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Harry and Louise on John Edwards’ plan

Harry and Louise on John Edwards’ plan

Universal Health Care Through Shared Responsibility

John Edwards 08
February 5, 2007

“We have to stop using words like ‘access to health care’ when we know with certainty those words mean something less than universal care. Who are you willing to leave behind without the care he needs? Which family? Which child? We need a truly universal solution, and we need it now.”
— John Edwards

John Edwards’ vision for health care reform is built on four steps:

First: Business Responsibility.

Businesses… will be required to either provide a comprehensive health plan to their employees or to contribute to the cost of covering them through Health Markets.

Second: Government Responsibility.

* Offer New Health Insurance Tax Credits: …to subsidize insurance purchased through Health Markets… …sliding scale to middle class families and refundable…

* Expand Medicaid and SCHIP: …to serve all adults under the poverty line and all children and parents under 250 percent of the poverty line…

* Require Fair Terms for Health Insurance: …community rating and guaranteed issue…

* Secure the Health Care Safety Net: …a health care safety net including public hospitals, clinics, and community health centers remains necessary.

Third: New Health Markets.

The U.S. government will help states and groups of states create regional Health Markets, non-profit purchasing pools that offer a choice of competing insurance plans. At least one plan would be a public program based upon Medicare. All plans will include comprehensive benefits, including full mental health benefits. Families and businesses could choose to supplement their coverage with additional benefits. The markets will be available to everyone who does not get comparable insurance from their jobs or a public program and to employers that choose to join rather than offer their own insurance plans.

* Freedom and Security: (Health Market plans are portable)

* Choice between Public and Private Insurers: Health Markets will offer a choice between private insurers and a public insurance plan modeled after Medicare, but separate and apart from it. Families and individuals will choose the plan that works best for them. This American solution will reward the sector that offers the best care at the best price. Over time, the system may evolve toward a single-
payer approach if individuals and businesses prefer the public plan.

* Promoting Affordable Care: Health Markets will negotiate low premiums through their economies of scale… …reducing the need for underwriting and marketing activities…

* Finally: Individual Responsibility. Once insurance is affordable, everyone will be expected to take responsibility for themselves and their families by obtaining health coverage. Some Americans will obtain coverage from public programs like Medicare, Medicaid, and SCHIP and others will get coverage through their jobs. Other families can buy insurance through the regional Health Markets. Special exemptions will be available in cases of extreme financial hardship or religious beliefs.

http://johnedwards.com/about/issues/health-care-overview.pdf

Comment:

By Don McCanne, MD

One of the more important reasons that John Edwards wants to be president is that he really wants to reform health care. He understands the great advantages of the single payer model. But he also understands that he cannot be elected when Harry and Louise point out to the nation that John Edwards is going to “raise our taxes in order to force socialized medicine on us.”

The health policy experts in the progressive community understand this. They understand that the polls demonstrate strong support for Medicare, but also strong support for employer-sponsored plans. Employers currently cover 59 percent of the nation. The workforce and their families are comparatively healthy and most are content with their current coverage. In spite of polls indicating strong support for single payer or Medicare for All, there is a very real reluctance to give up private plans perceived as largely funded by the employers in exchange for a government-run program, especially since many equate that with queues and rationing.

For this reason, the progressive policy community has proposed reform which would allow individuals the option of keeping their current coverage, while establishing a competing public program that would prove to be so compelling that eventually most individuals would want to trade in their private plans for Medicare for All coverage. Although an abrupt shift to a single payer system is not considered to be politically feasible at this time, this gradual shift would be, or would it?

Harry (sitting at the breakfast table, reading the newspaper): I see this guy Edwards wants to tax us to fund some nutty government “Health Markets,” whatever the heck that is.

Louise: Why can’t those politicians leave our health care alone? Why do they keep wanting to get the government involved?

Harry: Like I’ve been telling you for years, Louise, those liberals just want to “raise our taxes in order to force socialized medicine on us.”

In aiming for this highly dubious goal of political feasibility, what beneficial policies has Edwards sacrificed?

* Employer mandate: Smaller employers and those in many of the service industries will struggle with the affordability of plans that provide reasonable coverage, or with the affordability of their contributions to the Health Markets.

