Insurance Exchanges Providing Coverage At Reasonable Price With Choices Expanding

Now that health care coverage through the exchanges has been up and running for a several months we are getting more data on the favorable results. A major benefit has been to not only replace policies on the individual market which often had limited coverage with comprehensive coverage that cannot be canceled for development of medical problems, but to also make such care more affordable. A report from the Department of Health and Human Services found wide variation from state to state but found that on average those who receive subsidies are paying $82 a month in premiums, about one-fourth of what they would have paid without the subsidies.

The government has previously reported that 87 percent of the 5.4 million Americans who chose a health plan through the federal health exchange qualified for some financial help.

The health officials said they have not yet analyzed the incomes of people who qualified for the subsidies. But overall, the report shows, the average monthly tax credit this year is $264. Without the federal help, the average premium chosen by people eligible for a tax credit would have been $346 per month, and the subsidy lowered the consumers’ premiums, on average, by 76 percent. The result is that four out of five people with subsidies are paying premiums of no more than $100 a month — although that does not include money they might need to spend for insurance deductibles and other out-of-pocket costs.

An erroneous report in The Los Angels Times claimed that the cost of subsidies was running above current projections received a lot of coverage in conservative blogs this morning but the article has since been corrected to indicate that the cost of subsidies is consistent with projections from the Congressional Budget office.

McClatchy added additional information from the HSS report on choices available on the exchanges:

On average, federal marketplace users can choose from 5 insurers and 47 marketplace plans across all the metal tiers; bronze, which cover 60 percent of health care costs, silver plans, gold plans that cover 80 percent of costs and platinum plans that cover 90 percent.

The report found competition between plan providers lowers premiums. That bodes well for plan prices in 2015 when more plans are expected to enter the marketplace.

McKinsey & Company also looked at choices available in their own study, finding that consumers typically had a choice of both more expensive plans with larger provider networks and less expensive plans with more restrictive networks. They also note that, “There is no meaningful performance difference between broad and narrowed exchange networks based on Centers for Medicare and Medicaid Services (CMS) hospital metrics…” Of course there are reasons beyond quality metrics which might cause people to be willing to pay more for a plan which offers more choice. They also report that 46 percent of those responding to their survey indicated they knew what type of plan they had enrolled in and 26 percent were unaware of the network type they had selected.

The Hill reported on a growing number of insurance companies desiring to offer policies through the exchanges, which will both help lower costs and provide increased choice. As Jonathan Chait points out, this is evidence that Obamacare has been a success, doing what the program was designed to do. The actual news is also quite different from what is being posted at many conservative sites.

While insurance prices through the exchanges are expensive before subsidies are included (and remain expensive for those of us who do not qualify for subsidies), the premiums look much more reasonable when compared to insurance prices prior to the Affordable Care Act, and when the frequent double digit increases in rates were considered. The Commonwealth Club has looked at insurance prices on the individual market prior to Obamacare.

USA Today, in reporting on the HHS report and the increased number of insurance companies planning to offer coverage, points out that “new state filings for the 2015 plan year show more insurance companies are moving onto health care exchanges in some competition-deprived states and requesting rate increases that are largely in line with pre-Obamacare years.”

Choice in physicians is increasing in plans in the exchanges, but United Health Care continues to reduce choice by dropping still more physicians from their Medicare Advantage networks (which is unrelated to Obamacare).

The Los Angeles Times and The Boston Globe are among newspapers reporting on a study from The Journal Of The American Medical Association showing that the Affordable Care Act has resulted in better health care and lower costs for young adults.

