Monday, February 15, 2010

Health Care Update

Bowers: GOP demands White House post health care proposal online, then attacks WH for doing exactly that
Here is one from the "negotiating in good faith" files.

On February 8th, Republican House leader John Beohner sent a letter to the White House, demanding that the White House post online any health care proposal it wished to discuss at the health care summit:

If the President intends to present any kind of legislative proposal at this discussion, will he make it available to members of Congress and the American people at least 72 hours beforehand?

So, four days later, the White House accepted this demand, and announced it would post a legislative proposal online more than 72 hours before the summit:

Since this meeting will be most productive if information is widely available before the meeting, we will post online the text of a proposed health insurance reform package.

So, naturally, the next day, Boehner attacked the White House for giving into his demand:

"A productive bipartisan discussion should begin with a clean sheet of paper," Boehner said in a statement.

I see.

Ross Douthat's column on health care reform notes that Democrats and Republicans not only disagree on the policy, but also on the definition of "bipartisanship."

For President Obama, being "bipartisan" means incorporating a few right-of-center proposals into an essentially liberal legislative package. For Republicans, it means doing only those things that legislators of both parties can agree on -- a far more stringent standard, and one that would produce a very different bill.

Hence the frustration on both sides with the way the health care debate has proceeded. To Democrats, the right's complaints about having its ideas ignored are purely cynical. Doesn't the proposed legislation include ideas endorsed by prominent conservative economists? Don't some of its proposals resemble those championed by John McCain? Didn't Democrats eschew a single-payer approach in favor of a reform that retains a role for private insurers?

To conservatives, this misses the point: It isn't the details of the bill that they object to, it's the overall design.

That's at least partially true. Republicans have concluded that the basic framework of the Democratic proposal -- subsidies for the uninsured, consumer protections -- is fundamentally at odds with failed minority party's ideology. (At least, that's what they've concluded now. A few months ago, Republicans agreed -- publicly and repeatedly -- that they found 80 percent of the Democratic plan entirely reasonable.)

With this in mind, when Democrats embrace specific GOP provisions, it doesn't seem to matter, precisely because, as Douthat noted, Republicans reject the premise. It's like Democrats chose to order a pizza for dinner, and invited the GOP to help pick the toppings. But Republicans don't want a pizza for dinner; they want tire rims and anthrax. Choosing toppings is little consolation.

But Douthat's description of the GOP's understanding of bipartisanship is overly broad. For Republican leaders, the idea isn't to stick to "only those things that legislators of both parties can agree on" -- itself a ridiculous notion when the parties differ -- but rather to stick to only those things the GOP can tolerate.

Indeed, just last week, House Minority Whip Eric Cantor (R-Va.), among others, said they only health care reform package that can pass is the one created entirely by GOP lawmakers. Democrats may be in the majority, but the minority party believes only their ideas should be allowed to come to the floor for votes. The "only" health care plan Republicans will consider, Cantor said, is the Republican plan.

In this sense, "bipartisanship" is defined as giving Republicans exactly what they want, and nothing else. Period.

And if this were a normal legislative dynamic for the United States, such an argument would be laughed at and dismissed. But because Republicans have decided that the majority is no longer allowed to govern, an up-or-down votes can only occur if the GOP approves of the underlying bill, we're left with this maddening status quo.

mcjoan (DK): The Compromise Healthcare Reform Proposal

The White House created some confusion on Friday when it issued its invitation, particularly with this part:

Since this meeting will be most productive if information is widely available before the meeting, we will post online the text of a proposed health insurance reform package. This legislation would put a stop to insurance company abuses, extend coverage to millions of Americans, get control of skyrocketing premiums and out-of-pocket costs, and reduce the deficit.

It is the President’s hope that the Republican congressional leadership will also put forward their own comprehensive bill to achieve those goals and make it available online as well.

Did this mean that the White House was going to proposed a watered down plan with just those four elements included? Was it going to be some truncation of the existing legislation? Apparently not, according to what Ezra found out over the weekend.

I spoke to the White House over the weekend and they indicated that the president's package will not be a new White House plan, but a compromise between the House and Senate bills. That is to say, the White House expects that the House and Senate will have a compromise plan by February 25th.

That's not necessarily surprising: The two chambers were pretty close to agreement on a compromise package before Scott Brown's election threw everything into chaos. Presumably, that'll be dusted off for this meeting.

According to Tom Harkin, the two chambers weren't just close on the compromise package, they had pretty much sealed the deal.

