Latest Twists on the Public Option
I think that probably too much is being made of the latest comments from administration officials regarding the public option. My understanding is that the White House’s position has always been that it favors a public option, thinks a public option is a good idea, wants to see a public option in a bill, and also wants to sign a health reform bill that passes congress, covers the uninsured, and reduces long-run health cost inflation relative to current baseline projections. I haven’t heard anything new from the White House. They never said the president would refuse to sign a bill that doesn’t include a public option, and they’re not saying now that they don’t favor a public option.
So to me, this sounds like the status quo:
The “public option,” a new government insurance program akin to Medicare, has been a central component of Mr. Obama’s agenda for overhauling the health care system, but it has also emerged as a flashpoint for anger and opposition. Kathleen Sebelius, the health and human services secretary, said the public option was “not the essential element” for reform and raised the idea of the co-op during an interview on CNN.
Mr. Obama himself sought to play down the significance of the public option at a town-hall-style meeting on Saturday in Grand Junction, Colo., when a university student challenged him on how private insurers could compete with the government.
All of this is about the fact that private insurers are very powerful, and there’s not sixty votes in the senate for a robust public plan. As Jonathan Zasloff says, it’s extremely annoying to hear this argument from Kent Conrad who refuses to acknowledge that “the reason why ‘there are not enough votes in the Senate’ for a public option is because Kent Conrad opposes it.” At the same time, public plan advocates have gotten a whole bunch of progressive members of the House of Representatives to at least say they won’t vote for a bill that doesn’t include a robust public option.
Nominally at least that means that health reform is now in a legislative dead zone—there aren’t the votes in the House for a bill without a public option and there aren’t the votes in the Senate for a bill with them. If it comes right down to it and the senate is prepared to pass a bill that:
(a) subjects insurance companies to tough new restrictions,
(b) taxes employers who don’t provide decent health insurance to their employees,
(c) creates a new regulated marketplace in which individuals and small business employees can buy quality health insurance,
(d) expands Medicaid eligibility, and
(e) offers subsidies to ensure the affordability of insurance for middle class families
I have a hard time believing that House liberals will really kill the bill. But maybe they will.
One thing I wonder about is this. Given that adding a robust public option into the mix would reduce costs, if you set up a system without a public option wouldn’t you be able to add the public option in later years as an uncontroversial application of the reconciliation process? It seems to me that doing so would count as a 100 percent legitimate deficit reduction play. The public option concept also polls substantially better than does health reform as a whole. Under the circumstances, the odds for securing 50 senate votes for adding one strike me as pretty good.
89 Responses to “Latest Twists on the Public Option”
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August 17th, 2009 at 10:05 am
Re Matthew’s comment “if you set up a system without a public option wouldn’t you be able to add the public option in later years as an uncontroversial application of the reconciliation process?”
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We’re getting tired of you yanking the football away, Lucy.
August 17th, 2009 at 10:07 am
“I have a hard time believing that House liberals will really kill the bill. But maybe they will.”
Shorter Matthew Yglesias:
Billy Tauzin and Jeffrey Immelt should fight for the wording of the final bill, and House progressives shouldn’t fight for the wording of the final bill.
—–
And one should note the entirely false final paragraph he writes.
It appears he’s going back to 2003 to find arguments as false as the ones he used to pimp for the Iraq war.
August 17th, 2009 at 10:08 am
They MUST.
1) A bad bill will be political suicide. (Forcing young voters to buy crappy, overpriced private insurance with neither a public alternative nor sufficient subsidy to help them afford it? Great way to alienate them and thus to destroy the party’s future.
2) We MUST destroy the dynamic whereby it’s always the progressives who get rolled to appease the Blue Dogs. Unless the Blue Dog can at least be weakened we cannot meaningfully address any of the country’s serious problems- again threatening the future of the party (not to mention the country, though all too few on either side of the aisle seem to spend much time thinking about THAT.)
August 17th, 2009 at 10:08 am
As Howard Dean has noted, you can NOT afford to provide health care to Americans if you let the insurance companies bribe Congress into continuing to give them a $60 Billion per year subsidy from the taxpayers.
http://news.yahoo.com/s/ap/20090817/ap_on_go_pr_wh/us_health_care_overhaul
“WASHINGTON – Former Democratic Party Chairman Howard Dean, a leading figure in the liberal wing of his party, said Monday he doubts there can be meaningful health care reform without a direct government role…
,,,Dean, a physician, argued that a public option is fair and said there must be such a choice in any genuine shake up of the existing system.
“You can’t really do health reform without it,” he said. Dean maintained that the health insurance industry has “put enormous pressure on patients and doctors” in recent years.
He called a direct government role “the entirety of health care reform. It isn’t the entirety of insurance reform … We shouldn’t spend $60 billion a year subsidizing the insurance industry.”
August 17th, 2009 at 10:10 am
I’d be OK with dropping the public option, if Sens. Collins, Snowe, Nelson, Conrad, Baucus, Lincoln, Landrieu, etc. were willing to give something in return – at a minimum, their ironclad support for everything else that’s in the most liberal of the three House committee bills.
But it seems as if we’re dropping the public option and moving on, without any quid pro quo. Why is it that liberals can’t ever seem to drive a decent bargain?
August 17th, 2009 at 10:11 am
Without the public option, private health insurance firms will harvest and sell baby organs.
That ought to be the progressive negotiating posture.
But there’s no rule that we have to take our negotiating posture literally. In re: the political angle, see Nate Silver’s post this morning. He agrees that an individual mandate is politically bad mojo. We should press for employer mandates instead.
August 17th, 2009 at 10:12 am
any member of the House Progressive Caucus who votes for a bill without the public option better be ready for a primary challenge.
and of course, I assume ALL the Blue Dogs are preparing for well-funded primary challengers from their Left.
