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Max Baucus's Not-That-Bad Health-Care Bill, and His Not-That-Great Health-Care-Reform.

PH2009090700769.jpgHow you'll judge Max Baucus's framework depends on how you understand the goal of health-care reform. Insofar as the effort is aimed at filling in the cracks of the current system — making it more affordable, more transparent and less cruel — it's not a bad bill.

The legislation really would protect millions of Americans from medical bankruptcy. It really would insure tens of millions of people. It really will curb the worst practices of the private insurance industry. It really will expand Medicaid and transform it from a mish-mash of state regulation into a dependable benefit. It really will lay down out-of-pocket caps which are a lot better than anything people have today. It really will help primary care providers, and it really will make hospitals more transparent, and it really will be a step towards paying for quality rather than volume.

To put it more starkly, it really will be the most important progressive policy passed since Lyndon Johnson. The subsidies should probably sit at 400 percent of poverty, and the employer mandate should be reworked, but such failures are relatively easy to fix, and may well be patched over by the time the legislation arrives on the Senate floor. The fact that a bill of this size and scope can still be considered disappointing is evidence that the doors of the possible have been thrown wide open.

The main disappointment is that insofar as you see the bill as a vehicle for moving us towards a better, more efficient, less costly system, there are some problems. In particular, this bill seems to block off a lot of its own possible points of expansion. The health insurance exchanges are limited to the state level, and appear to split the individual and small-group markets apart from each other. There's no mention of a possible expansion toward larger employers, either. Similarly, the co-op plan is an interesting policy proposal, but unlike a public insurance option, it's difficult to imagine it growing into anything significantly stronger than what's outlined in the paper.

The early reaction to Baucus's bill has been overly negative. It's an imperfect improvement to the current system, but an improvement nevertheless. Where it really falls short — even in comparison to the rudimentary framework released by HELP and especially when compared to the more complete package offered by the House — is in imagining a system that is different and better and fairer than our own, and working to make it a reality. Baucus talks often of building a "uniquely American" system, but this proposal largely plugs some holes in the one we already have. As such, the failure is not so much in the bill as in its unwillingness to lay the groundwork for the bills that may need to succeed it.

Photo credit: By J. Scott Applewhite — Associated Press

By Ezra Klein  |  September 8, 2009; 3:36 PM ET
Categories:  Health Reform  
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Comments

It really will be written and paid for by insurance lobbyists.

It really won't have a public option.

It really will contain a series of empty promises that will do nothing to help ailing Americans and their ailing pocketbooks.

It really is a half-baked compromise that does not solve problems but pushes them further down the road.

Posted by: smvans7 | September 8, 2009 3:39 PM | Report abuse

This is pretty optimistic stuff. Looks like the tools for regulating explosive costs, and profit-driven proprieties are very weak. Looks like the insurance companies are going to love this bill, but not so much the doctors and patients.

Posted by: publictakeover | September 8, 2009 3:44 PM | Report abuse

As per usual, thank you, Ezra, for your fair minded analysis and informed perspective.

Posted by: cmpnwtr | September 8, 2009 3:54 PM | Report abuse

Exchange should be NATIONAL and should not seperate small businesses from individuals.

His exchange plan needs MAJOR WORK.

Posted by: maritza1 | September 8, 2009 4:04 PM | Report abuse

Baucus wanted to be a hero on health reform, but he was defeated by the poverty of his own imagination as much as by his fealty to special interests. He is a small man when all is said and done, all the more obviously so after the summing up of Ted Kennedy's life we saw over the previouos weekend.

Posted by: Mimikatz | September 8, 2009 4:04 PM | Report abuse

Below is a compromise between advocates of government provided health insurance and those against:

The state would provide insurance to all Americans but the annual deductible on the insurance would be equal to the family’s trailing year adjusted income minus the poverty line income (say $25,000 for a family of 4) + $300. So a family of 4 with a trailing year adjusted income of $30,000 would have a deductible of $5,300. A family of 4 with a trailing year adjusted income of $80,000 would have a deductible of $55,300. Middle class and rich people could fill the gap with private supplemental insurance but this should be full taxed. This would encourage the middle class and rich, who are generally capable people, to demand prices from medical providers and might force down costs. They could opt to pay for most healthcare out of pocket while the poor often less capable would be protected.

