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Eight Reasons to Pass Health-Care Reform

Barack Obama is going on the road today with a retooled pitch for health-care reform. In particular, he's emphasizing how reform will help the rest of us. To dramatize this, the White House has come up with the eight guarantees that will be written into health care bill the president signs:

* No Discrimination for Pre-Existing Conditions: Insurance companies will be prohibited from refusing you coverage because of your medical history.

* No Exorbitant Out-of-Pocket Expenses, Deductibles or Co-Pays: Insurance companies will have to abide by yearly caps on how much they can charge for out-of-pocket expenses.

* No Cost-Sharing for Preventive Care: Insurance companies must fully cover, without charge, regular checkups and tests that help you prevent illness, such as mammograms or eye and foot exams for diabetics.

* No Dropping of Coverage for Seriously Ill: Insurance companies will be prohibited from dropping or watering down insurance coverage for those who become seriously ill.

* No Gender Discrimination: Insurance companies will be prohibited from charging you more because of your gender.

* No Annual or Lifetime Caps on Coverage: Insurance companies will be prevented from placing annual or lifetime caps on the coverage you receive.

* Extended Coverage for Young Adults: Children would continue to be eligible for family coverage through the age of 26.

* Guaranteed Insurance Renewal: Insurance companies will be required to renew any policy as long as the policyholder pays their premium in full. Insurance companies won't be allowed to refuse renewal because someone became sick.

These protections would help a lot of people. Or, to be more precise about it, these protections will keep a lot of people from receiving a terrible blow when they're most vulnerable.

By Ezra Klein  |  July 29, 2009; 11:32 AM ET
Categories:  Health Reform  
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Comments

Will there be a cap on pricing? Otherwise, they'll just jack up the price (and when people complain they'll point to the new law).

Posted by: fuse | July 29, 2009 11:38 AM | Report abuse

Do we have any idea when these health insurance reforms will take effect? Years from now--or when President Obama signs a health care reform bill into law.

Posted by: flreader7 | July 29, 2009 12:06 PM | Report abuse

I like the extended coverage for youth till 26. When on their own, very likely these young people may not take insurance or very minimal and it can result in life crippling injuries. It is just a smart policy them to cover of insurances of parents.

However, things are never easy as they sound on the surface. What happens when these kids travel to university in some another state than where parents work, or university coverage only? Insurances are covered by original state law or resident state law? Will having national regulations help? (Yes, but it will have to end at the borders of USA, well somethings always have some limits...)

Next, what if it is a teenage pregnancy? Mother will be covered, but how long the baby will be covered? Or do we say, a young girl who is adult enough to have a baby needs to have her own coverage for the baby? What about the irresponsible father of that baby? Will he not be responsible? Not every young girl's mother is a governor of a far distant cold state....

Let us see a young girl unfortunately gives birth at the age of 13. Then again unfortunately that baby girl grows up and gives a birth at 13. Are we saying all of those on grand parents coverage? Where do we draw the line?

Point is any of these issues can turn out to be complex easily resulting in more than 1000 pages of health care bill. At some point we will need to introduce this concept of 'self help' in the debate - both in case of young adults or poor families.

I still support extended coverage for young adults on insurances of parents, but I guess we will need to draw a line based on some 'life changing events' than just on age.

Posted by: umesh409 | July 29, 2009 12:10 PM | Report abuse

How on earth can you prohibit companies from refusing coverage because of a pre-existing condition? I mean if someone is HIV positive I can't at all see why they should pay the same for healthcare as someone who is healthy. I don't get how this could work in practice.

Posted by: spotatl | July 29, 2009 12:18 PM | Report abuse

You may want to look at the States that have adopted similar regulations. In KY, for instance, these regulations proved so expensive to comply with that most insurers left the State. Now if your goal is to fix the market for a Government option this makes sense but if you're actually interested in helping consumers then it's pretty stupid policy. An exchange with one option doesn't exactly empower consumers.

Posted by: fallsmeadjc | July 29, 2009 12:28 PM | Report abuse

Here's the thing. This falls well short of what we need for long term economic viability as well as meeting the moral demands of a society and I think all progressives recognize that. The question of whether or not this is enough of a start to support is more complicated.

To me the acceptance of legislation that is well short of the bare minimum of what we need for long term success needs to be based on one question: does this get us on the right path? Can we build on this to eventually reach our goal? I'm not sure what the answer is. On the one hand, there's a long history of social welfare laws starting out completely inadequate (like Social Security) and eventually being built into much better programs. We've even seen some evidence of that in health care on a smaller scale: in Massachusetts they got something inadequate done 3 years ago, but it was a start. That has now forced the state to confront the issue of cost in a way that could get Mass much closer to long term sustainability.

