We Need To Fight For Meaningful Health Insurance Subsidies

by: DaveJ

Thu Jul 16, 2009 at 16:30

Yesterday I wrote that the mandates in the House health reform plan - requiring everyone now without insurance to pay to purchase insurance - will work but only if they increase the subsidies so people can truly afford the insurance.  Under the plan as presented a middle-aged couple like my wife and I would have to cough up about $10,000 a year if we make over 400% of the poverty level, and we can't afford that.  Even AT 400% of the poverty level the subsidies limiting costs to 11% of income are inadequate, requiring about $4765 to be coughed up yearly.  

I wrote,

... a mandate without meaningful subsidies is political dynamite that Republicans will use to try to destroy the plan - and Democrats - for decades.  If you don't think they will call the mandate a "big government ordering you to pay a huge tax" and do everything they can to destroy Democrats who vote for this, then you don't know Republicans.

And this risks more than just the health care reform,

The plan doesn't appear to take effect until 2013, giving Republicans a lot of time to campaign on "stopping this massive tax" and spread lots of lies about it after it passes.  So we could lose both Democratic control of Congress AND health care reform.

I think that progressives need to get ahead of this now.  Yes, they introduced a plan that doesn't raise the deficit.  Great, and it blunts conservative opposition.  Now lets get to work and make them put meaningful subsidies in this plan.

I think our opening position should be that people should have their health insurance fully subsidized up to $100K on income.  This is a political decision - if you are getting your insurance covered you are supporting this plan and Democrats everywhere and forever after.  Above that it should slowly creep up to uncovered at maybe $150K.  (At $150K you are largely in a job that covers you anyway.)

How do we pay for it?  Well, it would add costs equal to what about ten minutes of the bailouts for the big financial corporations cost, or what the Iraq war cost, or what we spend on military in a year or two.  It's about priorities.  

Maybe we could pay for it by taxing bonuses over $1 million, or double-taxing companies patriotically based in the Cayman Islands.

Here's the thing: Progressive pressure makes a difference.  Just from today see:   Re: Is Cantwell Reversing Herself on Co-ops?

DaveJ :: We Need To Fight For Meaningful Health Insurance Subsidies

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huh? (0.00 / 0)
300 million * $5000/yr = 1.5 trillion a year.  thats entire iraq war every year.  you need a huge AMT.

New Jersey politics at Blue Jersey.

Huh? (0.00 / 0)
Not sure what you are referring to?


Seeing The Forest -- Who is our economy FOR, anyway? Twitter: dcjohnson

[ Parent ]
Money (0.00 / 0)
You want virtually everyone subsidized 100%.  A rough calculation says that would cost 1.5 trillion every year, a wee bit more than just adjusting some priorities.

[ Parent ]
If you go to full (0.00 / 0)
single payor, the savings come in at about 1/3 of costs.  It might require a bit more taxes, but at the end of the day individuals and companies would both have more money in their wallet.

Guess I should write a post on that.  I haven't bothered mostly because single payor is off the table, and because the public plan's savings seem rather dubious to me (there'll be some, but I wonder how much.)

[ Parent ]
Mostly (0.00 / 0)
True single payer is much better as every other country in the world knows and would save lots of money.  I doubt it would save as much as you claim, at least in the short to middle time frame, as there are other reasons we pay more, but it would make bringing down the cost much easier.

[ Parent ]
It needs to be everybody in and everybody pays (0.00 / 0)
something.  How much can be a percentage of income, but who can afford 5 - 10K a year in this economy on these wages?  

It can't be a welfare program because if it is, it will get demonized out of existence.  

Let them demonize (0.00 / 0)
Hey if it passes they can demonize it all they want, but people will just laugh at them.

We all need to stop reacting to what the right might do and just do what's right.


Seeing The Forest -- Who is our economy FOR, anyway? Twitter: dcjohnson

[ Parent ]
So, you're a single payer supporter then? (4.00 / 1)
As you say:

We all need to stop reacting to what the right might do and just do what's right.

I agree. It's unfortunate that Nancy Pelosi doesn't; rather, she believes that public option is the "next best" solution after single payer.

So, do you agree with the Democratic leadership that a second-best solution is good enough for the American people?

