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Health Insurance Industry’s $300 Billion Victory Over the Public Option
When Blanche Lincoln (D-AR), Ben Nelson (D-NE), Mary Landrieu (D-LA), Joe Lieberman (I-CT), and the entire Republican Senate caucus stepped up to kill the public option in the Senate, it is important to remember that the health insurance industry won a victory-a victory worth $300 billion. As Jay Rockefeller (D-WV) and Tom Harkin (D-IA) now try to crush attempts to revive the public option inside a reconciliation measure, they are battling to protect that extra $300 billion that will flow to AHIP as a result. The public option was never just a "sliver" as Obama tried to claim. It was about a fundamental moral right and the role of government. But what it was also about was a huge amount of money.
The CBO projects that the relatively weak public option-the one limited just to the exchange in the House health care bill-would secure roughly one-fifth of that market, equal to around 6 million people (PDF). The CBO concluded that, as a result of those 6 million customers, the public option will take in $298 billion (PDF) in direct premiums, exchange subsidies, and risk adjustment payments from 2013-2019. However, with the public option removed, but the individual mandate remaining, that $300 billion will instead go straight to the private insurance corporations' books. If, like I personally suspect, the CBO slightly underestimated the popularity of the public option, and it manages to secure instead roughly a third of the customers on the exchange, that would be roughly $500 billion that the public option would take from the private insurance companies.
I often hear the argument that the public option was not important because only 2% of Americans would be using it. That's true, but it is important to remember that roughly a third are currently insured by public programs such as Medicare, Medicaid, and Tricare. Of course, of the roughly half of Americans with private insurance, the bulk of them get there coverage through employer-provided, self-funded plans. Plans in which the employer bears the risk and holds the premiums. The insurance companies are only subcontracted to provide administrative functions. That 6 million people the public option was projected to cover would be a significant share of the potential market for private insurance companies to actually cover and noticeably expand the amount of money they would have earning float revenue.
It is important to remember the sheer scope of the private insurance companies victory if they stop health care reform from having even a relatively weak public option. It will be a victory that will provide them with an extra $300 billion of our money. No doubt some of that same money will be used in the future to fight efforts to enact real health care reform.
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36 Comments so far
Show AllFolks,
I value the thoughtful opinions of all who comment on this board. I would like to hear your opinions as to what you may do in the following scenario.
I am repulsed by the health care fiasco created by our president, and it makes me queasy to think about how much money the health insurance industry stands to make and how much of my money currently goes to the insurance companies.
As further background, I am a state employee and have adequate health benefits at a moderate cost. Not great, but not terrible either. I have a wife and two children - 3.5 years and 6 months. However, during most years, I will not reach the family deductible. It is a scam as you all know, but I keep it more as insurance against catastrophe.
My question is:
What will others in similar situations do now that we will be mandated to carry insurance?
What advice would anyone give?
The activist in me feels I should cancel my insurance and put all the money I pay in premiums into a savings account and pay for health care as I go. Just give the big middle finger to this heinous piece of legislation and refuse to participate.
I truly believe nonparticipation and community building are the only options - because I have given up on any type of meaningful political support or reform - at least in the near term. And I believe the only way to effect change is by mass nonviolent nonparticipation in this society created by the elite.
With that said, I struggle with just cutting myself off of insurance (well, not myself but my children).
The moreal dilemma weighs on me, and I would appreciate any thoughts on the topic.
Rastaman vibrations are positive!
" It is a scam as you all know, but I keep it more as insurance against catastrophe.
"
It's when the catastrophe strikes that they'll cancel your coverage.
I'd start saving yesterday.
q
The disease industry in the States is a casino of blood, and all who reside here gamble in some form. The idea that one gambles with one's children's health only when one refuses to buy insurance is just false.
You do not write whether you qualify for government coverage. This varies between states, but the children may qualify when you do not, you may qualify for partial coverage if you do not qualify for complete coverage. Unlike with private insurance, you may arrange coverage after the fact.
On both uninsured trips to hospitals over about 10 years, the following procedure held.
1. The hospital gives treatment although one has no insurance. On a recent trip I told the paramedics to drop me off at my home, but of course they wouldn't risk the legal liability.
