THE TREATMENT JUNE 27, 2009
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Speaking on Thursday before thousands of activists gathered on Capitol Hill, former Governor Howard Dean made clear his litmus test for health reform: “We expect change,” he told the crowd, “We want a public health insurance option now.”
It’s not the first time he has said that and, among many health care reform advocates, it’s not really a controversial notion. Creating a public insurance plan, into which anybody could enroll voluntarily, has become more than a top priority for liberal activists. It has become the top priority.
In many respects, this is a good thing. I happen to be a strong public plan supporter myself, for reasons this magazine laid out in a staff editorial several weeks ago: It will guarantee the possibility of affordable, reliable coverage to everybody; it will promote cost control, by leading the way on reforms of how we pay for medical care; and it will promote a healthy competition with private insurers, keeping them in line and--hopefully--prodding them to perform better. (For a more detailed explanation, please read the actual editorial.)
I also think the public plan’s centrality has produced some obvious political benefits. The antipathy towards--and distrust of--the insurance industry has led many activists to shun past reform efforts that relied heavily on private coverage. And that’s been a major reason why those past efforts failed, since those same activists tend to be reform’s most passionate supporters--the ones who will make phone calls, go door-to-door, and show up at rallies like the one that made headlines last week. The public plan option has given these people reason not only to support this year’s reform push, but to support it enthusiastically.
And yet I confess to a certain ambivalence when I hear, as I frequently do, statements like the one Dean made at the rally. Yes, the public plan is a key element of reform. But it is not the only one.
Just consider what was going on inside Capitol Hill meeting rooms as Dean was speaking. Over the past week, leaders of the Senate Finance Committee have been busy hacking away at their proposed legislation, in order to bring the total price tag in at under $1 trillion over ten years. To accomplish this, the committee leaders have proposed cutting the subsidies that reform will make available to people who have trouble paying for insurance on their own.
If those cuts end up in the final legislation, fewer people would get assistance and, quite possibly, those that still got assistance wouldn’t get as much. The result would be more uninsured and more underinsured.
And that's not the only major issue in play. Among the others:
Will there be a maximum on out-of-pocket spending--and, if so, what will that maximum be?
Will the govenrment guarantee relatively good benefits for everybody? Or will people still end up taking out insurance that has huge cost-sharing--not to mention skimpy coverage of mental health and other traditionally neglected services?
How much funding for reform will come out of the pockets of the health care industry--and how much out of the pockets of individual taxpayers?
How aggressively will the government try to change the way medicine is practiced, to improve quality and reduce waste?
How slowly will all of these changes be introduced?
It’s not hard to understand why none of these issues have become as prominent as the public plan. They’re not yes-or-no questions. They’re more complicated, so fewer people (including journalists!) grasp their significance. And these issues don’t always fall neatly along the left-right ideological fault line. By contrast, a government-run insurance plan is everything the left loves and everything the right hates.
Still, that doesn’t (or shouldn't) mean these issues are less important--certainly collectively and, in some cases, individually. Or, to put it another way, reform without a public insurance plan would be a major disappointment. But reform without adequate subsidies, good benefits, and cost control would also be a major disappointment, too. As Igor Volsky, one of the relatively few writers paying attention to these issues, recently suggested, "Health reform that fails to make insurance more affordable is at best an incremental improvement."
To be sure, it's possible that any pressure from the left--no matter what it's focus--helps nudge reform in the direction of greater generosity, stronger regulation, and a harder push on efficiency. But it's also possible that the preoccupation with the public option displaces attention to these other issues--and that, as a result, a lot of people who need help won't end up getting it.
Note: Among those thinking along the same lines has been Karen Tumulty, who recently outlined "Five Big Health-Care Dilemmas" for Time. The public plan is one of those dilemmas, but, as you may have discerned, she came up with four more.
--Jonathan Cohn
15 comments
Related to cost, is cost to whom, and whether it is capped.
One of the disengenuous parts of the way this is being argued in D.C. is looking only at Federal costs, and not cost to states and local government, costs to employers, costs to individuals and actual total system costs; see table from Lewin/Commonwelath report at end of blog entryhere:
www.dailykos.com/.../-CBO-Analysis:-How-Much-Would-Single-Payer-Cost-(updatex2)
Also there is Medical Bankruptcy & Homelessness:
www.dailykos.com/.../-Only-in-America:-Medical-BankruptcyHomelessness
- DrSteveB
June 28, 2009 at 1:43pm
DrSteve, exactly, people who are clogging up emergency rooms are costing everyone money, it just doesn't count as part of government spending.