Read more here: http://www.mcclatchydc.com/2014/06/18/230648/new-hhs-report-touts-federal-marketplace.html?utm_campaign=KHN%3A+Daily+Health+Policy+Report&utm_source=hs_email&utm_medium=email&utm_content=13220140&_hsenc=p2ANqtz-9LEiMRY8tbEZ1g2JFk4Z-JO7Rf4BCeYZyOvcOmYTGlzNq5IKvCPlgMTZIg2Py07w_QMVoT4v6g8-NzQZYh0u7h_Lue2Q&_hsmi=13220140#storylink=cpy
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Liberals Were Wrong About The VA, But Conservatives Remain Wrong About Health Care Coverage

James Taranto of The Wall Street Journal, today demonstrating what they say about a broken watch, is right on one point. His column carries the subheading of “Not long ago, the left raved about the VA.”  While this is widely true about the left, there was at least one exception (myself). A few years back, many on the left were exclaiming about the quality of the VA system based upon quality evaluations. Evaluations of quality in health care currently has many limitations, and was downright primitive a few years back.  I pointed out several times, such as here, that the indications being looked at were not a valid means of determining quality health care.

Now we are learning that there is an even more serious problem beyond the fallacy of accepting computerized data as truly indicating quality health care. If the allegations we are now hearing are true, there is also the danger that information entered into computer systems might not even be accurate.

Suddenly, with the recent revelations about the VA, the line from the left has changed to (more accurately) saying that The Veterans Affairs Scandal Was Decades in the Making.

Of course this doesn’t mean that that the right is correct in their interpretation of this scandal. Many are using this to attack the idea behind the Affordable Care Act. We are comparing two entirely different ideas here. The VA is a rare case of government actually providing health care while the ACA involves using private insurance (or in some cases Medicaid) to pay for private medical care. The ACA became necessary in order to provide necessary regulations to curb the abuses of the insurance industry, along with providing support for those who could not afford health care coverage.

If government has problems in providing health care, as with the VA system, the problems in the private insurance industry have been far worse. In the past most areas had one or a very small number of insurance plans dominating a market. Thanks to the Affordable Care Act, we are having more insurance companies planning to enter many markets, which should lower prices. In the past, private insurance companies found it to be more profitable to deny coverage to many people with medical problems, including finding ways to terminate coverage should a policy holder develop a serious (and expensive) medical problem. Here is a report of just one example of an insurance company targeting women with breast cancer for recission of policies.

Obamacare provides needed reforms to encourage more market competition and eliminate this type of abuse from the insurance industry. It is an example of where government action is necessary and beneficial. We also have an example in providing coverage for medical care where government does a better job than the market. People on Medicare have a choice of the government program, which pays private physicians to provide medical care, or Medicare Advantage plans in which private companies handle the payment instead of the government. It costs from 13 to 19 percent less to over the same Medicare population under the government plan than with private insurance plans. The added money going to the private Medicare Advantage plans primarily goes towards increased profits for the insurance companies. Medicare might also be a better, and more cost effective, model to care for Veterans as opposed to the government attempting to maintain a parallel health system.

The lesson of the VA might be to question having the government actually provide health care, although Republicans certainly share the blame here considering their long history of opposing funding which Democrats have backed for the VA. Regardless of whether this is true, this has no bearing as to the benefits of the Affordable Care Act along with government programs such as Medicare which handle health care payments as opposed to directly providing health care.

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The Battle For Control Of Congress 2014

While the media is increasingly talking about the 2016 presidential election, we have a major election coming up for control of Congress later this year. At present it appears that it is unlikely for the Democrats to take control of the House, and they are now fighting to retain control of the Senate. Predictions that the Republicans will hold the House and possibly take the Senate are based upon historical trends and which Senate seats are up for reelection this year. Of course it is possible to see a break from past trends.

Among the trends causing people to predict this to be a good year for Republicans: minorities and young voters don’t vote as often in off-year elections, a president’s party generally does poorly in the sixth year of the president’s term, a president’s party does poorly when the president has low approval ratings, and a president’s party does poorly when the economy is having difficulties.

On top of this, the Democrats are defending Senate seats in several red states this year, giving the Republicans a chance to pick up some seats. Fortunately the situation is reversed in 2016 with more blue-state Republicans up for reelection. Based upon these fundamentals in a presidential election which is likely to already be more favorable to the party, a Democrat winning the White House should also see a pick up of several Senate seats.

The Republican Party has been working in other ways to pick up votes. They have made voter suppression a major part of their electoral strategy, along with continuing the Southern Strategy based upon racism and now xenophobia. On the other hand, their history of racism may backfire with the increase in minority voters, possibly turning some southern states blue in the near future. We saw this first in Virginia and to a lesser degree in North Carolina. In the future this could extend to Georgia, Texas, and additional states.