* Individual mandates: The requirement for individuals to buy health plans is dependent on the fiction that affordable plans that provide reasonable coverage will be available. With community rating and guaranteed issue, they can never be. Health care costs too much. Premiums can be made affordable only by making access to health care unaffordable through high out-of-pocket expenses.

* Tax credits: To work, refundable tax credits must be very generous for not only lower-income individuals, but average-income individuals as well. The amount would have to be close to what employers are already contributing. Tax credits would introduce the administrative complexity and the unnecessary demeaning intrusion of means testing. It is much more efficient to establish progressive funding of a health care system through tax revenues rather than through tailoring premiums and tax credits to each of the 300 million people in our nation.

* Medicaid and SCHIP: As welfare programs, without an adequate political voice, chronic underfunding will remain a problem. Access will remain a problem because of a lack of willing providers, perpetuating a two-tiered system.

* Health care safety net: Policies do need to be established to be certain that adequate facilities are available in underserved areas. But rather than being near the bottom of government budget priorities, the presence of safety net facilities can best be assured by by funding them through the same high-quality coverage that everyone else would have.

* Health Markets: The model of competing private plans has been thoroughly discredited. No matter what regulations are established, private plans will continue to select the healthy – especially the healthy workforce and their healthy families. The private plans cover the majority of us who are healthy and cost very little, while we taxpayers pay most of the costs for health care for those with medical needs. Even Harry and Louise should understand how absurd this is.

* Administrative inefficiencies: The program suggests that the Health Markets will provide oversight that would reduce administrative costs. Maintaining a fragmented system of public and private programs with thousands of plans and provider lists would perpetuate the excesses of the plans and the administrative burden on the providers. Keeping the plans in place and adding a new administrative intermediary, the Health Markets, is not exactly the ket to achieving administrative efficiency.

* A new public Medicare program: The current Medicare program includes higher-cost seniors and individuals with long-term disabilities, including chronic renal disease. If we were to open the existing Medicare program to everyone else, the pro rata share of the premiums would be so high that Medicare could never compete with the private plans that insure the healthy. In recognition of this, a separate new Medicare has been proposed. Early enrollees would likely include individuals with greater needs, including the currently uninsurable and those from plans terminated by employers with unfavorable claims experiences. It is likely that this separate Medicare risk pool would have much higher premiums than would the private plans insuring the healthy, resulting in the death spiral of Medicare premiums (premiums spiraling upward causing the healthy to leave and concentrating even more of the high-cost individuals in the plan, until no one can pay the premiums).

The way to avoid a Medicare death spiral would be to eliminate the current fragmentation of risk pools: low-cost pools for the healthy and high-cost pools for the sick. All pools need to be combined into one universal risk pool that really does redistribute the risk. Since average-income individuals can no longer afford a pro rata premium, the risk pool must be funded equitably through a progressive tax. Once you solve the problem of pooling risk, why keep in place superfluous private plans that serve no real function but which burn up funds in useless administrative services.

Louise (sitting at her computer, while Harry reads the newspaper): Harry, I’ve really been concerned about how much we’re spending on my health care and how little I’m getting for it. You don’t have to worry because of your Medicare, but I do. When I googled some of the problems, the computer kept taking me to Physicians for a National Health Program. So I looked over their website.

Harry: Yeah? What do they have to say?

Louise: Well, a whole lot.

Harry: Like what?

Louise: Well, it’s too much to say in one sentence. There are a lot of issues I’ve never given much thought to.

Harry: National health. Sounds like socialized medicine to me. I can’t imagine that they’re on to something.

Louise: Well, I don’t know, Harry. I think that we’ve been missing the big picture when we stopped listening because the government would be involved. But these folks have shown that we’re already paying enough taxes to pay for insurance for all of us, but we’re not getting it merely because we keep protecting the private insurance companies.

Harry: You mean WellPoint, UnitedHealth, Cigna, and them others?

Louise: Yeah.

Harry: Those crooks! They’d better not mess with my Medicare!

Louise: That’s the point, Harry. If we’d throw them out we could all have Medicare and save money while we’re doing it.

Harry: Like I was telling you, Louise. You can’t listen to those liberals like Edwards. He wants to leave the private plans in control. Those liberals will never get it right.

How would single payer control costs?

Crossroads/Health Care

Sacramento Bee
sacbee.com
January 29, 2007

How would single payer control costs?

