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"Ten years from now," writes Jon Cohn, "if health care reform is a boondoggle, you might be able to trace that failure back to a decision in the wee hours of last week's Senate Finance Committee hearings."

The decision he's talking about is the rejection of John Kerry's amendment "Empowering State Exchanges to be Prudent Purchasers." Olympia Snowe apparently dropped the guillotine, worrying that it would mean more government, which it would. But it would also mean working exchanges offering products that consumers can actually trust at prices they can actually afford. Cohn explains:

In the bills that passed three House committees and the Senate Health, Education, Labor, and Pensions (HELP) Committee, the exchange would be a "prudent purchaser." In other words, it would have a staff that bargained with insurers to bring down premiums -- and that made sure all plans lived up to strict guidelines for coverage and customer service. In effect, any insurer that wants to offer coverage through the exchanges has to get the equivalent of a "Good Housekeeping Seal of Approval" from the administrators. This is precisely how it works in Massachusetts.

By contrast, the Senate Finance bill envisions much weaker exchanges. Instead of choosing which plans to make available, the exchange administrators would, by law, have to accept any plan that meets a relatively minimal set of standards.

Jon Kingsdale, who runs the Massachusetts exchange, calls that a recipe for "policy disaster," as consumers faced a dizzying array of more expensive, less regulated choices. "It would be like telling your grocery store they have to offer every single kind of bread baked by every single bakery. ... The exchanges would be nothing more than an automated Yellow Pages."

There's a good chance that Kerry's amendment will triumph down the line, and the "prudent purchaser" language included in the House and HELP Committee bills will be in the final legislation. But it's worth keeping an eye on. If Kingsdale, the only guy who's actually run one of these exchanges effectively, says this is necessary, then it's necessary.

Photo credit: By Win McNamee — Getty Images

By Ezra Klein  |  October 5, 2009; 12:56 PM ET
Categories:  Health Reform  
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Comments

BE HONEST EZRA!!

Its more than a little disengenious that you point to this but not the Wyden Free Choice Ammendment. As you know that would have done much more to promote cost savings than the prudent purchasers ammendment. It would have opened up the exchange to everyone and it was Kerry (ironically) that was one of 4 Democrats to shoot it down while at least one Republican (Ensign) seemed in favor of it.

You can blame Snowe all you like but its the Democrats who deserve MORE blame.

Kerry and others bowed down to Big Business and Big Labor that destroyed all of our choices. HOpefully its ressurected on the floor.

Posted by: visionbrkr | October 5, 2009 1:11 PM | Report abuse

In general, Democrats have offered a lot of good ideas, but in this case Snowe has it right.

Consider: "....have to accept any plan that meets a relatively minimal set of standards."

As if this kind of diversity is bad.

No, this kind of diversity is very necessary.

Specifically, it will allow individuals like Lyn Robinson to finally get coverage that makes sense:

http://findingourdream.blogspot.com/2009/10/how-wydens-free-choice-plan-would-help.html

We only need certain "minimal benefits", that is, a regulation that prevent tricky loopholes where policy buyers think they have coverage, like hopitalization, which in fact they have little or none of by virure of carefully written tricky language in their policies. That is the only kind of "minimal" we need to exclude, and the "bronze," "silver," etc., levels will answer this.

Posted by: HalHorvath | October 5, 2009 1:22 PM | Report abuse

You might also think to the analogue of Medicare (Parts C & D). CMS does not accept a bid from anyone. It won't list plans that have marketing violations, where the formularies don't follow CMS rules or where bids are not submitted in a way that follows rules.

Posted by: GrandArch | October 5, 2009 1:40 PM | Report abuse

LOL. What difference would it make? You'd support it no matter how bad it got, Ezra. In fact, the only thing you won't do is admit it.

Posted by: whoisjohngaltcom | October 5, 2009 2:07 PM | Report abuse

--"[I]t would have a staff that bargained with insurers to bring down premiums -- and that made sure all plans lived up to strict guidelines for coverage and customer service."--

Would that sorta be like how a state trooper bargains with the speeders pulled over on the interstate?

Or more like how the members of the legislature and executive bargain with their brothers in loot down on K street?

Or some mixture of the two?

Posted by: msoja | October 5, 2009 2:37 PM | Report abuse

"Its more than a little disengenious that you point to this but not the Wyden Free Choice Ammendment."

I could have sworn it was tabled by a point of order from Baucus/Conrad rather than "voted down".

John

Posted by: toshiaki | October 5, 2009 3:06 PM | Report abuse

John,

it was technically tabled but Kerry and Binghaman talked so badly about it and how business and labor were against it that i'd suspect it would have a hard time managing itself through the entire senate much less a committee where democrats have the majority need to get it into the legislation. Also the reason it was tabled was because there was no score on the vouchers in the ammendment.

Other things weren't scored in its entirety and they made it through.

As I've said before on a different post if you want choice maybe you need to work for Raytheon because Senator Kerry doesn't want anyone outside large employers to have choice.

Posted by: visionbrkr | October 5, 2009 3:46 PM | Report abuse

Just so we're clear and can cut through the rest of the nonsense:

The amendment was tabled by Baucus/Conrad and not "voted down" by "four" Democrats.

It's worth noting that doesn't make the Dems look good: it was Baucus/Conrad who killed it, and they're (D) rather than (R).

John

Posted by: toshiaki | October 5, 2009 5:06 PM | Report abuse

Cantwell's plan will depopulate the exchanges by up to 75%. They are now worse than useless and should be eliminated completely.

Posted by: bmull | October 5, 2009 5:23 PM | Report abuse

John,

Don't just blame Baucus and Conrad. Kerry and Bingaman are just as much to blame. They put up the argument against it that will follow to the Senate floor. You can argue semantics to give them "cover" but watch the below starting at 1:17:00 in the evening session part 2. Kerry sold out to big business. Binghaman sold out too. Bingaman's concerns are easily allayed. His issue is that employees could opt out of their employers plan and take lesser coverage than they should be able to get or can afford on the exchange. All you have to do to fix that is put something in that's in insurance now. Its called open enrollment. You can only change once per year. If you can't allow that then you can't allow choice at all and you're basically telling people what they can afford. how long before we tell people they can't afford cell phones so they need to cancel them. Why didn't we tell them they couldn't afford their houses and second and third mortgages so we could have avoided the housing crisis??

And God forbid, but Senator Ensign (R) is for it because the Free Choice Ammendment gives power back to the individual instead of big business and labor. I know, my head spinned too when I heard it myself but the tape doesn't lie. I saw it live and was dumbfounded. This is something you'll never hear Ezra say.

http://www.cspan.org/Watch/Media/2009/10/01/Health/A/23901/Senate+Finance+Cmte+Health+Care+Markup+Day+7.aspx

Posted by: visionbrkr | October 5, 2009 9:34 PM | Report abuse

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