Preliminary Analysis of the Affordable Health Care for America Act
Congressional Budget Office
October 29, 2009
The Congressional Budget Office (CBO) and the staff of the Joint Committee on Taxation (JCT) have completed a preliminary analysis of H.R. 3962, the Affordable Health Care for America Act, as introduced on October 29, 2009.
The options available in the insurance exchange would include private health insurance plans as well as a public plan that would be administered by the Secretary of Health and Human Services (HHS). The public plan would negotiate payment rates with all providers and suppliers of health care goods and services; providers would not be required to participate in the public plan in order to participate in Medicare. The public plan would have to charge premiums that covered its costs, including the costs of paying back start-up funding that the government would provide.
Roughly one-fifth of the people purchasing coverage through the exchanges would enroll in the public plan, meaning that total enrollment in that plan would be about 6 million.
That estimate of enrollment reflects CBO’s assessment that a public plan paying negotiated rates would attract a broad network of providers but would typically have premiums that are somewhat higher than the average premiums for the private plans in the exchanges. The rates the public plan pays to providers would, on average, probably be comparable to the rates paid by private insurers participating in the exchanges. The public plan would have lower administrative costs than those private plans but would probably engage in less management of utilization by its enrollees and attract a less healthy pool of enrollees. (The effects of that “adverse selection” on the public plan’s premiums would be only partially offset by the “risk adjustment” procedures that would apply to all plans operating in the exchanges.)
http://www.cbo.gov/ftpdocs/106xx/doc10688/hr3962Rangel.pdf
And…
Affordable Health Care for America Act
H.R. 3962 (replaces H.R. 3200)
Introduced October 29, 2009
SEC. 321. (b) (2) ENSURING A LEVEL PLAYING FIELD
Consistent with this subtitle, the public health insurance option shall comply with requirements that are applicable under this title to an Exchange-participating health benefits plan, including requirements related to benefits, benefit levels, provider networks, notices, consumer protections, and cost-sharing.
H.R. 3962 (1990 pages)
http://docs.house.gov/rules/health/111_ahcaa.pdf
What happened to that public option that the liberals promised us when they decided not to try to enact the golden standard of a single payer national health program? You know, that government program, like Medicare, designed to be less expensive, more efficient and more equitable, and that each of us could choose in place of private health plans. Really, what happened to it?
Well, Congress plowed it under. Their first priority never was about patients. It was always about taking care of the private insurance industry. Instead of enacting policies that would provide everyone with affordable health care, they have crafted reform that provides a robust insurance market, and then patients are crammed into whatever niches that market creates.
A prime example of their approach is that they have insisted that the public option be prohibited from using policies that provide the greater efficiency and effectiveness of government health care financing programs such as Medicare. To protect the private insurers from “unfair” competition from the government, they have included in the legislation policies to “ensure a level playing field.”
What does the CBO predict will be the outcome of these policies? The public option would have “premiums that are somewhat higher than the average premiums for the private plans in the exchanges,” and fewer than 2 percent of our nation will be enrolled in our own Medicare-like plan that was promised as a choice for all of us.
The golden standard? This public option is not even made of brass. It’s merely the slag cast off while the private insurers walk away with the ingots.
(NB: Do not assume that this message is a plea for a “robust” public option. Adding a robust option to our dysfunctional, fragmented system of health care financing would have very little impact in reducing the waste, inequities, and inefficiencies in our system. This message is a plea to dump the private insurers into the slag pit and use our taxpayer ingots to purchase our own improved Medicare-for-all system.)