Republicans have an advantage in keeping control of the House as so many House districts are gerrymandered to protect the incumbent. In addition, Democrats tend to be more concentrated in urban areas, meaning that even if more people vote for Democrats than Republicans, the Republicans will win more seats by small margins while Democrats will win a smaller number with bigger majorities. More people voted for Democrats than Republicans in Congressional races in 2012 but the Republicans retained control of the House. It would probably take at least  a seven percent margin of victory for Democrats to take control of the House. Republican representation in the Senate is also exaggerated compared to their level of support due to lesser populated Republican states having the same number of Senators as more populated Democratic states.

There are some things which could throw off the fundamentals this year, but we cannot count on voters suddenly no longer being fooled by the GOP line. At present the Republicans receive far too many votes from low-information white voters. Over time the number of younger voters who receive their fake news from Jon Stewart will overtake the older voters who receive their fake news from Fox.

While Obama’s approval rating is low, Congress has an even lower approval rating. Typically in such situations people like their own Congressman even if they disapprove of Congress. This year polls show that many people also think their own Congressman should be thrown out. Based upon this, I wouldn’t be surprised if more incumbents than usual get upset, but that might not necessarily help the Democrats over Republicans. In addition, more people see the Republicans as being more responsible for gridlock, in contrast to a common false media narrative of treating each party as being equally responsible. Maybe they will surprise the pundits and throw the Republicans out.

Another factor influencing whether predictions based upon the fundamentals must occur is that any competent Democratic strategist is aware of every point here, and the party is doing far more than they did in 2010 to try to change this. They are working to increase turnout among Democratic voters this year. They  have a technological edge both in regards to get out the vote efforts and fund raising. It even appears that the same problems which are placing Republicans at a disadvantage with younger voters is also impacting their ability to recruit young tech savvy political operatives. Besides using their technological advantages over Republicans in getting out the vote efforts, they can  motivate Democratic voters with fear of the consequences of the Republicans taking control of the Senate. Tea Party extremism has led to an end to talk of a grand bargain. Democratic compromises on entitlement programs might have discouraged some voters on the left from turning out for Democrats.

I think Democrats will do better if they can successfully explain the advantages of their policies as opposed to Republican policies. Democratic economic policies turned around the economic collapse caused by Republican economic policies, even if the Republicans have managed to slow recovery with their obstructionist moves, decided upon from the start of Obama’s term. The deficit rolled up by George Bush has dropped considerably since Obama took office. The CBO  projects a deficit of $514 billion in 2014, representing three percent of the Gross Domestic Product. This is near the average level for the past forty years, and a vast improvement from 2009 when the deficit was at 10.1 percent of GDP.

Despite early IT problems, which the Obama administration does deserve criticism for, the Affordable Care Act has turned into a tremendous success on a policy level, both in terms of health care reform and its benefits for the economy. Both the Medicare Advantage plans under George Bush and the original Medicare program had early implementation problems which took a couple of years to solve. Of course Republicans will continue to spread unsubstantiated scare stories and it is possible Obama might never received the credit he deserves. Health care premiums will be remain high on the individual market as they were high before Obamacare. Insurance companies will continue to use restricted panels of physicians and hospitals as they did before Obamacare, leaving room for Republicans to blame the Affordable Care Act for problems unrelated to the law.

Other factors could come into play. The Tea Party might oust electable Republicans and replace them with extremist candidates which the Democrats can more easily beat. While doubtful, the Tea Party might force Congressional Republicans into a situation analogous to the government shut-down before the election which reduces public support for Republicans. While it is doubtful it will really alter that many votes, even the changes in the late night comedians could help the Democrats over the Republicans.

The easy prediction is now that the Republicans will keep control of the House and control of the Senate is up for grabs. Depending upon whether the factors discussed above alter the usual fundamentals, we still might wind up seeing the pundits talking about all the reasons they knew we would have a different outcome after the results are known.

