Democrats Ponder Health-Care Suicide

If Democrats enact something like the health-care bill emerging from
the Senate Finance Committee, they may call it a legislative victory
and it may keep the campaign donations flowing from the insurance
industry, but the Democrats would surely infuriate millions of American
voters.

Indeed, it seems like some Democrats, such as Sens. Max Baucus and Kent
Conrad, have lost themselves so much in the inside-Washington reeds of
legislating a convoluted compromise acceptable to the insurers, that
they are inviting an angry backlash from average Americans.

The danger for Democrats is that this industry-friendly legislation
would impose new burdens on citizens, including government fines for
failing to sign up for a health-insurance plan, without guarantees that
the coverage won't be almost as crappy and expensive as it is now. The
bill rejects a public option that would put competitive pressure on
private insurers.

Plus, key
elements of the bill, like the so-called shopping "exchanges," aren't
to take effect until 2013, meaning that Americans will have watched
this messy process unfold for months and then be told that the current
system, which has cruelly pushed millions of sick people into
bankruptcy, will get four more years to bankrupt more Americans.

By contrast, Medicare, the single-payer health system for senior
citizens, was signed into law on July 30, 1965, and took effect on July
1, 1966, less than a year later.

The Senate Finance Committee bill also is so complicated that few
citizens can possibly understand it or how it might affect them.
Instead of straightening out the health-insurance maze, the bill makes
it trickier to navigate. [To see for yourself, click here.]

While dumping the relatively straightforward public option, which
President Barack Obama favors and which is in the four other
committee-approved health-care bills in Congress, the Finance Committee
bill offers "non-profit, member-run" co-ops for individuals and "small
group markets."

The co-op
notion is a populist-sounding alternative favored by the insurance
industry because a co-op's organizational difficulties and relatively
small size would make it easy to compete against, much as small food
co-ops can be overwhelmed by the pricing advantages that favor large
grocery store chains.

The
other glaring problem for co-ops is that most Americans, especially
small-business people, are extremely busy already. They don't want to
take part in running an insurance company; they simply want to get
health insurance at a reasonable price.

Nor do most Americans want to puzzle their way through Baucus's
hodge-podge of private insurers, government subsidies, emergency
waivers, penalties for non-compliance, etc., etc. If Americans lose a
job or fall on hard times, they don't want to go hat in hand to some
government bureaucrat and have to lay out their financial problems to
get some special favor.

What Americans Want

What Americans want is affordable health coverage provided in as simple a package as possible.

That
was the finding of a New York Times/CBS News poll which discovered
widespread confusion about the health proposals taking shape in
Congress, but more than 2-1 support for a public option to compete with
private insurers -- 65 percent for a public option, 26 percent against
and 9 percent no opinion. [NYT, Sept. 25, 2009]

After all, one of the attractions of the public option is its relative
simplicity and cost-effectiveness. It could piggyback on the existing
Medicare bureaucracy and thus get started quickly and cheaply.
According to congressional budget analysts, it is the only plan that
offers significant cost savings.

Cost savings would not only help reduce the federal deficit but they
would mean that more Americans would get the health care they need
without going broke. In other words, it would save lives, reduce
housing foreclosures, and protect families now being ripped apart by
brutal financial pressures.

Yet, despite this common sense - and broad voter support for the public
option - the Senate Finance Committee rejected the idea. Chairman
Baucus conceded that the concept was appealing, but he joined other
conservative Democrats in voting no, claiming a public option couldn't
clear the 60-vote hurdle to stop a Republican filibuster.

So, instead of trying to rally the votes - or using the "reconciliation
process" that allows a simple majority to enact legislation having
budget implications - Baucus kept on cobbling together a nearly
incomprehensible construct of tax credits, income formulas, fees and
other mumbo-jumbo.

This
modified Baucus bill is in line to win final committee approval this
week. According to Washington's "conventional wisdom," it will then
become the vehicle for action by the full Senate, where Democratic
leaders have been ambivalent about a public option.

Some observers feel the best chance for the public option to survive
may be with a trigger mechanism that would permit it in some parts of
the country sometime in the future if private industry doesn't offer
enough competition.

The
trigger idea has been floated by Sen. Olympia Snowe of Maine, the only
Republican on the Finance Committee who has indicated even a faint
desire to vote for comprehensive health-care reform. However, the
trigger would push even this limited public option to some point after
2013, when the insurance "exchanges" are finally scheduled to open.

Yet, if a trigger proposal is needed to win over some votes and beat a
filibuster, another approach could be a "reverse trigger," one that
would put the public option in place immediately but set up a trigger
that would stop the public option from signing up new clients if
private insurers cut rates by 25 percent and scored a 90 percent
approval rating from customers.

Even then, the "reverse-trigger" public option would stay in place,
serving the Americans who had already signed up and ready to resume
taking clients if private insurers slide back into their old ways of
excessive executive compensation, bloated bureaucracies and huge
profits.

By moving up the
timetable of reform to "as soon as possible" and putting immediate
pressure on the insurance industry for real savings - in other words,
letting voters see real benefits in 2010, not making them wait until
2013 - the Democrats could show they're on the side of the people and
rack up electoral gains in 2010 and 2012.

However, if the Democrats insist on trading the common good for the
favors of special interests, all the industry campaign donations in the
world may not be enough to save them.