In her latest post on CJR.org, AHCJ immediate past president Trudy Lieberman picks apart the Baucus bill, with a special focus on the Montana senator’s latest changes. Lieberman pays special attention to Baucus’ concessions, and takes care to point out exactly who benefits and how.
Her assessment of the bill’s provision insurers to vary rates based on age (within limits) is particularly incisive:
In exchange for issuing policies to sick people, insurers get to jack up premiums for older people, a kind of proxy for medical underwriting. Baucus essentially allows companies to charge older people more for their coverage. Initially, he wanted to charge them five times more than a younger person, but now he suggests letting them charge four times more. A 58-year-old, for example, who has lost employer coverage and is struggling to pay the premiums for an individual policy may not see that as much of a gift.
The New York Times‘ Reed Abelson writes that the excise tax on premium health insurance plans that Montana Sen. Max Baucus is counting on to pay for about a quarter of his $774 billion reform proposal will hit urban families and union workers as hard as it will Goldman Sachs executives. Proportionally, in fact, union workers with less disposable income will suffer even more from the tax, which hits any plan that costs more than $8,000 for individuals or $21,000 for families, than high-flying white collar types.
The current national average for family policies is around $13,375, and only 1/10 of them would fall under the tax. But, Abelson reports, the pace of health premium inflation is such that far more policies will be caught in the tax net by the time the excise would go into effect in 2013.
The tax is based on the theory that it will help control health care costs by discouraging insurers from offering fancy plans that cover too many unnecessary tests and procedures. AHCJ immediate past president Trudy Lieberman writes for CJR.org that even this attempt to rein in costs will likely just increase them further as insurers pass the costs onto customers and the weaker coverage and corresponding rise in underinsurance forces folks faced with catastrophic conditions into financial difficulty or bankruptcy.
In case you’re wondering, they all come with an individual mandate, expanded coverage, comparative effectiveness, increased regulation of insurers and cost-cutting measures. They differ in terms of budget, funding, a public option and an employer mandate.
Scott Hensley runs NPR's online health channel, Shots. Previously he was the founding editor of The Wall Street Journal's Health Blog and covered the drug industry and the Human Genome Project for the Journal. Hensley serves on AHCJ's board of directors. You can follow him at @ScottHensley.
In the Republican corner, Sen. Judd Gregg of New Hampshire: “I don’t know who wrote it, but if it had been Rube Goldberg, Ira Magaziner, and Karl Marx you might have gotten this product.”
Counterpunching for the Democrats, Sen. Barbara Mikulski of Maryland: “Our current system is a combination of Adam Smith, Darth Vader, and ‘Invasion of the Body Snatchers’ .”
A sobering financial challenge lies behind the sniping – cost estimates have ballooned to $1.6 trillion. Democrats “privately acknowledged” to the Washington Post that finding a way to pay for an expansion of health coverage without blowing up the federal budget “is proving excruciatingly difficult.”
Indeed, the powerful Senate Finance Committee postponed the release of its draft amid worries about cost and a push for at least a little bipartisan support. “We’re not there yet,” said Chairman Max Baucus (D.-Mont.), The Wall Street Journalreported.
Pia Christensen (@AHCJ_Pia) is the managing editor/online services for AHCJ. She manages the content and development of healthjournalism.org, coordinates AHCJ's social media efforts and edits and manages production of association guides, programs and newsletters.
The Senate Finance Committee is holding the last of three roundtables about health care reform, which is being broadcast by C-SPAN. In addition to Sen. Max Baucus (Mont.) and Sen. Charles Grassley (Iowa), there is a long list of witnesses scheduled to appear:
Stuart H. Altman, Ph.D., Sol C. Chaikin Professor of National Health Policy, HellerSchool for Social Policy and Management, Brandeis University, Waltham, Mass.
Joseph R. Antos, Ph.D., Wilson H. Taylor Scholar in Health Care and Retirement Policy, American Enterprise Institute, Washington, D.C.
Katherine Baicker, Ph.D., Professor of Health Economics, Harvard School of Public Health, Cambridge, Mass.
Leonard Burman, Ph.D., Director, Tax Policy Center, Urban Institute, Washington, D.C.
Robert Greenstein, Ph.D., Executive Director, Center on Budget and Policy Priorities, Washington, D.C.
Jonathan Gruber, Ph.D., Professor of Economics, Massachusetts Institute of Technology, Cambridge, Mass.
Michael F. Jacobson, Ph.D., Executive Director, The Center for Science in the Public Interest, Washington, D.C.
James A. Klein, President, American Benefits Council, Washington, D.C.
Edward Kleinbard, Chief of Staff, Joint Committee on Taxation, Washington, D.C.
Gerald M. Shea, Assistant to the President for Governmental Affairs, AFL-CIO, Washington, D.C.
John Sheils, Senior Vice President, The Lewin Group, Falls Church, Va.
In the Columbia Journalism Review, Trudy Lieberman, president of AHCJ’s board of directors, tries to pin down exactly where Montana Democrat Max Baucus, chairman of the Senate Finance Committee, stands on the inclusion of a publicly funded option in any proposed movement toward universal health coverage. Thanks to his powerful position, Baucus is the gatekeeper for any proposed plans and will have significant influence upon their direction.
At issue is the role of private insurance companies in any proposed universal system.
Baucus recently told Time’s Karen Tumulty that he considered a public option a bargaining chip to force insurance companies into other reforms, like dropping restrictions on preexisting conditions and selling policies to everyone, sick or well. In other words, the chip would move them toward “market reforms” that bring more people into the insurance fold.
In different circumstances, Lieberman found that Baucus said that while he thinks health care reform can be accomplished without a private component, he might agree with Howard Dean that real reform wouldn’t be possible without a public component to the plan.