Tag: Health Policies

Will Obama Change Health Care?

Here’s a recap of the kind of health reform Obama wants to accomplish:
  • Build on the current employer-based health insurance system
  • Expand access to Medicaid and the state children’s health insurance program
  • Require large employers either to offer coverage or contribute a portion of payroll to its cost
  • Require that all children have health coverage
  • Require health insurers to accept all applicants regardless of any preexisting conditions they may have
  • Introduce a Medicare-like government-administered plan similar to the one available to federal workers that would compete with private health plans in a new market called the National Health Insurance Exchange
  • Create a new tax credit to encourage small businesses to provide coverage to their workers
  • Lower family health premiums by $2,500 through projected cost savings

Obama is likely to incorporate some pieces of McCain’s proposals into his own — even with a Democratic Congress on his side — in order to forge a consensus around the plans he has outlined, much the way Massachusetts went bipartisan to enact its statewide health reform in 2006, said Paul Ginsburg, president of the Center for Studying Health System Change, a think tank in Washington.

An example of an idea that Obama may consider adapting is McCain’s proposal to replace the tax exclusion workers currently get for their job-based health plans with a refundable tax credit of $2,500 for individuals or $5,000 for families, effectively making the value of insurance taxable income for the first time.

Economists have long eyed the tax exclusion as a potentially rich source of funding for health-reform efforts, Ginsburg said. While McCain proposed to eliminate the tax exclusion for everyone, Obama along with a Democratic Congress would be more likely to impose a cap on the amount not subject to taxes to better target people receiving the most benefits

Other McCain proposals such as encouraging people to buy coverage on the individual market and letting them buy policies across state lines are far less likely to be included in a compromise plan because of concerns about eroding risk pools, spiraling costs and loss of consumer protections.

The weakness of the Obama plan is that it doesn’t require individuals who don’t have coverage to buy it, making it difficult to force insurers to take all comers, Nichols said. “Without a mandate it will be hard to get private insurers to compete how he wants them to.”

Can Medicare Be Publicly Funded?

Medicare has never been a fully public program. A considerable portion of the medical bills has always been paid by the beneficiaries. In fact, on average, retirees over 65 years old are paying more out of their pockets today, with Medicare, than they did prior to the passage of Medicare in 1965. That is an astounding fact.

When the Medicare program was signed into law in 1964, Congress set a mandatory premium for Part B – physician care. They also required Medicare recipients to pay 20 percent of their medical bills. At the time the bill was up for a vote, Democrats stated that this condition was necessary in order for it to pass. The American Medical Association (those were the days when the AMA had decisive power), the insurance carriers, drug companies, and most of the rest of corporate America strongly opposed the passage of Medicare and Medicaid. Making these concessions got them to lower their opposition, but they kept the carriers and the drug monopolies in a position to do the dirty work they have been doing ever since.

One of the results of this compromise has been that Medicare Part B premium requirements have grown each year. The premium, now over $100 a month, is automatically taken out of monthly Social Security checks.

Even with Medicare, there is something like a 20 percent “gap” in coverage for recipients and is a huge financial burden. To help cover the gap, insurance companies sell so-called Medi-gap insurance, which has become a major source of revenue for private insurance companies. The dollar figure of this 20 percent gap has steadily grown to an astronomical figure, in the hundreds of billions each year.

Following the failure to win a universal health care program in the early 1990s, the insurance companies thought up a new scheme and quickly obtained federal government approval for it. The Gingrich Republican Congress, assisted by the caving in of the Clinton administration, devised a new way to satisfy the greed of the insurance companies, through health maintenance organization, or HMOs. HMOs were originally group practices, like the Kaiser programs, set up by well-meaning preventive medicine professionals.

The new HMOs of the 1990s were a whole new animal. These latter-day HMOs were created by insurance companies themselves to “offer retirees a deal.” The deal was simple. Sign up with us, we’ll pay the 20 percent gap, and we’ll give you better service.

Sounds like a good plan, but corruption was rampant. This was the heyday of corporations like Oxford Health Insurance company and other underhanded insurance carriers who, in the late 1990s, were caught raking in premium payments but refusing to provide advertised services, while doctors and hospitals went unpaid for months and even years. After the scheme was exposed, Oxford’s CEO was given a golden parachute worth millions.

Despite such enormous corruption, Republicans like John McCain, with campaign coffers over-flowing with HMO contributions, continue to champion deregulation and privatization, holding up the HMO and the supposed superior health care it provides. Americans have long known the truth, however.

In 2003, when George W. Bush pushed through his misnamed Medicare Modernization Act, expanding these private plans, he used a new Madison Avenue gimmick and called them “Medicare Advantage Plans.” Despite the fancy name, these plans have been a great disadvantage for many retirees, but have been a major new source of profits for insurance companies. Medicare recipients found themselves paying still more out-of-pocket expenses for fewer services. Some insurance carriers were allowed to exclude some Medicare recipients as bad insurance risks.
Amazingly, the Medicare Modernization Act (MMA) actually used taxpayer dollars to pay insurance carriers to set up these plans. And even with that money, the carriers demanded more, or they threatened to leave the program.

Finally, a showdown in the US Senate took place in July 2008. Senator Ted Kennedy dramatically returned from his sick bed to vote against the Bush administration’s attempt to lavish more money on the insurance companies. His was the 60th vote in the Senate to prevent a Republican Party filibuster. The mainstream media reported that Congress had voted to lower Medicare reimbursement for physicians fees, but the real deal was that Congress cut the money to the carriers. This was a major step toward Medicare reform that means something for all of us. Physician reimbursement from Medicare was frozen for 18 months.