I don’t think appeasers like Matt and Ezra realize the white hot intensity of Democratic voters who are watching this unfold and seeing Team Obama fold like a cheap fucking suit.
August 17th, 2009 at 10:14 am
IF Healthcare reform was all that important to Obama, why has he and the Democratic leadership been totally fucking silent in the Public Forum the past 8 months?
If you want Congress to support your change you have to rally the voters to put pressure on Congress. To do that, you have to go to the voters, point out the problem (the miserable conditions of many Americans) , point out the solutions and point out how Republican are stabbing Americans in the back by whoring for the wealthy. You have to have the people howling for change.
Hence the time to have run tv ads was months ago.
Instead, Obama has done everything but suck Republicans’ cock.
ALL of the NEWS received by Americans has been deceitful, misleading bullshit from those trying to sabotage reform and bury the problem. NOTHING from our side.
Here in Philly, we’re pretty good at judging when a fight has been fixed — at when a boxer has been paid to take a fall.
August 17th, 2009 at 10:18 am
I want to be clear: the public option is the only way to stop the harvesting of baby organs. Why do Republicans hate babies so much?
But — between you and me — I’m not going to walk down 5th Ave flagellating myself if we get nonprofit co-ops instead.
August 17th, 2009 at 10:23 am
remember too, it is in the best interests of the Progressives to kill the watered down non-reform, as it will be Blue Dogs in marginal (purple) districts that pay the heaviest electoral price. so doing everything liberals can to get rid of Mike Ross and his ilk will be the financial focus for 2010, and these targeted primary challenges become that much more effective in removing conservatives from the House.
August 17th, 2009 at 10:24 am
Matt, couldn’t I get a shout out on adding the public option in reconciliation?
At what point could Obama and the Congressional Dems let progressives know that this is the strategy. If they do it before “reform” passes the Senate, it will kill the chance of getting anything out of the Senate right?
Reading yourself and Ezra, I have the feeling that the Administration laid this out as the plan in June.
August 17th, 2009 at 10:25 am
If Cunt Kenrad can provide real-world examples of his “co-op” scheme working, he might be worth a listen. He can’t, because it was dreamed up on the back of an envelope in his senate office.
Perhaps he’s thinking about how if you’re sick in Nowhere, ND, you go to the vet, and if the vet’s busy, the tractor supply guy might be able to fix you up.
August 17th, 2009 at 10:27 am
Or, to put it another way, if the public option for healthcare is unacceptable to the senator from North Dakota, let’s hear him make the case for co-ops to replace federal largesse when it comes to agriculture. Perhaps he thinks that sucking from the federal tit doesn’t count when it’s directed towards the Plain People of the Plains.
August 17th, 2009 at 10:30 am
We heard from Howard Dean at Netroots Nation 2009 on Friday that everything else of substance has been stripped from the bill except the public option.
I have been wavering on my support for Obama as have several other people. If Obama caves on this issue he will have a hard time getting people back behind him.
The progressive caucus is the only place that will put enough pressure to get the public option in the bill by voting NO if it is left out.
Howard Dean said that we are winning this fight. It does not look like it to me.
August 17th, 2009 at 10:30 am
the reason people like conrad have been furiously lobbying against the inclusion of a public option in a final bill is not that it would not get the required votes, but because they know full well that if such a bill was actually on the floor for a vote, that they would have to vote for it.
no democrat – except for possibly ben nelson – would actually vote against a bill that had a public option in it. it would be political suicide. so the only way they can protect their benefactors – insurers, pharma, etc. – is by making certain that no such bill ever reaches the floor for a vote.
his entire “the public option doesn’t have 60 votes ” schtick has been designed to deal with that reality.
it’s been a preemptive strike designed to scare obama and reid into backing down.
if the dems had any guts and political smarts, they would simply draft the bill with the public option in itt, and dare any of its members to vote against it, either by supporting a filibuster, or against the actual bill.
August 17th, 2009 at 10:33 am
Number of Blue dogs that will lose if congress passes healthcare reform – 25
Number of Blue Dogs that will lose if congress does not pass healthcare reform – 25
Number of Blue Dogs that will be defeated by a progressive primary challenge – 0
August 17th, 2009 at 10:34 am
He agrees that an individual mandate is politically bad mojo.
Of course it is, absent either tight regulation or a public alternative. You don’t have to pay mandatory auto insurance unless you drive — and even then, there are usually state laws to limit the impact of regulatory capture.
No fucking way am I going to be placed in a situation where I’m forced to choose between paying one of the duopolist insurance parasites in this state.
August 17th, 2009 at 10:34 am
So to me, this sounds like the status quo
In other words, folks, we were fucked from the very beginning by a duplicitous, cowardly administration that wouldn’t fight for what they promised us in order to get elected. We were just plain stupid to believe that BHO believed in the public option as much as we did.
And now we’re going to get fucked again by a so-called left-leaning blogosphere that tells us that we should have known that we were fucked from the very beginning.
I have a question, MY. Why didn’t BHO fucking say: “I’m for the public option IF the folks who are dead set against it deliver it to me but, if they don’t, hell, I’ll sign whatever they send to me?”
There are two Waterloos here: BHO’s and blogs’ like this who don’t even have the integrity or guts to say “No thanks” to a bill that makes things worse — and LOWERS, perhaps eliminates, the possibility of solving the problem in the future.
It is now very clear that we elected the WRONG man for the job. Or should we have known all along that we were electing a sneaky two-faced coward who would negotiate behind the scenes with the sleaziest of our enemies, and sell us out at the last minute?
I mean, to paraphrase your argument, he never actually said he wouldn’t sell us out, now did he?
