On Opening the Exchanges

October 14, 2009 — Jon

Over at the Health Affairs blog, Chris Fleming discusses the exchanges in the Senate Finance Bill and quotes Elliot Wicks, a senior economist at Health Management Associates, with respect to Ron Wyden’s failed amendment to open exchanges to everyone.

Wyden’s amendment has attracted both enthusiastic support and fervent opposition. Elliot Wicks a senior economist at Health Management Associates, warns that Wyden’s proposal could saddle the insurance exchanges with the sicker, more expensive members of an employer’s workforce. “If individual employees had a choice of staying with their employer’s plan or going to the exchange, employers would find ways to make their plans more attractive to healthier workers and less attractive to sicker individuals,” Wicks tells the Health Affairs Blog.

That might be true, but this isn’t an argument against Wyden’s Free Choice Amendment as much as it is an argument against the entire employer based system of health insurance. If employers didn’t play a role in health insurance, everyone would simply go to the exchanges and voila! No more adverse selection based on employer preference. This is why Wyden’s original bill removed the tax exemption on employer based health insurance. Without an ability to offer insurance tax free, there’d be no incentive to go through your employer at all, and more to the point, employers would have no incentive to offer plans outside of the exchange.

What’s  more, I’m not entirely convinced by Wick’s argument. In particular, I’m not sure how it would be reconciled with Federally mandated standards for minimum insurance benefits. Presumably, plans that are attractive to healthier people are plans that are light on benefits. Assuming the minimum benefit package precludes the existence of such bare bones plans and also places a cap on lifetime out of pocket fees, I’m not sure the difference between what’s attractive to healthy people and what’s attractive to sick people would be so large as to create a serious adverse selection problem. In any event, I stand to be corrected on this, but it’s really not the point. The problem is entirely a product of an unwieldy and illogical employer tax exemption.

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Robbing Peter

September 16, 2009 — Jon

No time for commentary on the Baucus bill now (if you want that, go here or here), but I’m pretty surprised this Kaiser Family Foundation report isn’t getting more attention. Here’s the Washington Post:

As businesses contend with rising costs, many workers face an erosion of health benefits next year, according to an annual survey released Tuesday by the Kaiser Family Foundation and the Health Research and Educational Trust.

Forty percent of employers surveyed said they are likely to increase the amount their workers pay out of pocket for doctor visits. Almost as many said they are likely to raise annual deductibles and the amount workers pay for prescription drugs.

Nine percent said they plan to tighten eligibility for health benefits; 8 percent said they plan to drop coverage entirely. Forty-one percent of employers said they are “somewhat” or “very” likely to increase the amount employees pay in premiums — though that would not necessarily mean employees would pay a higher percentage of the premiums. Employers could simply be passing along the same share of the overall increase that they are doing this year.

Because health insurance is paid for from pretax income directly by our employers, most people don’t know how much they pay for care or why ballooning spending is a problem. When you talk about spending that comprises 1/6 of the economy, you’re talking about a lot of money. And while some people get a better deal than others, the simple fact of the matter is that we are all paying for this.

I was struck earlier today by the story of a health care company that urged its employees to contact their Senators and Representatives to dissuade them from slashing payments for the service they provide. The company warned that their livelihood was at stake, and I’m sure many employees took action. I just wonder though how quick these employees might leap to the phone if it were explained to them that the payments they were working to protect were coming directly out of their paycheck. That in effect, they were paying for their raise with their own money.

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Between A Rock and Hard Place

September 15, 2009 — Jon

Matt Taibbi has a characteristically scathing post on the Obama administration’s deal with PhRMA, which basically entailed buying the lobbying group’s tepid support by refusing to let Medicare bargain drug prices in bulk and by banning re-importation of drugs. This is all mostly true, although I think it misses the important point that Republican lock-step obstructionism and general intransigence among conservative Democratic Senators has left the administration between a rock and a hard place. If Republicans are almost entirely unwilling to negotiate and key Democratic legislators basically in hock to health care interests, it’s hard to see how see how health remains politically feasible without the support of affected industry groups. If you think the timbre of August was bad, imagine what it would have looked like with drug makers, hospitals, and device manufacturers dumping rocket fuel on the fire. Even if you assume an almost unprecedented — and perhaps ultimately misguided — dose of legislative courage from the left, I still don’t think you can get to 60 without providing cover for the conservative wing of the Democratic party.

