I guess I am done arguing my point in the comment threads. I'll just go on record here, and then hopefully be able to refer back to it triumphantly later. :-)
The bill as it stands now changes the status quo in the following ways:
- Deficit Amount - Passing the bill should make the deficit decrease
- Average subscriber premium - Will probably increase, but will increase more if we do nothing. However many people will scream that the premium increases will mean the bill is a turkey, much like how they scream that the rising unemployment over the last year means the stimulus didn't work
- Revenue to private insurance companies - Will increase massively. Repubs are in favor of this, wonks see it as irrelevant, and some (not all) progressives see this as a dealbreaker. If your number one objective with this bill is to reduce private insurance companies, this is a dealbreaker.
- Lives lost from lack of health care - This will significantly decrease.
- People kicked off of insurance - Will decrease, but remaining cases will be used to complain about the bill. (Similar to the logic on the stimulus attacks.)
Overall, if those rough parameters stay the same, I am very much in favor of this bill passing. There are political arguments to be made for the optics of the bill looking worse than the reality of the bill, but I personally have little patience for those arguments.
I still have some questions that I'm researching before I feel like I have a solid enough sense of the bill myself. For instance, cost controls could still use a bit more explanation. The rising cost of health care can roughly be split into three buckets:
- Private Insurance Profit Margins - Health insurance companies aren't known for having crazy "record profits" like we've seen with banks and oil companies. They've been largely consistent over the years, I think the number I've seen around 4% - right now I don't believe they'll start increasing massively in percentage terms.
- Private Insurance Administration Costs - Some percentage of administration costs are reasonable, and beyond that there are inefficiences. Large private insurance plans have administration costs of around 7%, small business plans are around 20%, and individual markets are a mess, around 30%. I think the bill has controls in it that say that an administration cost of a plan has to be less than 15% to be in the Exchange (I'm not sure on this), and plans will really want to be in the exchange.
- Cost of providers - This is really the bulk of the rising health care costs of the years. There are cost controls in place - I hear that "bundled payments" is really a big one. Beyond that, we're basically relying on the excise tax and things like that to provide pressure on insurers to pressure the providers for more efficient health care over time.
I think we have a roughly good framework here. From what I understand, the best controls are a combination of what came out of the Senate Finance Committee, combined with much of what is in the House Bill - there are areas where the Senate Bill is stronger, and areas where the House Bill is stronger. Luckily, most of these details are highly wonky and non-controversial, which means I think there is a good chance that many of these cost controls can be improved in conference. I think the exchange will do a lot of good in allowing people to compare plans. I think the pre-existing controls will do a lot of good in allowing people to switch plans, and I think the combination of the two will keep the health insurance companies from colluding and swapping out their plans for all high-deductible junk-insurance plans.
Now for some of the political side.
I think we have been paying closer attention to Congressional negotiations on this bill, far closer attention thatnwe've paid on any domestic bill in the past. Far closer attention than any bill we've ever had where we are on offense. This means that a good deal of our reaction is shock at what the actual congressional process is like.
I'm a beginner on this too, but I've kept a couple things in mind that help me hold the ship a bit steady.
- There is always compromise - We have 60 Democrats (roughly speaking :) ) in the Senate. Think about what the bill would be like if we got 70 votes. Sure, it's a great job by the President and the Senate Majority Leader to push the bill through so easily, but would the bill be stronger than a bill passed with 65 votes? Or 63 votes? If you believe that Democrats make it stronger and Republicans make it weaker, then no. That's simple common sense.
Then you have to keep in mind some simple bargaining logic. If you go in to buy a car, do you tell the car dealer from the outset the maximum price you are willing to pay? No, of course not - you are hoping to get it for less. And you're dealing with a counterpart that has the same logic. This means that in Congressional negotiations, there are going to be plenty of bill proposals floated, trumpeted, and marketed, that the floaters/trumpeters/marketers know damn well they are not going to get. And often times they're going to say, "This is my final offer!" when it's not their final offer. It's just how it works.
To outsiders, whenever someone takes a stand and gives in a little bit, they look weak. But the problem is, when you're trying to negotiate, you HAVE to take a stand and then give in a little bit, in order to truly know where the center point is and get the best deal possible.
Is it any coincidence that controversial bill after controversial bill, they only just barely pass? The stimulus bill barely passed. The House health care bill just barely passed, and they are a lot more liberal than the Senate. You have to practice brinksmanship. You have to ask for much more than you will eventually get. You have to insist that you cannot give up any more than you can, to make the other side give up more. And then you often times have to give up a little bit more - less than you would have had to give up had you not taken that "last stand" (or the "last stand" before that). To the untrained eye, every round of "capitulation" makes the "capitulator" look weaker, than if there were less rounds but more concessions.