August 17th, 2009 at 10:43 am
Matt, you know how this is going to go know that we’ve given away our single biggest legislative priority with nothing tangible in return:
Installs a new far-left socialist regulatory system that would make your insurance unaffordable! [x] million will lose coverage, according to insurance companies and this completely unbiased Heritage Foundation report.
More taxes! And all for people too irresponsible to buy their own insurance!
The government will force you to participate in Nancy Pelosi’s “death exchanges,” where you won’t be able to by the same generous insurance you have today. In fact, you’ll be forced to buy expensive government controlled (communist?) “plans”! These plans will mandate that everyone be covered for, say, mental health services without buying everyone a pony! That’s rationing!
Raises your taxes, for people irresponsible enough to be poor.
Gives billions of your tax dollars to insurance companies located in [Democratic Senator's] state! (And sidenote: given the shitstorm of the last month, how likely is it that those subsidies will come anywhere near the increased costs/lost wages employers will pass on to their employees?)
Having stripped out the major provision of the bill, what makes you think the Republicans will sit down and let the Dems pass anything else? Grassley spends days prancing around supporting Glenn Beck and Sarah Palin, and the Dems respond with this? They’re spitting on us…
August 17th, 2009 at 10:45 am
Wow. A lot of venting going on here. “Sneaky two-faced coward,” body parts left and right, etc. I think I’ll exercise the better part of valor and stay out of y’all’s way, because this clearly isn’t an opportune moment for dispassionate discussion.
August 17th, 2009 at 10:45 am
They never said the president would refuse to sign a bill that doesn’t include a public option,
Matt Y., today
[A]ny plan I sign must include an insurance exchange: a one-stop shopping marketplace where you can compare the benefits, cost and track records of a variety of plans – including a public option to increase competition and keep insurance companies honest – and choose what’s best for your family.
Barack Obama, July 20, 2009.
Yes, there is some wiggle room between “must” and “refuse to sign”, but to most people they would amount to the same thing.
August 17th, 2009 at 10:46 am
Everyone knows the left isn’t going to kill health care reform. That job is best left for sensible moderates.
That’s the sad thing about actually giving a damn about your constituents and the country’s overall well being. It greatly reduces your bargaining power when you’re up against people who don’t.
See California. Republicans can behave like a bunch of raving maniacs and credibly increase their leverage, because in the end they don’t care if the state goes into default.
If you’re going to draw a line in the sand, it should be on the employer mandate. A bill without one could end up being a massive political and policy disaster, as employers could drop their coverage, forcing people to get taxpayer-subsidized, probably inferior policies on the exchange. And President Baucus is apparently uneasy about the employer mandate.
The public option is a good idea, but it’s not something that’s essential for the reform framework to work.
August 17th, 2009 at 10:49 am
@22: agreed.
August 17th, 2009 at 10:51 am
Ted,
In all seriousness, what makes you think this is the last chip to fall? Do you see anything gained from this compromise?
FWIW, I really don’t think this is Obama’s fault. The conspiracy theories about Obama setting up Baucus as a foil for progressive anger don’t hold together. Obama knows how to rule out legislative priorities from the outset (see: single payer). If he really planned to kill that provision, why bring it up and sorta-back it in the first place at all?
August 17th, 2009 at 10:56 am
Status quo? Maybe since early June:
June 11-Kent Conrad introduces co-op idea after meeting with UnitedHealth President Steve Hemsley
June 24-White House shifts language to accomodate a “nonprofit” public plan
August 7-White House warns groups not to run ads against Democratic Senators opposing a government run public plan
August 16-Kent Conrad delivers blistering discount of government run option’s prospects in Senate. White House caves.
August 17th, 2009 at 11:00 am
Two things. First, there was never going to be 60 votes for any reform bill worth having. we must get past this fetish over having 60 votes and instead work to force Reid to make opponents filibuster for real, in front of the cameras.
Real reform will cost the health insurance industry big time and likely limit the fat bonus’s the execs would get. They see themselves losing their own money and they will fight like furies to prevent that.
Second, how are people supposed to pay for mandated individual coverage? How many people do any of you know whose money isn’t nearly maxed out already? Not to mention the millions of people who have lost their jobs and obviously have no money to pay for insurance–which would likely not cover very much anyway.
August 17th, 2009 at 11:01 am
“It is now very clear that we elected the WRONG man for the job. Or should we have known all along that we were electing a sneaky two-faced coward who would negotiate behind the scenes with the sleaziest of our enemies, and sell us out at the last minute?”
Sneaky? Barack Obama said straight up he would sit down will all the interest groups and work out deals.
He’s been saying for months now that he supports the public option, but that it’s not the most important part of health care reform, and that he’d be open to non-profit cooperatives.
If Obama seems too eager to compromise, it’s because he’s aware of the cost of failure. If this bill goes down, we’re probably going to continue on the current pace, with the ranks of the uninsured growing 2 million per year, for the next 20 years until we finally have another political opportunity. And then, there’s no guarantee that the bills we’ll be debating in 20 years will be any better than today’s.
August 17th, 2009 at 11:01 am
If an individual mandate is included, especially one accompanied by inadequate subsidies (a la Baucus), but not a public option, this statement is most definitely false. That’s recipe for a political time bomb.
August 17th, 2009 at 11:03 am
NS, I agree with you about Obama. I’m not overjoyed with him: it might have been better if he had taken a harder line earlier. But honestly, I don’t have the sort of inside information I would need to judge.
I also don’t feel serene confidence about this being the last chip to fall. I don’t like the way this has been going, and I plan to call my Senators (again) today.
But Nate Silver’s latest post at fivethirtyeight indicates that the votes may never have been there, in the Senate, for a robust “public option.” Nate seems to believe that this was always a long shot — in which case, there’s one way of looking at it that would say that we’ve actually done pretty well by making our “long shot option” the central subject of negotiation.