2. The hospital gives no extra treatment beyond what it needs to avoid lawsuit, so you have no unnecessary operations to worry about. Unnecessary surgery and errors in medication are major killers in the US.
3. The hospital billed me well over $20,000 for about 28 hours of care that included, basically, sophisticated diagnostics to confirm what I had told the paramedic, a neck brace, a spiffy automatic bed, and several meals.
4. The hospital had a well informed debt counselor at my side before I was ambulatory. Although the counselor was presented as having my well-being in mind, the principal client was, of course, the hospital.
5. Faced with the unpayable bill, I gladly provided financial information to the counselor, who coached me on getting the government to pay.
6. On the latter occasion, when I earned too much to receive government help, the counselor quickly assessed my financial status, phoned the hospital, and got the bill reduced to more or less the greatest amount I could pay and stay in my apartment: the bill dropped to $5,000.
7. The other parties, the ambulance and so forth, carried me for a year before I paid them off a few dollars at a time.
I would note also that bad credit can be repaired. Bad debts of a few hundred dollars mean little to banks when assessing loans. They simply tell the clients "Pay it off" to adjust the credit picture and make the loan.
More serious broken credit can often be battled off as follows:
-- Check the credit.
-- Review the record to see whether the credit reporting agencies have broken the law in dealing with one's record. This is true on most complex reports, incidentally.
-- Point out the infraction.
-- Accept the company bargain to wipe out the faults in one's rating in return for staying out of court.
-- Keep checking the credit for a year or so to see that the company does not quietly return the dings to the record.
There are companies that do this for a fee, though some are better than others.
Remember, most people who refuse to buy insurance will be better off, although some genuinely will not.
Never give hospitals/health care providers your Social Security number. By law, you don't have to give anyone your SS number besides your employer, IRS, law enforcement.
Even though I have health insurance, I decline to give providers this information.
Rastaman, I'd be surprised if your employer let you opt out of paying for insurance. My husband is a retired gov't employee and due to the recent wall street rape of pension funds, spouses under age 55 are not being covered after 2010. That includes me. So we called the retirement system and asked if we could have the money they were paying for my health insurance this year so I could put it in the bank and spend it as needed during the coming 4 years I would have no insurance. Nope, no dice. And no good reason, just no. They politely suggested that I get a job.
I appreciate your dilemma. What about getting together with friends and family and pool your now premiums together into a savings account upon which you can all draw when needed? For myself I refuse to be forced to pay into this proposed monstrosity of a health "care" insurance and will not be forced to decide between groceries and so called "health care".
Thanks Vaiadiavolo - I think this is a wonderful idea worth pursuing. I already have a number of families in mind if I can convince them to join our family.
Right there with you! It is an illegal tax, taxation without representation and criminal collusion of insurance and congress. What a way to start a revolution of sorts but instead of boycotting the tea and then destroying it, boycott the insurance companies for their underhandedness and also a point in mind about those r's or d's we keep sending up to congress when election time arrives.
"... I am a state employee and have adequate health benefits at a moderate cost. Not great, but not terrible either. I have a wife and two children - 3.5 years and 6 months. However, during most years, I will not reach the family deductible...."
You must have a very high deductible given the size and ages within your family. The gender of your children is also an important consideration. What is the cost as a % of your net income? Does your wife work? Since you already have insurance, you will not be mandated. How stable is your job--are you likely to be downsized soon?
Does your insurance plan include dental and vision?
As you can see, for practical advice to be given, some more information is required.
I have a individual health insurance policy that I will be dropping very soon.
Not only are the premiums expensive, they have denied claims/treatments which has resulted in chronic
illness.
I can't see paying into this evil system anymore--feeding this beast and keeping it in the driver's seat.
I don't have children-- I am only responsible for myself. I don't know what I'd do if I had a child--it's an awful dilemma.....
Im my case, I will just pay my GP out of pocket, if I die, so be it,as they have denied the treatment I need anyway.
Chelsea
FYI--Bill Moyers Journal March 5th is billed as a program on the most recent legislation with Wendell Potter and a woman from the N.E. Journal of Medicine. I'm interested to hear what they have to say about the legislation. By the way, best wishes. I've been self-insured, too, and hear you loud and clear.