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Why Private Insurers Need Reform

September 11, 2009 — Jon

So there’s been a sort of weird cognitive dissonance — or at least a gaping lacuna — when it comes to discussions of health care reform and private insurance. In particular, reformers have noted that if reforms fail to include an individual mandate, private insurers will be subject to rapid implosion as guaranteed issue (no discrimination on pre-existing conditions) means that insurers can no longer stay afloat through adverse selection. Of course, the enormous problem with this line of thought is that by definition, you really can’t stay afloat through adverse selection — you can only slow the rate of your drowning. New census data illustrates the point:

As you can see, with the notable exception of the government run Medicaid, Medicare, TRICARE, and VA, insurance is down across the board. The are lots of explanations, but jump in Medicaid is obvious. As both poverty and health insurance premiums have increased over the past several years, more and more people are only able to get health insurance through a government option designed explicitly for the indigent and otherwise uninsurable. And as the pool of people able to afford insurance shrinks, so too does the ability of insurers to pay for those who actually require care, forcing them to shrink the pool further. It’s a cycle that only leads to their demise.

That is, unless we pass universal health care that mandates everyone receive coverage. Ironically, the fate of the private health insurance industry lies in the hands of reformers.

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Joe Wilson’s Real Crime

September 10, 2009 — Jon
Joe Wilsons crime should be condemning other humans to pain and suffering because they arent permitted to pay income taxes.

Joe Wilson's crime should be condemning other humans to pain and suffering because they aren't permitted to pay income taxes.

Since I’ve been informed my previous gchat status was “distracting” and also since there’s been a lot going on lately, I figured I should update the blog. I’ll have a reply to this long piece in the September Atlantic on — you guessed it — health care when I finish it, but for now, let me offer a little comment on this Joe Wilson kerfuffle.

In particular, I’ve heard a lot of comment lately about how rude and disrespectful the “LIE!” shout was — and indeed, it was those things — but I have to admit it’s actually Joe Wilson’s and the vast majority of Republicans’ (and some Democrats’ and Independents’) positions on health care reform that so gravely offend me. That many of our political officials and leaders would subjugate the legitimate need of tens of millions of Americans to ideology and short term political incentives is callous and disgusting. And with respect to the “lie” in question, the belief that someone who is not a citizen — but is indeed a human being — should be permitted to die or suffer as the consequence of being a political bludgeon is barbarous and unbefitting a nation comprised of people who bristle at even the suggestion of our own imperfection. Save your outrage for what matters.

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Narratives and Strategy

September 3, 2009 — Jon

Today, E.J. Dionne has a column arguing that the town hall phenomenon of angry protesters is not representative of national sentiment, but rather reflects the tendency of the mainstream media to sensationalize news reports.

The most disturbing account came from Rep. David Price of North Carolina, who spoke with a stringer for one of the television networks at a large town-hall meeting he held in Durham.

The stringer said he was one of 10 people around the country assigned to watch such encounters. Price said he was told flatly: “Your meeting doesn’t get covered unless it blows up.” As it happens, the Durham audience was broadly sympathetic to reform efforts. No “news” there.

Steve Benen, noting that conservatives have begun pointing to town hall anger as indicating a lack of support for health reform, says this:

To base a historic public debate on what folks “learned” from cable news coverage of hand-picked town-hall events would be a ridiculous mistake.

Agreed, though I’d just add that this ability to point to protesters was almost definitely a concerted strategy by right wingers and not anything anyone “learned.” Exploit the media’s proclivity for conflict to make it appear that an extremely vocal minority is indicative of broader opinion, thus increasing the value of the political cover provided by protesters.