But I’m all in favor of screaming about this — progressive Senators need to be able to say “sorry, guys, I can’t trade away anything else, because — just look at my constituents — they’ve been foaming at the mouth.”
August 17th, 2009 at 11:07 am
Let me add that if you don’t have Senate support for a public option now, what on earth makes you think it would fly later when labeled “deficit reduction”?
Or maybe the real play should be to drop the previous work and move straight to the public option, since it does poll better that “reform” and would have the benefit of offering voters something more comprehensible than “reform”. It really is hard to explain to people what they would get from “reform”.
August 17th, 2009 at 11:08 am
Seems to me the left’s green lantern theory of domestic politics is pretty close to the neocon right’s green lantern theory of foreign relations.
August 17th, 2009 at 11:10 am
“Second, how are people supposed to pay for mandated individual coverage? How many people do any of you know whose money isn’t nearly maxed out already? Not to mention the millions of people who have lost their jobs and obviously have no money to pay for insurance–which would likely not cover very much anyway.”
Which is why expanding Medicaid eligibility and coming up with reasonable subsidies have always been much more important than the public option.
“If an individual mandate is included, especially one accompanied by inadequate subsidies (a la Baucus), but not a public option, this statement is most definitely false. That’s recipe for a political time bomb.”
The public option would have lower overhead than private plans, but it would never be a big enough part of the market to “bend the cost curve.” The public option was never going to solve the problem of rising insurance premiums that could make mandated insurance unaffordable even with a subsidy. That’s a huge issue that has to be dealt with continually after reform is passed, public plan or not.
August 17th, 2009 at 11:11 am
Re zak at 26: “Second, how are people supposed to pay for mandated individual coverage? How many people do any of you know whose money isn’t nearly maxed out already? Not to mention the millions of people who have lost their jobs and obviously have no money to pay for insurance–which would likely not cover very much anyway.”
—————
But that is why you need a public option. An austere government plan that will provide basic healthcare/protection from catastrophe but which is kept cheap by cutting out all the waste: Huge payoffs to insurance executives, $Trillions in ass-covering lab tests/specialist referrals, emergency rooms pandering to hypochrondriacs,etc.
Your fucking alternative is to pay $8000 PER YEAR to the insurance companies to cover 45 million people. That works out to $365 Billion per year.
If people want more expensive care and can pay for it, then fine –let them buy it. But I don’t see why the government should be FORCED by the insurance companies into wasting hundreds of billions of our tax dollars. Nor do I see why
any President –Republican or Democrat — would take the oath to defend the people of this country and then let
45 million Americans should be held HOSTAGE by the insurance companies and their Blue Dog whores.
August 17th, 2009 at 11:12 am
(a)-(e) constitute the Swissification that Krugman talks about, and it would be a good start, a major advance in fact.
As the perfidy and treachery of the private insurers becomes clear after a few years (I don’t believe they will abide by the new regulations), the demand to re-introduce a public option will become intense.
August 17th, 2009 at 11:15 am
If the Democrats pass a bill w/ an individual mandate AND Scrooge-out on the subsidies, they will lose for decades. That will be demonstrably worse for most Americans, regardless of the various whack-a-mole laws against current insurance abuses.
August 17th, 2009 at 11:20 am
NS, It’s hard to take someone seriously if they think setting up a fall guy requires a ‘conspiracy theory’. That’s like saying it takes a conspiracy for one bank robber to shoot the other and take the loot. It doesn’t really take a ‘conspiracy theory’ to believe something so common it’s become a cliche.
August 17th, 2009 at 11:21 am
FWIW, I really don’t think this is Obama’s fault. The conspiracy theories about Obama setting up Baucus as a foil for progressive anger don’t hold together. Obama knows how to rule out legislative priorities from the outset (see: single payer). If he really planned to kill that provision, why bring it up and sorta-back it in the first place at all?
And unlike any other legislation so far Obama said he would bypass the filibuster on healthcare via the reconciliation route. I think it will be like the stimulus package. The bitchy element will bitch about it not being enough like they bitch about every single thing (and were against Obama during the primary so they’re still fighting that fight) but it will be big enough and they can go back if they need more. With the global economy turning around (which the bitchy element was wrong about also, and will never ever admit it), the young Obama could have 8 years to work with.
What I see happening is that the MSM has latched on to a narrative: the public is growing less happy with health care reform so in reaction the Obama administration is making noises about compromising over the public plan in order to pass legislation. Drama! Whereas in truth nothing has changed and it’s all still up in the air.
August 17th, 2009 at 11:22 am
Why can’t people, at least over a certain age, be allowed to buy into Medicare?
August 17th, 2009 at 11:22 am
“But that is why you need a public option. An austere government plan that will provide basic healthcare/protection from catastrophe but which is kept cheap by cutting out all the waste: Huge payoffs to insurance executives, $Trillions in ass-covering lab tests/specialist referrals, emergency rooms pandering to hypochrondriacs,etc.”
Except that’s not what the public option is at all.
The public option would have to keep pace with medical inflation or else no providers would accept it. They’d have to pay Medicare’s rates at the very least.
The public option cuts overhead, which saves a substantial amount of money, but it doesn’t deal with medical waste or the problem of rising medical costs.
August 17th, 2009 at 11:23 am
Ted, I’m sure Ted Bundy is a bastard. But I*Wasn’t*There* it could all be a pack of lies. The important thing to remember is not to judge.
You’re a useful fucking idiot, aren’t you? How dare the rest of us judge a man based on results!
August 17th, 2009 at 11:23 am
I very much agree with Matt. What happens is the press is always looking for gotchas and drama and controversy. They take apart someone’s sentence and try to find something that sounds like it would make good drama.
Sebelius really said nothing much but, her phrasing gave the press a chance to twist it to sound so dramatic and they hyped it up into ‘There is No Public Option Now’!!!!
