Sunday, June 28, 2009

No Reason to Favor Private Health Insurers

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By Joel S. Hirschhorn

In the national debate about health care reform absolutely nothing makes less sense than the positive views of much of the public about private health insurers. There is no good reason to have positive views of private health insurers, the companies that have relentlessly increased the costs for very limited health insurance. Copays, deductibles and premiums have raped those lucky enough to have health insurance while also making it very difficult much of the time to get coverage for all kinds of health problems. The US health care system is unbelievably inefficient, providing far less effective health care for what is incredibly high costs, compared to all other industrialized countries. The main reason is the private health insurance industry.

If you need solid information to believe this view, then consider these facts.

On the cost side, what is the problem? The current private health insurance system is the most costly, wasteful, complicated, and bureaucratic in the world. Its main function is not to provide quality health care for all people but to make huge profits for companies. Private health insurance companies spend an incredible 30 percent of each health care dollar on administration and billing. Thirty cents of every dollar is not going to doctors, nurses, medicine, medical personnel; it is going to bureaucracy and administration plus exorbitant CEO compensation packages, advertising, lobbying, and campaign contributions. More efficient public programs such as Medicare, Medicaid, and the VA are administered for far less money, less than 10 percent.

From 2003 to 2007, the combined profits of the nation's major health insurance companies increased by 170 percent. William McGuire, the former head of United Health, several years ago, accumulated stock options worth an estimated $1.6 billion; CIGNA CEO Edward Hanway made more than $120 million in the last 5 years. CEO compensation for the top seven health insurance companies now averages $14.2 million. Over the last three decades, the number of insurance administrative personnel has grown by 25 times the number of physicians.

The double whammy is that we get so little for so much spending. The US spends far more per capita on health care than any other nation, and health care costs continue to soar unsustainably, now at $2.4 trillion and 18 percent of our GDP. Our per capita spending is 40 percent more than the second most costly national system. The insanity is that we get poor value for what we spend. According to the World Health Organization, the US ranks 37th in terms of health system performance; we are far behind many other countries in terms of such important indices as infant mortality, life expectancy, and preventable deaths. Even the latest federal National Health Quality Report concluded: “health care quality in America is suboptimal…the health care system is not achieving the more substantial strides needed to close the gap or ‘quality chasm’ that persists.”

If Congress and the Obama administration believed in true, necessary health reform, then they should favor a government run single payer system. But they do not because they are corrupted by the money from the private health insurance industry. If the public was not delusional and brainwashed, then they would be screaming for a single payer system, but the latest Washington Post-ABC News poll posed this question to respondents: What if having the government create a new health insurance plan made many private health insurers go out of business because they could not compete? In that case would you support or oppose creating a government-run health insurance plan? Remarkably, 33 percent were opposed and 25 percent were opposed if private health insurers could not compete. Only 37 percent support the government run option regardless of any impact on the private insurers.

Considering the predominantly negative experiences most Americans have had with their private health insurance companies, these results are depressing. The only rational explanation is that Americans have been successfully brainwashed by years of propaganda and disinformation from the health insurance industry. As I and other Medicare users can attest to, a government run plan has provided me total freedom in choosing any physician and hospital I want to use. There is no sound reason to believe that a larger version of Medicare offered to all Americans would in any way reduce the quality of health care received.

The simple fact is that a huge amount of money can be saved by shifting from private to government health insurance, $4 trillion over ten years, more than enough to pay for universal health care coverage for absolutely all Americans.

What we are now witnessing in Congress and the White House is a total, ugly capitulation to the money and power of the private health insurance industry. If the private health insurance industry maintains its stranglehold on the national system, then taxpayers will pay even more money for the worst national health care system in the world, if Congress makes that costly insurance available to more Americans by using government money.

There were some other recent poll results. The New York Times/CBS News poll found that most Americans would be willing to pay higher taxes so everyone could have health insurance and that they said the government could do a better job of holding down health-care costs than the private sector. In fact, 85 percent of respondents said the health care system needed to be fundamentally changed or completely rebuilt, nearly 60 percent said they would be willing to pay higher taxes to make sure that all were insured, and 72 percent supported a government-administered insurance plan — something like Medicare for those under 65 — that would compete for customers with private insurers, versus 20 percent that said they were opposed.