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What We Don’t Have Here Is a Failure to Communicate

September 1, 2009 — Jon

It hasn’t been an uncommon gripe among liberals that Barack Obama has somehow not communicated his ideas on health care reform clearly. I don’t have a link, but I’ve seen Bill Maher argue something like this, and I’ve heard it a number of times either around the office or in conversations with other people. Steve Benen — not complaining — mentions the criticism today, in the context of some disheartening polling which shows the public to remain confused about the various health care reforms on the table. Steve sensibly points out that Obama has made constant efforts to promote reform, and what’s more, is fighting an uphill battle because Congress has yet to coalesce around a single proposal. This is all true, but I think there’s a simpler explanation. From an NBC/WSJ poll:

As you can see, there are large swathes of the public — majorities in some cases — who believe things that are categorically false, but have nonetheless been peddled by Republican operatives, politicians and conservative members of the media. Indeed, Republicans have mounted a concerted strategy to lie about the particulars of health care reform, scaring vulnerable demographics into opposition. And despite the White House’s efforts — and the occasional debunking in the main stream press — research indicates that once a lie or distortion has entered the public debate, it’s basically impossible to undo the damage. Matters are not helped by a mainstream media that sees as part of its mission of even handedness to continue quoting people who are lying.

All these things considered, it seems quite difficult to blame President Obama for failing to communicate clearly. Strategically speaking, I think there are a number of things the White House could have done differently — for example, adjust more quickly to Republican obstructionism (arguably Max Baucus is most deserving of blame for this, though the White House could have done something to put the heat on), but I don’t think it’s been a failure of messaging per se.

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Horse Race Journalism Is Not Our Fault

August 31, 2009 — Jon

There’s been a little buzz lately over the Washington Post‘s ombudsman piece the other day criticizing the Post for too much “horse race” coverage of the health care debate. Putative causes have cited political obsession among reporters and editors, profit maximizing behavior, and competitive necessity, but Kevin Drum offers this explanation.

This is only going to get worse.  I don’t think mainstream news outlets have ever been all that good at explaining policy, but they’ve probably gotten worse over the years as attention spans have shortened and the media environment has gotten ever louder and more ubiquitous.  You really can’t explain healthcare reform in two minutes, but fewer and fewer people are willing to sit around for much longer than that.

The fault, in other words, lies not in the media, but in ourselves.  The mainstream media may have written ten times as much about the townhalls as they did about the actual substance of the healthcare proposals on the table, but the blogosphere only did a little better. Even here in wonkland, the outrage of the day is a much more tempting blog topic than reimbursement rates for Medicare.

I’m not so sure about this. First, with respect to the town halls specifically, coverage in the mainstream media and cable news was somewhat of a self-fulfilling prophecy. In other words, the fact that lunatics and their cynical agitators knew that nutty behavior would drive coverage spawned more and more nutty behavior, and more and more coverage of nutty behavior. If the media decided that accurate reporting of events meant not giving disproportionate attention to a minority of people, it’s unlikely things would have played the way they did. But this is all secondary.

My memory could be flawed, but I’m pretty sure most of people I read on the blogosphere spent their energy debunking some of the absurd claims made in the town halls or talking about animating factors, not bloviating about political strategy. Even if the general topic was the same, the conversation was totally different. Whereas people with blogs would address statements made in town halls and expose them as ludicrous fantasies, the mainstream media would report the events and discuss the ramifications for certain political actors. The former is helpful from a standpoint of informing the public, the latter is not. I’ve said it a million times, but the point of politics is governing, not winning debates, but the mainstream media seems to disagree with me. And certainly, not all discourse in the blogosphere was informative, but it was certainly better than coverage in the mainstream media.