As a rule I usually take the breathless claims by the press and wait. If you go over the rails everytime the press makes these breathless claims and go along with their odd reasoning you end up wasting so much time, emotion and look like a fool a few days later.
How many times has this happened to you since Obama announced running for president??? only to find just about all of it was the press’s imagination.
August 17th, 2009 at 11:27 am
The US government is spending $TRILLIONS of our dollars on healthcare. There is not a single fucking organization in the commercial sector that would spend that kind of money without having a say in what the money is being spent on and on how things are run.
The insurance companies oppose public option because they want to keep health care a a system of mysterious black boxes which they alone can control.
Because that is how they buttfuck the taxpayers of this country and how they can make tons of money while telling 45 million Americans to go fuck themselves.
Corporations THEMSELVES are doing their version of the public option — taking over healthcare management and insuring themselves. Because THEY realize they and their employees are being fucked by the middlemen who provide NOTHING but collect rents. So why should the government not manage its money in the same way?
August 17th, 2009 at 11:28 am
Why thank you, soullite! I’m not sure which I appreciate more, the personal compliment or the helpful analogy. Up to now, it never occurred to me to compare Barack Obama and Ted Bundy.
August 17th, 2009 at 11:29 am
I have a hard time believing that House liberals will really kill the bill.
And I have a hard time believing any Democratic Senators would actually join a Republican filibuster of whatever emerges from conference. And in fact I could see the House “liberals” walking away from this round and preferring to take their chances with the budget reconciliation process if they can’t get a decent result past such a hypothetical filibuster.
All that said, as I explained elsewhere, I don’t think a good co-op plan would be a terrible outcome. I just don’t see that compromise as being necessary yet.
August 17th, 2009 at 11:34 am
If you’re going to draw a line in the sand, it should be on the employer mandate. A bill without one could end up being a massive political and policy disaster, as employers could drop their coverage, forcing people to get taxpayer-subsidized, probably inferior policies on the exchange.
Couldn’t disagree more. Tying coverage to employment was a bad idea in 1943 and it’s still a bad idea. I’m willing to accept the reality that sudden, precipitous change to the system is risky, and is probably not going to happen, and I’d be fine with taxing employers as part of good piece of legislation. But a deal breaker? No way.
To me the deal breaker is proper regulation of the insurance industry so that the aforementioned “inferior policies” are, um, illegal. If insurance companies are regulated to the point where they’re essentially public utilities, and coverage approaches true universality via sufficiently generous use of public funds, then we’ve essentially got a Dutch or Swiss system. And that would be a huge improvement. And then, as Matt suggests, economizing measures such as public options could be implemented in the near future via the much easier reconciliation process.
August 17th, 2009 at 11:35 am
Conference committee is key.
A co-op option could be backed up by the federal government or any number of tools. It could structured as a quasi-governmental organization. The Rural Electric Association was established under the New Deal.
I’m not saying this is the best way to deal with this, but a compromise could be reached where liberals would be hard pressed to not vote for a bill out of conference.
This is in no way in a legislative dead zone.
August 17th, 2009 at 11:43 am
Re Jasper at 45: “If insurance companies are regulated to the point where they’re essentially public utilities, and coverage approaches true universality via sufficiently generous use of public funds, then we’ve essentially got a Dutch or Swiss system.”
—————
We’ve been “regulating” the insurance companies for decades.
So how is that working out?
Is Ben Nelson giving them a stern talking-to whenever he picks up another $Million in their checks?
August 17th, 2009 at 11:50 am
We’ve been “regulating” the insurance companies for decades.
So how is that working out?
As Krugman pointed out recently, not too badly. Group health insurance providers are prohibited from not renewing the coverage of individuals in the group. Group health insurance providers are prohibited from canceling the coverage of individuals within the group. Group insurance premiums aren’t deductible unless they cover all full time workers (and not just executives). These are examples of government regulation. And they work well. We simply need some additional regulations.
August 17th, 2009 at 11:50 am
If insurance companies are regulated to the point where they’re essentially public utilities, and coverage approaches true universality via sufficiently generous use of public funds, then we’ve essentially got a Dutch or Swiss system. And that would be a huge improvement.
The question becomes whether the existing insurance parasites can be good-faith actors in a system that’s regulated to that degree. I happen to think not. I’m more inclined to believe that persistent felons have more chance of rehabilitation than private health insurers.
August 17th, 2009 at 11:51 am
It seems to me that the existence of credit unions didn’t do very much to keep the costs of retail financial services under control, and I very much wonder if health insurance cooperatives will serve any different function in the health care services sector than credit unions have done in financial services.
August 17th, 2009 at 11:53 am
The question becomes whether the existing insurance parasites can be good-faith actors in a system that’s regulated to that degree. I happen to think not.
pseudonymous: I think you’re likely right. What I want is regulation that’s strong and comprehensive enough to render the question of good faith on the part of health insurance companies moot. I doubt the Ma Bell of the 60s and 70s was any less interested in profits than United Health is in 2009. The key is to take away the latter’s freedom to harm people.
August 17th, 2009 at 11:58 am
What I want is regulation that’s strong and comprehensive enough to render the question of good faith on the part of health insurance companies moot.
This is why I’m chary about the idea of the wingnutz wanting to bundle in some chewy ol’ tort reform. Given that the insurers have been documented adopting a strategy of dragging out litigation and only settling on the courtroom steps, any regulation needs to be accompanied by a regulatory body, that in turn needs to be swift and hard in its judgements.
August 17th, 2009 at 11:59 am
Matt writes above:
“I haven’t heard anything new from the White House. They never said the president would refuse to sign a bill that doesn’t include a public option … ”
Wrong, Matt. Sorry, but dead wrong.