Part of the disinformation campaign is that people are being manipulated to think that a government insurance plan equates to government run health care itself, which is shear nonsense. Medicare users access exactly the same private health care system as those with private health insurance. Of course, private health insurers charge so much money that they pay physicians and hospitals more money than Medicare, which is primarily a tactic to keep much of those parts of the health care system supportive of maintaining the private insurance system.

Dr. David Himmelstein is a founder and spokesperson for Physicians for a National Health Program. He believes President Obama is caving to the insurance industry: “The President once acknowledged that single payer reform was the best option, but now he’s caving in to corporate healthcare interests and completely shutting out advocates of single payer reform.”

Obama's Health Care Waterloo

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The Obama administration and the Congressional Democrats are finally hitting the inevitable wall that was bound to confront them because of the president’s congenital inability to be a bold leader, and because of the party’s toxic decades-old decision to betray its working class New Deal base in favor of wholesale corporate whoredom.

The wall is health care reform, which both Barack Obama and the Democratic Party had hoped would be the ticket for them to ride to victory in the 2010 Congressional elections and the 2012 presidential election.

But you cannot achieve the twin goals of reducing health care costs and providing access to health care to 50 million uninsured people, while leaving the profit centers of the current system—doctors, hospitals and the health insurance industry—in charge and in a position to continue to reap profits.

Watching President Obama address the American Medical Association was a cringe-inducing experience as he assured the assembled doctors he was not going to expand Medicare payments “broadly” to cover all patients, or end the current “piece-work reimbursement” system that has so enriched physicians, or as he told them that savings would “not come off your backs.” It was particularly cringe-inducing when he told the AMA that he knew that making money was not why its members were in the profession, saying, “That is not why you became doctors. That is not why you put in all those hours in the Anatomy Suite or the O.R. That is not what brings you back to a patient's bedside to check in or makes you call a loved one to say it'll be fine. You did not enter this profession to be bean-counters and paper-pushers. You entered this profession to be healers - and that's what our health care system should let you be. “

Oh please. I know there are plenty of wonderful doctors who are dedicated to their patients and to patient care. But I also know plenty of doctors who have told me how half their classmates in medical school were mainly in it for the money, and that study halls and cafeterias of American med schools echo with the conversations about what can be made working in particular specialties. Not to mention the corrupt and insidious profit-sharing arrangements doctors enter into with labs, CAT-Scan and MRI test centers, pharmaceutical companies and other businesses, to earn profits by sending patients for unnecessary tests and treatments.

One can only imagine what he would be saying to insurance industry executives about his “reform” plans.

Because Obama and Congressional Democrats are unwilling to cut themselves off from the lucrative campaign-funding bonanza that is the health care industry, they cannot address seriously either the cost or the access crisis that plagues health care in the US, and that makes health care in this country cost 20 percent of GDP—twice what it costs in any other modern nation on a per capita or GDP basis, and that still leaves one in six Americans without ready access to even routine health care.

The answer to this crisis is obvious: a single-payer “socialized” system, in which you still have private doctors, and private or publicly run hospitals, but where the government sets the payment rates for treatment, and provides all compensation to health care providers.

If Democrats in Congress were serious about health care reform, they would immediately order the Congressional Budget Office to conduct a cost study of instituting such a program—a study that would include an estimate of the savings to individuals and employers if health care costs were lifted entirely off their backs (because obviously it would require considerable new government revenue to fund a single-payer program, but that’s only half the equation—the other half, the savings, is simply ignored by critics and doomsayers on the right and in the health care industry). Instead, Obama and the Democratic Congress are studiously avoiding even allowing any mention of the single-payer option. (A New York Times report today on the various health care plans working their way through Congress, and coming out of the White House, completely blacked out any mention of a single-payer bill in the House authored by Rep. John Conyers (D-MI), chairman of the House Judiciary Committee, which the House leadership has prevented from even getting a token hearing.)

Obama’s unwillingness to lead on this issue will doom his health care plan. There is obviously no way Congress is going to shake off its corrupt leech-like attachment to corporate sponsors and their cash-spreading lobbyists, but had the new president wanted to make a historic mark and cruise to victory in 2012, he could have, like President Lyndon Johnson before him in his campaign for Medicare in 1965, put himself solidly behind a single-payer plan and made the case that it could cut America’s collective health bill in half while opening the door to every American.