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Cuts To Medicare Advantage Plans Half Of Amount Expected–Watch For Hypocritical Republican Reaction

Paul-Ryan-End-Medicare

One of the ways in which the Affordable Care Act is funded is by reducing subsidies to Medicare Advantage plans which receive more money to care for Medicare beneficiaries than it costs to care for the same patients in the government Medicare program. Republicans have been using this to raise bogus claims of cuts to Medicare patients despite the fact that Republicans have also included similar cuts to Medicare Advantage plans in their budget proposals.

Insurance companies have been predicting cuts of approximately 7 percent. CMS released their calculations today regarding proposed cuts for 2015 (pdf here). The current proposal is for a 3.55% cut in payments to Medicare Advantage plans, about one-half of what they have been projecting.

The Republican Party was already prepared today to use this news to attack the Democrats. They do not explain why it is necessary for private companies, which any Republican believes should be more efficient than a government program, requires more money to care for patients than the government Medicare plan does. Nor do they account for the fact that most Republicans voted for the Ryan budget three years in a row which includes the same cuts to Medicare Advantage plans. Or what about the same Ryan plan which would turn Medicare into a voucher system?

Also don’t expect the Republicans to point out that, while the Affordable Care Act will cut profits to Medicare Advantage plans, it also increases benefits to Medicare patients including phasing out the donut hole for prescription drugs and covering preventative services which were previously not covered.

Cross posted at The Moderate Voice

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More Republican Misinformation On Medicare To Scare Seniors

There they go again. Republicans are again trying to scare seniors by spreading misinformation about Medicare. They have been making the same false claims for the past few years. From Politico:

Republican Rep. Tom Rooney of Florida took aim today at Obamacare’s impact on older Americans, saying that seniors across the country are paying “more money for fewer choices, less access and far less peace of mind.”

In the GOP’s weekly address, Rooney castigated President Barack Obama’s very public pledge that Americans of all ages would be able to keep their doctors under the health law. Since the fall, the president has had to backtrack on that statement, acknowledging that the law was forcing changes in insurance plans that meant some people were losing their physicians.

“Here’s the reality,” Rooney said as he blamed Obamacare for “deep cuts” made to the popular Medicare Advantage program that serves low-income seniors, among others. “Constituents tell me they can no longer see the primary care physicians they have been going to for 10 and every 20 years,” he said. “One woman told me that four of her specialists have already been dropped from her plan.”

The truth is that Obamacare is helping, not hurting, seniors.

Medicare Advantage Plans were set up by George Bush as a way to reward insurance companies for all their contributions to the Republican Party. The initial law establishing the plans provided tremendous subsidies for insurance companies. The idea as initially argued by conservatives was that private insurance companies could provide health care more economically than the big bloated government Medicare program. Instead the government pays private insurance companies substantially more to treat Medicare patients than it costs to care for the same patients in the government plan. Any true Republican should think that private insurance companies should not need this corporate welfare.

The Affordable Care Act is paid for partially by reducing this corporate welfare, saving the tax payers about $136 billion over ten years. Private insurance companies will still receive plenty of money to care for seniors. Why should they need more money than it costs to treat them in the government program?

Medicare Advantage plans have been using limited panels for several years to try to save money. The Affordable Care Act does not change that, except now the insurance plans blame Obamacare for what they would do even if Obamacare did not exist.

The Affordable Care Act has helped seniors in many ways. It makes Medicare more sound financially. The donut holes in the drug benefit are being phased out, saving seniors money on their prescriptions. Preventative studies which previously were not covered are now covered by Medicare, saving seniors yet more money.

It is particularly absurd to expect seniors to turn to the Republicans when they have already voted for a plan which would end Medicare as we know it and force those on Medicare in the future to pay more out of their own pockets for health care coverage.

Cross posted at The Moderate Voice

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How Jed Bartlet Would Handle The Debates

There were many aspects of Obama’s debate performance which were disappointing.  As Zeth Meyers noted on Weekend Update last night, this was an event which Fox could report as it actually happened. The most frustrating was the manner in which Obama didn’t do enough to call out Romney for his many lies. If you watched closely, and manged to stay awake, Obama did point out the truth several times, but not as strongly as is needed for this debate format. Maureen Dowd suggested how Jed Bartlet might provide advice to Barack Obama. Here is a portion:

BARTLET They told you to make sure you didn’t seem condescending, right? They told you, “First, do no harm,” and in your case that means don’t appear condescending, and you bought it. ’Cause for the American right, condescension is the worst crime you can commit.