Unless you’re going to parse the difference between “refuse to sign a bill that doesn’t include a public option” -Yglesias above- and “[A]ny plan I sign must include … a public option” -President Obama, 18 July 2009.
http://www.youtube.com/watch?v=83FvLjsUOJg&eurl=http%3A%2F%2Ftpmdc.talkingpointsmemo.com%2F2009%2F07%2Fobama-demands-the-bill-i-sign-must-include-public-option.php%3Fref%3Dfpa&feature=player_embedded
Full Obama quote, “[A]ny plan I sign must include an insurance exchange: a one-stop shopping marketplace where you can compare the benefits, cost and track records of a variety of plans – including a public option to increase competition and keep insurance companies honest – and choose what’s best for your family.”
What think?
August 17th, 2009 at 12:03 pm
DTM, I have a hard time believing that Blue Dogs would pass up the chance to vote with the Republicans on this. Personally, I’d love to see them forced to make the choice. Having to vote what their constituients want or what their funders want could have real interesting results!
I think there’s been far too much compromise already. You can’t get anything in negotiations if the other guy knows your position is to compromise first. Sometimes negotiations really are about testing strength. If the other guy thinks you’re weak, they’ll just keep pushing until you have nothing left worth fighting for. That’s what we’re seeing now.
August 17th, 2009 at 12:08 pm
Jasper, regulation via the tax code certainly has prevented group insurance from adopting the worst excesses of the individual insurance market, and extending those protections to the latter is a good idea. However, what existing regulation has not done, and expanded regulations will not do, is to guarantee the affordability of coverage. The cost of group coverage to employers is slowly strangling the economy, and individual policies are already unaffordable by many people- a situation which will only get worse if regulations deprive insurers of selection tools they see as essential to maintaining their profits. They will raise premiums for everyone to compensate for this.
August 17th, 2009 at 12:34 pm
The question becomes whether the existing insurance parasites can be good-faith actors in a system that’s regulated to that degree.
It certainly helps if the insurance in question is being provided by non-profits (as in the German model) or on a non-profit basis (as in the Swiss model). But if all else fails, you can do something like really strict price controls (as in the Japanese model). Of course all this feels to me like cobbling together an unnecessarily complex imitation of a simple single-payer system, but it can in fact work out OK.
Anyway, my point is that if these are really non-profits run on something like a co-op basis (they will probably be too big for real co-op governance to work, but at least they could be designed to return cost savings to the plan participants), then further regulating them to provide a decent product becomes a lot more plausible.
DTM, I have a hard time believing that Blue Dogs would pass up the chance to vote with the Republicans on this.
I think the way the politics work out is that the House Blue Dogs and red-state Democratic Senators don’t mind voting with the Republicans when the Democrats win anyway. It is an entirely different proposition to have their votes be the deciding votes actually killing a major Democratic initiative.
That said, I could see that happening on cap and trade. I just don’t see that happening on health care. So, I would expect the conference report to pass the House with some Democrats voting against, and the conference report to pass the Senate with some Democrats voting against the bill but refusing to join an attempted filibuster.
August 17th, 2009 at 12:36 pm
The cost of group coverage to employers is slowly strangling the economy, and individual policies are already unaffordable by many people- a situation which will only get worse if regulations deprive insurers of selection tools they see as essential to maintaining their profits. They will raise premiums for everyone to compensate for this.
Well, there are pluses and minuses on the cost side both with the status quo and with reform. Although insurance firms will lose the cost-cutting tools you cite, they also should have fewer costs shifted onto them from hospitals that must provide care to the uninsured. And of course under the most likely reform scenarios, health insurance companies will gain the business of millions of cheap-to-insure young healthy people.
But any rate, conservative critics are correct about one thing: expanding coverage won’t reduce America’s aggregate healthcare bill — at least not in the short term. Getting to 97-98% coverage will surely push that 16% of GDP number upwards. But I’m just a crazy liberal, and I think spending money to make people healthy is a good thing (yes, I know, doing it this way will bankrupt the country blah blah blah; but Switzerland and The Netherlands doesn’t seem to be on the verge of bankruptcy, and, at any rate, fifty votes for deficit reduction in 2013 will be a lot easier than 60 votes for a new federal healthcare agency in 2009).
August 17th, 2009 at 12:43 pm
Maybe I’m missing something, because who knows WTF is actually in any prospective health care “reform,” but if you have mandates and you don’t have a public option, are you not forcing people to buy coverage they can’t afford, and publically subsidizing insurance company profits and executive salaries and bonuses, and thus actually making things worse while at the same time making the opponents of reform even bigger and more powerful?
If the Democratic party has 60 votes in the Senate and can’t deliver a measure that has 76 percent public approval, they’re not fit to govern. Who the hell made Kent Conrad and Max Baucus the kings of America?
August 17th, 2009 at 12:43 pm
Jasper, you’re not understanding the problem I’m talking about. I don’t care about deficits or aggregate spending (or rather, I’ll start caring when conservatives- and Obama- start worrying about the cost of unnecessary wars.) I’m talking about people not being able to afford their health insurance premiums.
August 17th, 2009 at 12:46 pm
[...] More from Yglesias. [...]
August 17th, 2009 at 12:59 pm
[...] unofficial leaders of the D.C. blogosphere and celebrities to nerds like myself in the metro area, point out that HHS Sec. Sibelius’s discouraging statements on the public option isn’t [...]
August 17th, 2009 at 1:02 pm
[B]ut if you have mandates and you don’t have a public option, are you not forcing people to buy coverage they can’t afford, and publically subsidizing insurance company profits and executive salaries and bonuses, and thus actually making things worse while at the same time making the opponents of reform even bigger and more powerful?
