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Cancel Obama's Hyper-Political Health Summit: Pass Bill by Reconciliation

By February 21, 2010

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The fate of health care reform legislation remains an enigma, fully 13 months after President Obama took office and kicked-off the debate.

The fault lies squarely on President Obama for his lack of imaginative, firmly flexible leadership on the issue despite holding historic Democratic majorities in Congress.

Frankly, his oddly conflicted actions about health care have left most wondering what, behind closed doors, he genuinely desires to accomplish...

In particular, the Obama administration's wishy-washy stance on a public option apparently depends on whom he is addressing. The President's mixed-signals on a public plan option have frustrated liberals, enraged conservatives, and confused everyone left in the muddled middle. Which leaves exactly nobody in agreement with whatever the President might actually support... whatever that might be.

Next Thursday, the President plans to host an extravagantly publicized health care "summit" to which he's invited recalcitrant Congressional Republicans (and presumably Democrats?) to accomplish... well, something unspecified. Since everyone realizes that this political theater will never produce any semblance of kumbaya agreement, his possible goals are to:

  • Embarrass Republicans into passing Democratic reform plans. (0% chance of happening)
  • Push Republicans to speak and act irrationally, then make sure all news outlets raptly report their colorful soundbytes, thereby ensuring stupid Republican behavior a long life on YouTube. (100% chance)
  • Show President Obama as earnestly, deeply engaged in pushing health care reforms.
  • Serve as high-profile political illustration that President Obama tried diligently to work with Republicans.

This summit appears to be a complete waste of time and money. Anything that will be said has already been said, and anything that will be accomplished on a bipartisan basis is already well known. Unless, of course, President Obama has some new proposals.

Personally, I believe Republicans have a couple good ideas that should be carefully considered, including:

  • Tort Reform - So what if trial attorneys don't like it? This is about helping the American people! Seriously, are Obama, Reid and Pelosi throwing all Americans under the bus in order to enrich lawyers? Besides, if tort reform would really have as little impact on health care costs as Mr. Obama claims, why not support it?

  • Cost Controls - 2,000 pages of legislation and not one paragraph requiring cost controls. Huh? Any level-headed 12 year old could tell you that her allowance money goes farther at retailers with lower prices. Providing to private insurers tens of millions of mandated new customers, then allowing greedy insurers to endlessly raise prices... which they surely will... is dumb economics. And guaranteed to crash the precarious new health care system into utter chaos. (Especially when there's no public option to force insurers to keep prices low.)

  • Allowing Insurers to Cross State Lines - I had no answer when my father-in-law asked why Democrats won't allow Americans to purchase insurance from providers outside their own states. Is there a legitimate, common-sense reason for not conceding to Republicans on this free-market point?

Hopefully, President Obama will present these or other new, worthy ideas at his summit, and attract a few more members of Congress to support health care reform legislation.

Regardless, though, unless both the Senate and House magically coalesce to pass a final health care reform bill, our timid President must support Senate passage of health care legislation via a simple majority vote using reconciliation... a process that George W. Bush unhesitatingly used to implement his agenda.

If, after his showy health care summit, President Obama still fails to obtain Congressional passage of a health care reform bill, he will look weak, ineffectual, and hyper-political. He will look like a neutered president. And Americans will feel like they made a mistake in 2008.

I say stop the political games, and cancel the damn summit. Either consider new ideas or don't, but spare us the TV-ready pageantry. Just get the work done by passing health care legislation via reconciliation, if necessary, and move on. Now!

(Photo taken on Feb 19, 2010 in Nevada as President Obama campaigned for Sen. Harry Reid: Ethan Miller/Getty Images)

Comments

February 21, 2010 at 7:11 pm
(1) G. Karber says:

The reason that Democrats are cautious about allowing people to buy insurance across state lines is that various states have various regulations about what insurance must be provided with certain plans, etc.

I think it’s strange that the moment protecting states’ rights goes against fighting Barack Obama, the GOP decides to throw the states under a bus.

As regards tort reform, it doesn’t just “enrich trial lawyers,” it helps people who have experienced medical horror stories get on with their lives. If a doctor botches a surgery because he was drunk and you have to live the rest of your life in a wheelchair, should your pain and suffering compensation be capped at two-hundred grand (or some other arbitrary number)?

February 21, 2010 at 8:27 pm
(2) John Ballard says:

The first comment is correct. Allowing insurance companies to kidnap customers across state lines would render moot state regulatory controls. However, lifting the anti-trust exception for the industry will go a long way toward increased competition. That provision, I think, is in both bills.

