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Hullabaloo


Sunday, September 06, 2009

 
That's It?

by digby

Feel the magic. The Baucus plan is finally revealed:

In a last effort to give the Senate a bipartisan health care bill, the chairman of the Senate Finance Committee circulated a comprehensive proposal on Sunday to overhaul the health care system and proposed a new fee on insurance companies to help pay for coverage of the uninsured.

The proposal is the culmination of more than a year of work by the chairman, Senator Max Baucus, Democrat of Montana. A similar fee was proposed by several liberal Democrats in July. In making it part of his proposal, Mr. Baucus may help cover the costs of the bill but also risks alienating Republicans whom he is trying to win over. Mr. Baucus is struggling to forge a bipartisan consensus among 6 of the 23 senators on his committee before President Obama puts new pressure on lawmakers in an address to a joint session of Congress on Wednesday evening.

The proposal by Mr. Baucus does not include a public option, or a government-run insurance plan, to compete with private insurers, as many Democrats want.

[...]

People familiar with Mr. Baucus’s plan said it was calculated to appeal to Senator Olympia J. Snowe, Republican of Maine. But, at first glance, they said, it appears unlikely that the proposal, in its current form, could win support from the other Republicans in the “group of six,” Senators Charles E. Grassley of Iowa and Michael B. Enzi of Wyoming.

The group is scheduled to meet on Tuesday, when Congress reconvenes after its August recess. Mr. Baucus is looking for a quick response from the Republicans.

Mr. Baucus’s plan, expected to cost $850 billion to $900 billion over 10 years, would tax insurance companies on their most expensive health care policies. The hope is that employers would buy cheaper, less generous coverage for employees, thereby reducing the overuse of medical services.

The separate new fee on insurance companies would help raise money to pay for the plan. The fee would raise $6 billion a year starting in 2010, and it would be allocated among insurance companies according to their market shares.

The fees were first proposed by Senators Charles E. Schumer of New York, John D. Rockefeller IV of West Virginia and Debbie Stabenow of Michigan. Until now, Mr. Baucus had not shown interest in the idea.

Mr. Schumer said, “The health insurance industry should pay its fair share of the cost because it stands to gain over 40 million new consumers under health care reform legislation.”

Mr. Rockefeller said the fees were justified because insurance companies were “rapaciously, greedily and unstoppably making money by underpaying the patient, by underpaying the provider and by overpaying themselves.”

Insurers and many Republicans in Congress oppose the fees, saying they would be passed on to families and employers who buy insurance. Robert E. Zirkelbach, a spokesman for America’s Health Insurance Plans, a trade group, said the fees would “make coverage less affordable.”

A recent report by Oppenheimer & Company, the investment bank, said, “It will be very difficult for the Senate Finance Committee to structure the fees in a way that they won’t be immediately passed on to customers in the form of higher premiums.”

Another section of Mr. Baucus’s proposal would help pay insurance premiums, co-payments and deductibles for people with incomes less than 300 percent of the poverty level ($66,150 for a family of four). It would also provide some protection for people with incomes from 300 percent to 400 percent of the poverty level (up to $88,200 for a family of four), so they would generally not have to pay more than 13 percent of their income in premiums.

Mr. Baucus’s proposal does not include a “trigger mechanism” of the type recommended by Ms. Snowe, who would offer a public insurance plan in any state where fewer than 95 percent of the people had access to affordable coverage.


Baucus has basically chosen the back door approach to lifting the employer exclusion, which was floated earlier by John Kerry. You'll recall that CBO head Steve Elmendorf indicated in his testimony that lifting the exclusion was one financing mechanism he would probably score well. (As I wrote at the link, that seemed like a strong hint from CBO to do exactly that if the Democrats wanted a decent score.)

Since this is going to piss off the insurance companies and make the Republicans more obstinate than ever, it's hard to see why he felt the need to eliminate the public plan, but there you have it. So we have a shitty plan that the CBO will say saves money but that Democrats will have as hard a time passing as one with a public plan. Awesome strategy.

So, no public plan, no co-ops, no trigger. No bipartisanship. No surprise.

We're still waiting for Obama and the conference. As we always were.


Update: FYI: according to the article:

Mr. Baucus would impose limits on out-of-pocket medical costs — the co-payments, deductibles and similar charges for covered items and services. The limits would be $11,900 a year for a family and $5,950 for an individual. The comparable numbers in the House bill are $10,000 and $5,000.


I'm not defending this crap sandwich, but after reading the comments it's clear that it needed to be pointed out that he did impose limits on how much the insurance companies charge --- which is why they will be pissed if this passes. Read the whole article.

None of this makes much sense in and of itself. IMO, he's just looking for a better CBO score to get it past the fiscal scolds and then they'll write the real bill in the conference. After all, months ago, Obama told bloggers on a conference call what he was planning:

The House bills and the Senate bills will not be identical. We know this. The politics are different, because the makeup of the Senate and the House are different and they operate on different rules. I am not interested in making the best the enemy of the good. There will be a conference committee where the House and Senate bills will be reconciled, and that will be a tough, lengthy and serious negotiation process.

I am less interested in making sure there's a litmus test of perfection on every committee than I am in going ahead and getting a bill off the floor of the House and off the floor of the Senate. Eighty percent of those two bills will overlap. There's going to be 20 percent that will be different in terms of how it will be funded, its approach to the public plan, its pay-or-play provisions. We shouldn't automatically assume that if any of the bills coming out of the committees don't meet our test, that there is a betrayal or failure. I think it's an honest process of trying to reconcile a lot of different interests in a very big bill.

Conference is where these differences will get ironed out. And that's where my bottom lines will remain: Does this bill cover all Americans? Does it drive down costs both in the public sector and the private sector over the long-term. Does it improve quality? Does it emphasize prevention and wellness? Does it have a serious package of insurance reforms so people aren't losing health care over a preexisting condition? Does it have a serious public option in place? Those are the kind of benchmarks I'll be using. But I'm not assuming either the House and Senate bills will match up perfectly with where I want to end up. But I am going to be insisting we get something done.


We still have absolutely no idea what that really means, but let nobody claim the president didn't tell everyone in advance that he planned to make the deal in the conference. The only question is why they decided to let this thing hurtle out of control in the month of August. If I had to guess, they actually thought that if they caved enough to the industry they could get Republicans on board. And if that's so, it doesn't bode well for the "tough, lengthy and serious negotiation process."



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