It is not a perfect plan but it might help. Some deregulation of healthcare would also help the poor gain access. The gauntlet that Doctors have to run these days to get to practice seems like an anachronism in today’s world. Let smart people get to practice medicine after on the job training. Let the medical businesses decide who is qualified to practice medicine. 12 years of training to tell if my child has an ear infection is overkill and reduces access to healthcare for the poor.

Posted by: jwogdn | September 8, 2009 4:05 PM | Report abuse

'Baucus talks often of building a "uniquely American" system.'

While state-mandated extortion for the benefit of corporations isn't uniquely American, it's distinctly so.

I hope the Canadian immigration department is recruiting new staff right now, because they'll need 'em.

Posted by: pseudonymousinnc | September 8, 2009 4:11 PM | Report abuse

*Baucus talks often of building a "uniquely American" system*

This was also the reason that the US developed the electric chair: it was a "unique American" method of execution, rather than one used by any of those foreigners.

Posted by: constans | September 8, 2009 4:16 PM | Report abuse

Interestingly, while Americans seem to be opposed to A paying for B's healthcare, they don't seem to mind much when B pays into stock market scams that make A very wealthy. Trickle down socialism, therefore, is more objectionable than trickle up socialism.

Posted by: georgetown_dc | September 8, 2009 4:20 PM | Report abuse

pseudo,

don't let the door hit you in the arse on the way out. I'm guessing they have liberal blogs there right?

And if the healthcare here was SOOOO bad then why haven't we heard of this mass immigration to Canada, or France right. France is best right?

T'es tu malade ou quoi?

Posted by: visionbrkr | September 8, 2009 4:21 PM | Report abuse

Ezra Klein, 7/29/09: The Most Important Part of Health-Care Reform "A strong public plan on a weak exchange will fail because it won't attain sufficient market share. It's as simple as that. Conversely, even a weak public plan on a strong exchange could thrive, because it would have access to a lot of customers. Focusing on the public plan and ignoring the rules of the exchange is like focusing on engine power but ignoring whether people can buy the car."

Ezra Klein, 9/8/09 "The main disappointment is that insofar as you see the bill as a vehicle for moving us towards a better, more efficient, less costly system, there are some problems. In particular, this bill seems to block off a lot of its own possible points of expansion. The health insurance exchanges are limited to the state level, and appear to split the individual and small-group markets apart from each other. There's no mention of a possible expansion toward larger employers, either."

The most important part of the bill, the exchange, sucks in Baucus's version. I don't know why you feel it's your job to always put this bill in the context of past reform efforts from the Clinton years or 2004 but you are a journalist writing in 2009. In the context of 2009, the Baucus bill sucks. I don't need a 'There are good things in the Baucus bill too!' lollipop every time you write about the Senate Finance committee. When it comes to the nub of the issue AS YOU SEE IT Baucus has failed miserably. That's a bit stronger than disappointing, no?

Posted by: jamusco | September 8, 2009 4:23 PM | Report abuse

@visionbrkr,

"And if the healthcare here was SOOOO bad then why haven't we heard of this mass immigration to Canada, or France right. France is best right?"

Tough to get a work visa. Plus the language barrier. Other questions?

Posted by: antontuffnell | September 8, 2009 4:44 PM | Report abuse

antontuffnell,

wait a minute don't many province's also speak English? also if its that important they'll go and work through the work visa. Again I'd love to see one example of this happening. What's actually happening is pseudo's hyperbole of how horrible the US system is but again it helps him to try to prove his point.

Posted by: visionbrkr | September 8, 2009 5:12 PM | Report abuse

The real reasons this bill is not, as Ezra says, a vehicle "for moving us towards a better, more efficient, less costly system" are not the ones directly following that sentence, but what Ezra wrote two paragraphs above: because the bill would lead to a major improvement in the health care system we currently have. If we get a much better performing system, why would we junk that one for an untested one (in the American context) when we didn't do that back when the system was substantially worse?

It's hard to change deeply-rooted systems. There's a reason we don't send the Army Corps of Engineers to move the Mississippi River to a new, more conducive channel. It's hard to do and even when we can, we may screw it up: witness New Orleans. Maybe France has lovelier rivers and we'd sure like to emulate them, but we're basically stuck with the rivers we have. We just have to try to make them as good as they can be.