Anyway, it’s hard to see how this improves. As Kevin noted earlier in his post, horse race coverage partially stems from the need to report news, and twists and turns in legislative sausage making happen far more frequently than policy proposals. However, that doesn’t mean coverage of politics has to be removed from the policies being discussed to the absurd extent they often are. For example, if reporters feel compelled to report that a gun-toting loon opposes a “government take-over” of the health care system, the reporter could at least mention that no such thing is under consideration, the unctuous blabbering of GOP operatives notwithstanding.

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Who Didn’t Know

August 28, 2009 — Jon

Jonathan Cohn has some props for Mickey Kaus who anticipated that making the argument for health care reform on cost savings would be a bad idea. And I think Kaus is right inasmuch as rhetorically it’s not a tremendous leap from “save money” to “ration care.” That said, the implication is that there was some better way. Maybe there was, and maybe there wasn’t. But if Republicans have proven one thing since Obama was elected, it’s that they’re unfailingly clever at twisting mundane and banal legislative language into nefarious plots to impose belief systems, bilk the public, or of course, murder your grandparents. The fact of the matter is that Republicans, with the possible except of Olympia Snow and Susan Collins,  have not been good faith negotiators. That means that no matter what case was presented, it was another argument that would have been the right one.

Republicans don’t have a problem with specific parts of the bill; they have a problem with health care reform. They were going to distort whatever argument Democrats advanced. Pace Mickey’s prescience, I just don’t think it really evinces any special perspicacity to have predicted that Republicans would lie about the legislation. So again, maybe there was an argument that was less immediately prone to distortion, but I have a feeling we still would have been hearing about a “government take-over” that comes “between patients and doctors” and “rations care,” no matter how the argument was initially presented. The mistake Democrats made was not in the form of the argument but that in the expectation that the debate would be based on the merits of those presented.

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Republicans Will Lie About Reform No Matter What The Bill Includes

August 28, 2009 — Jon

In an unsurprising turn of events, conservative pollster Bill McInturff thinks Democrats should have ditched the public option some time ago. From CQ (subscription required):

Bill McInturff, co-founder of Public Opinion Strategies, a firm that works with many Republican lawmakers, told reporters at a breakfast hosted by the Christian Science Monitor that Democrats “should have months ago jettisoned the public option.” Polling his firm released Thursday indicates that Democrats’ overhaul plans are nearly as unpopular now as former President Bill Clinton’s plan was in June 1994, shortly before Democrats then decided they could not pass it.

McInturff is known for conducting polling associated with the infamous “Harry and Louise” ads of 1994 that helped sink Clinton’s plan. His firm found that only 25 percent of the public supports Obama’s plan for an overhaul, while 37 percent oppose; in June 1994, a similar poll found nearly identical levels of support and opposition to Clinton’s plan. McInturff attributed much of the opposition to Obama’s plan to concern about the public option, which opponents say represents a “government take-over” of the health care system.

First of all, I’d be interested to see the specifics of the polling, because there hasn’t been any polling I’ve seen which suggests just 25 percent public support for “Obama’s plan” for health care reform (whatever that is). But more to the point, the thing to note here is that the causal mechanism McInturff explicitly cites is Republicans lying about health care reform. Simply put, nothing under consideration can really be rightly construed as a “government take-over” of health care. As presently constructed, the public option would allow people who qualify for the health care insurance exchange — which is to say nobody with employer coverage — to opt in to a public plan (which would exist alongside a number of private options). There’s just no basis for this belief that the government is going “come between you and your doctor.”

More importantly though, there’s absolutely no evidence to suggest that the lack of a public option would stop Republicans from lying about health care reform. A quick examination of the now infamous “death panels” debate should disabuse anyone of such a notion. What’s more, Chuck Grassley — who has succeeded in wringing compromise after compromise from Max Baucus, is now explicitly saying he doesn’t think there will be any compromise. Of course, this should not surprise anyone. It has been the stated goal of Republicans to kill reform for political gain; Republicans are going to reject out-of-hand any reform efforts that could plausibly be viewed as a “win” for Democrats.

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