Instead, he’s likely to end up with worse than nothing—that is with even more uninsured Americans come 2012, and with health care costs moving up as a share of GDP—and could well find himself out of a job. The policy that his handlers, like White House Chief-of-Staff Rahm Emanuel, had conceived of as Obama’s ticket to re-election, health care reform, could well prove instead to be his Waterloo.

That is if his adoption of a policy of expanded war in Afghanistan — another example of a failure to lead—doesn’t prove to be this president’s bigger policy disaster.

Saturday, June 27, 2009

The Policy That Dare Not Speak Its Name

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By Robert Kuttner

I'm sure I'm not the only reader who noticed the juxtaposition of two front page stories in Sunday's New York Times dealing with health care. The first article cited a new Times-CBS poll showing that 72 percent of Americans favored a government run health plan comparable to Medicare, which would be available to everyone.

The second reported on a rogue radiologist at a Philadelphia VA hospital who botched 92 prostate procedures.

The right will doubtless go to town on that one, as what we can expect of government-sponsored medicine. I'll have more to say about the VA in a moment, but first let's consider the poll findings.

The poll is relevant because Congress will soon decide whether to include the so-called "public option" in the Obama health reform bill. As drafted by three House leaders and unveiled last Wednesday, the 852-page bill would include a government-sponsored, Medicare-like public plan.

Republicans and the health industry have been kicking and screaming that this is socialistic. But the poll suggests that defenders of the public plan have nothing to fear politically, and that Republicans are in danger of getting on the wrong side of a popular issue.

However, that's only the beginning of the story. The reform package, as drafted by the Obama administration and the House leadership, is dubious legislation even with the inclusion of a public option. Basically, it leaves the two worst aspects of the system intact. First, private insurers will continue to dominate. Second, most people will continue to get their insurance through their employers. Given these two bedrock realities, there is no way that the bill can make serious inroads on cost without cutting back on care. The high cost of the approach is already causing key legislators to back off. The current system wastes huge sums, but because it is so fragmented the money flows to profit opportunities and not to the most cost-effective forms of health care.

Also, as my American Prospect colleague Paul Starr warns, a mixed system with a public option effectively invites the most expensive and hard-to-treat people to opt for the public plan, while private insurers will seek to insure the young and the healthy. This is a familiar problem known as adverse selection. The private insurers will then smugly point out that the public plan is less "efficient," when in fact it simply will have a more costly population. The only way to avoid this problem is to have everyone in the same universal plan--what's otherwise known as a single-payer plan.

The public option is a not-very-good second best--because our leading liberal politicians lack the nerve to embrace the one reform that simultaneously solves the problem of cost, quality, and universal inclusion. The policy that dare not speak its name is of course comprehensive national health insurance, or Medicare-for-All. I try to avoid using the term "single payer," because a technical, policy-wonk phrase not understood by most civilians has become insider shorthand for national health insurance. Let's call the thing by its rightful name. Medicare-for-All is something regular people understand.

The Times-CBS poll is evidence that this is what more than two Americans in three really want. Most voters have not followed the nuances of how the public option in the Obama plan would compete with private insurance. The poll simply indicates that voters want access to a straight-up, Medicare-style plan to be available to one and all. In past polls, when Times-CBS pollsters ask whether people favor national health insurance, responses generally favor Medicare-for-All by margins of about two-to-one.

In the current debate, liberals find themselves fighting to keep the public option alive, so that some form of efficient, publicly-run health insurance will stay in the mix--but knowing that it is embedded in a reform package that is far more costly and inefficient than it should have been. Instead of validating the common sense and reformist demands of ordinary Americans and identifying the insurance, drug, and corporate elites as the obstacles to real reform, too many of our liberal leaders from President Obama on down hope to co-opt business elites with a convoluted scheme that undermines the efficiencies of a comprehensive and universal system. And just wait until it gets watered down further in order to retain the support of these same elites. A plan that all of these groups would endorse would not be worth having.

So what's the matter with our politicians? Why are the people so far ahead of their elected leaders on this one? One reason, as usual, is money. The combination of the insurance industry, the drug industry, the American Medical Association, the hospital lobby--all of whom oppose Medicare-for-All--represents a huge amount of political spending. It takes a brave politician to face down all of these industries, even though the people are on the side of real reform. The AMA's position is especially shameful, since the professional societies that represent most actual physicians favor national health insurance.