Or do you take the progressive position?

I am in earnest -- I will not equivocate -- I will not excuse -- I will not retreat a single inch -- AND I WILL BE HEARD.  

[ Parent ]
Yes I am for Medicare-For-All (4.00 / 1)
But this plan with full coverage of insurance will do (for now) because then I just buy the public option.

But I never, ever say "Single Payer."  Regular people I talk to have NO IDEA what it means, some think it means single people have to pay for everything themselves.  I always say "Medicare For All."


Seeing The Forest -- Who is our economy FOR, anyway? Twitter: dcjohnson

[ Parent ]
I wrote a Quick Hits on that very topic (4.00 / 1)
Yes, we need to make Medicare for All the dominant terminology.

[ Parent ]
I thought the same thing a year ago, but now I disagree (4.00 / 1)
But that was before a year of agitation. "Single payer" is used constantly in letters to the editor, it's been used constantly by single payer advocates infiltrating OFA house parties, it's well known to the press (when the media blackout lifts), it comes up most every time Obama holds Town Halls, and Obama himself has used it (granted, after trying to censor it).

Further, "Medicare for All" is deceptive from a policy standpoint.  The VA is another "single payer" system, only for the military, and its system was certain IT advantages.

So, while I think newbies may feel more comfortable with "Medicare for All", and maybe people who don't want to be associated with single payer hippies, ;-) ultimately, single payer is the best term and will win out. All introducing new terminology will do is confuse the issues -- and they've been confused enough by "public option" (or "plan") advocates.

I am in earnest -- I will not equivocate -- I will not excuse -- I will not retreat a single inch -- AND I WILL BE HEARD.  

[ Parent ]
Surely you must know... (4.00 / 1)
Surely you must know that "I just buy the public option" bears no relation to the actual bills before us, which are means tested and firewalled to protect the insurance industry. But then you may be one of the lucky 9 million to get in! Then again, you might be one of the unlucky 10 million who aren't covered at all. One never knows. If anybody actually follows your advice to make life choices in this matter, it could be dangerous, even life threatening for them, so I suggest you revise and extend your remarks.

And surely you must know that the Democrats are committed to preventing the program from evolving into single payer? (I thought that deceptive talking point had long since been laid to rest, but not so.) See Kathleen Sibelius; see Obama (as opposed to the Obama of 2003, of course).

I guess I'm just simple-minded, but I think the way to be "for" single payer is, well, to be for single payer, and not to negotiate with ourselves. Lack of pressure from "progressives" is one good reason why Pelosi, like you, feels free to be "for" single payer, and then proceed to foist an admittedly second best solution on the American people -- one that is complex, untested, an experiment done without informed consent, and doesn't kick in until 2013. YMMV and, apparently, does.

NOTE As far as talking points, I'm not a "policy that dares not speak it's name" kind of guy; I leave that to the Herndon Alliance folks and the wannabe insiders. The people I talk to are perfectly familiar with it -- the word "single payer" was been used in several health care town halls, and it generally comes in questions to Obama (see here and above).

I am in earnest -- I will not equivocate -- I will not excuse -- I will not retreat a single inch -- AND I WILL BE HEARD.  

[ Parent ]
**** Crickets *** (0.00 / 0)

I am in earnest -- I will not equivocate -- I will not excuse -- I will not retreat a single inch -- AND I WILL BE HEARD.  

[ Parent ]
I never react to the right... I do have thoughts about them (0.00 / 0)
but none of them include caring a hoot about what they think.  I am reacting to the fact that this bill doesn't go far enough; they are still doing mandated insurance and not health care reform.  If they turn this into "welfare queen" legislation, a conservative will stir the pot of resentment.  "Your cookie is bigger than mine."  Divide and conquer.  Let's not forget what Bill Clinton and Ronald Reagan did to millions of poor people with their nasty TANF legislation.  

[ Parent ]
No more give aways to the insurance industry! (4.00 / 2)
That's the problem with the mandate and the subsidies in the first place.  It's just a boon to the insurance industry.  We need single payer at point of service.  Not single payer to the insurance industry. If we have a mandate, it needs to be a mandate that everyone is in on a public option.  I don't want my taxpayer dollars going to the insurance industry, period.  I fully agree that a mandate requiring us to buy insurance is horrible.  And for god's sake, why must we wait until 2013 to be able to get some relief from this health insurance mess?  My husband and I will be broke before then at the cost of the premiums we pay (both in our mid-late 50's, and let me tell you the cost is horrendous!)

