The government of the United States is not trying to kill your grandmother. Or at least, if it is, no one saw fit to include that detail in the broad proposals for the reform of the American health-care system.
The public debate on health-care reform has been largely lost in a
litany of concerns, real and imagined, ranging from death panels (not
mentioned) to illegal immigrants (who are excluded from benefits) to
the right to carry firearms near the president (which is, strictly
speaking, only a health concern under certain circumstances). So if the
word “Nazi” doesn’t appear in any of the bills under consideration by
Congress, what is in there that’s causing so much fuss?
First, there are several proposals. The furthest along at this point
is House Bill 3200, America’s Affordable Health Choices Act of 2009,
which has passed through the necessary committees and should come up
for a vote when representatives return from summer vacation in
September. The Senate version of the Affordable Health Choices Act,
with some differences, still needs to pass through the Finance
Committee before going up for a full vote, and any differences between
the two will need to be hammered out.
The Congressional Budget Office, in a preliminary estimate of the
costs of the reform plan, forecasts a spending increase of more than $1
trillion over the next 10 years, and the bills include sweeping changes
to the health-care system. Putting aside the name-calling for a moment,
here’s a look at some of the major proposals in the House and Senate
versions of the bill.
The Plan: Make health
insurance mandatory.
The Pitch: One of the starting points for the health care reform
debate is the significant number of uninsured Americans — about
15 percent nationwide. This presents a problem not only for the
individuals but for hospitals that are required to treat them, and to a
greater extent, federal and state government programs that cover the
lion’s share of the treatment costs.
Health-care reform bills in the Senate and the House both require
individuals to have coverage and employers to cover most of the costs.
Failure to do so in each case would result in a tax penalty, although
subsidies would be provided for low- and middle-income families, and
small businesses would be exempt.
The Problem: Some opponents say that in mandating healthcare, the
government is overstepping its bounds and imposing on individual
liberties. But most of the debate centers on the idea of government
requiring people to purchase a product from a private company with a
profit motive — one that they either may not be able to afford or
that doesn’t meet their needs. These people say that any individual
mandate must be coupled with an affordable public option so that it
doesn’t function primarily as a cash cow for private insurance
companies.
The Plan: Offer a publicly run health insurance option.
The Pitch: The health-care market currently operates as a near
monopoly, with the majority of services in a given market offered by a
single company. Proponents of a public option for health care say that
it could be run more cheaply by eliminating some of the administrative
costs and profit margins of private insurers, and that it would finance
itself through premiums. A large public plan would be able to bargain
more effectively with hospitals and doctors to secure lower payments,
along the lines of Medicare, and possibly exert pressure on private
insurance companies to lower their rates in order to compete.
The Problem: This is the big one, driving much of the public debate.
Opponents argue that a public insurance option would have an unfair
competitive advantage over private companies, eventually forcing them
out of business and leading to a system that is entirely
government-run. There are also questions about whether a public plan
could be run efficiently over the long term and whether costs could be
covered entirely by premiums.
The Plan: Change private
insurance regulations.
The Pitch: Sets new standards for private insurance companies,
including the percentage of money spent on medical services (as opposed
to administrative and other costs). The House bill would require
private insurers to meet a certain goal or refund any extra; the
Senate’s version would require companies to report that so-called
“Medical Loss Ratio.” Both bills would prohibit insurance companies
from denying coverage or substantially increasing premiums based on
pre-existing medical conditions.
Most states currently offer insurance to people who have been denied
private coverage, but those plans are generally more costly than
current private insurance rates precisely because they cover only
higher-risk patients. Private plans would have to meet standards set
for a minimum mandatory coverage, and limits on insurance spending over
the course of the patient’s life would be eliminated.
The Problem: In the case of pre-existing conditions, critics argue
that adding more high-risk patients into the mix would raise insurance
premiums for everyone. It also represents government interference in a
private business, by regulating the profit margins of insurance
companies.
The Plan: Expand and reform existing federal programs.
The Pitch: Both Senate and House bills would significantly expand
the number of non-elderly individuals eligible for Medicaid, and the
House version would allow some Medicaid recipients to enroll in the new
health-care exchange. Future increases in Medicare spending would be
scaled back, but payments to providers would increase. Medicaid
payments to providers would also be increased, although inefficiencies
in the system would be addressed that, according to the Congressional
Budget Office, could result in an overall reduction of federal money
spent.
The Problem: Critics doubt that reforms, coupled with upping
enrollment, will result in a net savings. Concerns also linger about
Medicare benefits being cut, but the plans under consideration make no
such suggestion.
The Plan: Use the elderly as a cheap and renewable source of
food.
Just kidding.
This article appears in Aug 26 – Sep 1, 2009.