The second reason that liberal politicians wimp out on single payer is that the self-styled realists in this debate have decided that Medicare-for-All, even if it's the first-best system, is too hard politically. But think about it. Has the administration picked up one Republican vote by supporting the present system plus a public option? Hardly. The current House leadership bill, offering a mixed system, with a robust public option, a requirement that employers provide good insurance or pay a tax, and that insurers not discriminate against pre-existing conditions, is just as heavy a political lift as national health insurance--and far inferior policy. So why not just go for the first-best?

The advocates of Medicare-for-All have become something of an embarrassment to the liberals. The White House forum on health reform on March 5th, which boasted a diverse range of viewpoints, including representatives of the Business Roundtable, the health insurance industry, the drug lobby, as well as a broad spectrum of business, labor and Congressional leaders, left advocates of Medicare-for-All banging on the door. None were included, despite requests for invitations.

When Sen. Bernie Sanders recently arranged for five prominent advocates of national health insurance to have a courtesy meeting with Senate Finance Committee Chair Max Baucus, the story was newsworthy because the political elite usually pretends that this viewpoint doesn't exist, much less that it represents the desires of two Americans in three. The mainstream media have also colluded in the general effort to keep the single-payer option out of the limelight. The organization FAIR recently published an important study in its heroic magazine, "Extra", titled "Media Blackout on Single-Payer Healthcare."

Indeed, the Sunday New York Times-CBS poll didn't even offer Medicare-for-All as a free-standing option. It took the Obama position as the left edge of the debate.

As for that rogue doctor at the Philadelphia veterans' hospital, quality control is not what it should be throughout our fragmented system. And the oases of public medicine are particularly starved for resources. Yet studies consistently find that on average, the VA does more with less than its private sector competitors. Phil Longman has written the definitive book on the subject, "Best Care Anywhere." Here is a summary.

In this case, the offending radiologist, Dr. Gary D. Kao, was actually a contract employee and not a VA physician.

Only by having a comprehensive system can we marry quality, cost-effective care, and universal access. One of these days, a national leader will have the nerve to embrace national health insurance and fight for it. Until then, we will keep paying more money for less care, and liberals will defend reforms they themselves scarcely believe in.

If you can't beat 'em, obstruct 'em. Is this the new motto of the GOP?

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Republicans are just about shizzling in their pants at the prospect of having to welcome Al Franken to the U.S. Senate, but they'd better get used to the idea - things aren't going so well for Norm Coleman at the moment.

Still, getting Franken into the Senate could take a while. Thanks to Minnesota law, he can't be seated while there is an ongoing legal challenge. And so the GOP has decided to do what they do best - throw up a bunch of roadblocks and waste everybody's time. According to Politico:

Franken, the former comedian, leads Republican Norm Coleman by 225 votes in a "Groundhog Day" of an election that dawned more than three months ago and shows no signs of ending soon.

Which is exactly how Senate Republicans want it. The National Republican Senatorial Committee held a ritzy fundraiser for Coleman in Washington this week, helping him raise the money he needs to keep his legal challenges alive through a trial and then a lengthy legal process if he loses.


If Franken becomes the 59th senator to caucus with the Democrats, the GOP knows that Obama and Senate Majority Leader Harry Reid (D-Nev.) will be able to railroad legislation through the Senate by picking off a single Republican moderate.

So while Coleman's gone - having neither won nor lost yet, he can't return to his old seat and has been booted from his Capitol Hill office - his friends in the party are doing everything they can to keep him in the game. At this week's NRSC fundraiser, PAC hosts paid $5,000 each; individual hosts had to pony up $2,300 apiece, and attendees paid between $500 and $1,000 to attend.

Republicans turned out in force. Senate Minority Leader Mitch McConnell (R-Ky.) has already maxed out to Coleman's effort, giving $10,000 from his PAC, including $5,000 at the fundraiser - and House Minority Leader John Boehner (R-Ohio) has given the maximum as well, according to a source familiar with the fundraiser.

