A recent New York Times highlighted Maine’s attempts at comprehensive healthcare reform. Their experiences serve as a cautionary tale for Congress.   The state established a public health insurance plan, expanded Medicare and Medicaid eligibility, and banned insurers from refusing to cover people with pre-existing conditions, but those actions have done  little to insure more of its residents.  Contrary to the promises of public option supporters, health care costs have only continued to rise in the state.

Reasons for the high health care costs range from the state-specific to the general. Unlike the bill that recently passed the House of Representatives, Maine’s healthcare reform legislation didn’t include a mandate to buy health insurance plans. It’s a vicious cycle: forcing health insurance companies to offer policies to unhealthy people with pre-existing conditions raises the rates for younger people; young adults will be even less likely to buy health insurance if their premiums go up, which results in the insurer’s risk being spread among less people. In the end, the older, unhealthier population remains in the pool and must contend with less affordable health insurance. Therefore, there is a larger uninsured population.

Granted, Maine is a market dominated by just one private health insurance company (which, with its effective monopoly, can increase premiums to their liking); and its population is older, sicker, and poorer than the U.S. in general. Senator Olympia Snowe points to her state as a cautionary tale of what may happen if drastic changes are made too fast. Snowe is a Republican that supports healthcare reform but is against the public option. Budgeting problems have caused Maine to cap enrollment of its own public option health insurance plan at under 9,000. The federal government, unlike most states, is allowed to run a deficit. However, it isn’t exactly rolling in the money right now either.

Continuing the use of technology that fueled his successful presidential campaign, President Barack Obama is now using Facebook and other social media sites to push the Democratic healthcare reform bill. By reaching the younger demographics most supportive of the public option where they congregate, Obama hopes to motivate them to call their representatives and express their support of reform. Generations X and Y live on the Internet, and are also the portion of the population most likely to be uninsured. Some of them might think that they’re healthy now and therefore invincible, but others realize the importance of having a health insurance plan at any age.

The House of Representatives will most likely be voting on healthcare reform this weekend, and representatives will no doubt be hearing from their constituents about it. Opponents of the Democrats’ reform are fired up, and the Obama administration’s goal is to light that fire under supporters who believe it’s the best way to provide affordable health insurance to the nation. They must hope that Obama’s millions of Facebook friends and Twitter followers keep up with their news feeds and become inspired to get involved in helping him enact part of the change he promised them. Their presence was sorely lacking for Democrats earlier this week, when Republicans won governor’s races in two states in off-year elections–largely fueled by anger over reform, and fears of people scared of losing their existing health insurance plans. We’ll see if Obama’s final push pays off.

Yes, you read that right. South Carolina Representative Joe “You Lie!” Wilson has proposed an amendment to the healthcare reform bill lumbering through Congress, which would require all congresspersons to enroll in the public option health insurance plan. He hasn’t switched sides and decided to vote for the Democrats’ bill; rather, his amendment is a stunt intended to point out what he sees as the failures of the public option.

Ironically, supporters of healthcare reform have pointed to the government-subsidized insurance enjoyed by senators and representatives as evidence that there should be a public option–if health insurance is good enough for our politicians, shouldn’t it be good enough for the rest of us? (In fact, although the federal government subsidizes their healthcare, it is actually administered by private insurers.) Wilson turns that strategy on its head, by saying that if a public option is suitable for average Americans, it should also be suitable for Washington D.C.

It’s quite unlikely the amendment will be ratified in the House. The current language simply allows Congress to sign up for the public option. Most Democrats probably won’t vote for this ‘poison pill’ provision; as they have admitted, most Americans would prefer to keep their existing health insurance. Republicans might vote for it as a lark, although they might refuse to dignify Nancy Pelosi’s bill with any type of ‘yes’ vote. Joe Wilson has 72 hours to get his own mandate into the bill, before it reaches the House floor.