From Daniel Weintraub:

In this commentary in the Boston Globe (link below), Marcia Angell says that “Medicare for all” is the only idea that could control the cost of health care. But other than a one-time drop in administrative costs, she doesn’t offer any examples of how a government-run system would control costs. She complains that private insurers are good for nothing but denying care to people who need it. But denying care would seem to be the single best way to control costs. It might even be the only way.

So to those who support the Medicare for all approach, or any other form of single payer, please help us understand: after cutting out the “administrative fat,” marketing and profits that are part of a private system, how would it control the cost of health care? Anyone?

http://www.sacbee.com/static/weblogs/crossroads/healthcare/

Marcia Angell, “Fix the system with Medicare for all,” Boston Globe, January 29, 2007:
http://www.boston.com/news/globe/editorial_opinion/oped/articles/2007/01/29/fix_the_system_with_medicare_for_all/

Comment:

By Don McCanne, MD

A single payer system, such as the proposed Medicare for all, would have the very powerful economic advantage of being a public monopsony: the single purchaser of health care. Although private monopsonies raise havoc in marketplaces, monopsonies owned by the citizens play a much more beneficial role. The mission of a publicly-owned, single payer monopsony would be to obtain the best health care value for all of us. That means not only reducing waste and inefficiency, but it also means providing adequate resources to develop and maintain the necessary health delivery infrastructure and to attract dedicated professionals that provide our care. It means obtaining truly beneficial care at the fairest prices.

This is much more than mere theory. All other industrialized nations have universal programs that function as monopsonies, whether through government ownership, single payer insurance programs, or very tightly regulated non-profit, quasi-public insurance systems. All have been more successful at slowing the rate of health care inflation, spending much less than we do, while providing care for everyone. They all receive greater value for their health care investment.

To control costs we need to understand why our costs are so high. A few reasons will be listed along with potential policy solutions.

The six largest private insurers in the United States spend an average of 80 percent of insurance premiums on health care; that means they keep 20 percent for administration and profit. Physicians and hospitals consume another 12 percent of private insurance premiums on billing and insurance related functions alone. No other nation would tolerate a system that consumes one-third of insurance premiums on insurance functions. A single payer system dramatically reduces this waste and some of the waste on other administrative inefficiencies as well. Although that is a one-time adjustment, it is a benefit that is perpetuated on into the future.

Health care prices are much higher in the United States than in other nations. Using prescription drugs as an example, a single payer system would negotiate prices to cover legitimate costs and provide fair profits. Allowances would no longer be made for the 80 percent of research that is designed simply to restart the patent clock. Rather, generous allowances would be made for innovations that provide hope of new, beneficial products. Marketing which results in misuse of drugs would not be supported. Since the marginal costs of increased production are quite small, the expansion of appropriate prescribing under a universal system would be quite affordable. A single payer monopsony would be more effective in getting prices right, whether with pharmaceuticals or with any other health care products or services.

A strong primary care infrastructure provides higher quality care at lower costs. Our primary care system is rapidly deteriorating. A single payer monopsony would realign incentives to strengthen our primary care base. Our costs would be lower, and everyone would have access to the quality provided by a medical home of their choice.

Because of the maldistribution of our health care resources and because of variations in medical practice patterns, overuse of high-tech, specialized services that provide no health care benefit have characterized much of our system. A single payer monopsony would have much better information resources to help realign incentives to promote more optimal use of the technologically-advanced products and services. Incentives should be provided to be sure that new and better technology does its best to live up to its promise to lower costs by replacing out-dated but more expensive technology.

With a single payer system, budgeting decisions become more rational. Budgets could be adjusted based on demographics, legitimate delivery costs, inflation, beneficial new technology, changing health care needs, fair profits, and any other appropriate factor. Global budgets, such as for hospitals, would be negotiated to be sure that adequate funds would be available to carry out the hospitals’ mission, while the temptation to drive up revenues by over-utilization would be eliminated.

In a new book, “Medicare Prospective Payment and the Shaping of U.S. Health Care,” Rick Mayes and Robert Berenson demonstrate how Medicare has been able to provide health care value-purchasing through oversight and continual refinement of payment systems. They demonstrate that private plans have not been innovators in cost management but have merely followed the government’s lead through measures such as private, managed care price fixing. Medicare’s prospective payment certainly is not perfect and will continue to be a work in progress, as it should be. Since Medicare controls the spending on less than 15 percent of our population, there are limits to its impact on shaping U.S. health care. But imagine the rich information of a universal Medicare program, and how that information could be used to improve health care value for all of us through a Medicare-type single payer monopsony.