Other Republican senators who contributed the $10,000 maximum limit include Mike Crapo of Idaho, Johnny Isakson of Georgia and Lamar Alexander of Tennessee, the third-highest ranking Republican in the Senate. Republican Sens. James Inhofe of Oklahoma and Charles Grassley of Iowa each contributed $5,000, while Collins chipped in another $2,000 and Sen. Lisa Murkowski of Alaska donated $1,000, the person said.

This is of course all in keeping with the GOP's new motto: "If you can't beat 'em, obstruct 'em."

Fighting Like Hell for Healthcare Now

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By Greg Kaufmann

At Upper Senate Park on the grounds of the US Capitol yesterday, on a hot, humid DC summer day, 10,000 people from across the country rallied for healthcare reform with a real public option.

They flew in from as far as Washington state, Montana, New Mexico and Nebraska; bussed in from Ohio, Pennsylvania, West Virginia, New York and New Jersey; and made the trip from Florida, North Carolina, Tennessee, Missouri and Illinois.

It was a vibrant crowd, showing the colors of unions that turned out in force: CWA red, UFCW yellow, AFSCME green, SEIU purple, LiUNA orange, IBEW lime, and SIU blue.

They were there not only to rally but to lobby. They understood the urgency with nearly 50 million people uninsured and millions more underinsured and an illness away from bankruptcy. They understood the opposition as the industry lobbyists fight tooth and nail to protect their profits. And they understood the need for citizens to make the case for real reform each and every day until we win.

Maddie, a resident caregiver for children with developmental disabilities in Vineland, NJ, made the bus trip down with AFSCME Local 2215.

"We have a lot of people -- even in the bus that we brought down today -- they have children that are sick. One lady has a daughter who has a rare disease -- she doesn't have any healthcare," she said. "It's more important than getting a raise, or making extra money. We fight health issues every day of our life... The private companies aren't necessarily gonna give us that healthcare, the public option makes sure it's for all. I just hope my brothers and sisters make a statement today and do what we came here to do -- convince Congress."

Ronald, a splicer for Verizon, came from Wilmington, Delaware with CWA local 13100.

"There's a lot of work that needs to be done. Everybody needs to rally together and get this," he said. "We're in America -- strongest nation in the world. We shouldn't be going through this -- with all these people not being able to take care of their family members .... We vote these guys in to do a job -- not to leave their state, come down here to DC, and then all of a sudden they flip the script, they have their own agendas."

Congressman Charles Rangel told the crowd that their efforts were historic, drawing a parallel to the March on Washington.

"Civil rights without the right to health -- you can't use it much," he said. "Remember this day the same way we remember the day that we marched down here with Dr. Martin Luther King. No one knew how important that march was....One day you'll tell your kids and your grandkids that have healthcare, 'Enjoy that, but don't take it for granted because [I] came to Washington on a hot, June day'...."

Senator Charles Schumer -- who has taken a leading role in speaking out for a public plan option (in contrast to weak substitutes like Democratic Senator Kent Conrad's regional coops) -- also fired up the crowd. He called for a public option that isn't "diluted" and told the people to "hold [Congress'] feet to the fire" in this "long, hard fight."

Actress Edie Falco -- a breast cancer survivor -- talked about her past as an unemployed actress who needed to make the same tough choices so many people are forced to make today.

"It's bad enough the emotional impact of not having a job, but to get sick on top of that, and worry every day that [you're] not getting better, figuring out what you're gonna have to do without so you can afford a doctor's visit," she said. "I'm far more familiar with that than I am with my situation these last number of years. I'm here on behalf of all the people who are still in that situation, working hard, doing their jobs, and not being able to take care of themselves or their families."

The rally lasted for about an hour and a half, then folks headed to lobby their legislators or attend town meetings. Pennsylvania -- which had 2,000 people who came down in 36 buses or carpools -- packed the main floor of the Capitol City Brewing Company and its balconies with hundreds of rank and file union members. (There were definitely more than 700 people -- the official capacity of the establishment.) There was word that Senator Arlen Specter was on his way, and with his plans for reelection hinging on Democrats who were unsure about his position on the public plan option and the Employee Free Choice Act, there was quite a buzz.

He kept getting delayed, however, and most were predicting he wouldn't show. In the meantime, Congresswoman Allison Schwartz stopped in to pledge her continued support for this cause. So did Sen. Specter's rumored challenger in a Democratic primary, Congressman Joe Sestak.