I recognize that healthcare reform is a serious issue that has the potential to change the lives of millions of Americans. I also acknowledge that many people are worried that such a bill will endanger their existing health insurance plans; their fears shouldn’t be downplayed. However, when healthcare reform proposals are compared to “domestic terrorism”, isn’t that going a bit too far? North Carolina Republican Virginia Foxx recently took to the House of Representatives floor to express her vehement opposition to the Democrat-written bill. The representative was quoted in the Associated Press as saying that the nation has more to fear from the bill’s potential passage than it does from terrorists. While hyperbole is a standard feature of modern politics, Foxx has reached a new level.

One of the identifying features of terrorism is the intent to cause a feeling of terror in a population.  Many may disagree with Nancy Pelosi’s plans of healthcare reform that include a public option, but keep in mind that congresspersons of both parties genuinely believe that what they are doing will help America. They may be wrong–and their policies might have disastrous results–but neither Democrats nor Republicans are purposely trying to destroy the United States. Therefore, comparisons to the likes of Osama bin Laden are off-base.  The worst thing about her comments is that they serve to cheapen the legitimate concerns people have. Foxx doesn’t like the bill because she believes it will allow the government to force people to buy health insurance, raise taxes, and and give bureaucrats more power. These are all valid arguments that deserve to be debated, but some people may tune them out due to her inflammatory statements.

Our infamously long-winded Vice President once said that he tried to never question a person’s motives, no matter how much he disagrees with their policies. All of our politicians would do well to take that advice. Both parties are striving to achieve what they think is best for America. Their varied opinions on healthcare reform deserve to be discussed civilly, without resorting to the modern equivalent of Godwin’s Law. In my opinion, that would be best for us all.

(Image: U.S. Army under CC 2.0)

The House’s healthcare reform bill looks like it’ll cross the $1 trillion mark, according to the nonpartisan Congressional Budget Office. Many Democrats have promised a bill that would cost less, and initial CBO estimates agreed with them. However, they have since added billions more in funding health insurance for the retired, as well as more spending on public health and increased reimbursements for preventative care services. Some of these provisions are intended to garner more support from important populations, such as senior citizens. These modifications bring the estimated total of the bill to at least $1.2 trillion over ten years.

Breaking the trillion dollar threshold makes reform of the health insurance industry more difficult to achieve. Nancy Pelosi has previously claimed that the bill would cost about $900 billion; still a massive sum, but short of the trillion mark.  It seems to be a sort of psychological block, even among Democrats whom are otherwise supportive of the bill. The new CBO estimate is closer to Republicans’ claims of $1.3 trillion. The big question is whether it’s worth the price. Supporters would argue that the eventual savings from health insurance plans would allow the nation to pay off that debt in time (after all, America managed to pay off its decades-long national debt by the end of Bill Clinton’s second term), but others feel that it’s a pointless gamble.

Last year, a representative from Texas was the true Republican maverick in the presidential race. Ron Paul may not have won the nomination, but he is still bringing his unique libertarian perspective to Congress’ table. His proposals for healthcare reform are no different. He recognizes that the current health insurance situation is untenable, but is against governmental involvement. Recently, he presented several intriguing bills to the House of Representatives.

1. The Comprehensive Health Care Reform Act of 2009 would give Americans a 100% tax credit on their health care costs (e.g. prescriptions, hospital stays, doctor visits). Health Savings Accounts (HSAs) with high-deductible health insurance plans would also be tax-free. Low-wage employees who don’t file tax returns can have the credit refunded against their payroll taxes, so the bill would help those who need it most afford healthcare. Currently, only medical expenses that reach over 7.5% of an individual’s income can be deducted.
2. Dr. Paul’s Coercion Is Not Health Care Act of 2009 would forbid the government from enacting a health insurance mandate. There has been some speculation as to the legality of such a mandate. Congressional Democrats, along with the Obama administration, believe that it has to be part of healthcare reform legislation. Their view is that universal coverage must include the young and healthy in order for the insurance pool to afford covering those with pre-existing conditions. This interference in the free market is anathema to Paul. Incidentally, if there is no public option, such a mandate might not be necessary.
3. Finally, his Freedom From Unnecessary Litigation Act of 2009 would save money through indirect tort reform. This act would establish so-called “negative outcomes insurance”, which would pay off if a patient’s medical treatment goes wrong; it would also offer a tax credit to make the purchase more affordable. The goal is to decrease some of the unnecessary (and costly) testing done in order to avoid malpractice liability, as well as lessen the need for hospitals and physicians to carry billions of dollars in insurance.

