Senate HELP Committee Summary on "Strong Public Option"

The following is the summary of the public option from Senate HELP Committee.

A Strong Public Option

The Community Health Insurance Option

A strong majority of Americans believe that a strong public option is an important component of any health reform bill that keeps costs down, expands coverage, and offers American families a wide variety of affordable options. Backed by the government for the public good, not private profit, the HELP Committee’s public option – called the Community Health Insurance Option – will be a strong, effective national plan that provides Americans with a real alternative to traditional, for-profit insurance.

Summary:

  • HHS-based plan: The Community Health Insurance Option would be run by the Department of Health and Human Services. The government would pay for the first three months of claims as a way to capitalize it; this would be a loan to be repaid over time. For the first two years and longer if necessary, this strong public option would also qualify for “risk corridor protections” which offset or reclaim excessive losses and gains which could result during the start-up period (identical to those in Medicare Part D). Subsequently, its premiums would be set to make it self sufficient. This would make the public health insurance option quickly available in all areas of the country.
  • Plays by the same rules: The public option would be one of the Gateway choices. It would follow the same rules as private plans for defining benefits, protecting consumers, and setting premiums that are fair and based on local costs.

Provider payments and participation:

  • Negotiated rates within limits: The payment rates paid by the public option would be no more than the local average private rates – but could be less. The Secretary would negotiate these rates.
  • Input from Advisory Councils: Each State would create a Council of provider and consumers to recommend strategies for quality improvement and affordability. States would share in the savings that result.
  • Purely voluntary: Health care providers would have the choice of participating in the public option; there would be no obligation to do so.

Why It Will Make Health Care Affordable

  • Pooled purchasing power: This public option can pool the purchasing power of its enrollees nationwide to leverage lower prices to compete with private plans. Similar negotiation power has been used by states to get drug rebates in Medicaid beyond the statutory minimum. It has been used by large businesses to drive delivery system change. This negotiation would be backed by a ceiling of paying no more than average local rates.
  • Flexibility and incentives to innovate: Unlike administered pricing, the negotiation for payment rates gives the Secretary the ability to quickly and aggressively promote payment policies that promote quality and best practices. In addition, the State Advisory Councils would tailor delivery system reform for the public option, with a financial bonus for success.
  • Lower administrative overhead: The public option would not need to raise premiums to support shareholder profits, extensive marketing, and extra risk reserves required by require to protect enrollees from plan insolvency or mismanagement of funds.

Comments

I would have voted no

Thanks for posting these details, I hope everyone will read them carefully.

This puts a positive spin on the plan, of course, and leaves out many concerns. But even within the spin, fatal flaws are apparent.

One fatal flaw promises to derail the plan from the outset, especially in under-served areas where providers have long cherry-picked plans and patients.

Purely voluntary: Health care providers would have the choice of participating in the public option; there would be no obligation to do so.

This effectively says that emergency rooms, hospitals, doctors and clinics can turn away people who may be covered by the public plan. And you can bet they will. The entire for-profit healthcare industry has a huge stake in seeing a public plan fail - and it's clear as a bell that they will work hard to make that happen.

That shortcoming is a logical consequence of this provision:

It would follow the same rules as private plans for defining benefits, protecting consumers, and setting premiums that are fair and based on local costs.

One would be forgiven for being skeptical about having another insurance plan that operates like the many private plans in force today. More of the same? Why bother?

In addition, the plan's dependence on employers as the backbone is both counterproductive and unsustainable. As I've written elsewhere, it will result in increasing unemployment, offshoring and outsourcing. Look for employers to eliminate full-time jobs in favor of part-time and contract labor. In an environment where people will take any job they can get, this is a formula for disaster.

Finally, the oversight, governance and compliance requirements for this plan read like a nightmare scenario. Indeed, it adds mind-boggling layers of complexity that not only fail to reduce bureaucracy, but actually exacerbate it.

I believe Congress is smack dab in the process of squandering the opportunity for an elegant, simple, single-payer plan that could have brought healthcare costs under control and set our nation on a sane course. That apparently puts me in a distinct minority. It's a sad day when people are willing to get excited by table scraps.

PS The name sucks too.

Lets See what comes out of the house

I am more likely to support what comes out of the house. The two bills will have to be reconciled anyway.