What about rationing? The United States has the worst and most cruel form of rationing because we ration care based on ability to pay. Essential acute care is not rationed in any other nation. Some nations have excessive backlogs (queues) for non-urgent or elective services. But, according to the OECD, many other nations do not have excessive queues because they control them by appropriate monitoring of their systems and applying queue management techniques, or minor adjustments in capacity, if necessary. With the funds that we are already devoting to health care, rationing of beneficial services would not be necessary.

One more very important point: health care does not burden our economy; it is a part of our economy. In fact, health care is the fastest growing sector within our economy. It adds to our economic health. And it does so within our domestic economy, keeping dollars and jobs at home. Although we want far better value for our current health care spending, if health advances can provide greater value, we should encourage them. Economic analyses have demonstrated that we could double our health care enterprise without any negative impact on the other sectors of our economy.

So, Daniel, that is how single payer could control costs, if we want it to. But it is also how single payer could provide us with more health care with even greater value, if we want it to.

Maine provides another lesson – for failure

Report of the Blue Ribbon Commission On Dirigo Health (Maine)

January 2007

From the Final Recommendations:

The Commission expresses its unanimous support for the Dirigo Health Program and its goals…

* Regarding making health care coverage more affordable overall, the Commission endorsed the following initiatives:

– increase transparency of insurance rates by building publicly available data sets that allow consumers and employers to review health plan offerings against broad set of comparative metrics.

– allow sole proprietors to purchase coverage in the small group market

– create options to allow non-subsidized individuals and employees to purchase health care coverage using pre-tax dollars

* Regarding individual market reform, the Commission recommends that the Governor appoint a work group representing the Bureau of Insurance, GOHPF, consumers, insurers, providers and employers to begin immediately to conduct an analysis of three options — (1) high risk pools, (2) merger of the individual and small group markets, and (3) reinsurance options applied to the individual market or merged market option — as well as combinations of and different versions of these options, and that the results of that study guide policy makers in proposing specific solutions to the individual health insurance market in 2007.

* Regarding employer and individual mandates, the Commission endorses the concept of an employer mandate along with a mandate for individuals with income over 400% FPL, and recommends that the Governor move forward to explore the parameters of how such mandates would work, including, but not limited to such issues as: what is considered credible coverage; what would be a reasonable payment for businesses who elect not to purchase coverage; and how the individual mandate would be enforced.

http://dirigohealth.maine.gov/BRC%20Final%20Report.pdf

Comment:

Don McCanne, MD

When the Maine legislature passed the Dirigo Health bill in June, 2003, it was hailed as a bill that promised “affordable coverage to all Mainers.” A Quote of the Day message at that time stated that the policies developed sacrificed “the goal of an affordable, comprehensive and truly universal system.”

https://pnhp.org/news/2003/june/maine_succeeds_in_ad.php

Since the Dirigo Health program was not working, Governor Baldacci issued an Executive Order establishing The Blue Ribbon Commission on Dirigo Health. They have now released their final report.

We have covered many times the reasons why state efforts to achieve universal coverage through individual and employer mandates to purchase private health plans cannot ever achieve the goal of reasonably comprehensive coverage for everyone. I do not need to restate those reasons to come to the conclusion that the recommendations of the Blue Ribbon Commission “cannot ever achieve the goal of reasonably comprehensive coverage for everyone.” (Is there an echo in here?)

My message on June 14, 2003 to health care reform activists in Maine remains the same today:

“Those of you in Maine who are continuing to craft the single payer model, please do not leave your tables. Maine desperately needs your program, as will soon be evident.” (as if it weren’t already)

A Connecticut lesson for state reformers

Although a prior Quote of the Day discussed a Policy Brief on which this report is based, some specifics in this final report are very pertinent to the current debate over various state efforts to provide universal coverage.

