What Failure Would Cost the Democrats

[babylonsister]

http://www.tnr.com/article/politics/what-failure-would-cost-the-democrats


What Failure Would Cost the Democrats
A cold analysis of this week’s vote.

Norman Ornstein and Thomas Mann


Disgruntled (if not former) Democrats Pat Caddell and Doug Schoen are the latest to join in offering advice to President Obama and Congressional Democrats to abandon their health reform quest before it causes catastrophic damage to the party. Caddell and Schoen close their Washington Post article with the following warning: “Unless the Democrats fundamentally change their approach, they will produce not just a march of folly but also run the risk of unmitigated disaster in November.”

The case Caddell and Schoen make parallels the one made the previous day by Karl Rove in the Wall Street Journal, and that is made daily by a parade of Republican pollsters and lawmakers: The Democrats’ health reform plan is wildly and deeply unpopular, mirroring the unpopularity of Washington and big government. If it passes, it will result in a huge political backlash, especially if Democrats use reconciliation, which Caddell and Schoen call manipulation and liken to the “nuclear option” that Senate Republicans threatened during the Bush administration. For Rove, the use of reconciliation will open the way for Republicans to use the same technique to repeal health plan when they recapture the majority.

We fundamentally disagree; the surest path to political debacle for Democrats is to fail to enact health reform, and the best way to avoid a rout in November is to show that the party in charge can actually govern. The reconciliation process is entirely appropriate for amending the Senate-passed bill; in any case, the public will judge the Democrats on the basis of the results, not the inside-baseball process. In fact, the Democrats most reluctant to support health reform--those from more conservative, Republican-leaning districts and states--are the ones most likely to lose in November if health reform is defeated.

snip//

It is undeniably true that a Washington plan to reform health care is not overwhelmingly popular. But that’s mostly because Washington is unpopular these days. When the component parts of the Democrats’ plan are parsed out, surveys show high approval for nearly all of them, including removing preexisting conditions, ending lifetime benefit caps, providing tax credits to small business to get them to cover employees, subsidizing low- and middle-income families to enable them to buy insurance, and creating a health-insurance exchange to shop for policies.

We also know that voters are warming somewhat to the idea of a reform plan, in part because the president has ramped up his efforts on its behalf beginning with the State of the Union and the health-reform summit—letting voters know what is actually in the bills. The actions of insurance companies like Anthem and Wellpoint, raising premiums sharply before enactment of reform, has also contributed to a public receptiveness to change. And we know that there was a noticeable bump in public approval when bills passed the House and the Senate—voters like action, and like success. Even where we are skeptical about the benefits of government programs, we want government to work.

It is also true that the health-reform plan, contrary to conventional wisdom, will not simply frontload the costs and backload the benefits. The plan will move quickly to erase the unpopular “doughnut hole” that results in a costly jolt for many seniors buying prescription drugs, to end discrimination based on preexisting conditions for children, to ease the insurance burden on those losing or leaving their jobs, and to enable parents to carry children up to the age of 26 on their family policies.

Many House and Senate Democrats are understandably nervous about voting to enact health reform. We are convinced that the political damage will be far, far worse if they fail to do so.

[CaliforniaPeggy]

1. This article gets it right. Absolutely right.

K&R

[damntexdem]

2. Yes, failure would cost the Dems; but ...

what's really important is what it would cost us, the American people. Our healthcare system is in crisis, and failure of HCR would only accelerate the death spiral of healthcare coverage. And, of course, GOP victories in November would hurt this country in a myriad of other ways.

[zipplewrath]

3. Either way is the same outcome

"failure of HCR would only accelerate the death spiral of healthcare coverage"

Either passing, or not passing this bill, I don't really see any difference in the long term out come. It does so little to control actual costs that ultimately, even with it, we are headed quickly to a time when huge portions of the population will not have access to anything describable as "affordable" health care. At that point, whatever party is in charge will have to do something that is going to look an awful like single payer/medicare for all. It will be the only way that we'll be able to get control of the costs.

As for the political cost, in November, again with this legislation, there will be alot of folks who are pissed, mostly those being forced to buy insurance. The confusion alone will be enough for the GOP to campaign upon. Even people who actually may benefit from the bill will be scared into thinking they are being hurt. And then the people who thought they bought access to healthcare, and then find out it is STILL too expensive, will also be pissed. Plus, they'll be out their premium.

I'm afraid this ship has sailed regardless of outcome, the political cost will be there, and the opportunity for health CARE cost reform is long gone. Politically the only hope is to get to work on jobs and the economy and hope there's an up tick about August.

[backscatter712]

4. Absolutely right.

The Eeyores and purity trolls refuse to acknowledge that there's a hell of a lot of good still in this bill - bans on rescission, annual & lifetime caps, the expansion to Medicaid, the subsidies for people making up to 300% FPL that have out-of-pocket cost caps, the restrictions on loss ratios, the closing of the Medicare donut hole.

There's a lot of good that will come out of this bill, and all the Dems need to do is put their bullet points together and sell the public on the good they're getting.

The kill-the-bill crowd have nothing. Fine. Kill the bill. Then what? I can guarantee that Congress won't touch health care again for a generation, while 47,000 continue to die each year for lack of health care, and millions more are dragged into bankruptcy. Sorry, I won't accept that outcome. Not just for what it does to Democrats (it WILL cause them to at least lose Congress this November if health care reform crashes and burns), but for what it does to the rest of us.

PASS THE FUCKING BILL ALREADY!!! The Eeyores can suck it!

[Nikki Stone1]

5. There are loopholes on recision, yearly caps, and Medicare cuts.

Not a surprise considering that the Senate bill was written by an insurance lobbyist.

[damonm]

6. Section and page, please.

If you've read the bill, this should be no problem.

[Nikki Stone1]

7. Which bill? It has been changing continuously since December.

You're better off reading the newspapers.

[damonm]

8. The MSM?!? *snort*

So you DON'T have a solid source.
OK. I would've gone and looked it up if you had.

[Nikki Stone1]

9. I have the bill itself in front of me. Let's start with annual caps

SEC. 2711. NO LIFETIME OR ANNUAL LIMITS.
`(a) In General- A group health plan and a health insurance issuer offering group or individual health insurance coverage may not establish–
`(1) lifetime limits on the dollar value of benefits for any participant or beneficiary; or
`(2) unreasonable annual limits (within the meaning of section 223 of the Internal Revenue Code of 1986) on the dollar value of benefits for any participant or beneficiary.
`(b) Per Beneficiary Limits- Subsection (a) shall not be construed to prevent a group health plan or health insurance coverage that is not required to provide essential health benefits under section 1302(b) of the Patient Protection and Affordable Care Act from placing annual or lifetime per beneficiary limits on specific covered benefits to the extent that such limits are otherwise permitted under Federal or State law.


Let's start with this. The original Senate bill had no annual limits in it. The one that was passed makes it ok to have "reasonable annual limits". Now "reasonable" will be decided by the industry; they were the ones who asked for this language. This means that if your cancer (or other high cost illness) has an "unreasonable" cost the insurance company can set a limit and stop you, in mid-chemotherapy say.

This means that there is a cap on care. Cancer, diabetes and other high-cost illnesses are not going to wait until the calendar year passes. There are no provisions for the Federal Government to step in and demand that a cancer patient get care once the annual cap is passed.

This is no small point.

[damonm]

15. What I'm missing here...

...is from where you derive "'reasonable' will be decided by the industry", especially in light of section 2719 covering the appeals process.
Moreover, section 1302(4)(G) on page 109 seems to work against this as well.
If your interpretation is correct, this IS no small point. But I do question your interpretation of it.
Moreover, there is a market incentive for them not to do this, as once word gets out that an insurer in the exchange is doing so, I should think a rather large exodus would take place...

[Nikki Stone1]

19. This is where you have to understand how goverment works and what is practical

1. The insurance industry will decide on "reasonable" either directly or indirectly.

Wellpoint (Anthem), Cigna, and Aetna (among others) will fight like hell to keep that control directly, and Congress has a recent history of caving when industry decides it wants to regulate itself. Even with TARP, a direct government giveaway, the financial services industry demanded the right to pay whatever obscene bonuses it wanted, the banks reserved the right to hoard taxpayer cash instead of lending it out (like they were supposed to) and the Fed still doesn't want us to know what banks got that money. The arrogance of the financial sector, of which insurance is a large part, is astounding, and it's not going to change.

But, even if, through some odd set of circumstances, Congress gained the power to decide on what "reasonable" is, so many individual members of Congress are so compromised as to be useless. They are so compromised that the Senate bill now being forced on the House was actually written by Liz Fowler, former VP for Public Policy and External Affairs at WellPoint. Max Baucus alone took about $1500 a day for 5 years from health insurance companies:

http://www.mtstandard.com/news/state-and-regional/article_6720e645-fa6e-557d-baf7-4baa76739593.html

ChuckyGrassley received nearly $2 million and as a whole:

"The sector gave nearly $170 million to federal lawmakers in 2007 and 2008, with 54 percent going to Democrats, according to data compiled by the Center for Responsive Politics, which tracks money in politics. The shift in parties was even more pronounced during the first three months of this year, when Democrats collected 60 percent of the $5.4 million donated by health-care companies and their employees, the data show."

http://www.washingtonpost.com/wp-dyn/content/article/2009/07/20/AR2009072003363.html


So in the end, the health insurance industry will continue its practice of giving millions to elected representatives to prevent them from hurting the industy's profits. If Wellpoint has to spend a little more, they will pass that cost onto us.


2. Market incentives will be extremely limited. (That is why so many wanted to public option.)

The national health insurance market is dominated by the following insurers: United Health, Wellpoint (Anthem Blue Cross), Aetna, Cigna, Humana, and Kaiser. With so few major players, competition is limited, and there are often "gentleman's agreements" to keep prices at a certain level. In other words, they will not compete to undercut each other because they are all big enough to have a lot to lose. Smaller companies in the exchange are often local (specific to a state) and cannot compete across the country. A larger company can, and if Wellpoint, for example, wants to get rid of the local competition, it could undercut the competitor in a single state (while keeping profits high in all the other states) and destroy a small insurer. Any real competition to the big companies, therefore, is reduced by the limited access of smaller companies to markets, and the threat of undercutting and destruction if a smaller company decides to really compete within a state.

The one REAL competition for the big dominant companies would be a public option, because the big guys couldn't push the government out of business and couldn't undercut the government since the government doesn't have to make a profit. That is why activists believe that the public option NEEDS to be in the final bill to provide some cost controls and some checks and balances on insurance company behavior. If Wellpoint caps a cancer patient with a annual limit ("reasonable" of course) and the government public option doesn't have such a cap, Wellpoint will lose a incredible number of customers. That's the fear the insurance companies have which is why they so DESPERATELY have fought the public option at every turn.

You mention "a large exodus" if an insurer does something nasty--this is the theoretical market forces at work. The problem is where does that exodus go if there's no public option? People's choices of insurers are limited because health insurance companies (like auto insurance) work within state lines, and certain large insurers have high market share (if not all of it) in certain states. For example, in California, Wellpoint (Anthem Blue Cross) has 57% of the market share, and California is a huge state. In some smaller states, Wellpoint has 80% of the market share. And the other companies sharing the other 43% or 20% are mostly others of the big dominant companies. There are not always places to go, and the large companies will not undercut each other, so you will end up getting similar coverage for similar money.

[damonm]

24. Some misconceptions in this.

1. Congress would NOT be the watchdog on this. That would be HHS - not an inconsiderable difference. Moreover, the appeals section has appeals happening both at state and federal levels.

2. If it weren't for section 1333, I'd agree. But the provision to buy across state lines in the exchange knocks down a lot of that.

[Nikki Stone1]

33. HHS is only as powerful as its backing: that's the White House

which has spent more time meeting with the insurance industry than with the progressive activists whom Rahm called "fucking retards."

Watch carefully at what happens with the Anthem case in California. There was a 39% increase out here this past month. HHS published a letter on their website, but it's the state of California that got Anthem to delay those increases for a month. Since my insurer is Anthem and I am in LA, I am watching extremely carefully to see who has what power.

If people are allowed to buy across state lines in the exchange, that could actually hurt the smaller insurers if the larger ones decide to undercut them. It also might lead to this:

http://motherjones.com/kevin-drum/2010/02/health-insurance-across-state-lines

"The basic problem with this proposal, of course, is pretty simple. If you allow health insurance policies to be sold across state lines, states would start competing for insurance industry business by writing ever friendlier regulations. Eventually some small state will win this contest with an absurdly lax regulatory regime, and every insurance company in America will set up shop there. Essentially, the entire country would be forced to accept whatever pro-industry rules that, say, Wyoming decides to write for the rest of us. Do the citizens of all the other states really want to cede that power to Wyoming?"

[laughingliberal]

32. This was a loophole which mysteriously appeared in the bill and which the President

was not happy about. He vowed to work to close this loophole which was secretly slipped into the bill. It was widely expected this would be rectified in the negotiations in which he was engaged between the House and Senate when the MA Senate race results shut that process down. You may question Nikki's interpretation but it is the same interpretation the President had and why he vowed to work to close it. The only people I know of who support this loophole work for the health insurance industry and the legislators who work for them. It's indefensible.

[Nikki Stone1]

10. House Tri-Committee Report on Medicaid cuts with Senate bill

http://www.politico.com/static/PPM136_100104_health_reform_conference.html

Total cuts of $43 billion in Medicare and Medicaid DSH payments
Medicare: 24.4 billion
Medicaid: 18.5 billion

[damonm]

16. Hm. Need to look into this further,

but with the overall expansion of coverage to lower-income folks under this bill, it would seem to me that the need for the DSH payments would be lessened, thus justifying the cuts.
Again, a first hack.
I might point out that the House bill also had cuts, just not anywhere near the size.
Problem is, there's no chance of the House bill going into law anytime soon, much though I'd prefer that.

[Nikki Stone1]

20. That would explain Medicaid but not Medicare, and the claim I made was about Medicare

Obama has already stated that this bill needs to pay for itself. He is not eager to raise taxes directly (although he will have to do that for this bill to work); the only other place to find money is cuts. They will claim to be cutting waste, fraud and abuse, and it would be nice if they could, but chances are what they will cut are benefits, since waste, fraud and abuse take money to track down. I knew someone who worked for the IG's office of a major government agency, and trust me, investigations into fraud take money, people and time. It will be easier and far less expensive for the administration (or HHS) to assume certain types of transactions are fraudulent or that certain services are extraneous, and to get rid of these.

[damonm]

27. OK, I think I see where you're going.

A lot of this is supposition and guesswork, rather than hard data from the bill - educated guesses, but guesses nonetheless.
In that case, there is no way at all to conclusively prove or disprove the claims made save by empirical data, and that can only be had by passing the bill.
And if you turn out right - I'll be right alongside you screaming for fixes.
If you turn out wrong - you can buy me a beer at the celebration. ( I prefer Killian's Red... :9 )

Just so we understand each other - I do NOT, by any stretch, view this bill as a completed product. There are flaws in it, I grant. But what I DO view this bill as is a necessary first step. Are you by any chance familiar with the "80/20 Rule"?

[Nikki Stone1]

34. No, not guesses. Actual figures in the bill, which I gave you.

I actually think the cuts will get worse as time goes on--now THAT is a guess.

[damonm]

35. Actual figures as to dollar amounts, yes.

Educated guesses as to where those cuts will be applied.
I don't argue you on the numbers - that's black & white. I give benefit of the doubt as to what gets cut, and you don't. Therein lies the difference.

[Nikki Stone1]

11. Oh, crickets now, that I actually have the bill in front of me.

You just wanted to play "pull my finger" did ya? ;)

[damonm]

14. It's more properly known as...

"I have a life and sometimes need to be away from the computer for awhile". :P
Will get to the rest as RL permits - thanks for taking the time to discuss this honestly.
With all the crap on DU these days, it IS appreciated.

[Nikki Stone1]

21. Be careful when you snark at people.

You're lucky I took you seriously. I could have just blown you off as another DU snarker. (And there are a lot of them). But it's worth it to get the information out there.

[damonm]

25. Note the smilie.

[waiting for hope]

13. Why don't you provide links and passages

from the bill to prove your point?

[damonm]

17. Because the poster I responded to is making claims, and thus

the burden of proof is on her/him.

[laughingliberal]

29. It's not a secret that the loophole for rescissions and annual caps somehow slipped back into the

bill, but this is the section on rescissions:

SEC. 2712. PROHIBITION ON RESCISSIONS.

