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The "Reform" Deal

Ezra Klein:

[I]f I could construct a system in which insurers spent 90 percent of every premium dollar on medical care, never discriminated against another sick applicant, began exerting real pressure for providers to bring down costs, vastly simplified their billing systems, made it easier to compare plans and access consumer ratings, and generally worked more like companies in a competitive market rather than companies in a non-functional market, I would take that deal.

Me too. Call us when that deal is offered. Of course, Ezra is arguing that that is the deal being offered - "And that may be the exact deal we're getting." It isn't. More . .

To give Ezra credit, he FINALLY addresses some point detractors of this bill make:

Health insurance suffers from market failure in part because it suffers from regulation failure. We're adding the regulations now and we'll see, in 10 years, whether people hate insurers somewhat less, or whether they've embraced the nonprofit model, or whether they're clamoring for public insurance. Either way, putting insurers into a structured market where they'll have to compete against one another and users will rate them should make things a lot better. Public insurance might be the best way forward, but an insurance market that works for consumers is progress nevertheless.

Good to see the admission of regulatory failure. Hard to see the argument for expecting it to succeed now. But, as Ezra says, "we'll see in 10 years."

This part seems fanciful to me:

[P]utting insurers into a structured market where they'll have to compete against one another and users will rate them should make things a lot better.

This is the vaunted exchanges (state based exchanges according to the Senate bill.) The argument seems to be that folks who do not get their insurance from their employer do not shop now. I'm pretty sure they try to. More importantly, "the structure" is rife for collusion, which would be legal by the way, as health insurance companies are exempt from antitrust laws (even if you thought antitrust regulators would be effective in policing them, they can't.)

Finally Ezra's argument that "Public insurance might be the best way forward, but an insurance market that works for consumers is progress nevertheless" misses the mark in two ways, First, the big carrot for political bargaining on health care reform was in fact the mandates and the government subsidies. There will be no second bite at the apple on health care reform. Second, this bill does not create "an insurance market that works for consumers." In the end, this is the dispute - do you believe in these reforms? Is it not fair to say, as Howard Dean does, that they will not and therefore I want to take out the bargaining chip we need to achieve real health care reform?

The Village Blogger argument is that this is all we can get and we will never have another chance again. I think that gets it backwards. Indeed, my argument for sunsetting the mandates is that the ONLY way we can really have another bite at the health care reform apple is if mandates are back in play.

Without the mandates to bargain with, health care reform is dead for a generation.

Speaking for me only

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  • Display: Sort:
    This presupposition that the market can fix (5.00 / 2) (#1)
    by andgarden on Wed Dec 16, 2009 at 08:40:57 AM EST
    healthcare is, I think, highly questionable. But of course, as you point out, we're not even attempting that. We're just paying the insurance industry more money to continue to do what it's been doing for years.

    It is a failed business model which is why (5.00 / 1) (#8)
    by inclusiveheart on Wed Dec 16, 2009 at 09:19:39 AM EST
    the Congress has done such things over the decades as allow the private insurers to drop expensive patients and deny people with pre-existing conditions coverage.

    For profit healthcare insurance is an oxymoron if the companies actually deliver the services they are selling.

    Parent

    mccarran ferguson (5.00 / 1) (#14)
    by jedimom on Wed Dec 16, 2009 at 09:50:20 AM EST
    without the repeal of mccarran ferguson (antitrust) and the interstate competition that allows me to shop for a RI plan here in AZ, there will be no meaningful price decrease

    in fact I hazard now that we will be hostage to them our prices will GO UP

    Parent

    Why do 'experts' say Health Care focus OR Jobs (none / 0) (#19)
    by Ellie on Wed Dec 16, 2009 at 12:17:44 PM EST
    Health care and job stability and creation are intrinsically entwined. My own situation, although in a new venture, can't be much different when it comes to coverage, whether it's a family Mom & Pop shop, a new company launching off a home-based sideline, a mid-range company or even a big business (excepting the VIP Caviar Class Coverage the fat cats have always alloted themselves.)

    Most companies are already running at fumes-level right now. For smaller and mid-range ones, if enough key employees get moderately ill, or require a health-related leave, it makes more sense to downshift parts of the whole temporarily (eg, go with layoffs) and revv up again depending on busy/slow times.

    I don't know what land Obama and his Dems live in, but the arbitrary "Christmas or Never" deadline is deliberately petarded. Not a tpyo.

    I agree with Greenwald et al that Obama, obRahm-a and their Anonymice-infested admin always intended this monumental cave. Not that we haven't seen this Dem Spelunking time and time again-- the small caves acting as harbingers to the gargantuan cave set to occur on arbitrarily pre-set cue: it's the Dem M.O.

    Might as well have stuck a couple of turkey wings on Stupak Pitts, Snowe, etc. and called them Christmas Angels (or fowl-appropriate, holiday appropriate version for Tiny Whiny Joe.)

    Parent

    Someone answered that question (5.00 / 1) (#21)
    by inclusiveheart on Wed Dec 16, 2009 at 02:59:09 PM EST
    for me a few months ago with what I thought was a fairly plausible answer.  It went something like this:  If the Democrats made the smart argument in favor of healthcare reform related to the positive effects that good reform could have on people's personal economies, then they would have to offer single-payer.  Because single-payer is the only system that really delivers the real cost savings for people, business and government; and since no one wanted to do single-payer they dropped the economic argument.

    I thought that was a plausible explanation.  Now with this Senate bill as it is, it seems like a very good call since they are proposing no systems for keeping premiums in check other than that vaunted (and totally unreliable) "free" (but not really free) market solution intrinsic in the limited exchanges.  Soooo...  FWIW

    Parent

    Friend who was early Obama supporter (none / 0) (#18)
    by oculus on Wed Dec 16, 2009 at 12:09:30 PM EST
    is fine with exchanges triggered if the insurance companies don't play fair.  Also supports surge in Afghanistan, U.S. drones in Pakistan, and Paul Krugman.

    Parent
    Fanciful indeed (5.00 / 2) (#3)
    by ruffian on Wed Dec 16, 2009 at 08:51:38 AM EST
    This part seems fanciful to me:

        [P]utting insurers into a structured market where they'll have to compete against one another and users will rate them should make things a lot better.

    I have been in the situation of being self employed and shopping for my own insurance. The market he describes has already existed for years. I went right to ehealthinsurance.com.  Maybe being in competition in that marketplace did bring the prices down a little, but it certainly has not helped much or we would not be having this conversation.

    Yes and how are those ratings (none / 0) (#6)
    by inclusiveheart on Wed Dec 16, 2009 at 09:15:30 AM EST
    going to work?  Are we talking internet polls and text voting?  Sigh.

    Parent
    No way, no how this will remain in (5.00 / 1) (#4)
    by MO Blue on Wed Dec 16, 2009 at 08:56:47 AM EST
    the final bill.

    I]f I could construct a system in which insurers spent 90 percent of every premium dollar on medical care


    indeed (none / 0) (#5)
    by lilburro on Wed Dec 16, 2009 at 09:02:02 AM EST
    when will Ezra explain what is actually in the bill, as opposed to what he thinks would work?

    Parent