There are a few kinds of partisan divisions on the issue of health care reform and two of them exist on our side of the spectrum. First, the Obama-Clinton divide on mandating employer based care and second, the left has a structural divide between advocates of single-payer and employer based health care.
I live in Massachusetts and as a blogger at this site I am seriously disappointed that partisans of all varieties continue to trash and defame my state's efforts to address costs by mandating coverage. I am particularly incensed when partisans don't tell the truth about my state. And I think we need to have this discussion honestly because if we can't get real national reform that works for actual people in the next administration then we'll be ready for the proverbial fork.
I read the Why Elizabeth Edwards is Wrong diary and I think the diarist owes a correction, several of them actually. But this diary is not about Mrs. Edwards as she can speak for herself. This diary is about us having an honest dialog.
Let's be honest about what is going on in Massachusetts.
We have a mandate. Why? The mandate is a necessary element of an employer based system because it's the best way to address costs for everyone. If you can't get everyone into the system then the merits of any reform should be greeted with intense skepticism. You need everybody in to pool risks and lower costs over the long-term. Cost control is the ultimate goal of health care reform, regardless of whether you support single-payer or employer based systems. Coverage for everyone, while a moral imperative, is the ancillary fruit of the tree that is planted for shade. More on this later if these statements don't persuade you, please read the rest before you go off on me.
If anyone wants to point to MA as proof that employer based systems do not work then they need to remember two things. First, the law went into effect July 2007. Second, this is the first year that residents need to show proof of coverage. In 2007, the penalty for opting out was only 219.00. This year is the first year that the penalties can be significant. But since significant fines have not shown up in people's budgets yet any conclusions drawn from current data showing who got what coverage because of the fine is completely erroneous at this time.
The issue is not really the mandate at all. The real issue is funding the mandate. It always has been. People concerned about the affordability of a plan should consider that fact. Today is the one year anniversary of passage of the new law. MA has signed up almost 350,000 new enrollees since then and that is solely due to: the subsidy now available for the first time to those that qualify under our new law; the mandate and/or the fine for not getting coverage. MA is a fairly wealthy state with most employers already offering health insurance to employees and that strength was a huge consideration in our state when the law was written with mandated coverage in it. That's exactly why the legislature chose to piggy back our reform on the back of the existing system. They were right about that choice. We had a lot of good employers to work with in the state.
While I fully concur with the assessment that many states do not have that luxury when looking at their choices for reform legislation, it is not honest to argue that MA chose the needs of for-profit insurance corporations over the needs of their citizens. That's the truth. Partisans arguing that MA is engaging in the worst kind of corporate welfare are lying about my state and readers of this blog should consider that when participating in these "MA sucks" diaries.
UPDATE: From Dallasdoc in the comments.
I practiced in MA for 15 years after getting my residency training in Boston, so I know something of the state. For-profit providers have very little presence in MA, so you don't see the worst of the insurers much. Not-for-profits have always been the major players in MA, which actually makes it a best-case laboratory for mandates. Experience in other states where the Uniteds and Aetnas and Cignas dominate would be significantly worse.
The blogger is a very strong proponent of single-payer and takes exception with a number of points I make in this diary. But Dallasdoc is also a very honest blogger and offers some productive comments in this thread. I'm excerpting this part as it pertains to the corporate welfare smear on my state because I think I made this point very weakly if at all. Thanks, doc.
That's the good news about MA. In the interests of honest dialog here's some of the bad news. We have a huge problem getting the money to people who need a subsidy to pay for a plan. There are many reasons for this. Right now, health care is virtually free for those at the federal poverty line and subsidies are hard to estimate but they are available for anyone earning up to 3 times the poverty rate. Some of the reasons for this shortfall in the subsidy are the following. Repeat: some of them are the following:
- The failure of the expansion of S-CHIP which is now shelved until the next Congress comes in DC, January 2009 at the earliest, takes away vital monies my state requires to meet the needed subsidies. Did they count their chickens too soon on Beacon Hill? Maybe, but the failure of the Federal government to provide S-CHIP money to my state is a key element of the deficit we now face in the Bay State. Any short term analysis of why the MA plan is harmful to people of modest income should include that fact.
