Health Plan: Ask ‘What,’ Not ‘When’
It’s not yet time to say that the political debate over this year’s effort at health insurance reform has reached its low, since we’re sure to hear more hyperbolic charges about socialized medicine, meddlesome government bureaucrats that might replace meddlesome corporate bureaucrats — and how we shouldn’t tax the rich because after all, they create jobs!
Any sentient person might wonder where all these jobs are, and why this upper-crust, job-creation engine should be spared a tax surcharge to finance insurance coverage for those who do not now have it. But that would be a digression.
What we apparently are supposed to be talking about is when health legislation should be passed — before the August congressional break? Just after that? Never?
Now that it’s gripped the imaginations of politicians and the media, the politics of the calendar has overtaken the plain truth that Congress already is moving — barely moving, and not necessarily to a triumphal finish — toward expanding coverage, reordering convoluted medical payment systems that breed inefficiency and raise costs, and cleaning up some messes in Medicare created when the Republicans controlled Congress and gave away billions to drug makers and the insurance industry.
Maybe this isn’t a very encouraging beginning. But making a truly fresh start would require the political courage to acknowledge that the workplace-based, private insurance system is too far gone to save with a hodgepodge of fixes. It would force us to acknowledge that to get the definitive cost controls politicians say they want, we would need cost controllers — those worrisome government bureaucrats — to impose rules that consumers, medical providers and the private insurance industry have failed to deliver through market “magic.”
I know, this is all too logical amid the inversion of logic that drives the health care debate. Still, Congress is managing a start. And despite whatever distortions you may hear, the House bill now moving through a series of committees is the best of this year’s starts.
It would expand coverage, according to the Congressional Budget Office, so that 97 percent of adults (not counting illegal immigrants) would have insurance. It would create a public plan as one option for individuals to purchase. And just to set the record straight, this is the clearest path to the culture change needed to upend the payment schemes that now contribute to ever-higher costs.
The nonpartisan Commonwealth Fund, a health care think tank, studied three options for new plans and found that by far the most effective mechanism to drive costs down — with savings for the federal government, consumers and employers alike — was the creation of a public plan that would pay medical providers at the same rates that Medicare pays. A middle-ground option along these lines, creation of a public benefit plan that pays doctors and hospitals somewhat more than Medicare, is included in the House proposal.
Meanwhile, though political ire is directed at the proposed surtax on high-income Americans that would finance much of the House bill, this is the only provision in any bill we’ve yet seen that effectively states the obvious: There has to be a clear source of revenue to finance all of this.
The surtax is transparent. We know who would pay it and how much it would raise (about $544 billion over 10 years, according to official estimates). It doesn’t need a slew of adjustments and exceptions, such as those now contemplated in the Senate for taxing workers who benefit from high-cost health insurance premiums. Any tax on these benefits would require political compromises to account for vast regional differences in premium costs, and, for example, generally higher premiums paid by employees in small firms or those dominated by older workers.
Though the surtax may well be jettisoned, there are unequivocally necessary parts of the House bill that must remain. Chief among them is elimination of overpayments to insurance industry managed-care plans that serve Medicare patients. Taxpayers now spend 13 percent more per patient in these HMOs than they do for a patient enrolled in regular (yes, government-run!) Medicare. Another must-have is a provision to force drug makers to reinstate discounts for Medicare patients who are poor enough to qualify for prescriptions under Medicaid — a rebate that was in place until the Medicare drug benefit legislation, laden with gifts to the pharmaceutical industry, was implemented.
You can call these nagging details. But surely they’re more significant than whether a bill passes next month, or the month after, or even by Christmas.
Marie Cocco’s e-mail address is mariecocco(at)washpost.com.
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