Universal Health for Insurance Companies
Thu Mar 01, 2007 at 05:59:17 AM PST
Last week I outlined the generic components of so-called mandated or mandatory plans. This week we will, with the help of Professor Len Rodberg (warning: it’s a PowerPoint file; not Len himself, he is flesh & blood, just his slideshow) briefly outline some of specific national proposals that have been in the news lately:
* America’s Health Insurance Plans
* Better Health Care Together Campaign
* Health Coverage Coalition for the Uninsured
* Sen. Ron Wyden with SEIU & Safeway
* Federation of American Hospitals
* John Edwards
What they share is the goall to keep the insurance companies healthy… lets see how that works.
* DrSteveB’s diary :: ::
*
First a note about Len. Len is not only a great guy, but has been involved in numerous progressive health care reforms from numerous single payer plans going back at least to the Dellums bill (look it up), to early promotion of Community Health Centers, to compiling and analyzing of hospital statistics statewide. He is the only Urban Studies professor I know of with a PhD in Physics (seriously).
As we noted last week, “Universal” Health Care is back in the political arena, for the first time since Hillary-care crashed and burned in 1993-1994. This is mostly due to the fact that costs rising far faster than inflation: From 2000 to 2006 health insurance premiums have one up 87%, compared to 20% for overall inflation and 18% for workers earnings. In our primarily employer-based coverage system more companies are either dropping coverage altogether, or raising the amount paid by employees (contributions to premium, copays, deductibles, reduced coverage).
The national average premium cost for employer-provided insurance is now up to $4,024 per year for single coverage and $10,880 per year for family coverage. Compare that to an annual income at minimum wage of $10,300 and the alleged average annual of a Wal-Mart worker of $17,114. If you have to buy your own, even at the reduced group rate that companies get, there’s not much left over for food and housing.
Not surprisingly the numbers of uninsured have been going up dramatically: from 22 million in 1975, we broke 30 million in 1985, 40 million in 1995, and are now around 46-47 million.
So what about those plans…
* The Good News: “Universal health care” is accepted as the goal.
* The Bad News: This is defined to mean using tax dollars to help the uninsured buy private insurance from the existing high-overhead middlemen of the for-profit insurance companies.
1. America’s Health Insurance Plans & Federation of American Hospitals
* – aka: “the private insurance & private hospital protection plan.”
* Expand SCHIP and Medicaid eligibility for very low-income
* Provide federal and state subsidies and tax deductibility to encourage everyone else to buy private insurance
* In other words: Use taxes to cover some more of the poor high risk, then give more tax dollars to the unnecessary middlemen private for-profit industry that eats up 31% overhead, compared to 4-13% achieved in direct plans.
2. Better Health Care Together Campaign
* aka: “The Grand Coalition”
* Members: ATT (big biz), Kelly Services (temp company), Wal-Mart (bigger biz), SEIU & CWA (unions), Center for American Progress
* Principles but no Program:
* a. Quality affordable insurance coverage for everyone
* b. Individuals are responsible for maintaining and protecting their health
* c. Improved value for health care dollar
* d. “Shared Responsibility”: Businesses, government, individuals all contribute. By business they mean both employers and the private for-profit health care industry.
* Widely covered press Conference, but no real specifics.
3. Health Coverage Coalition for the Uninsured
* aka: “The Even Grander Coalition”
* Members: UnitedHealth, Blue Cross & Kaiser (insurers), American Hospital Association, American Medical Association, Chamber of Commerce & National Association of Manufacturers (biz lobbyists), Pfizer (pharmaceutical company), AFL-CIO (well national anyway; many states, councils and locals have been endorsing Conyers HR-676 “Medicare for All”single payer), SEIU (well Stern anyway, many locals endorsing Conyers HR-676 “Medicare for All”, AARP, Families USA (well Pollack anyway; he’s still feeling too burned by 1994)
* Coalition was so “Grand” that they could agree only on:
* a. Expanding coverage as a goal
* b. Expansion of SCHIP
* c. Tax credits for children’s insurance
4. Senator Wyden’s Healthy Americans Act
* aka: “Employer coverage is dying, so let’s kill it faster”
* Supporters: SEIU, Safeway, Families USA
* Eliminate the tax deductibility of employer-based insurance with goal to ends employer-based health coverage.
* Requires individual purchase of insurance
* Transitional payments by employers
* Subsidies to low-income individuals
* Relies on competition between private insurers to contain costs (but unclear how this would happen since no evidence that health insurers work that way… they only compete for who can get the healthy and wealthy).
5. John Edwards Plan
* I give him some credit for at least making a relatively specific proposal.
* but some do call it “individual mandate with a pretty face”
* essentially same as Jacob Hacker plan from Econimic Policy Institute (EPI)
* Interestingly Edward’s also offered a mandate plan when he ran in 2000.
* Employer mandate (“play or pay”)
* Individual mandate with community rating
* Government subsidies for low-income
* Regional purchasing plans (“Health Markets”)
* Choice of Government program (which is DISHONESTLY referred to as single-payer; shame on them) as well as Private Plans.
* Claim: For everyone: Shared responsibility
* Claim: For the fearful: Lets people keep what they have
* Claim: For those worried about cost: Everyone will work together to make the system more efficient
* Claim: For single payer advocates: Individuals and businesses can choose if they want the government plan; if so, the system will “evolve toward a single-payer approach.”
* No cost control!!!
* Requires additional taxes and expenditure above what we pay already
* by comparison: Single-Payer costs about 5% LESS than current expenditures to cover everybody with high-quality coverage and no out-pocket expenses. That what you can do with the $350 Billion in savings by cutting out the 31% bloat of the unneeded middlemen of the private for-profit insurers.
So, once again… What’s Wrong with an Individual Mandate?
Well among other things:
* Will not lead to universal coverage. Comparison to mandatory auto insurance where at least 10% don’t have.
* Enforcement is anti-public health
* Affordable premium vs half-decent coverage: can’t leave private for-profit insurers in the middle and still have both, as Massachussetts is discovering. Feds discovered this when tried to have Medicare Manged Care and privates could not make enough profit and dropped out, until offered 11% higher payments than regular Medicare!
* Employers will drop coverage (“crowd out”) if play or pay cutpoint is set at affordable level.
* Insurance companies resist community rating (same premium rate for everybody regardless of pre-existing conditions or risk) and mandatory coverage(have to take everybody regardless of pre-existing conditions or risk)
* Leaves in place the consumer nightmare of copays, deductibles, exclusions, denials, appeals.
* Expands the complexity (and humiliation) of Medicaid’s humiliation of means testing (not so easy for the majority of workers who are not on straight regular salary; usually require income tax return to be shown).
* Add new layers of bureaucracy such as the “Health Markets”.
* Additional high cost of about $120 Billion in Federal tax money and some unknown still for individuals.
* No cost control, just continuing rising costs!
Len goes on to argue that none of these plans will happen, because:
* They cost hundreds of billions of additional dollars
* They benefit only those with low incomes and those without insurance, who are politically weak.
* Does nothing for the 50% of middle- and lower-income adults who have insurance but still experience serious problems paying medical bills or insurance premiums.
* Does nothing for the people with insurance and still going into bankruptcy. 50% of bankruptcies due to medical bills and 75% of those folks had health insurance.
* Does nothing for the 12-18% of folks who are underinsured.
* They don’t solve any of the problems (especially rising costs) that concern everyone
* None envisions a real structural change.
In the 1940s and 1950s America moved forward with employer-based group health care coverage.
Going backwards to individual purchase of insurance is not the answer.
What is common to these plans is that they identify the wrong problem and then offer the wrong solution:
