Watch the Wyden-Bennett "Healthy Americans Act"--It Could Be the Place Health Care Reform Compromise Takes Place in 2009
Health care reform will be hard to do after the November election. I've even called it a long-shot.
Polls clearly show the voters split evenly between the Democratic and Republican approach to health care reform. I can't tell you who will win the presidency but I am willing to make the bold statement that it will be a close election and neither very different approach to health care reform will enjoy any kind of mandate.
That will mean finding common ground between these very different approaches will be more than tricky.
But we may already have an outline.
Senator Ron Wyden (D-OR) and Senator Robert Bennett (R-UT) have crafted a health care reform plan that gives both sides the most important things each are looking for:
- For the Republicans, it gives them a plan that moves away from the third-party employer-based payment system to one of individual responsibility and the promise of a more vibrant market.
- For the Democrats, it provides a plan that assures everyone will have access to coverage and provides the financing to get about everyone covered in the short-term.
The key to the individual-based program's financing is an employer contribution. Employers would be required to pay a tax based upon a sliding scale of 3% to 26% of the cost of basic health insurance--tied to their size and revenue per employee. That would convert to a per worker tax of something like $250 to $2,000 for an employer. Employers who now contribute would be required to convert their contributions to higher wages during the first two years and pay the sliding scale tax later.
Under the Wyden-Bennett plan, people with an income of less than 400% of poverty would be eligible for subsidies, everyone would have access to guaranteed and community rated coverage, and the feds would oversee a system of private individual-based insurance and would collect the base-line premiums through the tax system.
In exchange for all of this consumer support, the Wyden-Bennett plan would also require individuals to have health insurance (an individual mandate) and that it must be purchased from a state-run purchasing pool that would require health policies have substantial benefits (rich benefit mandates) and offer a choice of private policies. There would be a flat personal tax deduction ($12,000 for a couple) for consumer insurance payments and low-income subsidies would be tied to the lowest cost policy available.
While employers could offer plans created especially for them by the state purchasing pools it is hard to see why they they would other than to comply with existing labor contracts that required benefits that did not fit the standard state pool offerings.
Those in SCHIP and Medicaid would be converted to this private system. The private insurance sector would clearly have lots more business as they picked up the uninsured and those in these public programs.
Just as there is something for everyone to like there is also something for everyone to dislike.
Conservatives still see too many benefit mandates, too little financial incentive for people to be better health care consumers, and too much federal regulatory control over how the private insurance market would work: See a critical view of the Wyden-Bennett "Healthy American's Act" from the Heritage Foundation.
Liberals, particularly the unions, will be concerned about moving away from the employer-based system. Liberals will also be concerned about continuing to base the system on private insurance--particularly the higher cost individual form and ceding SCHIP and Medicaid to private insurance companies.
Employers will be hard hit to pay for it. Those who provide health benefits today will have to convert their existing health support to wages and pay another tax on top of that.
I would also label the proposal "cost containment lite." It clearly emphasizes access over cost cost control.
It will also be easier to pass this bill since it doesn't directly take on any of the powerful health care special interests--insurers, drug companies, doctors, hospitals, or lawyers. However, the biggest losers would include insurance agents (out of business for health care), Medicaid and SCHIP program bureaucracies, and insurance company employees who do billing and eligibility work.
In exchange for all of the new business, insurers would be subject to a lot more regulation including minimum loss ratios and a complex bid process that could only narrow premium margins. This would likely be a business model not as kind to Wall Street.
But as a place for a country split right down the middle to come together and begin a health care reform process?
Watch this one.
The Wyden-Bennett "Healthy Americans Act"
9 comments:
You correctly point out two of the Healthy Americans Act’s major flaws. For one, employers are required to convert the health insurance benefit, where it exists, to wages, but at the same time the employer is required to make a contribution to the program based on the number of employees. Sounds like a payroll tax to me. And where does the employer find the funds to contribute? By reducing wages by the same amount.
This is not to avoid the reality that a universal health insurance system must be paid for, nor that it is the individual consumer who will pay for it. The larger question is whether continuing to involve employers in a reformed system is either necessary or makes economic sense.
The second flaw is the plan’s lack of attention to cost and quality. Without a systemic approach to containing costs and improving quality, the plan will not be sustainable.
As a potential "un-insurable" I like the up-front community rating/access requirement.
Any market-based plan is going to have to regulate insurers, they might as well come to terms with that right away.
I am healthy and young and buy an individually underwritten plan now...and it is very cheap.
I have ZERO interest in subsidizing sicker citizens...especially since so much cost and M&M is behavior driven.
I stay healthy and only want to pay for my own risk instead of subsidizing 400 pound diabetic smokers.
If the proposed bill is "cost containment lite" why don't we take a cue from other countries? The recent PBS Frontline episode "Health Care Around the World" concluded with three observations:
1. Everybody gets covered. Insurers can not deny someone for health related issues.
2. Those who can't afford it, have their premiums paid for by the government.
3. The doctors, hospitals and government agree to a FIXED set of prices.
Every proposal is doomed to fail if we don't address the COST of care. Why is there such a failure to address this side of the equation in the national debate? As an example, in Japan, the medical price book is set every two years. That seems timely enough to adjust for new technologies and new developments in evidence-based medicine (quality guidelines). If we want universal healthcare, we need FIXED pricing with input and agreement from all stakeholders (they can all stand to give up significantly in a universal healthcare model).
And by the way, what is the purpose of taxing employers after the transference of wage increases? Did the Congressional Budget Office calculate the billions of dollars added to their coffers when the present tax write offs for employers based coverage is removed?
Let's get moving so health care reform does not get shelved, again.
FIXED prices is exactly the WRONG solution.
When we fixed prices for Oil in 1973, what did we get? The same thing you always get: a shortage.
No, we need MARKET PRICES. Consumers with skin in the game comparison shopping for healthcare with their own dollars.
Once again, a bad solution for an overblown issue. When are we going to get the torches and pichforks and drive these fool socialists (from both parties) out of power.
As a primary care physician, I find it fascinating all the talk about providing INSURANCE, but no talk about providing health care.
Guarantee of insurance does not translate into the ability to access a health care provider.
Patient focused care receives such poor payment for services provided that the system is unsustainable.
Having insurance does not equal the ability to receive quality care or care at all. Just ask New-To-Medicare recipients in rural areas where no primary care physicians are able to afford to take them on. They are suddenly in a situation with insurance, but no physician to care for them.
It is true I am a proponent of healthcare coverage for all U.S. citizens. This "Healthy-Americans Act" does attempt to appease all sides to make coverage possible. I hope to see it pass, though I don't believe it will.
I believe the insurance agents (brokers) are powerful enough to stop this bill. Hillary made the same mistake (one of the many) with Hillarycare in the 90s.
The issue is not overblown. Medicare costs will account for every tax dollar collected in the near future. I see that as an enormous problem. And so should you.
To the primary care physician: It is true we should be conversing about providing healthcare- not insurance coverage. It is not lost on most people interested in health policy that there is a severe shortage (esp. in rural areas) of primary care physicians. I ask you, what good is living next to a doctor if you have to sacrifice rent to pay for a visit?
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