Health Coverage in Connecticut: Three Routes to Reform

By Stan Dorn, Jack Meyer and Elliott Wicks
Prepared for Universal Health Care Foundation of Connecticut

Three models for reform:

* One Health Plan Serving All Residents (Single plan)
* Health Insurance Purchasing Pool with Competing Private Plans (Private plans)
* Expanding the Health Coverage Safety Net While Requiring All Parents To Cover Their Children (Safety net)

Benefits:

* Single plan – All state residents get comprehensive coverage; no high deductibles
* Private plans – 61% of residents in pool, with diverse private options
* Safety net – Some adults get tax credits to access purchasing pools

Population covered:

* Single plan – No uninsured
* Private plans – No uninsured
* Safety net – 3.6% uninsured

Integration of low-income households:

* Single plan – Integrated into state health plan
* Private plans – Partial and voluntary integration into pool
* Safety net – Very little integration

Employer health costs:

* Single plan – Major savings
* Private plans – Significant savings
* Safety net – Minimal savings

Household health costs:

* Single plan – Major savings
* Private plans – Significant savings
* Safety net – Minimal savings

Total spending on health care and insurance:

* Single plan – $10.03 B
* Private plans – $10.56 B
* Safety net – $10.66 B

http://www.universalhealthct.org/admin/uploads/1057745758a8a7e7ef7.89093563.pdf

Comment:

By Don McCanne, MD

The “single plan” above technically is not a single payer proposal since it leaves Medicare in place, and it defines benefits as those typical of employer-sponsored plans. But it does include important features of the single payer model in that everyone is automatically enrolled, and the plan is administered by a state commission. Thus the impact demonstrated by the modeling of the “single plan” approaches that of the the beneficial effects previously demonstrated by other studies modeling bona fide single payer plans.

There are no surprises here. As with single payer, the “single plan” covers everyone, with the most comprehensive benefits of the proposals, and with the greatest cost savings – globally, and individually for businesses and households as well.

The current surge of interest in achieving universal coverage at the state level is certainly understandable considering the continued negligence of the federal government in failing to address this gross injustice. What is particularly valuable about this report is that it provides insight into the potential impact of the current proposals under consideration.

The “safety net” model has the greatest likelihood of being enacted since it merely entails expanding coverage for children and perhaps for a few low-income adults. But it is the most expensive and has almost a negligible impact on the problems we are facing. Those supporting this model (e.g., Families USA) contend that the perfect should not be the enemy of the good. But when a much more effective and less expensive option is available, then the “good” is actually bad as it is the enemy of the perfect.

Recognizing the gross inadequacies of the “safety net” model, many states are turning to the “private plans” model in the form of mandates for either employers or individuals to purchase private plans. This report indicates that the “private plans” model is significantly more costly than the “single plan,” and other studies have indicated that expanding coverage through private plans is the most expensive form of attempting to achieve universal coverage.

Also this report indicates that the “private plans” model would be universal, when, in fact, a mandate to purchase insurance can never be universal because many individuals or businesses simply do not have the funds required. This model fails because premiums for plans that are effective in preventing medical debt are too expensive for far too many people. We usually include Switzerland, the second most expensive system, in the list of countries with universal coverage, though actually many there are left without coverage because they also use an individual mandate. In fact, they will have a single payer measure on their ballot this year as a reaction to the inequities of their individual insurance market.

The most important lesson for states appears above under “Benefits.” The states are struggling to find affordable options, which really means affordable insurance premiums, but not affordable health care. The “private plans” model calls for “diverse private options,” which means plans with affordable premiums that expose individuals with significant health care needs to major medical debt. The “single plan” calls for “comprehensive coverage with no high deductibles.”

The policy lesson? The least expensive proposal, “single plan,” is the only one that really does cover everyone, and does it with coverage that really works. A bona fide national single payer program would be even better.

Ideas, not ideology, will bring reform

Tom Linnell, EdD
The Coloradoan

Health-care reform.

Everyone is jumping on the bandwagon, from Hillary Rodham Clinton to Arnold Schwarzenegger. The president highlighted it in his State of the Union speech. Health Care for All Colorado held a community forum in Fort Collins, in the chill of January, and drew 80 vocal residents.

A wide swath of Americans agrees that the health system needs repair. No one says any more that we have the best system in the world, though we may have the best technology.

We pay double what any other nation pays in costs, and for that we don’t even get ranked in the top 25 in health outcomes. Meanwhile, 47 million citizens have no insurance – the majority of them members of working families.

If we know what the problem is, what keeps us from solutions? We are one of the most ingenious nations on the face of the Earth. It makes no sense to be stuck in this morass of rising costs and failing outcomes.