Rep. Sestak told the crowd that while his opposition to the Iraq War is often reported as the reason he ran for Congress in 2006, his primary motivation was the debt he feels to the nation for the healthcare he and his family received while he was in the military.

Four years ago his daughter was diagnosed with a malignant brain tumor and given just months to give. But she received the best possible treatment and she is now eight years old. Her roommate her first day in the hospital -- a two year old boy with acute leukemia -- didn't have insurance and treatment was much more difficult to obtain. That was when Sestak began to focus on healthcare for all Americans. He said he's in this fight as "payback to the citizens of this nation" who provided the care his family needed.

The crowd began to disperse as people gave up on Sen. Specter. But about three hours after the meeting began, he showed -- having been delayed, it turns out, by the White House meeting on immigration.

For some minutes before the Senator spoke, the crowd chanted repeatedly, "Healthcare is a right. Stand with us and fight." So when Senator Specter finally stepped to the mic he said, "I compliment you on your tenacity.... And I think Sen. Schumer has the right idea about having a public component which has a level playing field with the private sector."

While it's good news that Sen. Specter called for the public option that Senator Schumer hours earlier said can't be "diluted", we know this is far from a done deal.

It would be good to see President Obama tap into the grassroots energy that brought so many to Washington yesterday. Congress now begins a recess that runs through Fourth of July weekend, and Pres. Obama should barnstorm around the country for the robust public option he wants. With his approval rating remaining high, and 72 percent of the country wanting a public plan, he can tap real momentum which could decide this debate.

Too many craven Democrats are still talking compromise in an effort to win 60 votes. We don't need a few out-of-touch Republicans. What we need is real health care reform that includes the public option, and it can be done with just 51 votes thanks to the arcane "reconciliation" rule in the Senate.

But to win this, it might take the President coming out and fighting like hell -- just like the good people who came to Washington to make their voices heard yesterday.

Obama the Collaborator Letting Naysayers Neuter Health-Care Fix

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By Pierre Tristam

There is no health-care debate in the United States. There's not even a debate over principles. You'd think a nation intent on overhauling a broken system that presidents going back to Harry Truman have been trying to fix would want to openly discuss what it wants -- universal care? Single-payer? A private-public combination? Nationalized insurance? Nationalized care? All very different things. None is being aired in congressional hearings and town hall meetings, with one exception: tinkering with more of what we have now.

When even Barack Obama -- the last great hope for reforming the West's trashiest health-care system -- plays into the rhetorical ambushes of reform's enemies, it's clear that the debate has been hijacked by shams over the language of reform rather than its substance. Detractors can lob meaningless phrases like "government-run health care" and "socialized medicine" all day long, knowing that the diversion is enough to keep reform comatose. In an almost hourlong address to the American Medical Association last Monday, Obama couldn't bring himself even once to say universal health care.

He did want to bat off a "concern that's being put forward by those who are claiming that a public option is somehow a Trojan horse for a single-payer system."

"I'll be honest." Obama went on, "there are countries where a single-payer system works pretty well. But I believe -- and I've taken some flak from members of my own party for this belief -- that it's important for our reform efforts to build on our traditions here in the United States. So when you hear the naysayers claim that I'm trying to bring about government-run health care, know this: They're not telling the truth."

But Obama was as guilty as those naysayers for equating such things as "single-payer" with "government-run health care," instead of setting them straight. Medicare is a single-payer, public system. It's not government-run. It's nationalized insurance, but it enables private care. It's similar to what Germany, France and Japan provide all citizens, even (as in France) giving individuals full freedom to have supplemental, private insurance. As such, incidentally, Medicare is also more efficient, more fair, less wasteful, less bureaucratic and more choice-conscious than private insurers. Medicare is one of those "traditions" that work in the United States. Instead of presenting it as America's single-payer system, Obama chose to dismiss the single-payer approach, dishonestly and by association, as "government-run." He made the naysayers' day.

One man is particularly responsible for the hijacking of the debate: Frank Luntz, the GOP pollster. Euphemisms neuter language. Luntz makes you love the knife doing the neutering. He's the man who gave us the ClubMed-sounding "climate change" instead of "global warming," "opportunity scholarships" instead of "vouchers" (you know, backers of private and religious school schemes to steal public education's dollars), "tax relief" instead of tax cuts." His latest, the 28-page "The Language of Health Care 2009," is a how-to manual for reactionaries looking to defeat reform before it's written. "Humanize your approach," accept that there's a crisis, you "MUST be vocally and passionately on the side of reform" -- but only to ride the Trojan horse of opposition to reform.