Anthony D. Hall,

Fighting for Truth, Justice, Freedom and the American Way!

I may be misreading some of this,

but it appears that "having a benign impact" on providers and private insurers was the top priority when this was put together, as opposed to providing affordable coverage for all.

And while I can dig the parts about not needing to stretch profits to take care of shareholders and advertising, "pooling purchasing power", especially when you're tied to average local rates, doesn't add up to dry shit. And counting on lower administrative costs under a Federally-administered plan is also kind of a leap, when you look at how the bureaucracy grows itself.

Providing a "slightly cheaper" public plan is not going to all-of-a-sudden make buying health insurance affordable for the tens of millions of Americans that can't afford it now. If you want to get them covered, you have to base their premium on a percentage of income and withhold it from their paycheck, like Medicare and Social Security. And it ain't gonna be self-sufficient, able to operate on its own without being supplemented from (other) revenues.

I was afraid something like this would happen.

It'll get even worse

The House approach has some intrinsic advantages, but in the Senate, it's going to go from bad to worse. This is a great example of where fancy language designed to dazzle the general public will create the illusion that something productive is being done, all the while preserving something very close to the status quo.

This toothless hound won't hunt

I read the HuffPo piece last night and this paragraph jumped off the screen:

It is a backstop option for people without access to affordable coverage. Health care providers will not be required to participate, payment rates will be set in a competitive fashion, and the community health insurance option will compete on a level playing field with private health insurance plans in the gateway."

As slinkerwink noted over at Kos,

Right now, we're in a better position today due to having two bills, one from the House Tri-Committees, and one from the Senate HELP Committee, with a good public option. If the Senate HELP Committee makes it through the Senate intact with its public option, and is the one supported over Max Baucus's Finance Bill, then it'll have to be reconciled with the House Tri-Committee version. So theoretically the public option in that could be made stronger in the conference process.

Well, we shouldn't just keep our fingers crossed on that. We have to keep up the pressure.

Slinkerwink? Don't put your trust in that.

I know she works hard to be on the rec list daily, but a lot of her insight is completely incorrect which you will discern in the comments she ignores and although she has a great following from the Obama campaign, you would be better to look elsewhere for hard information.

Check in with NYCEVE, go to Firedoglake, spend time perusing Motherjones and stay the hell away from Politico.

Just my 2c.

North Carolina. Turning the South Blue!

Voluntary

Aren't Medicare and Medicaid voluntary? And how many big providers can afford to turn them down?

What am I missing there?

Dan Besse

Proposed Public Plan Fails to Address Millions of Uninsured

This proposed public plan fails to address the millions of Americans that are currently uninsured/underinsured because they either do not have the financial means to pay for insurance or they have severe chronic health care needs. I was really hoping and pushing for a plan that would address the historically overlooked section of our population. The section that earns 250% to 400% of the Federal Poverty Rate but because of multiple members of the family that have special health care needs or because of a single family member/individuals severe chronic medical conditon still can't afford any form of private health insurance and do not qualify for any current public health program. There are so many gaps in our system of care that millions of people fall through which does not give them the option of paying for any form of private insurance and does not permit them to qualify for public health plans. The proposed plan makes the assumption that everyone can afford private health insurance if it can be competitive with current market rates. Current market rates is a huge problem for everyone. More of the same status qoi.

By allowing medical professionals the option of participation, this plan will perpetuate the ongoing problem with accessing health care that current Medicaid and Medicare recipients have. We need a better plan than what has been proposed that guarantees access to care regardless of income and requires all medical professionals to participate in the plan. I understand that the plan has to be paid for, but it should be on a sliding fee scale based on income, family size, and the medical conditions of family members. Under the current proposal, those family members that are dying from cancer or any other disease and can't afford health care will still be left to suffer because they can't afford health care.

Our current system of care promotes family divisiveness and family financial hardship. Families with special health care needs are commonly told that in order to qualify for Medicaid for their children that have severe chronic medical conditions then they have to either divorce and the mother or father has to leave the family and effectively disappear, or they have to severely limit their assets and income, or give up custody of their children with special health care needs. If an adult member of the family applies for Medicaid then they are told that their assets and income can not exceed $9004.00 per year, which is an amount that does not allow home or vehicle ownership and barely allows enough to pay government subsidized housing and major utilities let alone any decent quality or amount of food.

