Senator Nelson, when he recently rejected the "compromise" by Senator Casey because it wasn't restrictive enough on abortion, is telling the White House and the Democratic leadership to enable him. After all, he's watched what Senator Lieberman did with the Medicare buy-in, the public option, and Senator Kennedy's CLASS Act in the Senate health bill.
Nelson has been pressing for the Senate bill to include a provision contained in the health bill the House approved last month that would prohibit recipients of federal subsidies from using the money to buy insurance policies that include abortion coverage. Abortion rights advocates are strongly opposed to that provision, saying it would give insurers a strong incentive to abandon abortion coverage.
Here's more after the jump:
On Wednesday, Sen. Robert P. Casey Jr. (D-Pa.), an abortion opponent who is trying to mediate the dispute, proposed a compromise that would more clearly segregate public and private funds in the new insurance exchanges for individuals who do not have access to affordable coverage through an employer. Under the bill, people who earn less than 400 percent of the federal poverty level would be eligible for government subsidies to purchase insurance on the exchanges. In a statement issued Thursday, Nelson praised those provisions but said the proposal was "not sufficient" to win his vote.
"The compromise adds important new initiatives addressing teen pregnancy and tax credits to help with adoptions," Nelson said. "These are valuable improvements that will make a positive difference and promote life. But as it is, without modifications, the language concerning abortion is not sufficient."
By modifications, he means the Stupak amendment from the House bill which he's been pushing to have in the Senate bill. He wants it in there. And he doesn't want to stop there as well. He wants to go after the Medicaid expansion which is one of the very few good provisions in the Senate bill. What's Senator Nelson's reason for going after the Medicaid expansion in the bill?
Well, as shown in the video linked to by Jed Lewison on the front page, the bill covers "too many uninsured" and has to be pared back. Jed also has a nice list of Ben Nelson's ransom demands below:
Nelson's key points:
- Asked if he would vote for cloture even if his initiative to restrict abortion were adopted, Nelson flatly said "no."
- Nelson not only said a vote before Christmas was not feasible, he joked about it taking until next Christmas.
- Nelson said unless the bill's Medicaid expansion provisions were made optional he would oppose cloture.
- Nelson said the bill's revenue provisions were unacceptable because the economy was bad.
- Nelson said because the subsidies which provide the bill's coverage expansion couldn't be paid for without additional revenue, they needed to be "scaled-back"
- Nelson also that unless cost control were addressed first, coverage couldn't be expanded.
Every indication is that the Democratic leadership is willing to capitulate to Senator Nelson on that ransom demand as shown in The New York Times.
Nebraska’s governor, Dave Heineman, a Republican, has written to Mr. Nelson urging him to oppose the bill because of proposed reductions in Medicare spending and also because of the cost to the state of a proposed expansion of Medicaid.
Mr. Nelson has said he wants to change the bill to let states decide if they want to expand Medicaid, though he has not suggested how very low-income people would otherwise gain insurance coverage. Democratic leaders said they were working on a compromise.
This is the problem that comes with enabling conservadems and in allowing the bill to be weakened further. As long as the White House rests upon the assumption of 60 votes, it means that the Senate bill holds greater sway over the House bill in the conference process, and that the conservadems wouldn't be likely to accept any "liberal or progressive" provisions from the House bill. And yes, the conference report itself can be filibustered, which means it still requires 60 votes to pass. That means that the bill wouldn't be "made better" for progressives in conference.
And we'd be facing an unsustainable situation in the future when private insurance premiums keep going up, and the issue of raising the subsidies come up to match up with the rise in private insurance premiums. It means that you would have to pay twice out of our pocket, both in subsidies and private insurance premiums (as well as out-of-pocket caps which can exceed half of your income) to private insurers. Jed Lewison also has a good run-down of how quickly unsustainable this situation can become.
Given the centrality of those subsidies to the expansion of coverage, one of the biggest questions about this reform effort is whether the subsidies are politically sustainable. Unfortunately, history suggests they may not be. While Medicare and Social Security have broad-based support because everybody benefits from them regardless of income, means-tested welfare programs -- including Medicaid and even health insurance for children -- are constantly at risk of being cut, entirely dependent on the prevailing political winds.
The important point here is that because the mechanism for making coverage affordable is subsidies for low-income Americans rather than systemic reform that would apply across the board, the subsidies will constantly be on the chopping block -- and the expanded coverage that is the goal of this bill will always be at risk.