We actually know workable solutions. Only two things keep us from adopting them.

Ideology.

Business friends of mine acknowledge that a national plan makes sense – to insure every citizen, simplify the administration by establishing a single payer, and remove the burden of health insurance from the shoulders of business.

What keeps us from adopting something like universal single payer health insurance?

Ideologues just say, “The government should not run health care.” Well, ideas have strength, but ideology is dangerous. This is a country of ideas and ideals, but we never built anything on ideology.

So, does the government have a place in health care? Too late! It’s already hard at work in health care, and doing a great job. The Veterans Administration was cited for excellence last year. The Veterans Administration, Medicare and Medicaid all receive high marks for efficiency and quality. Overhead in Medicare runs at approximately 3 percent; overhead in private insurance plans is closer to 30 percent. Call them “government” or “quasi-government,” these programs are already serving America well.

Fear.

We are afraid of change. We fear the unknown. We fear that the new order might be good for the other guy but bad for us. So we say, “We’ve never done it. We could never afford it. We’d get rationing, and waiting lists, and mediocre care.”

The known facts are these. Every other industrialized nation has a national health plan. To an astonishing degree, they spend far less than we do and get better outcomes. Citizen satisfaction with those plans runs far higher than ours. Economists have shown that we can afford it.

We have kept profit-making companies in control of our nongovernmental system, hoping that the free market would create cost-savings, quality control and fairness. The facts tell us otherwise-our costs keep rising, our outcomes keep falling, and more of us are uninsured every day.

Ideas for health-care reform will pepper the news as we march toward the 2008 presidential election. Individual states such as Massachusetts, California and Colorado will devise alternative solutions while political candidates hold forth on the national stage, hoping to sound just the right note to capture our imagination.

Let’s not let fear blind us, or ideologues scare us away from known solutions.

Read, listen, ask, think.

Then, speak to your neighbor, your pastor, your doctor, your co-workers, your representatives.

They seem to have heard us say that health care is our number one concern. Now they need to hear that we are not interested in half-way measures. The profit motive in health insurance is not working for our health – let’s look at single-payer proposals.

Tom Linnell, EdD, lives in Fort Collins.

Dr. Don McCanne Comments on USA Today's Op-Ed on Bush's Health Plan

USA TODAY posted on their website Dr. Don McCanne’s response to their editorial that called for Democrats to take a look at the Bush proposal.

http://blogs.usatoday.com/oped/2007/01/post_40.html#comments

Everyone agrees that the regressive tax policies and job-lock of employer-sponsored coverage should be replaced. The divide is over what would be a better system. President Bush advances his ownership society ideology by using tax policy to encourage individual purchase of affordable (stripped down) health plans. That targets precisely those with significant health care needs and makes them owners of their medical debt – the opposite of the reform we need. The opposing view is that the employer-sponsored system should be replaced with equitably-funded, comprehensive insurance that covers everyone. Until we establish such a system, we cannot afford to walk away from the crucial funding that employers provide to our already very fragile system. Instead of new ideas, Bush has cluttered the negotiating table with mean-spirited policy proposals. They should be rejected.

Posted by: Don McCanne, M.D. | Jan 30, 2007 12:00:34 PM

The new 2007 Bush: It's Schwarzenegger lite!

By Peter Schrag
Sacramento Bee
Published Wednesday, January 31, 2007

Was it just imagination or were there unmistakable echoes of Arnold Schwarzenegger in President Bush’s State of the Union speech last week — health care, climate change, bipartisanship? Hadn’t we just heard this in the State of the State? Arnold wanted national influence: Is he getting his wish quicker than he thought?

Schwarzenegger and Bush got polite applause for touching on two subjects that not long ago had been unmentionable. Even last week, the closest Bush got to global warming was “global climate change,” no comfort to dispossessed polar bears, but at least getting warmer. His version of improved health care boiled down to getting 3 million off the rolls of the nation’s 47 million uninsured: the 6 percent solution.

The respective Schwarzenegger and Bush proposals on reducing use of fossil fuels and covering more people with health insurance have one principle in common: As advertised, neither would cost a dime in additional taxes for the average taxpayer. OK, so quibble about Arnold’s “fees” or about Bush’s proposal to tax high-cost employer-paid health insurance.