As Paul is himself a doctor, his views on the healthcare industry are worth listening to. His opinions tend to be shortchanged in the House because he doesn’t walk in lockstep with either party’s platform, giving his bills little chance of passing.  However, many Americans–who fear socialized medicine, yet acknowledge that we need more affordable health insurance as soon as possible–could find something to applaud in his plans.

The medical device industry, which manufactures and sells items such as heart stents and artificial hips, has kept a low profile during the healthcare reform debate. However, that doesn’t mean that they won’t be affected. Their products are very important to many patients, but help drive up the cost of your health insurance plan. That’s probably why the House of Representatives’ healthcare reform proposal includes $20 million in taxes–coming from a 2.5% sales tax. AdvaMed, the industry’s lobbying group, is obviously unhappy with this and believes that the tax will be detrimental to the American economy.

What would medical device makers consider a more acceptable bill? One that:

• Exempt small companies, defined at those making less than $100 million
• Would be tied to specific products, presumably with more profitable products being taxed a higher rate
• Was at least partly deductible as an expense and,
• Doesn’t take effect until 2013.

As it turns out, the medical device industry was lucky. An initial Senate proposal doubled the fee to $40 million, so AdvaMed has expressed its gratefulness for the reprieve. Such a break was probably going to happen anyway, in exchange for moderate Democratic Senator’s Evan Bayh’s support. Bayh represents Indiana, a state that is the headquarters to many medical device companies. Will the goal of affordable health insurance still be achieved with this corporate giveaway?

(Image: stevendamron under CC 2.0)

Following her Senate counterpart’s reveal of his healthcare reform plan earlier this week, Speaker of the House of Representatives Nancy Pelosi has now unveiled her chamber’s proposal for expanding affordable health insurance coverage. As expected, the House’s plan is farther-reaching than the Senate’s and more similar to the one outlined by President Obama during his campaign.  Here’s a quick Q&A on Pelosi’s plan:

Q: How much is this going to cost?

A: It’s projected to cost a whopping $894 billion over ten years.

Q: How is the government planning to pay for reform?

A: It will raise income taxes on couples making over $1 million and individuals making over $500,000 yearly. In addition, Medicare spending will be cut by an unknown amount.  Liberal representatives also floated the idea of having the government dictate the rates paid to health care providers by the public option, but moderates managed to strip out that provision. (The government, as well as private insurers, will instead negotiate payment rates with hospitals and doctors.)

Q: Is a public option included?

A: Yes. Unlike the Senate version, the House’s bill doesn’t allow states to opt out of it. So far, it doesn’t include a so-called “trigger” either.

Q: Will illegal immigrants be covered by the public option?

A: As of now, it’s unclear. That’s one of the main sticking points preventing the House bill from reaching a vote. However, remember that illegal immigrants are already receiving a form of public healthcare: hospital emergency rooms are required to serve everyone who comes in.

Q: What about abortion? Will it be covered?

A: That’s another controversial topic that will see much debate before the bill hits the House floor. A handful of pro-life Democrats will probably try to have abortion coverage removed from the public option in order for it to receive their votes. Meanwhile, some pro-choice representatives oppose a bill that doesn’t include abortion services. Either way, the Democrats have a solid majority in the House and can afford to lose some votes in either direction.

Q: What if I have a pre-existing condition and can’t get insurance?

A: These reforms are supposed to change that. Health insurers will no longer be allowed to deny coverage to people with pre-existing conditions. They won’t be able to charge those with pre-existing conditions significantly more, either.