No, we don't. That accepts the frame that public option is welfare (4.00 / 1)
means test + subsidy == welfare

That's a frame that condems us to "fighting" for subsidies for the forseeable future -- useful if you are planning a career as an activist doing that fighting, but no good at all for the American people.

What we should be fighting for is health care as a right and single payer. If you have an "everybody in, nobody out" solution, then the fight over subsidies goes away.

Reinforcing the welfare frame for health care reform is hardly "progressive." Single payer, besides being the science-based solution, is the progressive solution as well.

I am in earnest -- I will not equivocate -- I will not excuse -- I will not retreat a single inch -- AND I WILL BE HEARD.  

Giveaways to for-profit corporations... (4.00 / 1)
Straight out of the DLC/New Dem playbook. Romneycare writ large. No thanks.

Every place some form of the "public option" scam has been tried (7 states, iirc) it has failed to a.) reduce costs, b.) provide universal coverage, and c.) improve health care.

Single payer is the solution for the US at this time.

When I was a kid, for-profit health insurance was a crime, and it should be so again.

Where? (0.00 / 0)
Where has public option been tried?


Seeing The Forest -- Who is our economy FOR, anyway? Twitter: dcjohnson

[ Parent ]
States unspecified -- from Congressional testimony (0.00 / 0)
June 24, 2009

Testimony of Sidney M. Wolfe MD
Acting President, Public Citizen and Director, Health Research Group at Public Citizen
Before the Subcommittee on Health
House Committee on Energy and Commerce
Hearing on Health Insurance

"...In the U.S. we have had experiments as well with seven states having instituted various versions of the public/private combination that this legislation seeks to provide. In none of these states has this worked, once several years had elapsed, despite initial enthusiasm and short-lived decreases in the uninsured..."


[ Parent ]
Not just affordability... What is the tradeoff? (0.00 / 0)
Family budgets tend to be pretty tight. If you have a hefty cost in health care costs or insurance, something else has to be cut. Probably, you aren't going to cut necessities like food, housing, car.

Instead, people are forced to cut things that aren't immediate necessities like retirement savings and education. From a social welfare position, these are capital investments for the future, so expensive health care trades off against future financial security.

Implementation timeline (4.00 / 1)
I read the first 110 pages of this behemoth in the early morning hours.  A lot of the confusion is because the bill itself is confusing, lacking clear dates and with much of the wording referring to sections of previous federal laws including ERISA and various parts of the Social Security Act.

To cut to the chase, the bill allows a period of up to 18 months to establish rates and then has a three part implementation program.  The program starts in January 2011.  The first year, referred to in the bill as "Y1" and only Y1 has no starting date attached but that is listed elsewhere.  Y1 covers only those working in "small" employers (10 or fewer employees) through the insurance exchange.  Y2 (starting January 2012) would cover workers employed by employers with 20 or fewer employees.  The insurance exchange only gets into the act for employers with over 20 employees in January 2013.

That's why there is  confusion about the start date.  There are three of them but the bulk takes place in 2013.

The legislation claims that 94% of Americans will be covered by insurance once the bill is fully implemented.  That would leave about 19 million people uninsured by 2013. This is pretty consistent with the claims by Paul Krugman and others two years ago.

While much better than the current situation it is not universal health insurance but a half-way measure (it takes us a bit more than half of the way, call it a 60% measure).

The best parts are eliminating the pre-existing coverage gap under the present law and eliminating discounts for large group insurance.  After all those years of insurance scams, the community rating system returns.  It has been working quite well (and reducing overall costs) in Hawaii for all these years.  

The worst parts: still not covering everybody, has increased funding to prevent "fraud and abuse"(thus perpetuating the Republican stereotypes without actually payimg bills), takes too long to cover many people.  For a bill that requires "clear" language, the hundreds of pages of references to previous legislation and the lack of clear language as to dates, etc, is a bit frustrating.

Only 900 pages to go.


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