Big Insurance Promotes a Public Option

categories: Enemies of Reform, For Profit Insurance, Public Plan

Published October 13, 2009 @ 06:00AM PT

Public Option Now

Big Insurance just made the most convincing argument yet for a public insurance option. In a memo explaining a highly questionable study that AHIP commissioned from PriceWaterhouseCoopers, Karen Ignani explicitly promised that private insurance prices would rise dramatically under proposed healthcare reforms (I didn’t think they would confirm my wallet-stealing point so quickly.) Now we have it straight from the horse’s mouth – thanks, AHIP!

Actually, private insurance prices have already risen dramatically with NO healthcare reform. We can rest assured they will continue to rise. But it’s nice to have a scapegoat, isn’t it? Obviously the point of this study is to disrupt the passage of Max Baucus’ bill. AHIP isn’t satisfied with the millions of new enrollees it will reap, or the no-strings-attached government handouts (otherwise known as subsidies) to pay for those enrollees’ inflated premiums. Nope, they want more for all their lobbying millions.

First, they want a stronger individual mandate to lock in the maximum number of captive customers. Second, they want the excise tax on high-cost plans to go away. Third, they assume reflexive higher provider private insurance reimbursement rates due to Medicare cuts (though a Milliman, Inc. study already debunked the myth of cost-shifting.) Fourth, they promise to pass any industry taxes straight on to consumers – yep, we told you that was a lame idea. Is there any better combined argument for a public option to remove the private insurance choke-hold on our outlandish healthcare costs?

If that’s not enough, their study clearly states its questionable hypotheses. We can start with PWC itself: not a healthcare consulting powerhouse, much less a healthcare economics consulting powerhouse. The report lumps any government subsidies in as direct customer costs (not taxpayer costs.) It also assumes that employers will continue to buy taxed “limousine” plans instead of avoiding them, so the study conveniently adds these costs in to the hypothetical price tag. Finally, nowhere does PWC reveal its financial modeling methodology. This is an expensive exercise in smoke and mirrors.

To be fair, AHIP is right about one thing: there are inadequate cost controls in any of the healthcare bills. One day pay for performance programs may make a dent in provider overcharges, but meanwhile strong reforms are necessary to wring the waste from our convoluted system-less healthcare. However, it’s disingenuous not to admit that AHIP itself is a major leaking cost control valve.

Jonathan Gruber demonstrated how reform plugs that leak in a paper predicting lower individual premiums through an insurance exchange. Yes, you read that right. Lower is the opposite of higher, is it not? It's time to get this bill out of the Senate Finance Committee so a public option – for which AHIP made a loud and timely advertisement – can be inserted on the Senate floor.

Update: The Senate Finance Committee bill passed 14-9, with Olympia Snowe's symbolic but unnecessary vote. It now moves to the Senate floor where Senate Majority Leader Harry Reid gets to merge it with the much higher quality Kennedy HELP bill. With a little luck the final product will not resemble Max Baucus' "Bill That Lobbyists Built."

Photo xavierla // CC BY 2.0

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Comments (17)

And the TV Cable media, who are owned by many of the same corporate masters who are trying to kill reform, are trying to spin this Baucus bill as "oh, so important." I'm not buying it.

We need the president to step up now and be forceful in a requirement for a public option. It's not a demand, because I know he wants to be nice, it's a requirement.

Besides, the time for being nice has long past. Blue dogs have really messed us up. All I can say is "keep fu**ing that chicken!" LOL :) We will eventually have a good bill that works for the people or we will unseat those who work against us.

Posted by CherokeeGirl for Change on 10/13/2009 @ 10:38AM PT
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CNN leaves it there....

http://www.thedailyshow.com/watch/mon-october-12-2009/cnn-leaves-it-there

Posted by Martin Bring on 10/13/2009 @ 01:12PM PT
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According to recent news from the BBC, Maine Senator Olympia Snowe has said she will break with her party and back the healthcare legislation being proposed by President Obama:

http://news.bbc.co.uk/2/hi/americas/8304375.stm

Note also that such a vote would not necessarily her supporting later versions of the bill.

Nonetheless, her willingness to do vote for the bill even at this early stage brings our nation closer to all Americans having health insurance than ever before.

To be continued...

Posted by John Shepherd on 10/13/2009 @ 11:52AM PT
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I guess it is nice that she kept the process moving forward. I just pray the end result is a good bill for the people.

Posted by CherokeeGirl for Change on 10/13/2009 @ 01:55PM PT
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The Baucus bill has nothing. As for Olympia Snow. She said she would vote for the bill as it stands (not after changes). It's all conditional against the public option and public scrutiny/transparency.