Needed Medicare Reforms

In the reform plan now being promoted by many activists, the federal government would cover the cost of both Part B and the 20 percent gap. By taking that step, the insurance carriers can almost be eliminate from the process. The savings from dumping the insurance carriers, could be as much as $15 billion annually, according to some sources, including the Obama campaign.

The 2003 Bush MMA legislation did more than just hand money over to the insurance carriers. It also set up a new drug plan to feed the profit addiction of the big pharmaceutical companies. The MMA was supposed to reduce the cost of drugs to seniors, an issue which had become a national disgrace. Although the Medicare Part D did reduce the cost of drugs to some recipients, the basic problem remained: some Medicare beneficiaries in middle-income brackets – the infamous “donut hole” – were excluded from the plan.

The root of the problem is that Bush demanded that before he would sign the MMA, the legislation had to outlaw federal negotiation of the price of prescription drugs, as is the case with Medicaid and the Department of Veterans’ Affairs. Eliminating that provision could result in billions more for the Medicare program, and since congressional Democrats supported that position during the MMA legislative fights in 2003, a solid win for the Democrats in this election could result in a renewed effort on their part to revise the MMA.

Another flaw in the present system is that when the original Medicare law was passed, Congress failed to put the program into the hands of a reliable administrator – the Social Security Administration – to run the program. Instead, they paid insurance carriers to do that. This also must change. The highly successful Social Security Administration should be expanded to include Medicare. That makes sound fiscal and managerial sense. It would also mean a reduction in the duplication of government administration and provide the efficiency and reduced bureaucracy Republicans are always clamoring for.
Lowering the Medicare eligibility age to 55 is another needed reform. Originally raised in the 1990s and pushed by former Sen. George Mitchell (D-ME) after the failure of the Clinton health care plan, such a move could benefit a large number of retirees not yet eligible for Medicare and would dramatically reduce the number of uninsured Americans.

A strong and expanded Medicare program would also reduce the financial pressure on negotiated labor contracts. Now, many unions negotiate with employers for health benefits for retirees. They negotiate to have Part B and the 20 percent gap covered by a labor/management contract.

Lowering the Medicare age to 55 also makes early retirement more feasible for workers who continue to work just to keep their benefits. In fact, some unions negotiate health benefits as an added early retirement feature. So lowering the eligibility age to 55 would reduce the cost of retirees for many industries struggling with costs related to retiree health care.

Taking these pro-worker, pro-labor steps should ease the worries that many union leaders have concerning congressional action for national health care. It could encourage them to be more solid advocates for a national health program.

A beginning, for we must start somewhere.

Just The Facts On The 2 Health Plans

Everybody is talking about health care and what the candidates will do to help Americans get the care they need and desperately deserve.  Here are the plans of both candidates put as simply as possible.

MCCAIN

OVERALL. Begin taxing employer-sponsored health benefits as income, instead providing a tax credit of $2,500 for individuals and $5,000 for families to increase incentives for insurance coverage. Contain costs through payment changes to providers and tort reform.

INSURANCE POOLS. Work with states to create a federally supported Guaranteed Access Plan for people denied coverage due to pre-existing medical conditions. Financial assistance would go to those below a certain income leve

CHANGES TO PRIVATE INSURANCE. Promote competition by allowing insurance to be sold across state lines. Encourage multiyear insurance products.

COST CONTAINMENT. Adopt malpractice reforms that limit frivolous lawsuits and excessive damages. Promote less expensive alternatives such as walk-in clinics in retail outlets. Invest in prevention and care of chronic illnesses. Increase competition by permitting the sale of nationwide insurance not regulated by states.

COST OF THE REFORMS. $1.3 trillion over 10 years, according to the nonpartisan Tax Policy Center; campaign says cost containment measures will pay for it.

OBAMA

OVERALL. Require that health insurance be provided to all children, and require all employers to offer health benefits or contribute to a new public program. Create the National Health Insurance Exchange, through which small businesses and individuals without access to other public or employer-based programs could enroll in the new public plan or in approved private plans.

INSURANCE POOLS. Require participating insurers to offer coverage on a guaranteed issue basis.

CHANGES TO PRIVATE INSURANCE. Prohibit insurers from denying coverage based on pre-existing conditions. Children up to age 25 could continue family coverage through their parents’ plan.
COST CONTAINMENT. Invest $50 billion toward adoption of electronic medical records. Promote competition by regulating the portion of premiums that must be paid out in benefits. Promote generic drugs and repeal the ban on direct price negotiation between Medicare and drug companies. Require hospitals and providers to publicly report measures of health care costs and quality.

COST OF THE REFORMS. $1.6 trillion over 10 years, according to the Tax Policy Center; campaign estimates $50 to $65 billion per year when phased in. Much of financing expected to come from system savings; additional revenue to come from discontinuing tax cuts for those with incomes over $250,000.

There you go Irene, take your pick on which will best suit your family.

Elizabeth Edwards Pans MCCain Health Plan

Elizabeth Edwards on Tuesday said Republican presidential candidate John McCain’s health care plan would allow insurers to cherry pick individuals they want to cover, leaving those with cancer, diabetes and other diseases without coverage.

Edwards has been a frequent critic of McCain’s health care policies. McCain proposes to tax the health benefits on workers, which now are largely exempt, and create a refundable health insurance tax credit of $5,000 for families and $2,500 for individuals. McCain says his plan would give families more choice and make health insurance more affordable.

A report released Tuesday by the Center for American Progress Action Fund said that many people would end up paying higher taxes under McCain’s plan. Edwards serves as a senior fellow with the group, a nonprofit that is not allowed to endorse candidates.