It would seem that the question now that both chambers still have to work out is how much of that compromise could be put into a reconciliation side-car fix. Because, significantly, the package will reflect the compromise which suggests that the White House recognizes that the Senate bill as is won't pass in the House. Whatever the summit is likely to achieve, it isn't going to result in Republicans supporting reform, unless Obama has become a hypnotist.

So, since the existing compromise package is the plan, the big picture hasn't really changed--there has to be a reconciliation fix passed that allows for passage of the Senate bill in the House.

mcjoan: GOP will Attend Health Summit

Though they're still not happy about it, Roll Call reports that Republican leaders will participate in the hcr summit [sub req].

Republicans, demanding to have a say in the summit’s format and warning for days they have no interest in attending a "public relations" exercise disguised as a substantive negotiation, say that is exactly what the nationally televised event is setting up to be. But Republican leaders will probably attend anyway – perhaps for their own public relations reasons — though they are already labeling the summit a failure.

"So now the president wants to have a little PR event to try to resell a tremendously unpopular plan to Republicans and the American people. The administration still isn't listening," a House Republican leadership aide said Monday....

In particular, Republicans say Obama’s request that they come to the bipartisan summit armed with their own comprehensive health care reform bill is evidence that the White House is trying to predetermine the event’s outcome for political advantage.

Republicans have declined to produce a massive health care overhaul of their own because they prefer an incremental approach, and insist any negotiation should start from scratch and not be based on the House and Senate health care bills passed late last year. Obama shot down that recommendation during a Feb. 5 news conference, saying he did not want to go through a Congressional committee process that could take another six to eight months.

Boehner, after his demand that the plan be posted online, abruptly changed that demand to starting with "a clean sheet of paper." Senate Republican whip Jon Kyl echoes that, saying the Dems have decided what they want to do anyway, so the only possible way to make this bipartisan is to start entirely from scratch.

While the summit is likely to be mostly PR, the "blank piece of paper" and "starting over from scratch" demands from the Republicans sound more like they just don't want to have to do the work of finally come up with a real plan.

Ezra Klein: A California insurer shows how health-care reform would work, and help

The Anthem Blue Cross saga appears to have a happy ending: After criticism from the administration, the insurer has delayed the planned 40 percent rate hike. That will give the company time to reevaluate whether it's worth the blow-back, and I'd guess there's a good chance it never takes effect at all.

But if this is a good outcome, it's a not a good policy. The insured can't depend on someone in the White House's communications shop noticing when an insurer tries to screw its customers. What we need is an actual policy standing between the insured and the grim incentives of their insurers. That's what health-care reform is meant to be, and the Anthem saga is a good example of how it would work.

The Senate bill contains two separate categories of provisions that would stand between the insured and what Anthem attempted in California. The first are consumer protections that could be invoked if an insurer tried to raise rates precipitously. The second are market reforms that make it less likely for an insurer to try, and less calamitous for individuals if the insurer succeeds.

Let's start with the consumer protections. Under health-care reform, the Anthem plan -- which serves high-risk customers in the individual market -- would be in the exchange. If Anthem attempted to jack rates up by 40 percent, a couple of things would happen.

First, Anthem would have to justify the rate increase to the exchange's administrators and post their justification on their Web site. That's essentially what the Obama administration forced Anthem to do last week, and it was enough to derail the hike. Second, Anthem would run smack into Section 1311 of the bill, which gives regulators the power to control access to the exchanges based on whether the plan "is in the interests of qualified individuals and qualified employers in the State." In fact, the bill specifically states that regulators can take "excessive or unjustified premium increases" into account when deciding whether to certify a health-care plan's continued presence in the exchange.

In other words, Anthem's plan could be kicked out entirely for this rate hike. That would probably have to happen to only one health insurer for the rest to take notice that precipitous and inexplicable rate hikes are no longer going to be part of the business model.

But perhaps the more important part of health-care reform is that it would no longer make sense for Anthem to do this sort of thing. The problem is not that insurers are bad so much as that the market rewards bad behavior with profits. In this case, Anthem has an insurance plan with sicker people that is not proving profitable. They're increasing the costs to either drive those people out or force them to pay a lot more.

Under health-care reform, this wouldn't happen. First, insurers can't discriminate based on preexisting conditions any longer, and their ability to discriminate based on age or other factors is substantially reduced. That means that everyone is functionally in the same big pool.

Second, if one insurer or another does end up with an unusually sick customer base, the next move isn't to jack up rates on them. Instead, Section 1341 of the bill outlines the risk adjustment provisions, which basically means that there's a fund that will pay an insurer more if it ends up with sicker customers. The idea is that insuring people who need health care shouldn't be bad business.