""Rastaman March 4th, 2010 11:54 am""
First, I, and I would like to think many others, will flat refuse to pay a private corporation a tax under the charade of healthcare.
Second, I have worked and paid into medicare and since I am about 5 years away from being eligible for medicare, I don't intend on having to pay twice to some charlatan corporation to provide bonuses and dividends to lazy ass investors.
Third, I plan to keep my physical self in as good a shape that I can and for now my health is doing quite well because as I figured long time ago, I did not want to have my savings built up to end up by giving it to some insurance company, doctor or hospital when I can keep myself in good shape.( a hint here, I feel like crap when I tend towards eating too many carbohydrates and it takes a couple of days of non-ingestion of said carbs to get that good feeling back)
Fourth, just a note to say I was severed from my 'corporate' job 2 years ago and have yet to find employment doing what I would rather do than hanging out in a 'feel good' corporate hole.
I can't see how the health insurance fiasco was created by the President...its been a problem for many, many years before he even came into office. The problem is multi-dimensional- from our cultural acceptance and even delight in greed as a personal value, to the unfortunate by-product of democracy which is that the most corrupt are able to get the masses of the least intelligent to advocate and vote for legislation that hurts them the most. In a nutshell-even morons get to vote, and when the majority of Americans think climate change is not real despite overwhelming evidence to the contrary, you know we've got a lot of not-too-bright people in the voting booth.
If I had put all the money I've spent on insurance over the years in a savings account I could pretty much pay for any health issue that comes my way by now. If you don't have insurance you can still use or take your children to the emergency room, if you need some kinds of surgury you can go to other countries that have excellent care but MUCH lower costs and still save money. If we all just decided to cut insurance companies off the gravy train, things would change quickly.
Created?
Not exactly. But why would he pretend as he has instead of backing a solution were he not shilling for the insurance-grifting money as well as PhrmA's $$ and the finance ca$ino large$$e?
I think you're on to the first step towards solution, though. The healthy have to crawfish out of our individual parts of that $300-billion dollar chunk.
There are other reasons to avoid buying insurance, too. Insurance-holders are far more susceptible to unneeded surgery and over-medication, each a substantial cause of death and disease in the United States, where the medical industry as a whole charges a ransom rather than a fee.
Exactly, paying too much for insurance to get coverage from the industry that is the third leading cause of death in the country doesn't sound like health care or reform to me.
More and more people are dropping out of the insurance racket and self insuring. IMHO this is the REAL reason for this "reform". It is a bailout to the insurance companies on the backs of the average American, (AGAIN).
The insurance companies are now in a death spiral. Healthy people and those without jobs are dropping coverage, leaving more sick people in the pool, which causes the insurance companies to raise premiums which drives more customers away. Forcing people to buy their defective product will keep the Ponzi scheme going for a while longer.
Well, Fight BACK! Upon "victory", be prepared to cancel all elective insurance!! Cut 'em off at The BILL$ to the "tune" of $300B back, if possible!!!
Insurace companies VICTORY -
CHI CHING!
soon to come.... Climate change legislation - to which we can add:
coal, nuke and other polluting industries VICTORY!
CHI CHING!
Don't forget the MIC.
Whatever the Greatest Con Man ends up signing, will be worse than the status quo. With the public mandate in place forever (no Congress will ever repeal that because it is what the Medical Corporate Complex wanted) and no real cost controls with any teeth in place, these Insurance companies will just continue to rape the American public, and we will be forced by law to pay for junk insurance that we can't afford to even use, or, have no insurance, expose ourselves and our families to catastrophic risk, but still have to pay a portion of our income as a punitive tax to boot.
So this is what rule by Democrats looks like. I want my votes back.
I want my votes back too.
Never EVER vote for these MF-ers again.
Chelsea
You could have voted for NADER. Why didn't you? Many of us did! He supports SINGLE PAYER.
I know--my bad.
No Single-Payer? Then NO to ANY mandate to purchase private for-profit health "care" insurance. Let the rebellion commence!
The American Voters are the Sovereigns in this nation not these artifical creations.
It is time to repeal the corporate charters of these criminals against the Common Wealth.
Elected Officials are held to a higher standard so it is also time to flush the entire corrupt Senate.
