|The House bill has two major cost-control mechanisms: the public option and the 85% medical-loss ratio requirement. The Senate bill is on track to have neither, and nothing new to replace them. The Senate bill is a recipe for national disaster. If it's that bill or nothing, I prefer nothing.
We all know America's current healthcare system is failing -- and it's failing everyone, not just the uninsured. It is far too expensive: Americans spend 16% of GDP on healthcare and get worse results than countries that spend half that. Literally.
We need health reform that expands access to quality healthcare, abolishes unjust practices of insurers, improves value to the country, and puts us on a trajectory to continue to improve our healthcare system over time.
But the Senate has systematically stripped out nearly everything I liked about what was proposed in the early, heady days of healthcare reform. They have done so in order to please a handful of so-called centrists who care more about protecting corporate profits than protecting the people they claim to represent.
How do we judge whatever the Senate finally passes? How do we tell whether what's left of the bill is enough to support it?
There are four key questions we can use to evaluate the proposed reforms:
- Affordable coverage for everyone: How close are we to the ideal that every American will have access to high-quality healthcare that they can afford?
- Value: How much have we improved the value Americans get for our healthcare dollars -- so that we are healthier and get more for our money?
- Fixing insurance company injustices: Have we reduced or eliminated the injustices caused by insurance companies when they destroy the lives of people who get sick by refusing to pay for care, or retroactively cancelling their insurance?
- Trajectory: Are we on a path towards continued improvements in all of those areas?
If we look at the current Senate proposal, the scorecard is not promising:
Affordable coverage for everyone: FAIL.
The latest CBO estimates for the Senate bill say that a family of four with a household income of $54,000/year should expect to pay 17% of their gross income on healthcare - about $9,000/year. (And that was when there was a public option to hold down costs!) That's more than they'll spend on federal taxes. That's more than they'll spend on food. I'm guessing if you took a poll, very few Americans would consider that affordable. And because of the way they've approached this, there's no effective cost cap on premiums and nothing providing downward pressure, so this is a problem that would get worse rather than better over time.
In January 2007, the McKinsey Global Institute released a study showing that the United States spends twice as much on healthcare as the rest of the industrialized world. It costs our economy a extra $480 billion per year -- roughly $1,600 for every man, woman and child in the country. It's not because we get more effective care: we have lower life expectancy and higher infant mortality. Our results are worse, even though we're spending twice as much.
We pay more because we've set up the system so that the incentives to insurance companies, doctors, hospitals, and patients are all messed up. We've set it up so that expensive ways to treat things are preferred to inexpensive ones, even when the inexpensive ones are better. We're not getting better care, just more expensive care. Insurance companies won't pay to let a diabetic see a podiatrist to keep their feet healthy, instead waiting to cover amputations. Why? Because maybe by the time an amputation is necessary, somebody else -- another insurance company or better yet Medicare -- will have to foot the bill. Voila! More expensive, worse care.
Unless we address the messed-up incentives that are at the heart of our system being so expensive relative to the value being delivered, we aren't really fixing the problem. A public option might have been in a position to begin to fix those problems, but nothing in the current Senate bill does.
Fixing insurance company injustices: PASS.
The biggest areas of insurance company abuse -- denying coverage to people with pre-existing conditions, cancelling policies retroactively after people get sick, discriminating in rates on the basis of gender - appear to be addressed by the bill. I'll give them the benefit of the doubt here.
Finally, the question is not only whether the bill improves each of the three areas in the short term, but whether they will improve in five years or ten years or twenty years. What the Senate is currently discussing will make healthcare more expensive for individuals, families, and businesses, with no check on the insurance companies and none of the systemic reforms that might fix the incentive problems. They're on track to make the problems worse over time rather than better.
That's the best the Senate can do? Thanks to Joe Lieberman, it's worse than nothing.
We should fight for the House bill, which does a better job on all fronts. With some minor tweaks to ensure that women can get the reproductive care they and their doctors think they need, it's a decent bill on the right trajectory.
But if it's Joe Lieberman's bill or nothing? Kill it.