Finally, let's say everything fails and the insurer decides to walk from the exchange. In the current situation, the people on Anthem's plan have nowhere to go. They all have preexisting conditions, which means they either won't be offered insurance or can't afford the rates. Under health-care reform, they can go to any other insurer they please: They can't be discriminated against, and they can't be denied coverage. Losing their current insurance may be disruptive, in the same way that having your local grocery store close might be disruptive. But it will no longer be calamitous, or anything close.

Since Scott Brown's election, the conversation over health-care reform has become very, very political, and quite abstract. But the Anthem decision is a good moment for Democrats to return the conversation to the real problems that the real bill will really solve. If health-care passes, no one need fear what Anthem almost did in California ever again. If it fails, then it will simply continue happening, on and on into the future. That's the choice before Congress right now.

Think Progress: Fox News Scolds WellPoint Rate Hike, Not For Hurting Consumers, But For Energizing Health Reform Advocates

California Anthem Blue Cross Blue Shield, a subsidiary of health insurance giant WellPoint, announced recently that it would be hiking premiums for customers in the individual market by up to 39 percent. The looming hike unleashed a firestorm of criticism, and provoked two Democratic lawmakers to launch congressional probes into the matter. Even a spokesman for Minority Leader John Boehner (R-OH) was compelled to feign concern, telling reporters, “If the argument is that the WellPoint hike means we need reform, well, ‘duh.’”

Earlier today on Fox Business, WellPoint VP Brad Fluegel appeared to discuss the hikes. Fox hosts Charles Payne and and Stu Varney lashed out at WellPoint for increasing rates just when “it was safe to get out of the healthcare debate.” The hosts were uninterested with how the increasing rates would affect customers and struggling families in California. Instead, the pair attacked Fluegel for re-energizing advocates for health reform. Payne groaned, asking Fluegel why he didn’t “take Wall Street’s lead” and “wait for this to blow over and maybe a year from now try to hike rates”:

PAYNE: But Brad this is like Jaws 2, just when you thought it was safe to get out of the healthcare debate, you brought everybody back into it. [...] Didn’t someone though, wasn’t there a committee that said listen, let’s take Wall Street’s lead, do the minimum we can, wait for this to blow over and maybe a year from now try to hike rates?

VARNEY: You handed the politicians red meat at a time when healthcare is being discussed. You gave it to them! [...] You couldn’t see this coming? I mean really, you couldn’t see this coming? [...]

VARNEY: You actually did make a net in that quarter in twleve weeks, you made what, $500 million net profit didn’t you? You tell that to a politician and they’re going to say, ‘you made a half billion dollars in twelve weeks and now you put the price up 25%.’

Watch it:

HCAN has responded to the WellPoint rate hike by releasing a report demonstrating how premium increases have been feeding insurer profits, not paying for health care costs. “The report finds that the top five largest for-profit insurance companies increased their profits by $12.2 billion last year while dropping coverage for 2.7 million Americans.“ Pending the investigation and a review from the California Insurance Commissioner, WellPoint has postponed the hikes until May 1, 2010.

At the end of the interview, the Fox hosts chuckled with the WellPoint VP. They apologized for being so harsh and warmly reminded Fluegel that their criticism of insurer profits was only meant to be “warm up” for Rep. Henry Waxman’s (D-CA) investigation. “You did very good,” cooed one of the cohosts.

Karen Tumulty: Health Care: Must-Read Of The Day

It's not just California.

AP reports that insurance companies in at least four states are raising their premiums for individual insurance policies (those that people have to buy themselves, because they don't get coverage from an employer) by 15% or more. To give you a sense of what we are talking about if these rates go into effect, a family of four in Maine (which is a relatively poor state) can expect to pay $1,876 a month--about $22,500 a year--for health insurance, starting in July.

And this is just the beginning of what we can expect to see pretty much everywhere:

Premiums are far more volatile for individual policies than for those bought by employers and other large groups, which have bargaining clout and a sizable pool of people among which to spread risk. As more people have lost jobs, many who are healthy have decided to go without health insurance or get a bare-bones, high-deductible policy, reducing the amount of premiums insurers receive.

Steep rate hikes in this sliver of the insurance market — about 13 million Americans, as of 2008 — have popped up sporadically for years. Experts see them becoming increasingly common.

"You're going to see rate increases of 20, 25, 30 percent" for individual health policies in the near term, Sandy Praeger, chairwoman of the health insurance and managed care committee for the National Association of Insurance Commissioners, predicted Friday.

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