Public Option not dead after all! Compromise: State Opt-out?

[sumit1207]

http://news.yahoo.com/s/ap/20091025/ap_on_go_co/us_health_care_overhaul

WASHINGTON – A proposal for government-backed health insurance is close to gaining the 60 votes needed to pass the Senate and probably will be in overhaul legislation, a Senate Democratic leader said Sunday.

A proposal for the public option that is gaining wide support would allow states to choose not to participate in a government-run insurance program, said New York Sen. Chuck Schumer, the third-ranking Democrat. The "opt out" proposal is drawing support from many liberal and moderate senators and less opposition from lawmakers wary of government insurance, he said.

Although Democrats control the 60 votes needed to advance legislation under Senate rules, not all Democrats support creating a government-run health insurance program. Negotiations in recent days have focused on crafting a public option that would satisfy liberal and moderate Democrats and not drive away others.

Sen. Ben Nelson, a Nebraska Democrat who objects to a national government-run insurance program, said he would be interested in a proposal that allows states to participate only if they ask to join; he called this approach an "opt in" program. Nelson's vote would be critical in reaching the 60-vote threshold.

"I think if you go with a state-based public option, you can get bipartisan support," Nelson said. "I think we're all more comfortable, the people will be more comfortable if the states are engaged in taking care of the situation, recognizing that Utah's problems and California's problems are different than Nebraska's problems."

Sen. Sherrod Brown, D-Ohio, said the public option is needed now to provide competition in regions where one or two insurance companies dominate the market.

"I'm fine with the state opt out," Brown said. "If Nebraska or Utah doesn't want to do the public option, their governor and legislature can pass a law saying, 'We're not going to give our citizens that right to have a public option.'"

Schumer said Senate Majority Leader Harry Reid, D-Nev., is leaning strongly toward an opt-out public option. Reid, who would make the final decision about bringing legislation to the Senate for a vote, led a delegation of Democrats to the White House on Thursday to discuss the issue with President Barack Obama.

Obama has said he strongly supports a public option as a way of driving down costs by providing competition to private insurers. But the president has said it is not essential to achieving the broad goals of health care legislation.

Another approach to creating an alternative to private insurance is setting up nonprofit cooperatives, an idea that has been pushed by Sen. Kent Conrad, D-N.D., chairman of the Senate Budget Committee.

Senate Republicans, who number just 40 in the 100-member chamber, oppose the public option in any form.

"It doesn't make any sense at all," said Senate GOP leader Mitch McConnell, R-Ky. "In fact, I think 100 percent of Republicans have indicated they don't think having the government in the insurance business is a good idea."

Schumer appeared on NBC's "Meet the Press," Nelson and Brown were on CNN's "State of the Union," and McConnell spoke on ABC's "This Week."

It seems even the conservative Democrats are getting behind a state opt-out compromise for the public option, or at least willing to closure vote it? Interesting. Of course this will screw over poor minorities living in red states who probably most need the government assistance in healthcare, but I'm sure eventually even those states would come around. I think medicare started this way too?

 

[Karalysia]

A state-opt out would undermine the entire point of the public option. I don't think a state opt out should be allowed.

 

[Quackers]

It actually seems far more reasonable like this. I guess this is the final chance to save a public option before it defeated by a minority republican congress/senate LOL!!

 

[MagisterCultuum]

More important that the public option is allowing us to buy insurance across state lines. If that is passed, wouldn't a state opt-out be meaningless?


I'm still not clear on what a public option is supposed to mean. If it is to get no subsidies or special treatment like Obama claimed and is to be funded purely by those who use it then I fail to see how it is really public. That sound more like a not-for profit corporation that simply had its charter drafted by the government, which is perfectly fine by me. If you have a public option across the nation though then his promise cannot be kept without giving in to the Republicans and allowing private insurance to be bought across state lines too. That would probably make a public option unnecessary imho, but so long as it does not receive special treatment is it fine. I'm skeptical that it wouldn't get special treatment though, and tend to think that private non-profit cooperatives are a better choice.


While I guess I'm ok with a public option, legally mandating that people purchase health insurance is completely unacceptable.

 

[Karalysia]

While I guess I'm ok with a public option, legally mandating that people purchase health insurance is completely unacceptable.

Too late for that. Even the Bacchus bill had legally mandated health insurance with fines for those who failed to buy. So no matter whether we get the public option, single payer, or the private cooperative there is going to be legally mandated health insurance.

 

[MagisterCultuum]

I recognize it will probably happen, but it is still unacceptable. Mandating the purchase of insurance is one of the worst things we could do. It is a massive subsidy to the insurance industry, and would discourage them from having competitive pricing. Frankly we would be better off is most people were uninsured (having health savings accounts instead), as the paperwork associated with insurance is a large part of what is driving health-care costs up.


