With a Democratic majority, the Congressional debate on healthcare reform continues with revision, compromise, and vocal opposition. Despite the partisan split, a theoretical consensus persist: more Americans should have access to affordable healthcare. The Devil–and divide–is in the details.
The Senate’s current proposed plan would allocate in excess of 800 billion dollars over the next decade with the goals of providing universal healthcare to all Americans, regardless of their current health issues, and creating government regulated insurance exchanges for individuals unable to acquire healthcare coverage from their employers.
The public option, whereby the government would fund healthcare for individuals either unable to afford plans offered by private insurers or barred because of a preexisting condition, would not kick in until 2014, as currently proposed. Republicans prefer a market approach to incentivize states to adopt policies that would minimize the amount of citizens uninsured.
Proponents maintain that funds will be spent more effectively, and fees will be generated from drug, device, and insurance companies. Proposals also include increasing taxes on certain high-income workers receiving Medicare, and reducing payments for certain benefits covered by Medicare Advantage plans, but not covered by Medicare. Elective, non-reconstructive surgeries may even be taxed at 5%, generating an estimated 5 billion dollars over the initial ten-year period.
The Congressional Budget Office indicates that this plan will help reduce the deficit by savings to Medicare and in other areas, making the reform “revenue neutral or better.”
Do not expect passage of a healthcare reform plan, Obama’s top priority, to occur before the New Year. Pundits predict that politicians up for reelection will use the healthcare debate as a campaign platform for the approaching mid-term elections next year.
Republican leaders have made a series of “Common Sense” reform proposals, including tort reform, allowing small businesses to pool resources to provide employees insurance, and permitting insurance companies to sell insurance plans across state lines. Tort reform proposals include increasing barriers to punitive damages and limiting pain and suffering damages to $250,000 for malpractice suits. Pains and suffering limitations, as proposed, would include both physical and emotional suffering reward caps. The reduced risk of frivolous malpractice suits would decrease wasteful over-testing currently used by physicians to shield themselves from potential liability.
Pooling resources would ideally allow small businesses to spread risks, reduce costs, and pass on savings to employees. Business owners could construct their own policies and allow employees to subscribe on a take it or leave it basis.
Currently, individual states regulate the benefit packages health insurance providers offer to residents of their states. California law, for example, regulates heath insurance offered to Californians. Under the proposed alternative plan, the law of the state where the insurance company is based would govern the policy requirements for insurance offered to individuals in every other state. Insurance providers could then establish themselves in the states with the requirements that suit the policies they intend to offer. The bills proposed in both the House and the Senate contain “buyer beware” clauses requiring health insurance policies to contain clear notice to consumers that their state’s consumer protection laws do not apply.
The plan to allow insurance providers to sell policies across state lines, originally proposed to Congress in 2005, would allow for greater flexibility and competition among providers. Proponents argue that the competition will lower prices while replacing costly and undesirable services with healthcare packages consumers demand.
States currently mandate health insurance providers to offer plans with specified services. This is blamed for the rise of insurance premiums: citizens are required to purchase healthcare packages that offer more than they would consume. According to the Congressional Budget Office, however, such mandates have only a minimal impact on insurance premiums. Still, proponents of reform maintain that greater flexibility and relief from state mandates will allow customers to purchase only those benefit packages they desire.
Critics fear that this plan will create a “race to the bottom” in quality of services covered, resulting in cheap insurance payments and inadequate coverage. Consumer protection groups and the Blue Cross Blue Shield Association criticize those who exploit this fear that providers will seek out states with little to no regulation. Choice of a state of incorporation provides a counterexample: although many corporations choose Delaware, this is definitely not a “race to the bottom” phenomenon.
There are proposals to establish a federally-mandated floor, requiring certain basic services to be offered in any policy. Proponents of the plan to sell polices across state lines argue that such fears are unfounded, since consumers will not chose to purchase a plan that does not offer the services they require.
The plan to allow healthcare insurance providers to sell policies across state lines, creating a more flexible market for healthcare plans, is seen as an alternative to government run healthcare - the Public Option. Republican National Committee Chairman, Michael Steele, opposes the Democrats bill claiming it “would impose a government-run healthcare experiment on America that increases premiums, increases taxes, cuts Medicare and allows for taxpayer-funded abortions.” In an apropos quip from The Daily Show’s John Stewart to Lou Dobbs, Stewart opines “[i]t feels like everyone that wants limited government, really just wants government limited to Republicans.”
Written by Ashton Inniss, 3L Senior Staff Writer




