Felicia Muftic – Let’s at least debate health care reform honestly
October 4, 2009
This health care debate is getting so heated it is getting hard to see the light through the dense smoke caused by verbal flame throwers or the stoking of hot button side issues.
Besides the heated words, issues of access by illegals or abortion seekers are subpoints delaying the main show. Republicans are scare-talking Medicare by refusing to acknowledge facts that only administrative fat, not benefits, will be cut. They still chat up tort reform as the cure-all when 35 states have already enacted it with little noticed impact on health care costs.
Lost in the flames are the 37 million individuals who do not now have enough income to buy private insurance on the open market. Gone unchallenged is an American Journal of Public Health report that 44,000 adults die every year because they do not have health insurance or that family insurance bills are inflated $1,000 a year to cover care for the uninsured. Let us cool it, focus on fixing the problem and understanding the basics 101.
A health care exchange is in every version now in Congress. The exchange will be a menu of health care plans, extending a group cost break to small business employees and individuals, self-employed or unemployed. Businesses who currently offer insurance would be penalized for dumping health insurance benefits for their employees.
So far, legislation restricts access to an exchange to small business people and their employees, or self-employed or unemployed. Those with employer-based insurance could not apply.
This limit of access to the exchange is a protection plan for private insurance companies, a nod to the capitalistic system, and a tip of the hat to those who fear “government takeover” of health care. Private insurers are guaranteed a place on the exchange and access to 37 million new customers, and they are assured exclusivity in offering employer plans. Those who cannot afford the lower group costs offered in the exchange would get a government subsidy to pay for a plan, public (if included) or private.
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A public option is a plan that would be low cost, sponsored and regulated by the government and would be offered alongside private plans. While the Senate Finance Committee voted it down, it is still quite alive in other Senate committees, in other forms, and in the House. The Conference Committee may get the final say.
A public option plan as it is shaping up would not be subsidized by the government and would have to compete on equal footing with the private plans offered in the exchange.
Democrats contend that without tackling health insurance costs, medical care costs would not be significantly lowered. Most argue the public option is the best way to lower insurance costs by providing competition. Some Democrats would like all, including those insured by their employers now, to have access to an exchange that would include a choice of public option or private insurers.
The Democrats’ rationale for giving consumers a choice of a public plan is that the competition would force private insurers to cut their high administrative costs devoted to executive salaries, advertising and sales commissions in order to compete with a public plan that did not have to pass those costs on to the consumer and taxpayers. A variation garnered Senate Democratic conservative support Thursday that would let states opt in to a public option and negotiate with private insurers for a statewide plan, using a public option as a competitive hammer to get the lowest price.
At state and national levels a few private insurers have a strangle-hold on the number of health insurance companies. Collusion and price fixing are the anti-competitive results of oligopolies and monopolies. The Sherman Anti Trust Act gives authority to break up monopolies. However, insurance companies are exempted from such anti-trust laws. That is why buying insurance across state lines as a way to provide competition is a farce; we meet the same monopolies coming and going. That is also why Denver Congresswoman Diana DeGette will be introducing legislation to un-exempt insurance companies. A threat of an opt-in to a public option state by state may also act to jolt these state wide monopolies into competing and offering affordable plans.
Another possibility is to put a lid on “administrative costs.” The cap is 15 percent in the House legislation and Sen. Jay Rockefeller (D-W VA) threatens an amendment to limit them to 10 percent. (Medicare is 5.5 percent). Both DeGette’s and Rockefeller’s amendments would meet intense opposition from insurance lobbyists and their buddies in Congress.
The responsibility of those honestly seeking a solution to our health care system problems is to cut through the air pollution and to support solutions that will actually work to give access to all and to keep health care costs down.
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