Well, that is part of why something like a nonprofit co-op system is at least worth considering as an alternative to a public option. You can (and should) also regulate the terms of any insurance plan provided through the exchanges to make sure there isn’t excessive profit-taking (e.g., requiring a certain high percentage of premiums be paid out in benefits).
August 17th, 2009 at 1:03 pm
I’ll consider it on the day that Ken Conrad is willing to ask farmers to join nonprofit co-ops instead of suckling at the Federal teat.
August 17th, 2009 at 1:15 pm
I’m talking about people not being able to afford their health insurance premiums.
Steve LaBonne: Isn’t that what the subsidies are for?
August 17th, 2009 at 1:18 pm
You can bring a horse to water but you can’t make him drink. In major metro areas there’s few reasons that your average banking customer can’t use a credit union. Some people are lazy (including me for years and most of my friends now).
August 17th, 2009 at 1:18 pm
Who the hell made Kent Conrad and Max Baucus the kings of America?
James Madison, Alexander Hamilton, and Robert Byrd.
August 17th, 2009 at 1:21 pm
Echoing what Steve LaBonne said at #59: “I’m talking about people not being able to afford their health insurance premiums.”
People are being priced out of decent coverage already. What is to become of them? That’s the heart of the whole health care debate, how are we going to get health care?
August 17th, 2009 at 1:27 pm
I think the administration is going to say whatever they need to so that a bill can get out of the Finance committee.
Once Bacaus and Grassley are just two of 100, then progressives should push for the public option.
August 17th, 2009 at 1:55 pm
[...] unfortunate. Matt Yglesias (who heavily favors a public option and a single-payer system) makes the point that reform without a public option can still include the following: (a) subjects insurance [...]
August 17th, 2009 at 2:02 pm
holy shit! M. Ygliesias is not only a foreign expert (self-proclaimed), he is a domestic policy expert and whip-counter extraordinaire
a goddamn matt-of-all-trades
August 17th, 2009 at 2:29 pm
I do not understand why nobody is asking the conservative “Democrats” why they are opposed to the public option. I never heard any of them answer this question. Just saying there are not the votes in the Senate w.o any explication why is intelectually dishonest.
Let’s take the important metrics of the reform everybody agrees on:
1. Univresality – No doubt a plan with public option will insure more people.
2. Choice – The public option only increases choice.
3. Affordability and 4. Cost – No doubt the price to insure a person or a family in the public option will be smaller than pay or subsidize the corresponding premium for the same coverage in a private plan.
So if more universal, more choices, more affordable, and will cost less why are these conservative “D” opposed (especially on cost how they square this with their deficit hawkiness)?
If asked the only remaining answer for them is ideological (the free market vs Big Gov, bla, bla, bla..).
If that were they go than we’ll all know they are just GOP in disguise, enjoying all the perks of the majority and then stubbing their D colleagues in the back.
August 17th, 2009 at 2:41 pm
I’ll consider it on the day that Ken Conrad is willing to ask farmers to join nonprofit co-ops instead of suckling at the Federal teat.
I honestly can’t figure out the logic of this statement. It would be great if the “farmers” (more like giant conglomerates) benefiting from federal agricultural subsidies were forced to become non-profits before they could receive those subsidies. I also know Conrad won’t go for that deal, but I’m not sure why that means we shouldn’t do non-profit co-ops in the health care exchanges.
August 17th, 2009 at 3:34 pm
What I’m saying is that Conrad is full of shit and so is this nebulous, untried co-op “plan”. And that Conrad would never accept such a switcheroo on an issue he actually gives a damn about.
August 17th, 2009 at 3:37 pm
That would be the subsidies that conservadems keep trimming back to keep the total cost of the bill below some arbitrary ceiling they pulled out of their asses. There is no prospect of the level of subsidies that would be necessary to prevent the individual mandate from triggering a massive backlash.
August 17th, 2009 at 3:46 pm
Matt: “They never said the president would refuse to sign a bill that doesn’t include a public option”
Obama, July 17, 2009: “Any plan I sign must include an insurance exchange: a one-stop shopping marketplace where you can compare the benefits, cost and track records of a variety of plans – including a public option to increase competition and keep insurance companies honest – and choose what’s best for your family.”
August 17th, 2009 at 4:17 pm
House progressives ought to kill the bill, and come back in 2011 with a single-payer, Medicare For All plan.
August 17th, 2009 at 5:03 pm
Steve LaBonne gets to the meat here:
- the co-op stuff is just bullshit. It was pulled out of Conrad’s ass, but because it’s not Scary Gubmint Run Stuff, as opposed to the Department of Giving Dakotan Farmers Money, it meets a certain Beltway Bipartisanship standard of crapitude. There is no real model to draw upon. But it’s pure American, so it must be better than that frenchy shit.
- the cost target is also bullshit superficial showboating by “fiscal conservatives” who presumably wouldn’t buy a beater for six months’ driving before it dumped out its transmission on the road. The fiscally conservative approach should be to spend smartly, not cheaply up-front to avoid a repair bill down the road.
August 17th, 2009 at 5:10 pm
Isn’t the dominating force driving the legislation the insurance lobby, led by UnitedHealth, as BusinessWeek has reported? Doesn’t this means the bottom line in the final bill will be employer/individual mandates, reduced minimum benefits, private-run coops, and a massive increase in insurance company profits?
So, will “House liberals will really kill the bill”? I say no. Rahm Emanuel will find 25 House Republicans to vote for a huge transfer of wealth from the poor to the rich. That’s the flaw in the thinking of Jane Hamsher, Atrios, and others think “House Dems will hold firm” is a “plausible story.” The AP story today, saying
actually is perceptive, IMHO.
August 17th, 2009 at 5:12 pm
This statement and many others above are based upon the assumption that the premiums of the publicly-run plans in the exchanges would be considerably less than those of the private insurers. (Or that there would be subsidies available to those enrolled in the public plans that are not available to those enrolled in the private plans.)