- Our mandate is getting trashed in the media from all sides. The right wants to defeat our plan for obvious reasons, but so too MA is under assault in the media from progressive partisans of the Obama and single-payer ilk. That media trash bash makes it much harder for our leaders in this state to come up with funding. We're now looking at a sin tax on tobacco to address the shortfall, but bad media and "fear of a mandate" coverage make the job harder for Governor Patrick and the leadership to come up with an adequate funding stream. Contrary to conventional wisdom, this state is not Taxachusetts and our citizens hate taxes just the same as anyone. This negative coverage and innate inclination against taxes make a comprehensive tax hike to pay for the subsidies a total non-starter. Please consider that when trashing my state.
- MA has always had a structural problem in our health care reform efforts in that we can't provide a truly public plan like Medicare to all our citizens. Pretty simple. No qualifications here. We are not the federal government and it is not within our power to create a Medicare type system at the state level.
And that last point brings us to the issues I would like to discuss as far as a federal health care reform package and the partisan divides I see at the national level.
I fully agree that single-payer is a great way to address costs which is the fundamental impetus to enacting any reform in the first place. And I would concede that single-payer is a superior framework to achieve this goal. Totally. Unreservedly. I agree.
But again here, the dialog that I see is dishonest. Let's just assume that a single-payer system will have administrative costs akin to Medicare. I think that's an assumption we can all agree upon and I think that it's probably an accurate one too, bonus. Medicare admin costs are around 2-3%. Private insurers typically run anywhere up to 20-30%. So (cost + 3%) is always less than (cost + 30%) - that's the truth. But we all have to remember that the federal government, unlike the Commonwealth of Massachusetts, has the ability to offer Medicare to everyone insured the existing system directly passing on the savings inherent in a public plan potentially to every person in this country. I never see that pointed out in these diaries and I think that omission is dishonest.
Second, I hear a lot of grief about the punitive and harmful nature of the fine in the enforced mandate. I would never suggest to someone struggling with their bills that they should just suck it up or grow up. Never. And while last year you only lost about 219.00 by opting out, this year the fines can be significant and can reach as much as half the cost of a plan. Significant fines are just starting to show up in people's budgets, so any conclusions drawn from current data in my state about who got what coverage or who got reamed on their fines are completely erroneous for this reason. There is real pain here, to be sure. But single payer advocates that use this reason as a way to promote their preferred plan should ask themselves: how would we finance a single-payer system?
If you go by how we currently finance SS or Medicare then you would conclude that a single-payer system would be financed in large part with a payroll tax. There may be a tobacco tax as well because that's how we pay for currently S-CHIP which I think would be rolled in to the new reform. The sin tax is voluntary, for sure, but still you're not going to get enough money, especially in the long run, to pay for the new plan from a sin tax. So if you can't afford a plan that would be subsidized or a fine really hurts you for opting out then how could you afford to pay the payroll tax? See? I agree with the premise of the argument in that Elizabeth Edwards diary today, but I don't agree with the conclusions that single-payer is just pure magic just because and will represent little to no cost for people of modest income. Single-payer is going to cost people and employers too. Those of us concerned about those of us that would take a really serious hit on their budget need to consider that fact when publishing a screed against employer based systems.
Both plans include outlawing denial of coverage for pre-existing conditions. So too, a single-payer system would have this same provision. Hopefully. So let's agree that this really important provision is a wash in all these proposals. Let's also agree that these two plans are largely similar and are far superior to anything the YOYO Republicans will run on; "YOYO" meaning here's a tax cut go figure it out in the "free" market because You're-On-Your-Own out there.
I think this part of the diary is going to inflame discussion so allow me the opportunity to say a few things here about myself. Groan, I know, but just for purposes of defending my position. I was an Edwards supporter and I volunteered for that campaign in NH. I voted for Edwards in my primary because I could and after all that work in NH I think my choice was justified. As a democrat I will work for my nominee in the fall because it's so important that we defeat McCain. I haven't declared for either candidate at this point largely because my opinion is irrelevant, I already voted, the carnival left town months ago and MA ain't going to be a battleground state this year. I expect Obama is going to be our nominee and I have no problem with that whatsoever. He's a good choice, but from reading his UHC plan I think it's seriously flawed for two reasons. I think Clinton is a seriously flawed candidate for a variety of reasons, but I think her UHC plan is superior.
I'm not trying to cast any aspersions here or slam the candidate. I'm arguing for a little honesty here precisely because I think he will be the nominee. He's earned it because he's inspired the nation and gotten the votes where they count - at the ballot box. Since I expect him to be my nominee and I don't like certain provisions of his plan I think it's very important that liberal voices in the sphere try to challenge the candidate on his plan that we will all have to "sell" in the electorate come this fall and live with next year. This is why I think the Obama plan is flawed.