One thing that bothers me about the public option is those so passionately railing for it already have insurance, so can easily take the position all or nothing. I like the public option as much as anyone, but right now lets get the uninsured insured. We can revisit the public option later.
- blackton
June 28, 2009 at 7:42pm
I agree. Pass portability and non-discrimination based on prior disease. This would solve the problem of many uninsured. Go ahead with the plan to computerize patient records and the 'best practices' list. This is enough. It reforms some fundamental things about today's coverage and still offers a good base for future reforms.
There just aren't enough particulars to go the whole way now.
- CAMtwo
June 28, 2009 at 9:01pm
It seems to me that this whole health care discussion is combining two issues: How to provide adequate health care to the entire population and how to pay for it. The debate so far is only how to pay for it. Providing health insurance to everyone will better quantify the cost since there will no longer be any hidden costs for the uninsured, that is if health care coverage is mandated. However, it does nothing to answer the first question--how to deliver adequate care to the entire population. We still face the existing situation: I want whatever treatment I think is necessary and I want someone else to pay for it! This is really the fear of the conservatives--currently we can only afford to provide unlimited health care to a portion of the population which is why we cannot have a public option.
- tpinter
June 28, 2009 at 9:55pm
Krugman already covered this on Friday. He explains why cost control is not possible without a public option, and reform will be a failure if does not include it. This would be a terrible political (and moral) result.
- rhorath
June 28, 2009 at 10:01pm
Why We Need A Second Stimulus : Don't be fooled by dropping unemployment rates. by John B. Judis
- Anonymous
June 29, 2009 at 10:04am
With or without the public option, our representatives in DC are simply trying to find a palatable "bipartisan" way to maintain the profits of the private insurers (i.e., their campaign donors). I'm surprised that Dr. Dean has fallen in with that cohort. No one seems to have the guts to say, "This market-based system does not work in health care--the insurance industry has the money and the power to call all the shots."
The 2007 Nobel prize in economics went to "three Americans for their work in mechanism design theory, a branch of economics that looks at the design of institutions in situations where markets do not work properly.
Leonid Hurwicz of the University of Minnesota, Eric S. Maskin of the Institute for Advanced Study in Princeton, New Jersey, and Roger B. Myerson of the University of Chicago shared the award for 'having laid the foundations of mechanism design theory,' the Royal Swedish Academy of Sciences said.
Their work addresses situations in which markets work imperfectly, such as when competition is not completely free, consumers are not fully informed or people hold back private information. . . .
Their work also addresses cases where transactions do not take place openly in public markets, but within companies, in private bargaining between individuals or between interest groups."
(Graham Bowley, NY TImes, October 15, 2007).
Yet Congress now wants to shape a public plan--not to provide affordable quality care to the sick and the disadvantaged, not to relieve employers, states and municipalities of the burden of rising premiums, not to cut costs, not to make the most efficient use of our tax dollars--but crafted to be "competitive" with for-profit plans, designed so the latter would not be disadvantaged!
The public option is simply a placebo administered to humor a gullible electorate.
We need a proven equitable, humane and cost effective system.
Get angry! Call the White House! Call Dr. Dean! Call your Congressperson.
Get active!--Join your local single payer group.
- hmseil01
June 29, 2009 at 11:26am
Any bill that does not include a public option plan is likely to do more harm than good. Churchill once noted that ''You can always count on Americans to do the right thing - after they've tried everything else”. We have tried everything else on health care. Now it's time to do the right thing. Over 20 other first-world countries having heath care plans with universal coverage and a public plan (usually single single-payer systems) have equal or better overall health care statistics at costs of 8-12% of GNP compared to our 16-17% of GNP. Pick one of the others you like the best (Germany, Japan, Canada, France, Norway, Sweden, Denmark, Netherlands, England, Switzerland, Austria, Australia, New Zealand, whatever) and increase the costs by 20% to cover what you don't like about that particular system and you've got a much better system than ours at 20-40% less cost than our present system. The successful models already exist. Tweaking our existing, unsuccesful, rapidly sinking, model is almost cetainly the eqivalent of re-arranging the deck chairs on the Titanic. Furthermore, making a public system available to all does not necessarily mean the end of private systems. Many countries with successful, much lower cost public plans cover basic medical needs for everyone. Additional coverage for other, more elective, medical procedures is handled by optional private plans where the total cost of the two is still 20-40% less than ours. As one example, Google Germany.