Can you track all those peas under all those shells? Since all this is supposed to be “revenue neutral,” who gains and who loses? You might think the Bush scheme to tax only gold-plated health plans would affect only corporate fat cats, but it’s likely to hit many ordinary workers, especially the public employees with lush health plans, even harder.

Schwarzenegger’s people put out a document last week comparing the Bush health plan with Schwarzenegger’s, which makes the two sound even more like Rube Goldberg devices than they probably are. But Arnold at least wants to go for the whole enchilada. Yet since both health plans have so many moving parts — a dump of responsibility by the state on the counties, big-bucks fiddles with Medicaid and Medicare, employer mandates, fees/cum taxes on doctors and hospitals — a lot of things will have to change before either plan becomes more than a puff in the headlines. Ditto for the global warming-energy independence proposals: higher motor fuel economy standards; ethanol, biomass, hydrogen, solar, nuclear, clean coal.

Given that the Bushies had been doing nothing for so long on fuel efficiency, just the mention of it was worth a nod. (If you watched the Bush speech, you might have also noticed the corny delight on the face of Sen. Charles Grassley of Iowa when the president mentioned ethanol.)

A lot of those new technologies are dubious or distant, or both. What would not be dubious is the quick efficiency gains and lowered demands resulting from higher taxes on carbon fuels. Schwarzenegger induced Californians to approve a mega-buck transportation bond issue last year — and may yet again — without a cent in additional fuel or other use taxes. Which is to say that even as we struggle with crowded, crumbling roads we do nothing to reduce demand, and so keep chasing our tail.

Because neither the health proposal nor the energy proposal asks for fundamental changes, either from taxpayers or from corporate interests, both rest on the rickety structures of the existing national health systems and energy policies, which are the source of the problems to begin with.

Schwarzenegger’s health plan ambitions are commensurate with the challenge of covering everybody (except maybe the state’s illegal residents who are adults). But his failure to attack the costly and inefficient private insurance system to which he wants to graft his fixes almost assures that the mess will continue. Still that beats Bush, who tinkers only at the margins.

As long as we have a profit-based health care system in which 21 cents or 22 cents — some studies say as much as 27 cents — of every dollar goes to the bureaucracies that manage it to protect industry profits, we’ll spend more for care and get less for it than any other modern nation.

The governor wants to force insurers to spend 80 cents of every dollar on actual care, which would be a marginal improvement. But it doesn’t get within shouting distance of eliminating the 3-to-1 difference in administrative costs between the United States and Canada, which, like most of the civilized world, has a single-payer system in which everybody is covered.

The governing message both in Washington and Sacramento is that the voters can have it all — energy independence, clean air, a thick ice cap, open roads, big cars, good health care (for some) and other quality public services — at no additional cost and, as in the Iraq war, no sacrifice or imposition on anyone except the troops.

According to the latest surveys of young Americans, 80 percent regard getting rich as their top goal in life. Nothing is being asked of them — or of their elders — except maybe in the future. We could be developing alternative energy technologies and an efficient single-payer health system. Instead, we tinker at the margins and pretend that we can fix it all for nothing. Won’t the kids be surprised.

Dr. Don McCanne Comments on USA Today’s Op-Ed on Bush’s Health Plan

USA TODAY posted on their website Dr. Don McCanne’s response to their editorial that called for Democrats to take a look at the Bush proposal.

http://blogs.usatoday.com/oped/2007/01/post_40.html#comments

Everyone agrees that the regressive tax policies and job-lock of employer-sponsored coverage should be replaced. The divide is over what would be a better system. President Bush advances his ownership society ideology by using tax policy to encourage individual purchase of affordable (stripped down) health plans. That targets precisely those with significant health care needs and makes them owners of their medical debt – the opposite of the reform we need. The opposing view is that the employer-sponsored system should be replaced with equitably-funded, comprehensive insurance that covers everyone. Until we establish such a system, we cannot afford to walk away from the crucial funding that employers provide to our already very fragile system. Instead of new ideas, Bush has cluttered the negotiating table with mean-spirited policy proposals. They should be rejected.

Posted by: Don McCanne, M.D. | Jan 30, 2007 12:00:34 PM

The new 2007 Bush: It’s Schwarzenegger lite!