The CBO has shown that the Bacchus bill will greatly increase the cost of healthcare instead of decreasing it, mostly because of the mandate.

I know there is at least one Democratic Congressman who recently said on CNN that he was open to the public option but would never vote for any bill containing a mandate. In addition to saying it was a horrible policy that would drive prices up and cause the public option to be overburdened with those who cannot pay enough to support it, he also expressed an opinion that a Federal mandate to buy health insurance is probably unconstitutional and may lead to a supreme court case that could overturn the entire bill. I am inclined to agree.

I know I've heard many on the left arguing that a mandate is an unjustifiable handout to the insurance companies unless accompanied by a public option. I'm hoping for the formation of one of the bizarre alliances between the more principled far left and far right against the moderates in which they kill the mandate in order to pass a public option. I know this is unlikely though.

 

[Archbob]

If you want mandatory coverage for everyone, you need a public option. Otherwise its just padding the wallets of the insurance companies.

 

[Karalysia]

I recognize it will probably happen, but it is still unacceptable. Mandating the purchase of insurance is one of the worst things we could do. It is a massive subsidy to the insurance industry, and would discourage them from having competitive pricing. Frankly we would be better off is most people were uninsured (having health savings accounts instead), as the paperwork associated with insurance is a large part of what is driving health-care costs up.

I don't see you objecting to mandatory car insurance? Or are cars more important than people? And that's why a public option is needed so it isn't a massive subsidy to the insurance industry though I myself would prefer single payer but that doesn't seem possible right now. Maybe a few years down the road.

 

[Cutlass]

The push poll I got earlier in the week insisted that the mandate was unconstitutional.

 

[Elrohir]

Well, here's the question: Is this public option going to pay for itself, or will it have to be supported with federal funds from other sources? Because if the income taxes from state X are going to support this program, then opting out of it will probably never make fiscal sense. Which means this probably isn't much of a compromise, because I highly doubt this will be self-sustaining, especially right off the bat.

Now, of course, it could still be worth doing, even if it doesn't pay for itself. But I think that's a fact that needs to be considered.

 

[Integral]

Well, here's the question: Is this public option going to pay for itself, or will it have to be supported with federal funds from other sources? Because if the income taxes from state X are going to support this program, then opting out of it will probably never make fiscal sense. Which means this probably isn't much of a compromise, because I highly doubt this will be self-sustaining, especially right off the bat.

Now, of course, it could still be worth doing, even if it doesn't pay for itself. But I think that's a fact that needs to be considered.

It will pay for itself by taking in premiums, which are themselves highly subsidized by the government. Most of the ten-year cost of the program, the $1 trillion or whatever it is today, is the cost of those subsidies.

Though I'm not sure why we keep making this 'sustainability' thing a big deal...after all, the Congress just added $250 billion to the ten-year deficit with the so-called 'Medicare doctor fix', none of which will be paid for...

--

(re:mandates: Didn't Obama expressly run against an individual mandate, and even use that as a point of contrast between himself and Clinton? Where did that go? I'm getting terribly confused.)

edit, found it:

the main difference between Senator Clinton's plan and mine is the fact that she would force, in some fashion, individuals to purchase health care. If it was not affordable, she would still presumably force them to have it, unless there is a hardship exemption, as they've done in Massachusetts, which leaves 20 percent of the uninsured out. And if that's the case, then, in fact, her claim that she covers everybody is not accurate. Now, Senator Clinton has not indicated how she would enforce this mandate. She hasn't indicated what level of subsidy she would provide to assure that it was, in fact, affordable. And so it is entirely legitimate for us to point out these differences.

Do note that none of the plans on the table are universal insurance plans; at most, they will ensure about 94% of the nonelderly population, up from the current 84%.

 

[MagisterCultuum]

I'm not a big fan of mandatory car insurance either, but that is not in the same league as a health insurance mandate.

First of all, those mandates are all on the state level. The US Constitution does not give the Federal Government any right to mandate purchases, while State Constitutions probably do. (I'm no expert on state constitutions, but since constitutional amendments for things like giving special tax breaks for fly fishermen pass I assume that there are also provisions allowing the state to mandate certain people have certain kinds of insurance.)


All but one (or is it two?) states mandate insurance, but the level of enforcement varies. In most places, the mandates don't really work. I believe it does tend to raise the average insurance rates though.


The big difference is that car insurance is not an absolute mandate, but a prerequisite in order to operate an automobile. It is really just a prerequisite for the privilege of having a driver's license and using publicly owned roads. I believe that at least in most states you can still drive on private property without a license or insurance. There is a big difference between requiring a purchase for the privilege of being licensed to drive on public roads and requiring a purchase for the right to live. You can also get by without using a car, although it may limit your job opportunities, but there is no way to opt out of a health insurance mandate. A health insurance mandate is only analogous to a car insurance mandate if it does not apply to everyone, but only those who wish to use publicly funded hospitals. Those who use a hospital run by a private charity that refuses government subsidies or know a private physician willing to do house-calls for cash or avoid all modern medicine should not be required to join the system. (How would the mandate effect the Amish or Christian Scientists? I wonder if it could be ruled unconstitutional under the first amendment because of such sects.)