I'm very happy where this is heading. I'd love single payer; I'd prefer a strong public option. But if we can get a system where health insurance companies are so well-regulated that they can NEVER take someone's money for years and then, in their moment of most desperate need, go back into their files and determine that they're not obligated to pay them a dime, then our country will be a better place.

And if, via incremental change, we can continue to make it better in the future -- then so much awesomely the better!

Posted by: robbins2 | September 8, 2009 5:13 PM | Report abuse

Oh, visionbrkr, you must praise Uncle Sam and his army of lobbyists every bright morning for letting work-shy skimmers and pool-boys like yourself prosper from exploiting the sick. I know plenty of people who have farted through the door on the way out, and they're not coming back.

But please, keep waggling your junk and spewing out tenth-grade English as if it makes you something special.

Posted by: pseudonymousinnc | September 8, 2009 5:24 PM | Report abuse

I have one serious question I never see addressed anywhere...last week it was confirmed that we actually have about 16% unemployment and about 15 MILLION people out of work...many of them have been out of work for 1-2 years now, and the job losses continue at a bare minimum of 250,000-500,000 a month...people that are barely hanging on to their homes...

...so my question is, since these 15 MILLION or so people are out of work and have NO INCOME and god only knows how many of them are just hanging in there and managing to pay for rent and survival basics, if that...obviously they cannot buy health insurance with no income, so will they be fined and then certainly rendered bankrupt by health insurance costs anyway? or will the government pay to insure the unemployed and their families?

Posted by: angeltour | September 8, 2009 6:05 PM | Report abuse

I agree with jamusco's point. As much as I've loved reading Ezra over the years, he's moving the goal posts this year.

I think robbins2's point comes across as naive when talking about the potential for Big Health to be "so well-regulated". We can't even pass reform to the financial industry in a time when they're the biggest goats in the country. Expecting Big Health to get more strongly regulated than this bill is a pipe dream. More likely, regulation will get watered down over time. Big Health already knows the ways they can exploit Baucus's bill, along with what the White House is pushing. Given them a GOP administration down the road and the agencies/department charged with regulating Big Health will fail to do their job.

If you think I'm being naive on that, you might want to ask Ezra to write a 1000 words on how well "regulation" is going in Big Food/Agra/Meat. It's going so well that when a livestock man wants to test his herd at above the requirements of government set standards, the government actually steps in to stop him from doing it. When one ponders the insane risks being taken with the Food Supply in the name of corporate profit, the wild lack of interest/ability in DC to regulate it, and the potential for catastrophy on an epic level... don't put much faith in Health Care being "so well-regulated". Won't happen.

John

Posted by: toshiaki | September 8, 2009 6:15 PM | Report abuse

We have one chance in a generation to ram something past the Republicans. We can either ram a plan that is okay and can gradually mature into something much better, or we can ram a plan that is okay and can't turn into something better. I can see no reason whatsoever to advocate the latter strategy.

Posted by: Ulium | September 8, 2009 7:06 PM | Report abuse

pseudo,

actually since I'm in a guaranteed issue state then I'm not affecting the sick one bit. In my state finally with an individual mandate we'll have some accountability. Not enough but its a start. But hey you've never let facts get in the way of your arguments.

What is it you do again for a living?

___________________________________


Posted by: visionbrkr | September 8, 2009 7:07 PM | Report abuse

The insurance reforms Ezra talks about could be accomplished without an individual mandate. The individual mandate is only fair if there is a guarantee of affordability, which there is most certainly not.

As for Medicaid, it's a part-insurance part-charity system that is harming rural and underserved areas. We should fold it into Medicare before we start expanding it.

Posted by: bmull | September 8, 2009 7:35 PM | Report abuse

"actually since I'm in a guaranteed issue state then I'm not affecting the sick one bit."

Oh, bull. You're told us before what's needed to keep your clients' premiums low, and that entails cleaning out one pool and shoving the dirty sick in another.

And I've told you before that I don't want one of your policies.

Posted by: pseudonymousinnc | September 8, 2009 8:18 PM | Report abuse

I would think that if this bill passes the subsequent tweaks to make it better and actually save costs will be doable through methods like reconciliation. I imagine jamming through a modification is easier and less politically damaging than jamming through the entire bill.