Unfortunatley, I do not see the proposed plan being accessible or affordable for families with adults and/or children with special health care needs. The only positive aspect that I see in this plan is that it will be managed by HHS/DPH and have an Advisory Council. I should say that it would be a positive aspect if the Advisory Council is comprised primarily of health care advocates for individuals and families with special health care needs that are not government employees or corporate CEO's but are average citizens that care about others and want to ensure that the plan is actually helping everyone. Individuals and families with special health care needs typically access multiple sections of our health care system and are the primary consumers of health care so they would be effective advisors on the quality and affordability of the plan. DPH has experience in utilizing an Advisory Council in much the same way as this plan would.

I encourage everyone to write to your state Senators, Congressmen/Congresswomen, and the President and urge them to take into consideration the actual effectiveness of this proposed plan on the millions of citizens that are currently uninsured simply because they can't afford to pay for private insurance as well as the millions that have severe chronic health care needs which causes private insurance to be completely unaffordable. 18,0000 people die per year due to "complications from being uninsured" which breaks down to 49.3 people per day. These individuals are dying because they have a health condition that requires access to health care but they can not afford insurance nor can they afford the medical bills so they are forced to make a choice between what will hurt their families now or later. This plan does little to nothing to reduce that statistic.

I have several friends who work mulitple jobs

just to make ends meet. They can't afford health insurance premiums or they would have health insurance, so the "requirement" provision falls very short.

In a way, I like being able to pick apart the plan out of the HELP committee because it gives us specifics to fight for or against as the House is finalizing its plan and while House and Senate plans are being reconciled in conference. This is one of the details I will fight against (after clarifying my understanding or lack of understanding of the provision...that is.)



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Vote Democratic! The ass you save may be your own.

Picking apart the plan and advocating for one that works.

I know a great many people that are working multiple jobs to just pay normal living expenses too. I also know many people that have taken jobs just because they offer some form of health care. I know even more people that are completely uninsured/underinsured and can't afford to do anything. I am in the middle of writing a letter to Kay Hagan, Richard Burr, and Bob Etheridge because they are my areas reps and I am hoping that it will be read and it will make a positive difference. I have written so many letters to them and to President Obama about Health Care/Health Reform. I wish I could go to D.C and talk with them in person or do something more to influence this issue than writing letters. I am thrilled that President Obama embraces transparency of government and we have access to the plans. I just wish we could do more to get them to listen and pass a plan that will actually help everyone.

Letters are good, emails are good and phone calls are good

...do all three. Speak out here as well. They are reading and they are listening and we just have to keep at it until we are sure they are hearing and understanding.



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Vote Democratic! The ass you save may be your own.

Emails and calls

I'm told by folks in D.C. that emails and calls are better than hard copy letters--a reversal of how it used to be--ever since the anthrax attacks of a few years back. Apparently, the mail processing is so slow because of the new safety protocols that it takes weeks for a hard copy letter to be delivered.

Dan Besse

Yup...I heard that as well

which is why I encourage the emails along with the letters. I know some folks who mail regularly and don't use email at all. Hard to imagine in this day and age, isn't it? I know they eventually get the letters, but I did hear there was a fairly long delay compared to emails.



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Vote Democratic! The ass you save may be your own.

Thanks and I hope you are right - will be posting an open letter

I really hope you are right. I just finished a two page letter and sent it on to Kay Hagan, Richard Burr, Bob Etheridge, President Obama, and HealthReform.gov. I have to stop the tears now though, it was hard to write so openly but I have to hope and pray they will listen, understand, and respond without discriminatory judgements or negativity. I have to hope that they will listen and others will agree and maybe, just maybe, we will see a plan that will help everyone.

Emailing and Calling Government Officials

I always email my letters to any government officials and advocacy organizations if at all possible. I attended a Health Care Conference in D.C. right before I lost the use of my legs and got sick and learned that emailing was always better than sending letters because of security protocals and they usually respond faster to emails. The letters I sent out today were emailed. I am hoping I can get a day with reduced pain and have someone drive me to Raleigh while our state officials are home on break to meet in person and speak with them on the Health Reform issue. I voted for the Democrats in office now and have always been a loyal Democrat although I don't think that will matter.