Both the House and Senate bills also provide limitations on the percent of premium dollars that must be used for actual medical expenses. This effectively limits how much can be used for administrative, marketing and shareholder profits.

Tort Reform is a red herring.

http://bit.ly/4yy9S

Nevertheless, I agree with you. That is a harmless treat for the yelping dogs. Besides, there are already limits on damage awards in several states, some so low as to make jury awards meaningless anyway.

My instinct is that although the reality of malpractice lawsuits is insignificant, the FEAR of such has two expensive byproducts: (1) Doctors over-treat and over-test, running up unnecessary costs, and (2) Insurance companies, playing on those fears, never miss a chance to pump up premiums.

Some kind of tort reform is definitely in order to stop those non-medical costs to what we carelessly call “medical care.”

The Kaiser Family Foundation has an excellent interactive summary of the legislation.

http://www.kff.org/healthreform/sidebyside.cfm

Anyone complaining about the length of the legislation is being disingenuous. There are plenty of summaries representing thousands of days and hours of hard work by a lot of people on both sides of the debate.

==================

As you know, I’m one of the true believers.
I say let’s give comity one more chance.

But I have to tell you…
This week I about decided what we need is a Republican Congress to get this White House off their accommodating butts to start getting something.. anything… done.
It’s time to put the Blue Dogs in the street and let a bitchy minority do what it does best — push an agenda that reveals the opposition for what it really is, a cowardly crowd of hypocritical opportunists.

February 21, 2010 at 8:55 pm
(3) George says:

Why is “Allowing Insurers to Cross State Lines” a really bad idea?

Here’s why:

It would be a redux of the 1978 Supreme Court ruling that let state usury laws cross state lines. Prior to the ruling, consumers were protected by the usury laws of *their state*. But the ruling said that as the then current federal law was written, the usury laws of the bank’s home state would apply.

At that time, most of the big banks (like today) were based in New York where usury laws were pretty tough.

But then the light bulbs went off in the job starved state of South Dakota. In 1980 they made a deal with Citibank. Citibank would move their credit card operations to South Dakota if the state struck down its usury laws. SD did, and Citibank packed up their card operation and went there. So now, Citibank customers in all 50 states would be subject to an unlimited interest rate – even if their state had a cap.

Nevada and Delaware followed South Dakota’s lead. Now, if you look at the mailing address for your credit card bill, there’s a 99% chance that it’s in one of those three states. And pretty much nobody in America is protected by usury laws on their credit cards. And customers do not have the choice to vote with their wallets because all of the options went to those three states..

This is a piece of history that we all need to know so we don’t repeat it.

In the case of insurance, this is what Republicans and insurance industry lobbyists are looking for.

So insurance companies would all move to most ethically challenged states where, say the state doesn’t have an independent claims review board to insure that insurance companies aren’t trying to weasel their way out of covering an MRI or open heart surgery.

February 21, 2010 at 10:25 pm
(4) Louis Anthes says:

“Allowing Insurers to Cross State Lines – I had no answer when my father-in-law asked why Democrats won’t allow Americans to purchase insurance from providers outside their own states. Is there a legitimate, common-sense reason for not conceding to Republicans on this free-market point?”

Yes, states like Arizona will put vast resources into marketing low-cost, poor-service health insurance to the poor, with high deductibles and poor coverage. And that will lead to a “race to the bottom” among the other states.

States like California, New York, Massachusetts will suffer.

February 22, 2010 at 3:24 pm
(5) George says:

Great choice of words Louis. “race to the bottom” is exactly what we would see.

The insurance exchange is about price – not quality.

So, on this hypothetical exchange, we would only be seeing policies from bottom feeding states.

Insurance companies would pack up and leave the good states.

February 27, 2010 at 3:46 am
(6) Riley says:

Before you ram that bill down America’s unwilling throat…

I challenge anyone to reconcile the following three issues with ObamaCare as Rep. Paul Ryan addressed, bearing in mind that President Obama wouldn’t sign any bill that increased the deficit:

(1) Both the Senate and House bills use the CBO’s static budget analysis methodology to make it appear the bills are fiscally responsible. They both collect 10 years of taxes to pay 6 years of benefits. For any subsequent period, the bills create GIGANTIC deficits.

(2) Both bills include a long term care component. They begin collecting premiums immediately, but since most people that buy long term care don’t need it right away, for the first ten years the long term care runs a big “surplus”. That makes the CBO ten year static budget number look better than they otherwise would. HOWEVER, in the subsequent 10 years as people begin drawing the benefits, the program wipes out the “surplus” from the first ten years, and then some since the long term care provisions in the bill use overly generous underwriting standards.

