The
Show Must (not) Go On
The elaborate Congressional
circus whimsically referred to as 'healthcare reform' - the one
that has held the nation captive since President Obama's earliest
weeks in office - came complete with dancing clowns, disappearing acts
and trained tigers jumping through hoops.
But today the magic is gone.
The performance is degenerating.
The public is beginning to understand what the political players knew
all along - that this three ring circus was never meant to be more than
a sideshow.
Americans have been forced
to bear witness to embarrassing public displays of angst over their
government spending a paltry $85 billion (or so) annually on health
care for millions of Americans when about 20 times that amount has been
gifted to the still-unaccountable robber barons responsible for the
ongoing financial crisis.
Today, anyone not in a comatose
state has surely grown tired of the smoke and mirrors. Surely Americans
have noticed the eerie disconnect between the carefully staged healthcare
'debate' with its fixation on the cost of an increased government
role, and the nonexistent debates on the (far more costly) war in Afghanistan
or the obscenely expensive government program to bail out Wall Street.
It was against this surreal
backdrop that House Speaker Nancy Pelosi agreed to support an even more
frail version of what never was a particularly 'robust public option'
for health care consumers in the first place. The move marked not the
beginning, but the continuation of an unraveling process that began
before the 'health care debate' ever got off the ground.
Dropping the part of their
plan that would have allowed insurance premiums to be set by the government
in favor of 'negotiating rates' with insurers is only the latest
in a series of compromises by House Democrats that puts industry interests
ahead of (what we used to call) the 'public good.' Concepts of 'meaningful
cost containment' and 'greater competition' in the insurance market
have vanished into thin air.
It's hard to believe that
only a few months ago we were promised that the 'public option'
would accommodate 120 million people. Today that number is down to 10-12
million - and god only knows what it is they'll be getting
into.
In other words, Wall Street,
the insurance industry and their Democratic lap dogs (only some of whom
are blue) have made a mockery of the entire premise of health care reform
- greater public access.
Public Loss, Private Gain
An article published a few
months ago in the Wall Street Journal reassured investors that "elements
of health-care reform potentially most onerous to industry have little
chance of being included in any overhaul bill that might make it through
Congress."
The authors must have been
clairvoyant.
How else could they have known
that Speaker Pelosi would ultimately 'see the light' and decide
in favor of the insurance industry with respect to how payments for
care would be made under a 'public option.' When the Speaker announced
recently that she no longer supported payments based on Medicare rates
(as she had promised progressives she would), and would instead support
tying rates to those of the big insurance companies, Wall Street must
have been so relieved that its investors would have one less
'onerous element' of health care reform to worry about. Insurers
too can sleep well knowing that whatever plan eventually comes out of
Congress, it is almost certain that the ability to compete or to put
downward pressure on costs will have all but disappeared. Pelosi also
dropped a number of tentative provisions to promote consideration of
"Medicare for All" models and to allow states to experiment
with single-payer plans.
Little wonder then, that Wall
Street analyst Richard Evans, in a report published November 3rd, was
able to proclaim with complete confidence that the health insurance
industry needn't worry too much about the prospect of a government-run
health plan - at least not as it now is taking shape in Congress.
Any government plan, Evans
assured investors, "is likely to resemble a competitor that the for-profit
insurers already know ... It appears the public option would be required
to negotiate price with providers, pay back its start-up capital, cover
its operating costs, and earn sufficient reserves ... In other words,
it looks like a Blues [Blue Cross] plan."
If Evans is right - and he
probably is - those investors who worry that the public option is little
more than a gateway drug to socialized health care (translate: single
payer) can rest easy knowing that Congress - once something, anything,
gets passed - is likely to wash their hands of 'the problem' into
the unforeseeable future.
"Whether reforms pass or
not, the degree of political capital and legislative bandwidth consumed
by the effort are simply staggering, despite the fact that health reform
remains well below economic concerns on voters' radar screens ...
From this, we infer that, after the health reform effort reaches an
end, the near- to midterm odds of Congress again turning its attention
to anything related to healthcare is as close to zero as it has ever
been."
Evans goes on to advise investors
that Pharmacy Benefits Managers (known in the industry as PBMs) will
be "clear winners" if the current iteration of a 'public option'
is passed into law. "PBMs have the potential for positive earnings
surprises," he predicts.
The PBMs, it should be said,
are dominated by three large players and several mid-size players, including
Walgreens, CVS/CareMark, Prime Therapeutics, MedImpact, as well as a
slew of 'captive' (part of a managed care company) PBMs. Those include
Wellpoint, Aetna, Cigna and others.
Corporate Control over Public
Health Insurance
In a comprehensive executive
summary at the Physicians for a National Health Program (PNHP) website,
Kip Sullivan, JD writes: "Both the Senate and House versions of the
proposed 'public option' require that corporations with expertise
in health insurance administer the option." Sullivan believes this
is very bad news for the public.
He warns that private sector
firms will likely play a role "that closely resembles the role that
defense contractors play in the production of weapons for the Pentagon.
Just as Northrop Grumman carries out all tasks necessary to create a
fighter plane, so private corporations (not public employees) will carry
out all tasks necessary to create the 'option' health insurance
programs." This function, he says, "is obviously very different
from, and more significant than, merely processing claims."
The options in the current
Senate and House bills, writes Sullivan, "will not resemble the traditional
Medicare program but will in fact consist of numerous insurance programs
(or plans) functioning at the level of individual insurance markets,
that is, at the level of states and regions within states. Once you
understand this, you begin to grasp what it means to say that private
corporations will 'administer' the option program. You begin to
comprehend that the multiple local option programs might actually be
owned by, or administered by privately owned corporations, possibly
health insurance companies."
Public Option Not an Option
for Most
According to Robert Laszewski,
president of Health Policy and Strategy Associates, the current House
proposal works pretty well for families making $20,000 or $30,000 a
year. "A family making $27,000 a year will pay about $1,000 (annually)
toward their health insurance," he told Jim Lehrer on PBS' News
Hour. Under the option now being considered, a family making $55,000
annually would pay about $5,400 - that's nearly $500 per month -
nothing to sneeze at. A family making $73,000 will pay $8,700 toward
their health insurance bill.
"We're just not doing anything
for the middle class here," Laszewski told Jim Lehrer.
Laszewski believes Congress
will need to get "either more savings or more revenues into this program
in order to make it affordable for families in the middle range. And
the people we're really talking about here are people between about
300 percent and 400 percent of poverty level income" - currently
a huge segment of the population.
Of course, the open secret
is that a single payer system is inevitable in the long run. And by
the time Americans finally get coverage for all, no one will care what
it is called. Congress will eventually be forced to follow the
lead of states like Pennsylvania, California, Illinois, Ohio and Massachusetts,
all of whom are currently working to implement their own single-payer
healthcare.
If the Democrats' option
turns out to be little more than window dressing for Congress to throw
hundreds of billions of dollars per decade at the insurance industry,
and if (as seems likely) the public option fails to either effectively
control prices or open up the system to all who need it, Americans will
pay a huge price - both as patients and as taxpayers.
In the meantime, Congress should
stop pretending they're doing something, and actually do
something to help the American people. If legislators got to work saving
Americans' homes and jobs instead of distracting them with sides shows
and 'voodoo healthcare' they'd have to actually deal with the
mess they've made of this country.
Now that would be a show worth
watching.