Posted by: mschol17 | September 8, 2009 8:38 PM | Report abuse

"actually since I'm in a guaranteed issue state then I'm not affecting the sick one bit."

Oh, bull. You're told us before what's needed to keep your clients' premiums low, and that entails cleaning out one pool and shoving the dirty sick in another.

And I've told you before that I don't want one of your policies.

Posted by: pseudonymousinnc | September 8, 2009 8:18 PM | Report abuse


----------------------------------

haha. I wouldn't sell you a policy if my life depended on it and thankfully it doesn't.

Oh and i realize you don't have a clue when it comes to it but i was speaking in generalties of how risk management works for those that don't understand it like you. I was not speaking about my state in particular. If you had a clue you would see that. Look here:

http://www.statehealthfacts.org/comparetable.jsp?ind=353&cat=7

this is a great page that details how each state handles its healthcare's main points. NJ is guaranteed issue for all products.

But hey go ahead and lie some more or show us how little you know.

Posted by: visionbrkr | September 8, 2009 9:23 PM | Report abuse

The insurance reforms Ezra talks about could be accomplished without an individual mandate. The individual mandate is only fair if there is a guarantee of affordability, which there is most certainly not.

As for Medicaid, it's a part-insurance part-charity system that is harming rural and underserved areas. We should fold it into Medicare before we start expanding it.

Posted by: bmull | September 8, 2009 7:35 PM | Report abuse


and furthermore its comments like this that make no sense. When i refer to risk management if there is on mandate there can be no end to pre-ex. WHat about risk pools is so hard to get? If you don't have a mandate but you require insurers to cover all comers then you'll only insure the sick and then its even MORE unsustainable than it already is.

Posted by: visionbrkr | September 8, 2009 9:25 PM | Report abuse

Sorry, this is not the change I can believe in. It is not what I voted for. Mr. Obama how is allowing former health insurance VPs to write the legislation changing the way Washington works? If this health reform turns out to be a gutless give-away to insurers you will destroy everything that was won last year. You will lose your strongest base of support if you betray your campaign promise.

Posted by: motodude | September 8, 2009 11:21 PM | Report abuse

visionbrkr- I don't think we're ready for EITHER an individual mandate or an end to pre-ex. We can do things like letting young adults be covered under their parents' plan, requiring higher MLRs, etc. My prediction is that health reform will fail and that measures like these will be added to next years' Medicare fix.

Posted by: bmull | September 9, 2009 1:46 AM | Report abuse

bmull,

i'm sorry but that's putting off the inevitable. We all need to take accountability. Pushing kids off on their parents plans is not the answer. Those 40 or 50 something's that can't get insurance can't push it off because some don't want to pay their fair share. They need coverage honestly sooner than 2013. I hope it doesn't fail because we need to bring costs down. We're all going to have to give up something we want to make sure it gets done and if it doesn't then we'll all be back here eventually and in a much more dire situation.

And in NJ like some other states we offer dependent children who don't have access to employer sponsored coverage to age 31 by paying 65% of the single rate once they age off their parents plan. That may be a compromise. If we just shift that ocst to insurers to cover dependents to whatever age because they're still living with Mom and Dad or for whatever reason they'll just shift that cost to higher pricing on employer sponsored plans.

Posted by: visionbrkr | September 9, 2009 7:49 AM | Report abuse

Ezra: "The health insurance exchanges are limited to the state level."
I'v been trying since last summer to get people to notice that the dichotomy between state-level and national plans is false. The five biggest states are as big as smaller European countries, which mostly do a good job. Many of the Midwest and New England states are much too small: so you group them together into regions. I doodled a map here (http://www.samefacts.com/2009/08/health-care/conrads-health-care-regionalism-wimp-out-or-jeffersonian/) for a rather arbitrary cutoff population of 12 million. 25% of 12m, a reasonable ultimate share of the market, is 4m members: the size of the Welsh NHS. Why aren't regional public plans big enough for leverage?

Posted by: JamesWimberley | September 9, 2009 1:17 PM | Report abuse

Oops, 25% of 12m is 3m, as in my post, not 4m as in the comment. (Maybe I should apply for a job on Michael Steele's staff.) Still the size of Wales.

Posted by: JamesWimberley | September 9, 2009 1:30 PM | Report abuse

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