OBAMA What’s your suggestion?

BARTLET Appear condescending. Now it comes naturally to me —

OBAMA I know.

BARTLET It’s a gift, but I’m likable and you’re likable enough. Thirty straight months of job growth — blown off. G.M. showing record profits — unmentioned. “Governor, would you still let Detroit go bankrupt as you urged us to do four years ago?” — unasked. (shouting) I’m talkin’ to you, too, Lehrer!

WILL (in the other room) I got him, sir!

BARTLET All right! (back to OBAMA) And that was quite a display of hard-nosed, fiscal conservatism when he slashed one one-hundredth of 1 percent from the federal budget by canceling “Sesame Street” and “Downton Abbey.” I think we’re halfway home. Mr. President, your prep for the next debate need not consist of anything more than learning to pronounce three words: “Governor, you’re lying.” Let’s replay some of Wednesday night’s more jaw-dropping visits to the Land Where Facts Go to Die. “I don’t have a $5 trillion tax cut. I don’t have a tax cut of a scale you’re talking about.”

OBAMA The Tax Policy Center analysis of your proposal for a 20 percent across-the-board tax cut in all federal income tax rates, eliminating the Alternative Minimum Tax, the estate tax and other reductions, says it would be a $5 trillion tax cut.

BARTLET In other words …

OBAMA You’re lying, Governor.

BARTLET “I saw a study that came out today that said you’re going to raise taxes by $3,000 to $4,000 on middle-income families.”

OBAMA The American Enterprise Institute found my budget actually would reduce the share of taxes that each taxpayer pays to service the debt by $1,289.89 for taxpayers earning in the $100,000 to $200,000 range.

BARTLET Which is another way of saying …

OBAMA You’re lying, Governor.

BARTLET “I want to take that $716 billion you’ve cut and put it back into Medicare.”

OBAMA The $716 billion I’ve cut is from the providers, not the beneficiaries. I think that’s a better idea than cutting the exact same $716 billion and replacing it with a gift certificate, which is what’s contained in the plan that’s named for your running mate.

BARTLET “Pre-existing conditions are covered under my plan.”

OBAMA Not unless you’ve come up with a new plan since this afternoon.

BARTLET “You doubled the deficit.”

OBAMA When I took office in 2009, the deficit was 1.4 trillion. According to the C.B.O., the deficit for 2012 will be 1.1 trillion. Either you have the mathematics aptitude of a Shetland pony or, much more likely, you’re lying.

BARTLET “All of the increase in natural gas has happened on private land, not on government land. On government land, your administration has cut the number of permits and licenses in half.”

OBAMA Maybe your difficulty is with the words “half” and “double.” Oil production on federal land is higher, not lower. And the oil and gas industry are currently sitting on 7,000 approved permits to drill on government land that they’ve not yet begun developing.

BARTLET “I think about half the green firms you’ve invested in have gone out of business.”

OBAMA Yeah, your problem’s definitely with the word “half.” As of this moment there have been 26 recipients of loan guarantees — 23 of which are very much in business. What was Bain’s bankruptcy record again?

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Republicans Advocate Eliminating Medicare

I’ve frequently seen mention of the Republican plan to end Medicare in various medical newsletters but have been surprised that it has not received much attention in the mainstream media. After all, this is an idea which the Democrats should be able to receive support by attacking. The idea is basically to give people vouchers to purchase insurance instead of going on Medicare in ten years. Presumably the Republicans believe that people more than ten years away from Medicare do not think enough about their personal future to pay attention. There is an outside chance they might be right on this. Republicans are also hoping that seniors will not care if it doesn’t affect them, but seniors would be wise to see this as a threat. If young people are not going to wind up on Medicare, they’d have less incentive to see it protected today. Having a steady stream of new people on Medicare will help ensure that there is political support for maintaining this important and highly successful program.

