So what is really in the Health Care Reform Bills? One Progressive Analysis

I ran across this very interesting piece by Maggie Mahar who works for the Century Foundation.  The Century Foundation was founded in 1919 and  is “committed to the belief that a mix of effective government, open democracy, and free markets is the most effective solution to the major challenges facing the United States.”  1919 places it with the progressive movement and so it remains.

Mahar writes “Why Congress’ Health Care Bills are better than you think” posted on AlterNet on November 6. (Before the vote and before the Stupak amendment which is upsetting and a backdoor way of extending the Hyde amendment, but now is not the time to kill reform. Repeal of the Hyde amendment is a fight for another day.)  I have sampled a few of her observations, but the entire piece is very interesting, particularly her comments on the Congressional Budget Office which could be a blog on their own.

Many progressives are expressing deep disappointment with the health reform legislation now moving through Congress.

Some suggest that some legislators made deals with lobbyists and let them write the bills. Others complain that both the subsidies and the penalties are too low. Still others don’t like the fact that states can “opt out” of the public insurance option and decide not to offer “Medicare E” — Medicare for everybody.

Finally, many ask: “Why can’t everyone sign on for the public plan in 2013? Why do we have to wait until 2013? Why can’t they roll out universal coverage next year?”

Normally, I would be among the first to critique the bills. By temperament and training, I’m both a skeptic and a critic.

But in this case, I think it is important to recognize that we cannot expect this first piece of health reform legislation to be anything but wildly imperfect. In fact, I’m impressed by the progress Washington has made in just 10 months.

I’ve been watching the struggle for health care reform since the early 1970s, and compared to what has happened over the past 39 years, this is mind-boggling.

Mahar cites gains in three main areas:  affordability, no denial of coverage, and a realignment of Medicare.

On affordability

For example, under the House bill, a family of three making $32,000 a year would pay $1,360 in annual premiums for good, comprehensive coverage; under the Senate Finance Committee bill, that family would be asked to lay out $2,013. Today, without reform, if that family tried to buy insurance, it would find that the average plan costs $13,500. For this household, the current legislation makes all the difference.

Too often, the press suggests that such a family would be expected to pay $10,000 out of pocket to cover co-pays and deductibles. That just isn’t true.

Even if the entire family were in an auto accident and racked up $200,000 in medical bills, at their income level, the House bill caps out-of-pocket expenses at $2,000 a year. Under the Senate Finance bill, the family would have to pay $4,000.

Moreover, under both bills, there are no co-pays for primary care. Even private insurers cannot put a $25 barrier between a family and preventive care.

Moving up the income ladder, a median-income household earning roughly $55,000 would pay premiums of $4,300 to $6,500 — depending on whether the Senate Finance bill or the more generous House bill sets the terms.

Without legislation, they too would face a $13,500 price tag — and that is if they could get a group rate. If they are buying insurance on their own, coverage could easily cost $16,000

No denial of coverage

House Speaker Nancy Pelosi’s health care reform fact sheet offers two outrageous examples of just how easy it is for insurers to deny coverage today:

  • Peggy Robertson: The Colorado mother of two was denied health coverage because she had a C-section in 2006. The insurance company told her if she got “sterilized” she would be eligible for coverage.
  • Christina Turner: After being sexually assaulted in Florida, Turner followed her doctor’s orders and took a month’s worth of anti-AIDS medication as a precautionary measure. She never developed an HIV infection. Months later, when shopping for new health insurance coverage, Turner was repeatedly denied coverage because of the precautionary anti-HIV treatment she received after being raped.

Realignment of Medicare which has the Republican opposition literally foaming at the mouth.

What many reformers don’t seem to understand is that when the public plan begins to negotiate fees with providers in 2013, Medicare fees for some very expensive services will be significantly lower than they are today, while reimbursements to primary care doctors will be substantially higher.

Medicare already has announced plans to cut fees for CT scans and MRIs by as much as one-third and has proposed trimming fees to cardiologists by 6 percent next year. Meanwhile, it would hike fees for primary care physicians by 4 percent.

Over the next three years, Medicare will be realigning financial incentives to reward preventive care and management of chronic diseases, while reducing payments for overly aggressive tests and treatments that have no proven benefit — and penalizing hospitals that don’t pay enough attention to medical errors. In the process, Medicare will be conserving health care dollars while protecting patients from needless risks.

As President Barack Obama has promised, Medicare cuts can make health care safer and more affordable for everyone — including the upper middle class. Because most private insurers will mime Medicare’s efforts to reduce overpayment, the cost of care will come down for everyone.

Mahar makes a couple of other interesting points about the new legislation including this on the Senate opt-out.

…even if the Senate’s opt-out provision for states remains in the final health care reform bill, states will not opt out. It would be too difficult for politicians to try to explain to voters why they cannot have access to a government plan that will be able to offer comprehensive insurance for less than what they pay for private insurance.

She concludes

If there ever was a time to avoid the traps of perfectionism, it’s now. As the old saying goes, don’t let the perfect be the enemy of the good.

And there’s a lot that’s good in the bills coming out of the House and Senate. No, they’re not perfect, but they offer a path to even better reform in the future while improving the lives and health care outcomes for millions of Americans. And that is all to the good.

We need to encourage Harry Reid and the other Blue Dog Senators to get a backbone.  One way to ease re-election fears might be to have some provisions kick-in sooner rather than later.  Mahar doesn’t talk about time tables and I know that the health exchange and public option are set for 2013.  I think some more research is in order.