Moreover, because subsidies don't kick in until 2014, it's possible that in a nightmare scenario, they could be dramatically cut or even eliminated before seeing the light of day. In the absence of any systemic reform, then, we face the unpleasant possibility that with a realignment of power in Washington, DC, we could end up with a mandate -- and fewer, or even no, subsidies.
Also, I'd like to address the excise tax myth being pushed by the White House about how it would raise your wages. Emptywheel has an excellent run-down about how this myth is FALSE and would not lead to you getting a raise from your employer, but more likely get your employer-provided health care get cut, switched over to a high-deductible junk insurance plan with fewer benefits, and your cost-sharing would go up.
That is, PWC is making the argument that the Cadillac tax will hit tons of plans, not that employers will succeed in avoiding the excise tax. In fact, the report goes further to note that by 2016, even the lowest acceptable plans, Bronze plans, will trigger the tax in metropolitan areas.
We estimate that in many metropolitan areas, which tend to have higher than average medical costs, the lowest option plan (Bronze Plan) would be considered a “Cadillac plan” as early as 2016. By 2016 at least one of the mandated plans will be considered a “Cadillac plan” and be subject to the 40 percent excise tax in 17 of 50 states.
PWC included that handy map, too, showing how many plans in the Northeast will trigger the tax by 2016 (the darkest red means even plans with a 65% actuarial value will trigger the tax; the report has maps for Florida and California, as well; note, though, I think the Senate has tweaked rates for higher markets since this report, so even assuming the AHIP report is correct, it’ll take longer for crappy insurance to be taxed).
In other words, the PWC study shows not what the Administration uses its quote to suggest–that employers will successfully avoid the Cadillac tax–but rather, that even the crappiest allowable plans in more expensive parts of the country will trigger the tax as early as 2016.
Yes, you read that right. Even the bronze plans in the Senate bill would be subject to the excise tax. Employers are more likely to cut health benefits and keep their workers' wages the same according to several studies cited below:
Which is awfully strange, because a lot of evidence suggests that’s what would happen. A Mercer survey of 465 employer health plan sponsors conducted in November found just 16% would pass on any savings to employees.
One argument that some have made in favor of the excise tax is that employers cutting benefits would return the savings to employees in the form of higher wages. However, less than a fifth of respondents (16 percent) say they would convert their cost savings into higher pay.
And Towers-Perrin did a survey in September, this of 433 human resource executives, that shows even fewer employers would share savings with employees.
Although costs are a sensitive business issue today, interestingly, when we asked survey participants how they would respond to various cost scenarios under health care reform, a significant number (ranging from just over a quarter to just over 30%) said they didn’t know what they would do.
But among the majority of respondents who did have an expected course of action, the response was very clear. Regardless of the specifics of reform legislation, these employers do not plan to absorb higher health benefit costs and would take a variet of actions to avoid doing so … Nearly all would reduce benefits. Some would cut jobs or salaries. And over a third (38%) would increase prices for customers.
Along similar lines, survey respondents who have a clear sense of action in mind (i.e., once again excluding those who gave “don’t know” responses) would not shield employees from any cost increases that reform might bring for them …. And if any savings were to result from reform, most employers would retain those savings in the business (Exhibit 12).
So to review:
- 30% in the Towers-Perrin survey said if health reform increases employer costs, they would reduce employment
- 86% in the Towers-Perrin survey said if health reform increases employee costs for health care, they would pass those costs on to employees
- 9% in the Towers-Perrin survey and 16% in the Mercer survey say they would pass on any savings to employees in the form of wage increases
- So employers are saying that the fundamental assumption that went into CBO’s and JCT’s calculations on the Cadillac tax are wrong. If the employers are right, it means that employees will get crappier health care–with more out of pocket expenses–but for the most part get no corresponding raise to help pay for those costs.
Please go over and read emptywheel's takedown of the excise tax myth being pushed by the White House. It's a very eye-opening read.
UPDATE: New poll shows a majority of Americans oppose the mandate
New poll by Research 2000 for DFA and the PCCC shows that people hate the mandate:
Would you favor or oppose requiring all Americans to buy health insurance — the so-called mandate — even if they find insurance too expensive or do not want it?
FAVOR OPPOSE NOT SURE
38% 51% 11%
UPDATE: Former Rep. Martin Frost has a great op-ed about the danger of allowing too much power to the Senate by the White House.