Posted by: mutantpoodle | December 10, 2009

Getting There

Steve Martin and John Candy in Planes, Trains, and Automobiles

It wasn’t a movie I loved, but lately I’ve been thinking about Planes, Trains, and Automobiles, the John Hughes film where Steve Martin and John Candy are unlikely travel companions during Martin’s desperate attempt to get home during a weather-challenged Thanksgiving holiday.

Planes came to mind because of the braying from some on the left about the likely death of the so-called “public option” – something I actually predicted a few weeks ago. In the film, of course, Martin wanted to get to Chicago, but couldn’t complete the trip on a plane because, given the weather, no plane would take him there.  So he chose another path.  In the case of health care, it may well be that the public option can’t get a bill to cloture. Do we take another path, or stay stuck (to complete the film metaphor) in Wichita?

Let’s take a step back.

What are the critical elements (from the progressive perspective) of health care reform? I’d argue there are three: Access, Affordability, and Universality.

  • Access: everyone has access that can’t be denied for pre-existing conditions or rescinded when one actually gets sick. This is handled largely by regulation.
  • Affordability: One should not have to choose between one’s health and, say, food or rent. This is addressed by competition (the exchanges and, in particular, the public option), and subsidies, the generosity of which is an issue for progressives (and the biggest cost item in the bill).
  • Universality: Everyone is covered, including a mandate that everyone purchase insurance. Not realistically possible without affordability.

The public option was a mechanism by which for-profit insurance companies who participated in health insurance exchanges would face competition – for the small percentage of customers who don’t have employer-based insurance – from a government-run not for profit entity.  The theory was that the public option would keep private insurers honest, and force them to be competitive with a plan that didn’t have a profit margin cooked into their rates.

In reality, the public option that emerged from Senate was not that robust, and there were analyses done which indicated that public option costs might be higher than their competition. (The brilliant Karoli has more on this here.)

What is shaping up as the compromise version has two major components: a plan, administered by the Federal Government’s Office of Personnel Management (OPM) using for-profit companies getting a small fee to do so, and opening access to Medicare to people at the age of 55 (Medicare buy-in). And all I could think of when I heard this was, what took them so long?

I remember watching Darrell Issa and Jack Kingston – stalwart members of the House GOP – talk, on Real Time with Bill Maher –  about giving the American public access to the federal government’s health insurance plan.  My reaction? (a) Why didn’t you do that when you guys controlled the necessary branches of government and (b) from a consumer perspective, that’s a pretty good deal. And, when you add subsidies for lower-income families and individuals, it gets better.

After I left the Fortune 500 company I worked at for 12 years, my “Cadillac” plan cost me, through COBRA, less than $450 a month. Out on the open market, I pay that amount, have a deductible that’s 5 times higher, don’t have dental or vision coverage, and face a more limited network to boot.

The bargaining power of the federal government dwarfs that of the company I worked for.  And while $450 a month isn’t chump change, it’s not highway robbery, either – especially because, by choosing a different plan, I could have paid much less.

So: will the presence of this OPM-administered plan on the insurance exchanges provide real competition to insurance companies? Absolutely.  Will access to Medicare at 55 help millions of people who are most often hammered by insurance companies when they have to buy individual policies? Unquestionably. Is that combination better than the Public Option the Senate was considering? Maybe. But even if it’s barely the same, isn’t the left getting caught up in nomenclature?

(In reality, we don’t know what the final product will look like. But for what it’s worth, Howard Dean likes the new structure just fine.)

A lot of people on the left were arguing that, in Afghanistan, contra Obama, we should declare victory and go home. Why can’t they do that with health care – where that claim is even less of a stretch than it would be in Afghanistan – and stop the reflexive indignation?

After all, if you have to take a train to get to Chicago, you still get there, and the city is no less magnificent than if you’d flown in to O’Hare.

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Responses

  1. If and when the Senate can force itself to vote on the HCR bill, until that point any comment about any particular part of the bill is only speculation. If that happens or not, we can pitch the rants and whine about how it isn’t any better than before, and who’s getting screwed and who walks away with the money. My feeling is the Democrats are going to take an atrocity and turn it into a catastrophe.


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