So there's that possibility: we expand coverage drastically now and a few years down the road when costs haven't been held down and there are still coverage holes, we are forced to take a few more steps in the right direction. But there's also another problem, we expand coverage drastically, but costs keep rising and the right uses that as an excuse to label the whole project a failure and rolls back all the coverage expansion.

Its tough to roll back expanded coverage. As we've seen, people will often fight harder to avoid losing the things they have than to get the things they don't have. That said, in order to get people to fight to sustain something, it has to be something worth fighting for. When health care spending becomes even more of a crisis in this country (and it will be,) we need to get to a point where there's enough of a constituency out there to say no to the inevitable right wing plans to slash coverage. We need a constituency who will say, "find a way to save money without slashing coverage."

Thats why there ABSOLUTELY needs to be a line in the sand. Progressives can and should stomach compromise, but only if it does enough to build momentum towards future improvements.

I don't feel like I know enough to say where exactly the line is, but I know that there has to be one. This year's health care plan was never gonna be a panacea for the problems in our health care system, but it has to be something that builds a foundation for future improvement. If costs keep rising AND people's coverage is so lousy that it doesn't really inspire them to fight for it, then this will be seen as a failed experiment and cost reduction will turn into the slashing of coverage for everyone except the rich and healthy.

Posted by: Matt40 | July 29, 2009 12:34 PM | Report abuse

There seems to have been little thought of the consequences of these "guarantees." For example, the first one (new coverage for preexisting conditions) will likely result in all health insurance coverage being uniformly mediocre.

Otherwise, it the best strategy for a consumer would be to have the least expensive policy that the law requires having, most likely one with poor coverage. And then, when he is diagnosed with some expensive disease, switching to a new policy that has better coverage for that disease.

The analogy is to car insurance. If you can increase your policy limits after an accident, then its best to carry the minimum required limits (perhaps $0 for damage to your own car), and then call your insurance agent for higher limits when you have an accident.

Many of the other "guarantees," such as low copayments just make it so there will not be inexpensive insurance if you're willing to share the risk. And "free" preventive care just bundles those costs into the price for everybody. Car insurance doesn't pay for oil changes, although it would if people didn't mind the higher rates.

Posted by: LeeHollaar | July 29, 2009 12:38 PM | Report abuse

I just finished doing a quick analysis with the CBO numbers and was shocked to find that the House bill manages to cover uninsured persons at roughly 1/3 the cost of the Senate HELP bill. Granted both bills are drafts, and CBO's analyses are preliminary, but if one of the goals of reform is increased coverage, and another goal is efficiency, shouldn't this be a rather important finding? Come take a look and give me your comments. Spread the word on this. http://www.healthpolicyanalysis.com/2009/07/understanding-1-trillion.html

Posted by: bradwright1 | July 29, 2009 12:40 PM | Report abuse

fallsmeadjc, what is your solution? If the risk pool is large enough, then the indivuduals with preexisting conditions would not make premiums change much. This is one of the basic arguments for single payer or a robust (read national) public option. Spreading the risk over a large (min 20 million) pool keeps costs down for everyone.

Basically, the insurance companies are going on strike in KY because they don't like the rules set down by the state. Yet they don't get the bad press that striking workers would get in that right to work state. Not really fair coverage IMHO.

Posted by: srw3 | July 29, 2009 12:43 PM | Report abuse

I can't help but notice that every single one of these guarantees will increase the cost of health insurance. It's very simple, if P&C insurers are prevented from charging more to people who have houses in hurricane prone areas, then everyone must pay more. Same goes for health insurance.

What happened to bending the curve? They guarantees will make it worse.

If these guarantees are not accompanied by a mandate, then even more young, healthy people (especially men) will make the rational choice to forego health insurance.

Posted by: mbp3 | July 29, 2009 12:47 PM | Report abuse

"Will there be a cap on pricing?"

Yes, it's called the public option. If private insurers start charging exorbitant fees people will voluntarily switch to the public option. Thus it's in insurers' best interest to charge reasonable fees.

"Otherwise, they'll just jack up the price (and when people complain they'll point to the new law)."

See above.

Posted by: bluegrass1 | July 29, 2009 12:50 PM | Report abuse

One of my greatest concerns is this:
If the proposed Health Care Reform is sufficient for the public, why are all federal employees and members of Congress excluded from these bills?

Posted by: ProudMary | July 29, 2009 12:51 PM | Report abuse

NO cap on pricing.
NO public option.

Therefore, guarantees 1, 4 and 8 are MEANINGLESS to anyone who has an extended illness.

