Obama's Senate Health Care Bill: A "Uniquely American" Idiocy (and 35 Ways It Can Be Fixed)

Obama's Senate Health Care Bill: A "Uniquely American" Idiocy (and 35 Ways It Can Be Fixed)

By Scarecrow and Jon Walker, Firedoglake. Posted December 22, 2009.

The White House and the Senate Democratic leadership should be assailed for the travesty of a health "reform" bill now slouching towards Christmas eve.

In Copenhagen last week, when Senator James Inhofe tried to sell reporters on his climate change denialism, the European press corp showed the American media how to take its job seriously: "You are ridiculous," one German reporter said to his face. Sometimes, that’s what reporting the truth requires.

And that’s exactly what the American media should be saying to the White House and the Senate Democratic leadership for the travesty of a health "reform" bill now slouching towards Christmas eve. Only a group of idiots would have concocted this incoherent mishmash and called it "reform."

To be sure, there are many provisions of the Senate bill that are worthwhile, worth passing — I’ll get to that — but these mostly ad hoc features are carrying, fronting for a deeply flawed, underlying structure of a bill that utterly fails to reform what’s wrong with America’s inhumane, corrupt health care system.

America’s private, for-profit health insurance and delivery systems have failed. Their so-called "markets" are not competitive, and that can’t be fixed with puny exchanges that may or may not be created by skeptical — or recalcitrant — states. The insurance and hospital sectors are highly concentrated, dominated by market power that allows providers and insurers to overcharge Americans by 50 to 100 percent more than other nations pay for equal or better care and universal coverage.

So you would think any genuine reform effort would use the power of the federal government to bust up or at least confront the oligopolies and use its leverage to counter the industry’s market power, rationing-by-price and price fixing. But the Senate bill protects the industries, shields them from competition and expressly precludes national public entities from demanding better prices on the public’s behalf.

With government collusion, the private actors created a system of inhumane rationing that denies insurance to nearly 50 million and hawks fraudulent coverage to tens of millions more. The failure of the insurance system leads directly to the most egregious rationing of actual health care of any industrialized nation. Only in America is a private system allowed to bankrupt and deny care to millions, causing tens of thousands to die every year.

The obvious alternative to this massive failure of the private, for-profit system would have been to move strongly in the direction of universal public systems, while imposing strong price, quality and access regulation to the remaining private sectors. Public alternatives and strong regulation are the models for every other advanced nation — there are no exceptions. These are only ways to break the backs of the private oligopolies that are strangling health care in America.

But instead of doing the obvious, the reforms that actually work, the corporate Democrats and their corporate-shielding President have done the opposite. Every travesty in the Senate bill springs from an effort to preserve and shield the private industries that are financially and literally killing us.

Instead of providing strong public alternatives, the bill will bail out the private system, and not merely by giving them hundreds of billions to subsidize their unregulated premiums and fees. No, we will force 30 million Americans who can least afford it to buy their overpriced, poorly regulated products, and pay only lip service to the economic hardship this imposes.

The mandate to bail out the insurance companies (and the hospitals/providers they feed) is worse than bailing out the investment banks. It’s as though we had forced 30 million modest income Americans to purchase toxic assets from the banksters and then imposed taxes on everyone else to complete the bailout.

If you look beyond this flawed foundation and consider only the WH/Harry Reid list of wonderful things the Senate bill does, you’ll notice that virtually all of them require the government to replace or intervene in the private system. The best features provide discrete escapes and selected access to a government/public alternative.

In all of the arguments claiming it would foolish to defeat this bill, we find the bills best features move millions from the private denial/rationing system to Medicaid (maybe 15 million uninsured) or extend SCHIP; they expand and fund thousands of public health clinics ($10-14 billion more, thanks to the House and Bernie Sanders). Cantwell’s proposal allows states to carve out quasi-public negotiated systems for those between 133 and 200 percent of the federal poverty level. The Medicare buy-in would have been another benefit, following the same pattern.

In contrast, the last minute "fixes" to buy off extortionists like Nelson, Landrieu, Lincoln, Baucus and friends typically involved federal bailouts of their private contributors.

Other "good" features try to rein in the abuses of the private insurance sector, but these weak features leave the private insurers too much flexibility to escape the regulations and provide minimal to no effective price oversight for an industry that survives through price fixing and market power. It is scandalous that the White House would cut special deals to preserve industry profits, while leaving the drug industry’s monopoly pricing scams essentially unregulated and prohibiting the government from negotiating better prices for the public’s benefit.