Here's one of his strategies: "Make no mistake: the high cost of health care is still public enemy number one on this issue -- and why so many Americans (including Republicans and conservatives) think the Democrats can handle health care better than the GOP. You can't blame it on the lack of a private market; in case you missed it, capitalism isn't exactly in vogue these days. But you can and should blame it on the waste, fraud and abuse that is rampant in anything and everything the government controls." (His italics.)

So it's clear that health care is too expensive, that most Americans know Democrats can be more trusted than Republicans to fix it, and that the free market failed the system -- but blame government for trying to fix it anyway (although no one is talking about "government-run health care"), and do so by dishonestly portraying government with the very words that perfectly suit private-sector health care: waste, fraud and abuse.

Not surprisingly, Luntz also is big on painting government as looking to rob patients of choice, impose delays on care or denying it outright, and running up costs -- again, precisely the sins of the current, private-insurance driven system. It's a matter of time before I call my insurer to get "permission" for a medical necessity only to hear some off-shored, slave-wage bloke in Toughluckistan tell me over a stuttering Internet line that my necessity isn't on the approved list, thank you very much.

No wonder the health-care debate is flat-lining. Talking points such as "The Language of Health Care" are as offensive -- and lethal -- as the prison house of junk-rate care they aim to preserve. And for all his skills at countering the pimping of language to crooked uses, Obama is flirting with collaboration on this one.

Not Enough Audacity

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When it comes to domestic policy, there are two Barack Obamas.

On one side there’s Barack the Policy Wonk, whose command of the issues — and ability to explain those issues in plain English — is a joy to behold.

But on the other side there’s Barack the Post-Partisan, who searches for common ground where none exists, and whose negotiations with himself lead to policies that are far too weak.

Both Baracks were on display in the president’s press conference earlier this week. First, Mr. Obama offered a crystal-clear explanation of the case for health care reform, and especially of the case for a public option competing with private insurers. “If private insurers say that the marketplace provides the best quality health care, if they tell us that they’re offering a good deal,” he asked, “then why is it that the government, which they say can’t run anything, suddenly is going to drive them out of business? That’s not logical.”

But when asked whether the public option was non-negotiable he waffled, declaring that there are no “lines in the sand.” That evening, Rahm Emanuel met with Democratic senators and told them — well, it’s not clear what he said. Initial reports had him declaring willingness to abandon the public option, but Senator Kent Conrad’s staff later denied that. Still, the impression everyone got was of a White House all too eager to make concessions.

The big question here is whether health care is about to go the way of the stimulus bill.

At the beginning of this year, you may remember, Mr. Obama made an eloquent case for a strong economic stimulus — then delivered a proposal falling well short of what independent analysts (and, I suspect, his own economists) considered necessary. The goal, presumably, was to attract bipartisan support. But in the event, Mr. Obama was able to pick up only three Senate Republicans by making a plan that was already too weak even weaker.

At the time, some of us warned about what might happen: if unemployment surpassed the administration’s optimistic projections, Republicans wouldn’t accept the need for more stimulus. Instead, they’d declare the whole economic policy a failure. And that’s exactly how it’s playing out. With the unemployment rate now almost certain to pass 10 percent, there’s an overwhelming economic case for more stimulus. But as a political matter it’s going to be harder, not easier, to get that extra stimulus now than it would have been to get the plan right in the first place.

The point is that if you’re making big policy changes, the final form of the policy has to be good enough to do the job. You might think that half a loaf is always better than none — but it isn’t if the failure of half-measures ends up discrediting your whole policy approach.

Which brings us back to health care. It would be a crushing blow to progressive hopes if Mr. Obama doesn’t succeed in getting some form of universal care through Congress. But even so, reform isn’t worth having if you can only get it on terms so compromised that it’s doomed to fail.

What will determine the success or failure of reform? Above all, the success of reform depends on successful cost control. We really, really don’t want to get into a position a few years from now where premiums are rising rapidly, many Americans are priced out of the insurance market despite government subsidies, and the cost of health care subsidies is a growing strain on the budget.