Posted by: adagio847 | July 29, 2009 1:21 PM | Report abuse

In a 2004 study on medical imaging in Canada,[79] it was found that Canada had 4.6 MRI scanners per million population while the U.S. had 19.5 per million. Canada's 10.3 CT scanners per million also ranked behind the U.S., which had 29.5 per million.[80]

Why Ezra, why? Could it be that the market system is superior than the command and control? Could it be that by nature and through the market system people seek to invest their money where there is a higher return? The US has made the investment in MRI's and CT scans because there was a higher return on investment due to demand. When the market becomes saturated, demand goes down, the profit will go down, then the investment will turn elsewhere, where there is demand. The result is an equilibrium. Or to put it more concisely, there is a tendency in a free market toward the establishment of a uniform rate of profit on capital invested in all different industries.
The result is that the industry is well served, the patients are well served. They are not waiting in line like they are in Canada or in Britain.

You can't get this equilibrium through command and control system. Either the patient is underserved or the investor (the investor might be anyone with a 401k or savings.) is underserved. Or both are underserved. That is exactly what is happening with your plans. I advise you to visit a library and study some economics before bloviating all over the internet about something you

Posted by: HayeksHeroes | July 29, 2009 1:31 PM | Report abuse

"No Gender Discrimination: Insurance companies will be prohibited from charging you more because of your gender."

Why? Is it unfair to give men a discount for not having female reproductive needs? Not all discrimination is unfair.

Posted by: whoisjohngaltcom | July 29, 2009 1:40 PM | Report abuse

I could be easily convinced that the government should be an insurer of last resort for people that are not able to get healthcare through normal means. Decide that no person should pay more than 12% of their income on healthcare and give everyone the option buying into a government public plan that is funded by taking 12% directly out of their paychecks and they are covered. (pick whatever percentage you like, and of course what is covered is up for debate) This would end up subsidizing the poor because 10% of their income is not enough to cover their medical needs. The problem with this is what do you do with people who have for years chosen not to buy into the public plan and then only want to once they get a major illness. I think the only possible way to do this is to have an individual mandate where everyone must have some basic level of covereage to avoid that problem.

Posted by: spotatl | July 29, 2009 1:45 PM | Report abuse

You left out the promised benefit of counseling for older people, wherein they will hear whether Ezekiel Emanuel thinks they are "life worthy of living" (wasn't that the phrase back then?) or not.

Posted by: truck1 | July 29, 2009 2:08 PM | Report abuse

What about national security? You would want everyone insured in case of a pandemic or other calamity.

Posted by: MerrillFrank | July 29, 2009 2:17 PM | Report abuse

"In a 2004 study on medical imaging in Canada,[79] it was found that Canada had 4.6 MRI scanners per million population while the U.S. had 19.5 per million. Canada's 10.3 CT scanners per million also ranked behind the U.S., which had 29.5 per million.[80]"

And the result from the horribly low rate of MRI's on Canadian health outcomes? My god, they live a couple of years longer:
http://www.oecdobserver.org/news/get_file.php3/id/25/file/OECDInFigures2006-2007.pdf

Posted by: jeirvine | July 29, 2009 3:13 PM | Report abuse

If the goal is to expand coverage to the uninsured then pass a bill that subsidizes their premiums directly or indirectly through tax breaks.

If the goal is to create a marketplace for health insurance then change the regulations and taxes that prevent that from existing.

There is no need for this overly complicated 1,000 page rubbish. There are much easier ways to help people. Too bad they're not politically feasible.

Why does Congress always prefer complex stupidity over good policy?

Posted by: fallsmeadjc | July 29, 2009 3:52 PM | Report abuse

And the result from the horribly low rate of MRI's on Canadian health outcomes? My god, they live a couple of years longer:
http://www.oecdobserver.org/news/get_file.php3/id/25/file/OECDInFigures2006-2007.pdf

Life expectancy is a poor statistic for determining the efficacy of a health care system because it fails the first criterion of assuming interaction with the health care system. Life expectancy also largely violates the second criterion - a health care system has, at most, minimal impact on longevity.
The primary reason is that the U.S. is ethnically a far more diverse nation than most other industrialized nations. Factors associated with different ethnic backgrounds - culture, diet, etc. - can have a substantial impact on life expectancy. Comparisons of distinct ethnic populations in the U.S. with their country of origin find similar rates of life expectancy. For example, Japanese-Americans have an average life expectancy similar to that of Japanese.10

Posted by: HayeksHeroes | July 30, 2009 1:03 AM | Report abuse

Something for everyone ...for nothing. More govenment mandates...until the only insurer standing is Obama's takeover plan. Then we'll find out that we all will be paying for these things and many, many more things that many of us do not want or need. Stop the madness. Do no harm.

Posted by: KathyCorey | July 30, 2009 12:35 PM | Report abuse

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