- Leverage - There's a reality here that we can't get around. We as progressives are trying to change things. People that are trying to change things by definition have less leverage than those who are just fine with the status quo.
When talking about people like Lieberman or Nelson, we wish we could just engage in a staredown or an armtwisting. I've seen a lot of people insist that we should just "call their bluff". When the problem is that they aren't bluffing - if we called their bluff, they'd just laugh and win. What do we actually have to hold over them? They are the 60th vote. We need 60 votes. We do not have equal leverage. This is what makes it so difficult.
Finally, I should say a few words about what we should have done, or what we should be doing instead. I'll limit this to my thoughts on reconciliation.
We do not have the votes in reconciliation to open up "Medicare For All". We only had 43 firm votes for a strong public option to begin with. Without Medicare For All, we need the reforms on rescission and pre-existing conditions. Those reforms are not eligible in a reconciliation bill. So they require a second bill. One bill for the reconciliation stuff, and a second bill for the reforms.
This bill we're working on right now is the second bill.
No matter how you slice it, passing this bill is a faster path than dumping it and starting over with a two-step reconciliation process. The chances for overall success are also better, because at least right now, the moderates aren't suspecting that Obama has a secret plan to immediately pivot to reconciliation to get a public option or expanded Medicare. They're more gettable right now than they would be in the alternative. We get as much as we can in this bill, the bill that has all the stuff that isn't eligible for reconciliation, and then we pound the drums for a reconciliation bill afterward.
All right, so finally, my sense of what will happen now.
My hope is that Nelson is blowing smoke a little bit. My fear is that he will actually insist on everything he is insisting on. If he really does succeed on making Medicaid optional and reducing subsidies and his various other demands, then... I'd have to review the details, but that could be enough for me to withdraw support for the bill, simply because it probably changes the summary I started this diary with. But I don't think it will come to that, and here's why.
I think they will be able to tell Snowe that they will be able to get Nelson and pass the bill if they give him the abortion restrictions. That they'll have 60 votes either way, but that if she doesn't want the abortion restrictions, they'd rather have her anyway.
In many ways I think 59+Snowe is a better scenario than 59+Nelson.
At that point, I think we'll go to conference, improve some of the innards of the bill, and the late-stage momentum will lead to a little more blinking from the moderates, and we'll actually end up with a pretty good bill. That's my prediction, and I'm sticking to it. All this is is a signpost for me. If we end up giving up Medicaid and the other things that would change my summary above for the worse, then we'll probably be able to look back at this and see it as the point at which tunesmith got more cynical about the nation.
There's a couple more points here. First and real quick, mandates. In my view, the insurance mandates go hand in hand with the rescission and pre-existing conditions control. It's simple math. If you dump the mandates, we have to dump rescission and pre-existing conditions improvements. There are various explanations online on why this is true. At any rate, I'd rather have the improvements. And besides, for those who want to dump the mandate, states can opt out.
And one final point, and this is just more of a rant.
Let me ask you a question, say you're a guy and you go to the car lot to negotiate the price - do you bring a new girlfriend along in an attempt to impress her? I can't think of a worse idea. You might have fantasies that you'll have all the leverage and will beat up the salesmen and will look all impressive, but the reality is you're going to be rocked back a few times, get a little beaten up yourself, and might even look weak from time to time. We know at the end of the day it doesn't matter if we get the car we want without having to walk away, but... I don't know about you, but if it were up to me, I'd rather not let the new girlfriend see the process. If she were there, I'd be liable to give up more than I otherwise would. I would do it to put up less of a fight and more easily claim victory, so I would look more victorious even if I lost more.
My point is, regarding these health care negotiations, the congresspeople are trying to negotiate, and we are the new girlfriend. I can only wonder at how much leverage we'd have if we were a little more sophisticated about the whole thing. I think our reactions are lessening the administration's leverage. Nelson and Lieberman would have more pressure on them if this were a more popular bill. But this has instead all become about us being very visibly upset about the loss of the public option. I'm telling you, if a car salesman saw that, you'd see dollar signs in his eyes. We raised our expectations up so high on the public option that it not only hurts when it's gone, it makes the plan unpopular when as it stands right now, the plan is better than it looks. Nelson and Lieberman see the unpopularity, and it gives them more leverage, because they're not standing in the way of a popular bill.
That's it. If you read this far, thanks for your time and I hope it was worth it in some sense.