-"It will be a victory that will provide them with an extra $300 billion of our money"
Why do you think the Democrats are so determined to pass their bill? It is too profitable for their employers for it not to pass.
But seriously, these comments about not paying, rebellion? It sounds ridiculous. You will do whatever the Republicans and Democrats want you to do, until you take power away from them.
Single payer or the public option are dead. Our loser representatives have shitcanned them for this insurance company bailout and no ranting on any blog will change that.
The corporations, besides insurance companies, also don't want you to have an option of getting out of their employer provided insurance, that would release you from being their healthcare hostage. I would guess many millions of people are hostage to their current plan since you can't go somewhere else with a pre-existing condition whether they cut your pay or working conditions and the pre-existing condition can be one of your dependents.
Once again we are fucked by electing people to office who have as small minds as they do peckers. Any democrat politician who doesn't want to provide healthcare to all through single payer is a hypocrite. They all know it is the only plan that will work to cover everyone and reduce costs and cut out the middle man. They are obviously only there to get rich. Fuckemall.
Being a one term President won't be so bad considering the size of his golden parachute.
Well he's a golden piece of shit so it will be appropriate, right? lol.
One of the worst aspects of Obama's health deform bill is that there are no criminal penalties incurred by the bloodsuckers if they refuse to insure pre-existing conditions, cut people off when they get sick etc. The worst that can happen to them is that they can be sued in civil court. With most judges being nothing more than corporate stooges, who do you think will win? This is just another case of Obama being a "free market guy". I anticipate a young persons' revolt against this unconstitutional mandate.
So let's just lay the cards on the table and look at them.
About 60% of USans want to preserve the domination of corporate fascism over the society. These people value it, identify with it. To them, corporate fascism represents power, thus freedom, out of which "all good things" flow.
They're remotely aware that corporate fascism oppresses the people, i.e. THEMSELVES, but their greed takes over at this point, and they figure that they THEMSELVES, or their progeny, would like to join the ranks of the elites someday, squat on the dominator's throne, and survey their kingdom.
This is why they tolerate the 2x to 5x healthcare inflation costs it the US versus other countries, the massive oppressions of corporate fascism, DAS KAPITAL!!! We can't eradicate greed from human nature but we can eradicate the messages of greed from our institutions, including the media.
In your church this Sunday, ask your pastor to discuss the role of elites in this society with their messages of greed. And what have the pastors been preaching past decade? Are these "community leaders" keeping the peace? Keeping the wrong kind of peace? Don't ask fascist, don't tell fascist?
"""""In your church this Sunday, ask your pastor to discuss the role of elites in this society with their messages of greed. And what have the pastors been preaching past decade? Are these "community leaders" keeping the peace? Keeping the wrong kind of peace? Don't ask fascist, don't tell fascist?"""
****************************************************************************
This is something that would make a good article and/or research to see how pastors will treat the 'role of the elite' in our society, but I just can't think that there would be any real candor and objective rhetoric, especially about the people those pastors get money from.
"...some of that same money will no doubt be used in the future to fight efforts to enact real healthcare reform".
No doubt. I used to live in California and I remember some years back there was a ballot proposition designed to rein in the huge profits of the auto insurance companies. They spent 65 million dollars fighting it by saying they couldn't afford to stay in business if it passed. This was back when a million was lots of money.
When there is that amount of money being spent on politics (and politicians) what chance does people first legislation have?
If Joe Lieberman is against a public Option, he is making his wife Hadassah richer. Time for us to get rid of Move-on and all those billionaire backers in the next election. Out with all the Obama followers.
Yes, it is health care alright. Taking good care of the insurances' financial health...and to hell with all others.
What on good GODS green earth did the honest folks in our world do with AL Co pone?
The jerk meet his demise did he not, he is the rotten grandfather of all insurance companies everywhere.
When we are forced to spend more funds annually on the dag-gone rotten insurance companies than we earn, what will become to all of us so called hard working, GOD fearing Americans.
Who will the jerk neck insurance companies extort from, each other no doubt.
We cannot stand for this non-American style of treatment to much longer.
The jerk-neckers running the stinking insurance rat traps are people just like you and me, although they are much more needier and greedy.
There are words written that are much more powerful than what we write and they are the true justice for all and final. Thank GOD.
Thank you,
An American that has had more than enough.............!