Healthcare Reform: What's In It For ME? (And Caveat Emptor)
If you want the bottom line on Obama’s healthcare reform objectives and what they mean to you (whether you’re currently insured, uninsured, or a senior on Medicare), see the video below.
The video sums it up nicely in 4 minutes, wouldn’t you say?
Caveat Emptor
However, there are two caveats about what Obama is saying:
1. No, John McCain’s risk pool proposal IS NOT a good idea.
What are risk pools? They act as very expensive group insurance, that is self-insured (i.e., sponsored) through the states and administered by large private insurers. There is a misconception that only the disabled need risk pools. Actually, anyone with one of a long list of “automatic individual health insurance policy denial” conditions (see the California Board of Managed Care’s compiled list here) needs risk pools currently.
That doesn’t even consider those who have any two common conditions that the insurance companies know are expensive to treat. For example, if you have a history of two of the following, you too will be denied individual insurance and require a risk pool: asthma, high blood pressure, high cholesterol, diabetes, back pain, GI issues. Gee, that seems to cover about 80% of the US population!
OK, so back to McCain’s plan. In fact, it’s not even McCain’s idea. It was Bush Jr.’s.
In 2002, Bush tried giving away $40 million in grants to high-risk pools “as part of the Bush Administration’s broad strategy for expanding access to health care for the more than 40 million Americans without health insurance.” (no, I’m not kidding.)
The results? States used them to temporarily regain pool solvency. So 178,000 total enrollees across the country still pay 125-200% of normal premiums and most risk pools remain closed to new applicants.
McCain’s plan is the Bush plan on steroids: subsidize existing state-based risk pools by as much as $15-20 billion. Talk about wasted bailout money!
If you substitute “state-run co-op” for “state high-risk pool” it’s also a great crystal ball for the go-to anti-public option solution included in the Senate Finance Committee’s healthcare reform bill.
2. What Obama wants and what the three healthcare reform bills include are not necessarily the same.
As mentioned above, the Senate Finance Committee (SFC) bill includes a co-op option to “compete” with private insurers, instead of a public option. Co-ops can’t compete due to lack of experience, size, and clout. It’s like expecting Mom ‘n Pops Small Town Hardware to compete with Home Depot or Lowe’s. Yes, it’s a local alternative, and no, it can’t compete on price or scale.
The SFC also mandates individuals buy coverage, but doesn’t require employers to provide it. It proposes a tax on insurers, pharmaceutical companies, and laboratories that these entities will be more than happy to pass along to you, the paying customer. Further, there are no constraints on insurance costs in the SFC bill. So neither choice nor cost containment are key objectives. Rather, making sure private insurers reap millions of new captive customers seems to be the focus.
Similarly, HR 3200 contains provisions for $10 billion in subsidies to go to labor union’s early retiree healthcare pools (yes, this is what we get for bailing out the automotive dinosaurs). It also includes over $88 billion for “healthcare workforce needs”, prevention and wellness programs, quality metrics and rural hospital prescription discounts. Of these provisions, only physician incentives for primary care, quality metrics, and rural discounts are critical.
Taxpayers hardly need to incentivize a larger basic nursing pipeline—the low barrier to entry (2 year degree) and high salary are incentive enough. There are also enough current prevention and wellness programs to franchise without spending billions reinventing the wheel.
Let’s be optimistic and say $20 billion of this bloat is really necessary. Between unions and healthcare professional handouts, we’ve already found $78.1 billion that would be better spent on taxpayers’ healthcare.
Bottom line: beware of special interest influence in the healthcare reform bills. Obama’s vision to cover all Americans affordably is easily lost in thousands of pages of pork drafted by “bought” Congressmen and women.
Check out the healthcare reform bills here.
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