Presidents Health Care Reform Proposals

They White House has posted the Presidents plan for reform online at whitehouse.gov. I have been reading through the post this morning. This plan is just another version of the existing bills. As I read this document I am finding that the position of the administration has not changed nor has the core elements of the bills put forward by the House and Senate.
I admit I could not read the 2000 plus page bill produced by the Senate, but I did scan through it. I did read the House bill, but I admit it is very confusing and as a layman I had trouble understanding much of the content. There are somethings that I did read and strongly object too and I have discussed them in previous postings on Yes-23.
One thing that I missed in the proposed bills has something to do with bio-fuels. I wonder what that has to do with health care reform. The following is copied from the whitehouse.gov page:

Close Tax Loopholes.
Adopts two House proposals to close tax loopholes: (1) Current law provides a tax credit for the production of cellulosic biofuels. The credit was designed to promote the production and use of renewable fuels. Certain liquid byproducts derived from processing paper or pulp (known as “black liquor” when derived from the kraft process) were not intended to be covered by this credit. The President’s Proposal adopts the House bill’s policy to clarify that they are not eligible for the tax credit. (2) The President’s Proposal helps prevent unjustified tax shelters by clarifying the circumstances under which transactions have “economic substance” (as opposed to being undertaken solely to obtain tax benefits) and raises the penalties for transactions that lack economic substance. In so doing, it adopts the House’s policy, with minor technical changes.
I find that this is typical of the Congress, put in something not relevant to the bill, fund it to the tune of a few billion dollars and hide it from the American people. This is a costly practice and causes the cost of the health care bill to balloon. In this time of economic crisis I think it would be better if our Congress and President refrained from this practice, in fact I think it should be illegal at anytime. Pass each bill on its own merit.

It looks like the President is going to postpone and not eliminate the Cadillac tax but postpone it. The following is from the posting on whitehouse.gov:
Delay and Reform the High-Cost Plan Excise Tax.
Part of the reason for high and rising insurance costs is that insurers have little incentive to lower their premiums. The Senate bill includes a tax on high-cost health insurance plans. CBO has estimated that this policy will reduce premiums as well as contribute to long-run deficit reduction. The President’s Proposal changes the effective date of the Senate policy from 2013 to 2018 to provide additional transition time for high-cost plans to become more efficient. It also raises the amount of premiums that are exempt from the assessment from $8,500 for singles to $10,200 and from $23,000 for families to $27,500 and indexes these amounts for subsequent years at general inflation plus 1 percent. To the degree that health costs rise unexpectedly quickly between now and 2018, the initial threshold would be adjusted upwards automatically. To ensure that the tax affects firms equitably, the President’s Proposal reforms it by including an adjustment for firms whose health costs are higher due to the age or gender of their workers, and by no longer counting dental and vision benefits as potentially taxable benefits. The President’s Proposal maintains the Senate bill’s permanent adjustment in favor of high-risk occupations such as “first responders.”
Going to delay this tax not remove it. If you read the Presidents plan you will find all sorts of delays like this when it comes to tax increases.

The following is the Presidents plan for Medicare Advantage: Improve Medicare Advantage Payments.
Medicare currently overpays private plans by 14 percent on average to provide the same benefits as the traditional program and much more in some areas of the country. The Medicare Advantage program has also done little to reward quality. Moreover, plans have gamed the payment system in ways drive up the public cost of the program. All of this is why Medicare Advantage has become a very profitable line of business for some of the nation’s largest health insurers. The Senate bill creates a bidding model for payment rates and phases in changes to limit potential disruptions for beneficiaries. The House proposal phases payments down based on local fee-for-service costs.

The President’s Proposal represents a compromise between the House and Senate bills, blending elements of both bills, while providing greater certainty of cost savings by linking to current fee-for-service costs. Specifically, the President’s Proposal creates a set of benchmark payments at different percentages of the current average fee-for-service costs in an area. It phases these benchmarks in gradually in order to avoid disruption to beneficiaries, taking into account the relative payments to fee-for-service costs in an area. It provides bonuses for quality and enrollee satisfaction. It adjusts rebates of savings between the benchmark payment and actual plan bid to take into account the transition as well as a plan’s quality rating: plans with low quality scores receive lower rebates (i.e., can keep less of any savings they generate). Finally, the President’s Proposal requires a payment adjustment for unjustified coding patterns in Medicare Advantage plans that have raised payments more rapidly than the evidence of their enrollees’ health status and costs suggests is warranted, based on actuarial analysis. This is the primary source of additional savings compared to the Senate proposal. Look like this is still target, eventually it will no longer be available.

There is much more to be discussed about the Presidents proposal, It does contain some very good things that we can all agree are needed for reform, but I feel they are simply a few “bones” being tossed as part of political game in order to get the big change passed. Here is a the public option, back in its full glory.

More Choices, Greater Competition — Health Insurance Exchange
The proposal creates a new insurance marketplace that lets individuals and families without coverage and small business owners pool their resources and increase their buying power to make insurance more affordable. Private insurance companies will compete for business based on cost and quality and they’ll have to follow common-sense rules of the road that rein in the worst insurance industry abuses.

For the first time ever, Americans who lose their jobs, change jobs, move out of state, get divorced or get sick will have the peace of mind and security of knowing they will always have quality affordable health care they can rely on. For Americans who get coverage through their job but can’t afford it, the exchange will give them new choices. For small business owners, the exchange will level the playing field with big businesses and lower their costs.

And here is the big selling point, the one thing that makes this ok for the American people: Same Coverage Choices as Members of Congress.
Every member of Congress will be required to purchase their insurance from the new health insurance exchange.

This whole thing is an attempt to push the current bill through because the Democrats know they are probably going to losing their majority. The so called bipartisan meeting with Republicans is an attempt to justify using reconciliation to push the bill through. The Administration will say the party of no was unwilling to compromise and we put in their ideas so we have no choice but to move the bill to law via reconciliation.

The American people have clearly stated that they want reform, but do not like these bills. Why not actually sit down and have a real meeting, exchange ideas and develop a bill that benefits all of us and doesn’t break the bank.

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