- gbittner
June 29, 2009 at 12:53pm
We are in trouble. ALL options have been explored and the public plan is the only way to achieve cost control. Yet, wary politicians see that a public plan, given price setting abilities like Medicare, might have such a competitive advantage that they will gobble up the private insurance industry and we will end up with a defacto single payer plan. It seems like there is no way to compromise.
Personally, I find the situation sad. There are unexplored ways we can have universal health care with cost control. Short of such an innovation, my bet is that insurance companies would accept the public plan if the public plan’s hospital rates were placed in the public domain for all insurers to use. Clearing this high hospital cost hurdle, private insurers might be on a more even playing ground in dealing with the patient/physician economic relationship. Problem seems to be that the intellectuals controlling the debate are afraid their high cost hospitals in the northeast might not be able to compete.
- donmcmahon
June 29, 2009 at 4:46pm
Great post, Jonathan, and you are right: Getting down to the $1 trillion mark by cutting subsides, benefits, and allowing too much cost-sharing for low- and moderate-income families will only leave more people un- and underinsured, something we can’t afford to do. To work, health reform must be affordable for everyone, and we need to be talking about that.
For more on affordability, check out Community Catalyst and PICO’s paper on what a commonsense affordability standard looks like at:
www.communitycatalyst.org/.../resources
- kmelley
June 30, 2009 at 12:18pm
gbittner << have equal or better overall health care statistics at costs of 8-12% of GNP compared to our 16-17% of GNP.>>
Not true. If you never get sick, you'll do fine in other countries. But if you get something bad, like cancer, your survival rates are quite a bit higher in the US that elsewhere.
Additionally, the US has organ transplant rates that are generally 2X higher than UK and Canada. That means our death rates for livers, kidneys, etc, are half of UK and Canada.
US mammogram rates are 20% higher than canada, 1 in 3 in the US have had a colonoscopy compared to 1 in 20 in canada, etc.
There is no better place to be than the US if you get sick, or if you are worried about preventive care, whether or not you have money.
http://www.ncpa.org/pub/ba649
- SeattleEngineer
July 1, 2009 at 2:30am
DrSteveB: >>Also there is Medical Bankruptcy & Homelessness <<
The claims of medical bankruptcy are likely very overinflated. The study you probably saw only required you to have 5% of your annual earnings in medical bills for it to be consider "medical related".
This means for someone making $50,000 per year, if they had a $2500 (or more) unpaid medical bill when they declared bankruptcy, the study authors concluded their bankruptcy was due to the medical bill.
That is a stretch of a conclusion.
If the person declaring bankruptcy were typical, then they also had $11,000 (22% of salary) in credit card debt, $350/month in car payment, a $900 mortgage, a $100/mo cellphone bill, a $50/mo cable bill, etc.
Seems a bit silly to blame the bankruptcy on that rather small medical bill when all the other voluntary expenses were also present, doesn't it?
- SeattleEngineer
July 1, 2009 at 2:37am
http://www.ncpa.org/pub/ba649
Wow, what a piece of lie filled excrement.
I am sick and tired of comparisons between the US and Britain. hey, seattle, how many goddamn things do you have that say made in Britain. Why don't you spend some time studying the Japanese Health care system? they have better outcomes for much lower costs.
Japan is the US main economic rival, yet that piece of shit organization acts like Japan doesn't even exist. There are only 3 reasons why this is so:
1. They are evil racist bastards who don't view Japanese people as human. (unlikely)
2. They have never heard of Japan. (unlikely)
3. They don't dare mention it because they know it blows everything they believe straight to hell. (likely)
Shame on them. Rebut this asshole ncpa.
- blackton
July 1, 2009 at 1:28pm
The quote of the day comes from Vermont Senator Bernie Sanders, in a telephone interview with Ezra Klein
- Anonymous
July 1, 2009 at 2:07pm
After a tumultuous few weeks, the latest news in health reform is still worth savoring. On Friday, the
- Anonymous
August 2, 2009 at 11:58pm