(3) The bill counts $500 billion in Medicare cost reductions over the next 10 years. These reductions were called for originally in a bill from 1999. Congress has every year since enacted legislation that prevents these cuts from taking place, including this year. Nothing in the bill precludes the cuts from being deferred again. If these cuts were enacted, most doctors would lose money on every Medicare patient. By Medicare’s own admission, doctors would be forced to drop millions of Medicare patients from service or face bankruptcy. Also, depending on what discount rate you use, Medicare has an unfunded liability of $30 to $70 trillion. By what logic is it fiscally responsible to take $500 billion in savings from Medicare and use it to create a new entitlement program?

These are accounting tricks that would make an Enron accountant blush.

February 27, 2010 at 9:37 am
(7) John Ballard says:

Okay, I’ll give it a shot.
I doubt you’ll like anything I say but you know what they say about backsides and opinions…

Paul Ryan is a very impressive talker. He talks so fast reminds me of the late Billy Mays, the famous pitch man, a torrent of real facts pouring out with such velocity that no one has time to contemplate whether or not they all apply or fit togther appropriately. I’m not sure which is a more apt image, a blushing Enron accountant or a Washington politician.

Deficits first. I just heard on the radio that unemployment benefits in Georgia (where I live) will run out Sunday night unless yet another extension from Washington is forthcoming. Both our (R) Senators are pristine examples of politicians who rail against “deficits” but will do all in their power to insure that every dime of federal expenses gets channeled into this state… deficits be damned. And just a few weeks ago our governor proudly proclaimed a joint effort with Microsoft to release thousands of training vouchers to upgrade job skills for lucky recipients. I heard no mention of the fact that ARRA was the source of the funding. That uncomfortable reality is buried at http://www.gaworkready.org/
which is not even linked at the official GA DOL Site.
http://www.dol.state.ga.us/site_index.htm
I mention these local facts simply to illustrate that “blushing” is not an important part of any political discussion.

The CLASS Act, as you point out, is included in both the Senate and House bills. And it is true that in accordance with this provision, a carefully crafted product of the late Ted Kennedy, starts collecting money for several years before it starts paying anything BECAUSE IT IS A SELF-PAYING ARRANGEMENT THAT WILL COST NOTHING AFTER IT GOES INTO FULL EFFECT, being operated in accordance with well-understood and widely used actuarial and accounting principles… the same tried and true formulas that the insurance industry has honed to a fine edge in our lifetimes and manipulated to insure hefty profits over and above whatever is “paid out” in putative “benefits.”

Just as we consumers regard bank deposits as assets while the banks where they are deposited regard them as liabilities, so, too has Congress regarded all income as part of the general revenue, including payroll taxes collected for Social Security which for all of my working lifetime has amounted to a SURPLUS over and above the real needs of the Social Security Administration. Some time during the Reagan years, thanks to Alan Greenspan’s creative imagination, the overage collected from payroll taxes has been pissed away in exchange for what George Bush called “a bunch of IOU’s” in a West Virginia file cabinet. http://bit.ly/cGlQU0
I could go on, but the point has been made that one person’s deficit is someone else’s investment. (See “underwater mortgages” for more information.)

This administration came into office WAY behind, facing a truly horrendous financial train wreck. I could argue that the intent was a malevolent attempt on the part of Republicans to insure that the next administration had enough poison in their diet that they would not survive more than one term, but I really don’t believe that is the case. I never attribute to malice what can be explained by ordinary greed and ignorance.

In any case it is easy in retrospect to say that bailouts, TARP and ARRA were over-reactions. (Heck, I just learned yesterday that GMAC is the seventh largest “bank” in the country. Not saving GM would have added that casualty to the ones we already know about.) It is also easy to throw stones at Medicare, Social Security and Medicaid without any constructive suggestions about how to turn the corner. But the reality is that if nothing is done… and that was precisely the recommendation I heard this week from opponents of reform (and the implication of that comment) the alternatives are even more frightening than what is being considered.

Fifty cents of every health care dollar is now coming from some federal source (Medicare, Medicaid, VA, Tricare, FEBHC). And before the longer this recession lasts, the more people will be pushed out of private insurance and into Medicaid. It’s high time someone with authority at the Federal level got a grip on this national hemorrhage, put a few meaningful rules on the insurance industry and started collecting from future (currently deliberately uninsured) beneficiaries before they present with sickness, accident or age. The day will come when they will expect their piece of the pie, even though they didn’t sweeten the pie when they could afford to do so.

Spare me the mention of blushing.

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