I challenge anyone here to find any language in any of the bills out of committee that includes guaranteeing that public option premiums would be considerably lower than that of the private premiums.
You won’t find it. But, please try.
The public plans are designed in all of the bills to be on a level playing field with the private plans. The public option will not make insurance any more affordable for those who use the exchanges than what is available from private insurers. But, again, prove me wrong. Please.
It’s also worth pointing out again—because a considerable number of people are confused about this—that the public option will not be available to anyone who can get health insurance from their employer or via Medicaid. You can’t refuse employer coverage so that you can enroll in a public plan. Per Yglesias’s flow-chart, it is only a relatively small number of Americans for whom the public option will be an option. This seems to be a widely misunderstood point and many of those who are infuriated about the possible loss of the public option wrongly imagine that the public option would be something like a Medicare plan that any American could choose to enroll within. It’s not.
There have been various proposals discussed which include very expansive varieties of the public option. But none of those proposals made it into any of the committee bills. The “strongest” public option in any of these committee bills merely included cost-control provisions limiting reimbursements equal to Medicare. None of them included open access to the public option, nor subsidies beyond those available with private plans or provisions which otherwise guarantee that the public premiums would be considerably less than the private premiums. The public option that many people are defending simply doesn’t exist.
I’m in favor of the public option as it appears in the these bills—I prefer it, even when very weak, over not having it at all. (Which is how I feel about reform, in general.) Indeed, I’d be strongly in favor of public options in the very expansive forms that many seem to imagine that the versions in these bills are. In fact, I’d prefer a single-payer system or even nationalized health care. But none of those latter things are on the table. What’s on the table is a weak public option that won’t greatly improve the reform in relative contrast to not having any reform at all. If it were a matter of losing the public option that many seem to think exists, then it would be worth it to fight to the death for it. But that’s not the public option that’s on the table.
It’s not worth endangering reform for.
Furthermore, I have very little sympathy for all the 30K+ income uninsured folk who are complaining about the individual mandate. The vast majority of the currently uninsured make much less than this and they will be able to get coverage because of the subsidies. Failing to support reform because of this personal interest is just voting with your wallet, as the Republicans so often do.
August 17th, 2009 at 6:21 pm
Failing to support reform because of this personal interest is just voting with your wallet, as the Republicans so often do.
It’s one thing to have an unstipulated portion of one’s taxes go towards funding stupid, fucked-up wars. It’s another thing to have one’s bank account raided by a specific amount per month to fund a private insurance parasite fucker’s lunch account. Consider it conscientious objection until there’s a way to ensure I won’t be doing that.
August 17th, 2009 at 7:49 pm
See, I still don’t see what that gets Obama at all. If the plan was to make Max Baucus the big bad guy selling some Aetna giveaway, why didn’t we get the stingy “nonprofit” co-op plan out of Finance months ago? Why did Obama even float any support for the public plan? Why did he even bother responding to the town halls, etc…?
Why, for that matter, would the Republicans be opposing it so forcefully? If this was really just an unqualified giveaway to the insurers, why would Grassley be whipping up his psycho base?
I don’t like throwing around the phrase “conspiracy theory,” because a lot of very real questions have been dismissed that way. But I honestly cannot follow your logic here. What “loot” does Obama take home in creating a bad plan that gets half the country yelling “sellout!” while the other half yells “socialist!” ?
August 17th, 2009 at 9:37 pm
What I’m saying is that Conrad is full of shit and so is this nebulous, untried co-op “plan”. And that Conrad would never accept such a switcheroo on an issue he actually gives a damn about.
Germany basically does a version of co-ops (their “sickness funds” are nonprofits which collect premiums from the members and negotiate with providers over fees).
Anyway, I actually don’t care about Conrad’s motives.
August 17th, 2009 at 11:16 pm
If Cunt Kenrad can provide real-world examples of his “co-op” scheme working, he might be worth a listen. He can’t, because it was dreamed up on the back of an envelope in his senate office.
I’m a member of one of the two current (large) health co-ops in the United States. I paid a $600 co-pay for a $115,000 brain surgery (with complications) at the the UW Harborview medical center. I’ve only received a bit of guff from my insurance company over something that was approved within two weeks of it being denied. I’d still prefer a public option, but health co-ops are here, and they’re not bad.
August 18th, 2009 at 12:20 am
Co-ops are the new HMO’s. HMO’s were going to save us the last time round. They were new — nobody knew much about them — but we were all assured they’d be cheaper and would manage health care better.
In reality they were nothing but a bogus distraction whose chief accomplishment was to run real health care reform off the rails.
Sound familiar? We’ve been here before.
August 18th, 2009 at 1:49 am
Co-ops are the new HMO’s.
Except they would be nothing like HMOs.
In truth, there is nothing more and nothing less “new” about the co-ops idea than the public option idea. I nonethless have a preference for the public option on the merits, but I recognize that I have to do better than “co-ops are new” to justify that preference.
August 18th, 2009 at 2:09 am
[...] Matthew Yglesias does see what the big deal is, either way: [...]
August 18th, 2009 at 6:30 am
We use be able to try it first before we get the coop health insurance so better watch for it…
August 18th, 2009 at 2:20 pm
Don Williams is right. I had a bunch of “c” level chores to do yesterday which took me all around Philadelphia. All the ordinary folks I talked to — from the ones inspecting my car to the ones getting me an instant registration, etc., were fired up and quoting Olberman. My son and I were amazed to hear so many progressive voices.
Obama and the administration dems better wake up. They are losing the progressive voters big time on the health care front.
August 19th, 2009 at 12:23 am
[...] feel is very constructive, and might be self-destructive in the long run. Which probably puts me in the Matthew Yglesias camp. Hmmmm. I may have to rethink that [...]