I don't know about all states, but in Georgia the law only requires Liability Insurance, not Collision Insurance. You don't have to have insurance to take care of yourself or your property, only the persons and properties of others you might damage while driving. (My family chose to have only the minimum coverage on my car and my sister's car, as one year of collision insurance cost more than the cars were worth.) The insurance is not to care for your car, but to protect you from being sued/guarantee that your victims get payed if they win a lawsuit against you. That is not comparable to the proposed healthcare insurance mandate, but to the existing medical malpractice insurance mandate for licensed doctors.


I actually think that removing the medial malpractice mandate could greatly improve the health care system. It would be a sort of tort reform, as it would discourage lawyers from seeking huge sums against those who cannot possibly personally pay. Removing the safety net would tend to make them more responsible. The best doctors never do anything to get sued over anyway, but with malpractice insurance have to subsidize those who do. I've heard many doctors complain that they have never been sued and probably never will be sued and so should not be forced to pay as much or more in malpractice insurance each year than they do in taxes in order to subsidize doctors who are less careful. There would of course have to be some way of punishing uninsured doctors who do goof up. Obviously they could loose all their possessions and have a lean on their income, but that might not be enough. The state would probably have to intervene to provide extra funds in some cases. The doctor would in these cases probably have to be punished in some other way. Maybe we could give debtor's prison another try.

 

[Imperialmajesty]

This will bring few to none Republicans on board. However... I think this will help bring the blue dogs on board.

 

[Elrohir]

It will pay for itself by taking in premiums, which are themselves highly subsidized by the government. Most of the ten-year cost of the program, the $1 trillion or whatever it is today, is the cost of those subsidies.

Which is to say, it won't pay for itself at all. If it truly paid for itself, flat out, then they could offer unsubsidized premiums and pay for it that way. Now, of course, this could still be worth doing - I don't know enough about it to have much of an opinion - but I think saying "Well, you can opt out!" is meaningless as a compromise, unless the federal government is actually going to rebate federal tax dollars back to that state, to cover what would go towards subsidizing the premiums that they aren't taking advantage of.

Although, now that I think about it, that might work....each government would have that much money to craft their own system.

 

[Archbob]

I think instead of mandating health insurance, we should just mandate health. Much easier if people just don't get sick.

 

[MagisterCultuum]

Which is to say, it won't pay for itself at all. If it truly paid for itself, flat out, then they could offer unsubsidized premiums and pay for it that way. Now, of course, this could still be worth doing - I don't know enough about it to have much of an opinion - but I think saying "Well, you can opt out!" is meaningless as a compromise, unless the federal government is actually going to rebate federal tax dollars back to that state, to cover what would go towards subsidizing the premiums that they aren't taking advantage of.

Although, now that I think about it, that might work....each government would have that much money to craft their own system.

I think the idea may be that they'll heavily subsidize all health insurance, but make the public option such a bare bones plan that the subsidies should cover most of the cost while most private plans offer a lot more and so cost a lot more. Obama claimed that the public option would receive no special treatment, but I don't trust that. At the very least, they will probably cite supreme court precedent (such as that one early case excepting the Bank of the United States from state taxes on banks) and make the federal government corporation that runs health care exempt from following various state regulations that require private plans to cover certain things. (One of the first things to come to mind is how many states require insurance for women to cover the costs of a potential childbirth, and don't make an exception for women that are on birth control, suffer from infertility, or even those who have past menopause.)

 

[Counterclaw]

I think the state opt-out option ought to be extended to more policies. State's rights are always trampled on these days. It would be nice to see a little more respect for them.

 

[MagisterCultuum]

I don't think the Feds should be able to mandate that the states run any programs. Relative the population the federal government has been shrinking over the past 50 years or so, but this is mostly because it has been shifting its responsibilities to the states and forcing the state governments to expand far more than the Feds shrink, and without a way to pay for it. If the feds want a program to operate in a state they should run it themselves.

 

[Miles Teg]

I don't think the Feds should be able to mandate that the states run any programs.

Huh. I didn't know Nullification was making a comeback.

 

[Ayatollah So]

The CBO has shown that the Bacchus bill will greatly increase the cost of healthcare instead of decreasing it, mostly because of the mandate.[...]
I know I've heard many on the left arguing that a mandate is an unjustifiable handout to the insurance companies unless accompanied by a public option.

Exactly. Baucus bill is worse than doing nothing, because it will break the bank and poison the public's opinion of health insurance reform.

I like how you changed his name to match the Roman god of wine, though.