the exchanges.

Lastly on this point, if an insurer takes the risk of gouging anyway though the exchange, they can be forced to pay back their customers via rebates.

From the CBO

Several provisions regulating insurers were added, including a requirement for an insurer to provide rebates if its share of premiums going to administrative costs exceeds specified levels and a general prohibition on imposing annual limits on the amount of benefits that would be covered.

If insurers charge more than the 85% limit they have to GIVE THE DIFFERENCE BACK as a rebate. That would be what's called a Price Control.

Nyceve's issue with the junk insurance would not apply to the insurance offered through the Exchanges in 2014 which require that preventative care be offered for free (not with a high deductible), and that a fairly comprehensive minimum set of coverage - for the bronze plans - which haven't even been established by the Secretary of HHS yet be made available at a reasonably affordable price, with subsidies available for those who still can't afford them.

Beyond Health Care the second major criticism of the Obama Administration has been their failure to address the War Crimes of the previous Administration and their overall handing of the "Rule of Law".

The problem isn't just with the Administration, it's with the Law itself and Congress failure to correct that law, although the SCOTUS has been gradually correcting much of this on their own.

After losing the Hamdan case the Bush Administration pushed through the Military Commissions Act which stripped Foreign Enemy Combatants of Habaeus protection, some of which was restored by Boumediene in regards to Gitmo, but as yet has not been restored for Bagram A.F.B. which is were the current detention sore festers. Thus Far the Courts have ruled against Bagram Habeas petitions in accordance with the MCA, but this issue has yet to reach SCOTUS.

On two levels, both via executive order and via both Hamdan & Boumediene at the SCOTUS Habeaus has been restored for Enemy Combatants - but not yet for those held in Bagram, and that is where Congress needs to act.

Don't like Warrantless Searches? Congress essentially Ratified them with the FISA Fix Congress needs to "Unfix" it. Unlike the Bush Administration, the Obama Administration's Justice Dept has been implementing the law as written even if it's a lousy law. The problem is the law itself, not the Administration who has pledged to uphold the law - even when that law sucks.

The investigation of Torture & Bush War Crimes has been handed off to a Special Prosecutor, and although there is no guarantee exactly what that prosecutor will do, or how far they will or won't take the case - it is clearly NOT fair to argue that the Administration has ignored the issue, they've done what they should have done which is let a prosecutor handle this outside of the political process, but under the law. The problem is with the law itself, specifically the MCA which effectively immunized many of these activities retroactively by re-writing the War Crimes Act to match the Bybee Standard (Torture equals Likely Death Only) during the lame-duck session of 2006 right after the Hamdan decision came down. Obama wasn't even in the Senate when that happened.

Admittedly Obama hasn't addressed this since campaigning but he has made it known that he realizes the MCA needs to be repealed and Habeaus restored, the Detainee Treatment Act needs an update to include civilians under Geneva and the AFM, the War Crimes Act needs an update which includes providing legal advice designed to deliberately circumvent the law, and Obama needs to get both Gitmo and Bagram closed down - but those are all works in progress (many of which were delayed by Health Care, The Stimulus and Financial Reform) as the Iraq and Afghanistan Wars wind down, not failures. Not yet.

Even though Bush is gone, he left behind a pile of bad laws that Congress needs to fix, not just Obama - and as a result we need the best possible Congress we can get if we're going to have any hope at all of addressing this continuing issues.

Right now Barbara Boxer is in Trouble. Russ Feingold - the only U.S. Senator to vote against the original Patriot Act - is threatened. We may have our issues with Blue Dogs like Mary Landrieu, but we can't let that frustration be taken out actual progressives like Boxer or Feingold. They need our help, and they need it NOW!

I'm not arguing for anyone to just "clap louder", but to admit these are complex and difficult issues - it will take years to clean up this mess and all the while we're doing it we'll have to fight hard to keep the Conservatives and the out-and-out Wingnuts from rebuilding the mess as fast as they can.

The facts are on our side, we don't have to feel bad or down about anything. This legislation is far from perfect and still has many fixes and changes need, but we're not likely to get any of that done with even fewer Democrats in Congress than we currently have. It's not time give up or give in, it's time to double-down - and to ActBlue.

We all may our issues with how things went down, but one thing we can't do is let the Know Less-Than-Nothing Party steal the day and benefit from their own strategy of obstruction and obfuscation. We have to keep Congress in Democratic hands, at all costs.

Vyan

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