Q: When will healthcare reform take effect?

A: It’s hard to believe, but the bill won’t fully kick in until 2013. By then, a mandate will require everyone who can afford it to buy health insurance. They can be insured via the newly created exchange (consisting of private insurers, in addition to the public option), by their employer, or an existing government program such as Medicare or Medicaid.

Q: But I need health insurance now! What can I do in the meantime?

A: The government is putting together a temporary program to insure individuals and families that have been rejected by private insurers. Otherwise, do you really want to wait for the government’s health insurance plan? Keep in mind that the House bill needs to be reconciled with the Senate bill before there’s a final vote, and that could take months.

(Image: U.S. House of Representatives Portrait)

Senate Majority Leader Harry Reid has joined the strong push for a public option in Congress’ healthcare reform bill, but its inclusion is not guaranteed. The provision’s fate is in the hands of moderate Democrats. Despite the ability for individual states to opt out of the government-run health insurance plan, centrist Democrats like Senators Ben Nelson and Max Baucus are still leery of voting for it. You should get a health insurance quote while you wait for the endless wrangling of votes to finish, since garnering 60 Senate votes to pass this bill will no doubt take awhile. The fact that several politicians in the party have received large campaign contributions from the health insurance industry doesn’t help.

Why the delay? The Senate and the House of Representatives have to debate exactly what form the public option will take, and moderates hold its fate in their hands. They need to compromise between comprehensive health coverage and cost. Gaining Republican votes is a lost cause at this point, so party leaders will be forced to exert their power. For example, Reid may try to convince a swing vote with a seat on a prestigious Senate committee–that a Senator will only get if he or she votes with him on healthcare reform. The more liberal House has a more comprehensive public option proposal included in its bill, and it must be combined with the bill in the generally more conservative Senate prior. Afterward, it’ll see even further amendments by the rest of Congress before a final vote. There is also the possibility, albeit less likely, that some liberal politicians will vote against the bill because it doesn’t do enough to reform our health insurance system. However, centrist politicians receive more attention from leaders because they are the wild card. Can you wait for Washington to decide, or would you prefer to be safe and get health insurance quotes from multiple insurers now? If, years from now, you like what the public option shaped up to be better than your existing health insurance plan, you’ll be able to switch–but if you’re caught uninsured before then, you’ll wish you hadn’t waited.

Finally, we get some more concrete information about the proposed government-run health insurance plan, otherwise known as the public option. It’s already in the House of Representatives healthcare reform bill, but the Senate’s version goes into more detail on what a public option for America would look like. First off, it wouldn’t take effect until 2013; after which it would be included in an exchange (think the Dow Jones or NASDAQ for health insurance), along with private insurers. Small businesses and individuals will be able to take part in the exchange and pool their buying power to buy their health insurance plans at a lower group rate. The idea behind the public option is that, with the government’s negotiating muscle and lack of profit motive, the competition will make healthcare costs lower across the board.  Opponents are skeptical, and believe that there is no way other health insurance providers can compete against governmental subsidies.

Even though the federal government doesn’t need to maximize profits for its shareholders, it still intends to cover most of its costs through the insurance premiums paid by its participants. The Obama administration plans to increase the federal deficit in order to provide initial funding, but hopes to repay the debt through those premiums. However, those revenues may end up smaller than anticipated; the Senate bill also allows states to individually opt out of the public option portion of reform, beginning in 2014. The program will be nationwide by default, but each state can pass legislation excluding itself from it. Further details are unknown; would those states have to pay the portion of federal taxes that goes to cover the public option, or will that money be refunded to their residents so they can buy one of the existing private health insurance plans? It remains to be seen how many state governments would actually take up that offer when all is said and done, but the choice allows some halfhearted “Blue Dog” Democratic politicians from conservative regions to vote for some form of healthcare reform without arising the ire of their constituents.

(Image: Andrew Aliferis under CC 2.0)