Baucus Plan Round-Up « Main Street

Baucus Plan Round-Up

Max Baucus released his health care reform plan this week. Is it worth the months of delay he’s imposed on the reform process? Is it good for working families?

Lots of opinions on that one. Ezra Klein thinks it’s good.

To put it more starkly, it really will be the most important progressive policy passed since Lyndon Johnson. The subsidies should probably sit at 400 percent of poverty, and the employer mandate should be reworked, but such failures are relatively easy to fix, and may well be patched over by the time the legislation arrives on the Senate floor. The fact that a bill of this size and scope can still be considered disappointing is evidence that the doors of the possible have been thrown wide open.

The main disappointment is that insofar as you see the bill as a vehicle for moving us towards a better, more efficient, less costly system, there are some problems. In particular, this bill seems to block off a lot of its own possible points of expansion. The health insurance exchanges are limited to the state level, and appear to split the individual and small-group markets apart from each other. There’s no mention of a possible expansion toward larger employers, either. Similarly, the co-op plan is an interesting policy proposal, but unlike a public insurance option, it’s difficult to imagine it growing into anything significantly stronger than what’s outlined in the paper.

Pointing out that the plan was written by Liz Fowler, Baucus’ senior counsel and a former vice president of insurance giant WellPoint, Emptywheel really, really disagrees, concluding that WellPoint should be considered a co-author. Her other specific objections?

First off, if a 50-person firm decided not to offer health care, it would have to pay up to $20,000. That’s a whole lot cheaper than the hundreds of thousands they would have to pay to insure these employees.

But let’s take a hypothetical employers–we’ll call them AlmartWay–that employs around 1.4 million people in the US.

AlmartWay pays such shitty wages that a huge proportion of their employees would actually be eligible for Medicaid, particularly with the eligibility for Medicaid boosted to 133% of poverty. So those employees could just enroll in Medicaid; AlmartWay wouldn’t pay a dime, and you and I would therefore be subsidizing the gutting of our local economy so that the descendants of Sam AlmartWay could continue to get disgustingly rich.

Digby is also not a fan.

But we’re stuck with what is, not with what works, and the fact is that there will be some material improvements for people other than me and my useless middle aged loser cohort, and that’s something. The Baucus plan does provide some rather substantial help for the poor, caps out of pocket expenses (at a pretty high rate, but it’s better than most private insurance which pays out a total of about $3.72 when you add up all the exclusions.) But I’m very skeptical of the plan actually bringing improvement over the long haul for reasons that have little to do with the actual policies they contain (the final mix of which we can’t know yet.)

The problem is the politics. Any plan that forces the uninsured to pay their hard earned money to wealthy private insurance companies under penalty of law is a huge political risk. These are the same companies that have brought us to this place where people are routinely denied the care they were promised, lied to about what was covered, scammed into paying huge sums of money for no security and no guarantee. Health insurance companies have dealt with their customers in bad faith for years and years and now we are being told that everyone must pony up and pay them even more. For all the talk of reform, when you whittle this down, that one fact comes roaring back at you and it sticks hard in the craw of anyone who considers themselves progressive.

And the funny thing is, she updated her post later to walk back the statement that it would help the poor. Matthew Yglesias, who initially liked the plan, also became worried about this point:

Basically the way Baucus has done this, hiring certain classes of workers—typically people from the most vulnerable social classes—would be costlier than hiring other kinds of workers. This is no good.

So…no public plan, written by someone who was very recently an insurance company executive, distributed to lobbyists before the White House saw it, which will create incentives not to hire low-income workers, etc etc etc. Doesn’t sound good to me.