I hate to admit it but, the public option is the only chance. Yesterdays release by PriceWaterhouseCoopers said the costs would escalate. The logic behind it is sound. D---ed if you do, d---ed if you don't.

Either a mandate enforced brings down costs or the public option bank brings down costs. The ingredient is necessary!

This issue is a giant stink bomb ready to explode in the public's face. Politicians, Ugh! Get rid of them all! They didn't even get "Happy Birthday" right.

Posted by M Arnest on 10/13/2009 @ 01:49PM PT
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I so agree. They act like they don't know that 65% of the people want a public option and 75% of doctors, I think most nurses. They act like that doesn't matter and that we'll get what they give us.

Mark Whitaker was on MSNBC at lunch saying he doesn't think that the final bill will have a public option. I love how these guys get psychic when they have no facts to base it on. That's when I peg them as shills for their corporate masters. What else could it be? They aren't using logic.

Posted by CherokeeGirl for Change on 10/13/2009 @ 01:58PM PT
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CherokeeGirl:
What source are those percentages from? Curious.

Posted by Jason Jaytheman on 10/21/2009 @ 12:12AM PT
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If the politicians had any balls, they'd say screw you to the insurance companies. We're going single payer. To hell with all of the insurance companies. Let them price themselves out of business.

Posted by Melissa Latessa on 10/13/2009 @ 02:10PM PT
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Fun post. Again, it doesn't matter how official, unbiased and scientific you sound, your logic is faulty if you begin with faulty presuppositions. For example, very little has been introduced to address the COST of care-everything has focused on premiums. Cost and access are the true elements fundamental to our debate.

In this case, we are still not addressing the appropriate role of health insurers. They are fighting (are we surprised by this?) most effectively by trying to distract us from the real issue: they are fundamentally irrelevant in their current form.

Until that is addressed, we will all keep fighting the wrong battle (as vigorous as it appears). The problem is that we really don't have a choice because, if we stop fighting this battle, it may take another 40 years to uproot them if they win.

Posted by Aaron Sidner on 10/13/2009 @ 02:54PM PT
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Aaron,

Don't forget the government is trying to distract us with "health care for everyone, down with insurance companies" when in reality they care about the medicare problem (original reason for health care reform).

I'm waiting to see what comes out of the senate. I'm starting to feel nothing will pass. Democracy is so slow.

Posted by M Arnest on 10/14/2009 @ 04:03PM PT
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So when do we get fed up with extortion? We can't afford to keep paying more. Period. We can't keep denying people care based on their income. Period. We can't bankrupt the least healthy among us to pay for chronic illnesses. Period. We can't afford to have any entitites skimming profits of of premiums. Period. It isn't moral or ethical to profit from sickness or injury. Period.

For profit medical care doesn't work. Period.

Posted by Harold Lewis on 10/15/2009 @ 12:50PM PT
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Harold, that is a broad statement:
"For profit medical care doesn't work."

Why do folks with single payer systems cross our borders for care?

This is both entertaining, and scary:
http://www.youtube.com/watch?v=q2jijuj1ysw&feature=related

Posted by Jason Jaytheman on 10/21/2009 @ 12:41AM PT
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It's time to stop talking about healthcare reform and start SINGING about it!! See "Healthcare Fighting (King Fu Mix)" at http://www.youtube.com/watch?v=8nc1VwJOb9Y

Posted by Bruce Hopman on 10/19/2009 @ 09:53AM PT
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HA! If you are looking for a chuckle to break of the monotony of fighting for reform, check out that video. My favorite part is Rahm and the noonchucks (sp?). What a fun video. Thanks for sharing. :)

Posted by CherokeeGirl for Change on 10/20/2009 @ 11:00AM PT
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So glad you liked it!! Please spread the link around. And check out more political parodies at http://parodyandson.blogspot.com

Posted by Bruce Hopman on 10/20/2009 @ 09:19PM PT
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Hello change.org,

I am not sure this is the right place to put this and if it is not please let me know. I am having a very serious problem. I had medicaid coverage when I received the diagnosis of breast cancer and in the middle of my treatment the medicaid has been cut off. Is this legal and can you let me know where I can go for help? I am still not through with my treatment and I cannot get anyone with the state to talk to me. I am desperate for help.

Thank you,

longsuff

Posted by Stephaney Gaddy on 10/19/2009 @ 11:03AM PT
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Stephaney--Sorry to hear about your situation. It happens all too often, and it's why we are pushing so hard for change.

Patient Advocate Foundation may be able to help you: http://patientadvocate.org/ They are a non-profit that provides mediation services. Others on the board may have more suggestions. Best of luck.

Posted by Gillian Hubble on 10/19/2009 @ 11:28AM PT
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