The idea finally started attracting attention today with Paul Ryan writing about his plan in The Wall Street Journal. Apparently one Democrat did a poor job of criticizing the plan on Hardball but there will be many more opportunities. While the Democrats are frequently beaten by Republicans on the spin war, primarily because not being bound by the facts makes it easier to argue, this is one GOP idea which is so bad that even the Democrats should be able to successfully attack it.

The primary problem is that health care costs will continue to go up and vouchers are unlikely to allow seniors and the disabled to buy health care insurance which adequately covers their needs. Health insurance companies already do a terrible job of covering those over forty on the individual market in their efforts to avoid covering people who actually need health care coverage. The insurance companies do not want to cover people with pre-existing conditions, and this applies to a very high percentage of those on Medicare. The one exception where private insurance companies have insured the Medicare population has been Medicare Advantage plans, but many companies have already left this market after the subsidies to care for these patients were reduced. It costs about twelve percent  more to cover people under private Medicare Advantage plans than in the government plan, showing how the private insurance industry is a poor alternative to the Medicare program.

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Tomorrow’s Right Wing Attack Regarding Health Care

Tyler Cowen, writing in The New York Times, warns that no matter whether the current health care reform legislation is passed we will be seeing more of managed care.

There is no doubt this is true. The financial realities are there regardless of whether or not health care reform is passed. As Cowen concludes, most Americans are in denial of the fact that “our government — or, for that matter, our insurance companies — can’t pay every bill.”

This does have an important ramification for the future spin war. Republicans are already falsely claiming that health care reform will lead to rationing and even “death panels.” They are attacking the proposed cuts to Medicare even though the proposed cuts would primarily reduce the profits of insurance companies which sell Medicare Advantage plans and will not significantly affect patients .

However, while the proposed health care reform bill does not ration care or meaningfully cut Medicare, the economic reality is that we are going to see more rationing and cuts to Medicare in the future. Democrats, who are already losing the spin war, need to be careful if health care reform is passed. It is inevitable that conservatives will blame future changes in health care which have nothing to do with the current legislation on “Obamacare.”

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Republican Ideas on Health Care

The main strategy of Republicans is to block any meaningful health care reform. Their overall plans would do little if anything to help the uninsured, increase the ability of insurance companies to avoid consumer protection laws by operating out of the states with the weakest regulations, and would increase out of pocket expenses for most people. However, when Republicans have made suggestions which could be considered as part of an overall health care reform measure many Republican ideas have already been included.

Newt Gingrich and John C. Goodman list several suggestions in an op-ed in The Wall Street Journal. This hardly represents a meaningful health care reform proposal but many of the Republican ideas are already included in the current health care legislation. The Wonk Room goes through many of these suggestions noting how many are now in the bill. I’ll just add comments on a few of the topics.

The Republicans are trying to portray themselves as the defenders of Medicare  after years of trying to destroy the program. The Medicare cuts being proposed are not serious cuts to the program. Most of the cuts would be to Medicare Advantage programs which use the bulk of the subsidies they receive to increase profits for insurance companies and sometimes use a small amount to provide extra benefits to entice customers. In addition, if there is near-universal health care it will not be necessary to fund as much money for Medicare to pay for added expenses due to cost shifting because of the uninsured.

The article is misleading when it says Medicare pays doctors by the task but  doctors “do not get paid to advise patients on how to lower their drug costs.” No, there is not a CPT code for advising patients on lowering drug costs but Medicare does pay for office calls in which such matters can be discussed, and does pay more when more time is spent counseling patients.

They also write that “Under Medicare, doctors are not paid if they communicate with their patients by phone or e-mail.” True, but the same is true of most private payers. This is an area which is just starting to be considered. It could either be added to health care reform legislation or could be added in the future.

Gingrich and Goodman advocate meeting the needs of the chronically ill but one of their key recommendations for doing this will not have this result. They write that “Having the ability to obtain and manage more health dollars in Health Savings Accounts is a start.” The problem is that when people with chronic diseases have to pay for more expenses out of money in their own account they tend to avoid many necessary tests and office visits to save money. In the long run this leads to poorer outcomes and higher costs. There is also the danger of these accounts being depleted leaving patients with chronic medical conditions without sufficient coverage.