To every Democrat who created and now defends this monster of a bill, "you are an idiot." You blew the best chance we’ve had in decades, you protected the abusive industries instead of their victims, and by enriching the corrupters, you’ve made it harder to fix this mess in the future. You betrayed those who put you in office.

If you don’t fix this, we will watch/help you lose next November and again in 2012. Trust us.

35 Ways to Fix the Bad Senate Health Bill
John Walker, Firedoglake

This Senate bill is bad and there are many ways to improve it. Right now, it is not real reform–it is only a corporate giveaway that might trickle down to help a few Americans. The ideas listed here are a guide to transform this legislation into real reform.

1. Add a robust public option open to all Americans.
2. Remove the rollback of a woman’s right to choose.
3. Repeal the anti-trust exemption for private insurance companies.
4. Add early Medicare buy-in.
5. Add a real employer mandate.
6. Fix the excise tax that would reduce the quality of many Americans’ insurance. This can be done by properly indexing it so that it forever remains only a tax on “Cadillac” plans.
7. Move up the start date of reform to as soon as possible. Three years is too long!
8. Increase the affordability tax credits to individuals.
9. Expand Medicaid to 150% of FPL.
10. Reduce the maximum annual out-of-pocket limit to 5% of income.
11. Move up state waiver for innovation to 2014 and add ERISA waiver. The state waiver for innovation is a good idea, but having it start in 2017 creates a bureaucratic nightmare of putting in place one reform only to replace it a few years later. We need to fix our system now, not have states start working toward a real solution a decade from now.
12. Give states that set up “basic health programs” 100% of the money, and allow them to use the program for people above 200% of FPL.
13. Allow for drug re-importation so Americans can get cheaper drugs from Canada or Europe.
14. Give Medicare the power to directly negotiate for lower drug prices.
15. Give the government the power to negotiate for lower drug prices on behalf of all Americans (like every other industrialized country does to bring down pharmaceutical prices).
16. Create a national exchange with a strong regulation enforcer instead of state-based exchanges with weak local insurance commissioners.
17. Force all non-HMO insurance plans on the exchange (or at least on the new OPM exchange) to work with the exchange commissioners to collectively negotiate a single provider reimbursement rate for all insurance plans (as it is in Switzerland, Belgium, and The Netherlands.)
18. Add truly strong risk adjustment mechanisms to force competition based on quality instead of trying to dump sick customers (as is done in The Netherlands).
19. Increase the actuarial value of the minimum qualified plans offered on the exchange and base subsidies on the gold level (80% actuarial value) instead of silver level plan (70% actuarial value).
20. Force all insurance companies on the exchange to offer at least one precisely designed high quality insurance plan. This will allow true apple-to-apple comparisons, and make it harder for insurance companies to game the system.
21. Greatly reduce the amount of plan design leeway given to insurance companies to reduce their ability to game the system.
22. Make it illegal to sell basic health insurance for profit, like in almost every first-world country on Earth.
23. At the least, allow only non-profit insurance plans to take part in the new exchanges (or OPM exchange).
24. Reduce the community rating based on age to at most a 1:2 ratio with age rating bands. (one price for all 18-30 year olds, one price for 30-45 year olds, and one price for all 45-64 year olds).
25. Make minimum medical loss ratio 92%. (Try to do this in way to get around the CBO.)
26. At the very least, remove the MLR loophole for the individual market.
27. Allow state and local governments to apply for grants from the CO-OP program.
28. Allow the co-ops to sell insurance to anyone, not just the small group and individual markets.
29. Allow undocumented immigrants to buy health insurance with their own money on the new exchange.
30. Make all legal immigrants eligible for all public health care programs right away, instead of creating a five year wait.
31. Eliminate direct-to-consumer advertising for prescription medication.
32. Provide enough money to give every American access to a community health care center.
33. Follow the FTC recommendations and create a real pathway for biosimilars to create generic forms of the most expensive medications in this country.
34. Create a Government-run HMO option modeled on the VA system.
35. Scrap the whole bill and replace it with a single payer “Medicare-for-all” system.

If they implement a vast majority of these reforms, progressives should only then embrace the individual mandate. Until the government takes real steps to ensure that people actually have access to high-quality, affordable health insurance it is immoral to force people to buy expensive, junk insurance from private corporations.

Right now, the bill is only a big corporate giveaway masquerading as reform–reform that will only enrich, empower, and entrench the enemies of real reform. Only if they add the bulk of these ideas could you ever honestly call the bill reform, and, so, make it worth passing.

AlterNet also published today an article by Harold Pollack calling on Howard Dean and others who are vocally opposed to the Senate bill to support the legislation, no matter how flawed.

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