`A group health plan and a health insurance issuer offering group or individual health insurance coverage shall not rescind such plan or coverage with respect to an enrollee once the enrollee is covered under such plan or coverage involved, except that this section shall not apply to a covered individual who has performed an act or practice that constitutes fraud or makes an intentional misrepresentation of material fact as prohibited by the terms of the plan or coverage. Such plan or coverage may not be cancelled except with prior notice to the enrollee, and only as permitted under section 2702(c) or 2742(b).

As for annual caps, here are the news reports about it:

http://www.cnn.com/2009/POLITICS/12/11/health.care.benefit.caps/index.html


Health Care Policy
Washington (CNN) -- After hearing concerns from patient advocates, the White House on Friday said it is looking to close a loophole in the Senate health care bill that would allow caps on annual insurance benefits.
"The president has made it clear that health insurance reform legislation should prevent insurance companies from placing annual limits on health expenditures that can force families into financial ruin," said White House spokesman Reid Cherlin. "We will continue to work with Congress on this policy."
The loophole in the Senate bill reversed a previous version of the plan that would have prevented insurance companies from establishing such limits, according to three Democratic aides who spoke to CNN earlier Friday.<snip>

<snip> In acknowledging the loophole Friday, a spokesman for Senate Majority Leader Harry Reid said, "We were trying to minimize premium impacts."
When asked if the language goes against one of the fundamental promises Democrats made in health care reform, Sen. Tom Harkin, chairman of the Senate Health, Education, Labor and Pensions Committee, said it was "one of the compromises we had to make."<snip>

This loophole remained and is in the current bill. It was one of the things reform advocates were hoping could be reversed in the reconciliation between the House and the Senate that ended when the Senate race in MA was won by Scott Brown. This is not unknown.

As for the cuts to Medicare, they are well known. The president himself repeatedly stated some of the funding would come form $500 billion dollars to cuts to Medicare. $1.77 billion dollars of these cuts will come from ending the subsidies to Medicare Advantage programs. The balance of the money will come from cutting waste, fraud, and abuse and instituting best practices. The actual cuts which were in the final version of the bill which passed the Senate came to $460 billion.

A news report which discusses this and Republican attempts to use the issue and block the cuts:

http://www.msnbc.msn.com/id/34258944/

Medicare cuts stay in Senate's health care bill
AARP, the seniors’ lobby, threw its weight behind the Democrats


updated 4:49 p.m. PT, Thurs., Dec . 3, 2009
WASHINGTON - Unflinching on a critical first test, Senate Democrats closed ranks Thursday behind $460 billion in politically risky Medicarecuts at the heart of health care legislation, thwarting a Republican attempt to doom President Barack Obama's sweeping overhaul.

The bid by the bill's critics to reverse cuts to the popular Medicare program failed on a vote of 58-42, drawing the support of two Democratic defectors. Approval would have stripped out money needed to pay for expanding coverage to tens of millions of uninsured Americans.<snip>

[Nikki Stone1]

12. Here's what it's costing the rest of us:

http://www.democraticunderground.com/discuss/duboard.php?az=show_mesg&forum=222&topic_id=83841&mesg_id=83841

[damonm]

18. Actually, the state initiatives allowed by

Sec. 1332 of the Senate bill tend to undecut this argument.

[Nikki Stone1]

22. Not really.

Check it again.

[damonm]

28. I see no restrictions on states in the bill...

...are there other statutes in play here? If so, where can I find those?

[last1standing]

23. I'm a little more concerned about what 'success' will cost the American People.

As Nikki has shown repeatedly, this bill is nothing but loopholes, giveaways and mandated payments to monopolies. This isn't the Democratic party I voted for.

[ibegurpard]

26. exactly

not too concerned with helping achieve a victory for victory's sake.

[Ozymanithrax]

30. Failure costs 45,000 lives every year...

put 48 million on a waiting list for a coffin.
costs thousands of bankruptcies every year.

Lets try not to play politics with peoples lives.

[saltpoint]

31. Thoughtful and incisive. We can own this debate for the fall and forever

after by aggressively holding the obstructionists' feet to the flames.

No reason we should allow a cretinous anti-American slimeball like Jim DeMint to set the boundaries for public discourse on this subject.

Or on any other subject, as far as that goes.

Recommended.