They also advocate eliminating junk lawsuits. I agree, but Republicans tend to greatly exaggerate the effect of this. Malpractice suits and the resultant defensive medicine do result in wasted money we should attempt to recover but this is a small part of overall health care costs. The health care legislation does provide for state demonstration tests regarding tort reform. I would be happy to see some actual solutions included in the bill. Perhaps if the Republicans took an attitude of compromising to get their ideas included, as opposed to all deciding early on to vote against health care reform, they might have been successful in having more concrete solutions for tort reform included.

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White House Responds To Howard Dean’s Criticism of Health Care Plan

The White House has been responding to yesterday’s attacks on the watered-down Senate health care reform bill from the left which I also discussed here. David Axelrod appeared on MSNBC:

Axelrod, responding on MSNBC, said: “I have a lot of respect for Governor Dean but he got on the phone with Nancy-Ann DeParle, our point person on the health care issue, went through point by point. She explained why he was wrong. And he simply didn’t want to hear that critique. I saw his piece in The Post this morning, and it is predicated on a bunch of erroneous conclusions.”

Asked his response to progressives who say “kill this bill now,” Axelrod replied: “I think that would be a tragic, tragic outcome. … I guess if you’re hale and hearty and have insurance, it’s fine to say, ‘Kill this bill.'”

Peggy Noonan, the columnist and former Reagan speechwriter, told Axelrod: “On the issue of health care, you are losing the left, you are losing the right, you are losing the center. That looks to me like a political disaster.”

“When you describe what’s in the bill, there’s strong support for it,” Axelrod replied. “We don’t think of the world in terms of left, right and center. We think of the world in terms of small business people, … senior citizens, … Americans who are looking for help on a problem that we’ve been trying to solve for a century.”

The White House Blog has been busy responding, starting with White House Communication Director Dan Pfeiffer:

Recently, a somewhat perplexing new line of argument has emerged about health insurance reform, with some folks suggesting the Senate bill is a “dream” for insurance companies.

If that’s the case, though, it must be news to them. The insurance industry has been leveraging its considerable resources in a ferocious effort to defeat this bill, including producing a report the day before the Senate Finance Committee vote that was so misleading the firm behind it had to walk away from it. And that’s not surprising, because this bill will finally wrest power away from the insurance industry and put it in the hands of American consumers.

  • Among the many provisions to end insurer abuses, lower premiums, and hold insurance companies accountable:
  • Insurance market reforms will prohibit abuses such as denying coverage for pre-existing conditions, charging exorbitant premiums based on gender, age, or health status, dropping coverage when people are sick, and imposing lifetime limits on benefits.
  • Consumer rights will be enhanced by requiring all insurers to provide effective appeals procedures including outside, independent review of appeals
  • New insurance exchanges will reduce premium increases by lowering administrative costs and increasing the leverage of individuals and small businesses in this insurance market.
  • Competition will also be enhanced by providing consumers comparative information on available insurance options giving them the tools to make more informed decisions and drive competition based on value and service.
  • Insurers will be held accountable for excessive overhead costs fueled by unreasonable executive compensation and profits.
  • Insurers will also be required to compete against cost-effective national plans selected by the federal Office of Personnel Management.
  • Wasteful taxpayer overpayments to insurance companies through private Medicare Advantage plans will be eliminated.

Jason Furman, Deputy Director of the National Economic Council, added:

As we move into the final stage of the historic push for health reform, opponents of reform are testing the age old adage that if you only say something enough times you can somehow make it true.  Yesterday, we heard a new version of the old, tired refrain that the health reform bills in Congress would raise taxes on the middle class.