First, the Obama plan does not include a mandate for everyone. He has the mandate for children, but not for everyone. If you don't believe there's any merit to a mandate then I can see that you may not be persuaded by my argument here. But please remember that Obama includes the mandate for children because that's the best way to get the most kids covered. So if mandates work for kids then why don't they work for adults. Right?
Also in the interests of fairness let me say that I heard Kerry on Meet the Press argue against mandates because they're not going to pass in the Senate. I don't disagree that it will be an "uphill both ways" kind of a battle, but it is a fatally flawed argument for this party to stake our reform position on "can't get there from here" considerations in the general. The "we can't get anything passed with a mandate" argument is flawed because it's purely a tactical decision to get a mostly universal plan through the Congress and it doesn't reflect the will of the people in this country. I don't know about Obama, but John Kerry, who argues against mandates, has said that ultimately you need mandates to truly meet the commitment of Universal health insurance so he would support such a mandate in the 2012 time frame. I don't think that's good enough because if we screw up the reform that we need to do in 2009 then how much support can we expect from voters to fix it in 2013? People have to start seeing results in their pocket books or the whole thing goes pear-shaped real fast. And our party loses the trust of voters on this issue for a generation. I really believe that.
Mandating coverage for everyone also provides our party with an essential ingredient as far as framing goes. Without the mandate we can't argue that "we're all in this together" and it's going to be tough but the results are an investment in our future. "Most of us will get more affordable coverage" under the new plan doesn't sound as persuasive. It's all in time. It's FDR time. The country is ripe for transformational change. Obama has inspired the nation, why isn't he using his voice to make this argument? And why aren't we asking him to do so?
Besides why accommodate conservative senators by leaving out the mandate in the first iteration when those senators are not only going against the will of their own voters but don't believe in any kind of public trust in the first place? Conservatives have been trying to kill SS and Medicare forever, a position which is not supported by voters. Their completely indefensible blockage of S-CHIP was not supported in the court of public opinion either. Yet the Congress caved and Dems gave up on the issue until after the next election, see the link above. That was completely incomprehensible to me and it's outrageous that this kind of capitulation is tolerated in the liberal sphere. It was a great issue to stand and fight on. Standing for a mandate could be another great issue for the party. We do things together as a people for the public interest, they want to give you another voucher that isn't worth the paper it's written on and good luck to you.
This kind of corny crap sells itself to the nation, 80% of which think the country is seriously going in the wrong direction.
The second deficit with the Obama plan is more serious in that it does not include a truly public option. If you check the website you can see that there is a provision for the expansion of S-CHIP, cool, and Medicaid, cool too, but there is no language in that plan about providing Medicare as an option available for anyone regardless of their eligibility requirements. The "public plan" referred to is the Federal Employee Health and Benefits Program, FEHBP. This is the insurance available to federal employees like senators in DC, but it is implemented through private insurers. Blue Cross/Blue Shield. HMO's. Whatever. These are not truly public plans like Medicare is and for that reason they represent no fundamental cost savings for citizens based on administrative costs. Right?
An employer based system with a Medicare for All type option could easily turn into a single-payer system through individual choice. Today about 50 cents of every health care dollar comes out of the federal and state governments. Some of that money comes from privately implemented plans but most of it comes from good old Medicare, Medicaid and existing S-CHIP. If you put a truly public option into the reform plan and make it available to everyone regardless of eligibility then that number could go through the roof. And readers should consider that other countries like Germany and Japan now achieve universal health care through employer based systems so single-payer may be the best and easiest way to contain costs, but an employer based system can also achieve the goals of universal coverage.
I still hope that Obama will change his offering on a universal health care plan by adding two provisions: mandated coverage and Medicare for all. I think the party needs him to make the case before voters. His voice in this dialog is going to be the governing factor in how well we do going forward. If we're not going to run on a single-payer system, and we're not - let's face it, then we're going to run on an employer based system. Subsidizing private for profit corporations without applying the right kind of downward pressure on costs through the Medicare for all option has a huge margin for error. That kind of a plan could very well turn into the worst kind of corporate welfare. I hope our party doesn't make that mistake in this cycle and I hope Obama realizes that he now bears the lion's share of the responsibility for enacting a universal health care plan and achieving the goals, all of them, of long overdue health care reform in this country.
My apologies for all the straw man arguments here. I know, I know, those really bug me too, but a lot of this diary argues for honesty in the discussion we are having about single-payer and universal health care reform. In that respect I think it's valid to include them in this diary.