By Peter Schrag
Sacramento Bee
Published Wednesday, January 31, 2007

Was it just imagination or were there unmistakable echoes of Arnold Schwarzenegger in President Bush’s State of the Union speech last week — health care, climate change, bipartisanship? Hadn’t we just heard this in the State of the State? Arnold wanted national influence: Is he getting his wish quicker than he thought?

Schwarzenegger and Bush got polite applause for touching on two subjects that not long ago had been unmentionable. Even last week, the closest Bush got to global warming was “global climate change,” no comfort to dispossessed polar bears, but at least getting warmer. His version of improved health care boiled down to getting 3 million off the rolls of the nation’s 47 million uninsured: the 6 percent solution.

The respective Schwarzenegger and Bush proposals on reducing use of fossil fuels and covering more people with health insurance have one principle in common: As advertised, neither would cost a dime in additional taxes for the average taxpayer. OK, so quibble about Arnold’s “fees” or about Bush’s proposal to tax high-cost employer-paid health insurance.

Can you track all those peas under all those shells? Since all this is supposed to be “revenue neutral,” who gains and who loses? You might think the Bush scheme to tax only gold-plated health plans would affect only corporate fat cats, but it’s likely to hit many ordinary workers, especially the public employees with lush health plans, even harder.

Schwarzenegger’s people put out a document last week comparing the Bush health plan with Schwarzenegger’s, which makes the two sound even more like Rube Goldberg devices than they probably are. But Arnold at least wants to go for the whole enchilada. Yet since both health plans have so many moving parts — a dump of responsibility by the state on the counties, big-bucks fiddles with Medicaid and Medicare, employer mandates, fees/cum taxes on doctors and hospitals — a lot of things will have to change before either plan becomes more than a puff in the headlines. Ditto for the global warming-energy independence proposals: higher motor fuel economy standards; ethanol, biomass, hydrogen, solar, nuclear, clean coal.

Given that the Bushies had been doing nothing for so long on fuel efficiency, just the mention of it was worth a nod. (If you watched the Bush speech, you might have also noticed the corny delight on the face of Sen. Charles Grassley of Iowa when the president mentioned ethanol.)

A lot of those new technologies are dubious or distant, or both. What would not be dubious is the quick efficiency gains and lowered demands resulting from higher taxes on carbon fuels. Schwarzenegger induced Californians to approve a mega-buck transportation bond issue last year — and may yet again — without a cent in additional fuel or other use taxes. Which is to say that even as we struggle with crowded, crumbling roads we do nothing to reduce demand, and so keep chasing our tail.

Because neither the health proposal nor the energy proposal asks for fundamental changes, either from taxpayers or from corporate interests, both rest on the rickety structures of the existing national health systems and energy policies, which are the source of the problems to begin with.

Schwarzenegger’s health plan ambitions are commensurate with the challenge of covering everybody (except maybe the state’s illegal residents who are adults). But his failure to attack the costly and inefficient private insurance system to which he wants to graft his fixes almost assures that the mess will continue. Still that beats Bush, who tinkers only at the margins.

As long as we have a profit-based health care system in which 21 cents or 22 cents — some studies say as much as 27 cents — of every dollar goes to the bureaucracies that manage it to protect industry profits, we’ll spend more for care and get less for it than any other modern nation.

The governor wants to force insurers to spend 80 cents of every dollar on actual care, which would be a marginal improvement. But it doesn’t get within shouting distance of eliminating the 3-to-1 difference in administrative costs between the United States and Canada, which, like most of the civilized world, has a single-payer system in which everybody is covered.

The governing message both in Washington and Sacramento is that the voters can have it all — energy independence, clean air, a thick ice cap, open roads, big cars, good health care (for some) and other quality public services — at no additional cost and, as in the Iraq war, no sacrifice or imposition on anyone except the troops.

According to the latest surveys of young Americans, 80 percent regard getting rich as their top goal in life. Nothing is being asked of them — or of their elders — except maybe in the future. We could be developing alternative energy technologies and an efficient single-payer health system. Instead, we tinker at the margins and pretend that we can fix it all for nothing. Won’t the kids be surprised.

Don McCanne on 'From Left Field' with Barry Gordon

Barry Gordon talks with Don McCanne, M.D., former president and current Senior Health Policy Fellow of the Physicians for a National Health Program, about the problems with the new Bush proposals and the recent Schwarzenegger plans for healthcare and the advantages of a single-payer system, as Barry has long touted.

Click here to listen (mp3)