So let’s set the record straight:

  • First, the health insurance reform bill being considered in the Senate does not raise taxes on families making less than $250,000 – in fact it is a substantial net tax cut for American families. The bill being considered represents a substantial net tax cut for middle income families. According to the independent Joint Committee on Taxation, the bill will provide nearly $450 billion in individual income tax cuts over the next 10 years.
  • Second, the excise tax levied on insurance companies for high-premium plans, the so-called “Cadillac tax,” will affect only a small portion of the very highest cost health plans – a total of 3% of premiums in 2013. The vast majority of health plans fall below the thresholds set in the Senate plan and would be completely unaffected by the provision. And those that are above the threshold would only face an excise tax on the generally small portion of the plan that exceeds the threshold. As a result, based on analyses by the Joint Committee on Taxation, only about 3% of premiums will be affected by this provision in 2013. In addition, the Senate plan provides special protections to plans held by workers in high-risk professions – like police and firefighters – as well as by those over 55.
  • Third, for the small sub-set of plans that are affected, the primary impact of this provision will be to increase workers’ wages. Getting a pay raise is not what most people would call a tax increase. Economists agree by taxing the highest cost plans this provision will lead insurance companies to be more efficient and provide quality care to consumers at lower prices (see this endorsement in a letter from a group of prominent economists – including three Nobel laureates and previous members of both Democratic and Republican administrations and this analysis by CBO 2009). Even a report commissioned by the insurance industry’s trade association acknowledged that: “[w]e expect employers to respond to the tax by restructuring their benefits to avoid it.” [PWC, 2009].  As a result, employers will be in a position to increase workers’ take home pay.

Nancy-Ann DeParle, Director of the Office of Health Reform, described the benefits of the measure and the blog also quoted Bill Clinton:

At last, we are close to making real health insurance reform a reality.  We face one critical, final choice, between action and inaction.  We know where the path of inaction leads to: more uninsured Americans, more families struggling to keep up with skyrocketing premiums, higher federal budget deficits, and health costs so much higher than any other country’s they will cripple us economically.  Our only responsible choice is the path of action.

Does this bill read exactly how I would write it? No. Does it contain everything everyone wants?  Of course not. But America can’t afford to let the perfect be the enemy of the good.  And this is a good bill: it increases the security of those who already have insurance and gives every American access to affordable coverage, and contains comprehensive efforts to control costs and improve quality, with more information on best practices, and comparative costs and results. The bill will shift the power away from the insurance companies and into the hands of consumers.

Take it from someone who knows: these chances don’t come around every day.  Allowing this effort to fall short now would be a colossal blunder — both politically for our party and, far more important, for the physical, fiscal, and economic health of our country.”

Ezra Klein also disagrees with Howard Dean’s evaluation of the Senate bill:

What’s so strange about Dean’s objection is that the exchanges in the Senate bill (pdf) do act as “prudent purchasers,” that is to say, they set limits on the plans that can enter in the exchange to ensure that people are getting good choices. The relevant section begins on page 131 of the Senate bill. “The Secretary shall, by regulation, establish criteria for the certification of health plans as qualified health plans.” A couple of pages of relevant criteria follow, including marketing requirements (plans can be disqualified for focusing their marketing in outlets that would bring them uncommonly healthy enrollees), broad provider networks, coverage of options used by low-income folks (community health centers, say), quality measures, quality improvement strategies, consumer ratings, standardized benefit packages, etc.

And then, a couple of pages later, the language gets stronger. On page 143, the exchanges are given power to certify insurance plans based on whether “the Exchange determines that making available such health plan through such Exchange is in the interests of qualified individuals and qualified employers in the State.” On 144, premiums, and premium increases, enter explicitly into the discussion. Any insurance plan that wants to increase premiums has to submit a written justification for their decision. It will have to post that information on its Web site. And if the exchange is not convinced, it can decertify the plan.

Don’t believe me? In his op-ed, Dean names John Kerry as the senator who has been working hardest on this question. This morning, I spoke to Kerry’s staff, who got me a statement from Kerry himself. “The prudent purchasing provisions in the Senate health bill will lower costs and increase affordable options for consumers,” Kerry says. “It’s strong language that will allow the exchange to deliver competitive prices and offer high quality care, and I’m thrilled to see national reform honor the best innovations already succeeding in Massachusetts.”

John Podesta has also made a case similar to the arguments above.

Update: Richard Eskow disagrees with some of the claims from the White House.

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