And that’s why the public plan is an important part of reform: it would help keep costs down through a combination of low overhead and bargaining power. That’s not an abstract hypothesis, it’s a conclusion based on solid experience. Currently, Medicare has much lower administrative costs than private insurance companies, while federal health care programs other than Medicare (which isn’t allowed to bargain over drug prices) pay much less for prescription drugs than non-federal buyers. There’s every reason to believe that a public option could achieve similar savings.

Indeed, the prospects for such savings are precisely what have the opponents of a public plan so terrified. Mr. Obama was right: if they really believed their own rhetoric about government waste and inefficiency, they wouldn’t be so worried that the public option would put private insurers out of business. Behind the boilerplate about big government, rationing and all that lies the real concern: fear that the public plan would succeed.

So Mr. Obama and Democrats in Congress have to hang tough — no more gratuitous giveaways in the attempt to sound reasonable. And reform advocates have to keep up the pressure to stay on track. Yes, the perfect is the enemy of the good; but so is the not-good-enough-to-work. Health reform has to be done right.

Serving the Medical-Industrial Complex

Original Link:

By Robert Parry

The usual knock on government programs is that they’re not as efficient as the private sector, which we’re told can provide the same product for less money and with higher quality. Thus, it should be no big deal when the public and private collide because the private sector should prevail.

However, in providing health insurance, those rules clearly don’t apply, which is why congressional Republicans and so-called “centrist” Democrats are going to such lengths to deny the American people access to a public option on health insurance.

Indeed, if a public option were to be piggybacked onto the existing Medicare bureaucracy, the chances for savings could be impressive for average Americans and the overall American economy.

Insurance middlemen could be eliminated; investigators who ferret out “preexisting conditions” wouldn’t be needed; doctors could save on administrative costs; the burden on U.S. industry providing health benefits could be reduced; and more money could be freed to cover the nearly 50 million uninsured or for actual doctoring.

For a nation facing multiple fiscal crises – all complicated by the costs of health care – one might think that the most sure thing in the health care debate would be to allow a cost-saving public option, which as President Barack Obama says would help keep private health insurers “honest” regarding their promises to trim waste and control premiums.

According to a New York Times/CBS poll, that point is obvious to 72 percent of the American people who favor “offering everyone a government administered health insurance plan like Medicare that would compete with private health insurance plans.”

It’s also reflected in a study cited by Sen. Chuck Grassley, R-Iowa, and other insurance industry defenders saying that 119 million Americans would bolt from their private insurers to the public option if they were given the chance.

To put that figure in perspective, it is about two-thirds of Americans who have private insurance through their employers or as individuals. In other words, the industry's defenders say two of every three customers want out.

Though some analysts doubt the defection rate would reach 119 million, Grassley’s argument is that Americans would so prefer a government-run plan that it would destroy the private insurance industry – and that therefore the public option simply can’t be permitted.

Grassley’s fear of 119 million Americans voting with their pocketbooks against private health insurance represents a remarkable admission of failure by the industry and its backers. It says, in effect, that the industry’s treatment of its customers has been so highhanded over the decades that the industry can only survive if Americans are left with the unappetizing choice of private coverage or no coverage.

Representing Whom?

So, not only are the Republicans – and some Democrats – standing against the desires for 72 percent of the population but, in effect, they also are trying to lock in 119 million unhappy customers for a profit-making industry. To add another windfall for the insurance industry, Congress may compel the near 50 million uninsured to buy insurance under penalty of fines.

Even in the sorry history of special-interest-dominated Washington, it is rare for politicians to so blatantly adopt defense of a private industry over the will of the people.

One might think that Democrats would take this club and beat the Republicans over the head with it. The Democrats could argue that the public option is not only popular but could save money for struggling U.S. businesses by bringing down their health insurance costs and freeing up more money for investment and for the hiring of new workers.

One of the key factors that drove General Motors into bankruptcy was how its health insurance benefits for employees inflated the company’s costs-per-worker total and thus hurt its competitiveness against rivals who operate in countries where the government pays for health care.

The public option issue also would seem ready-made for Democrats given that the New York Times/CBS poll found that a solid majority of Americans (57 percent) were willing to pay higher taxes so that all Americans could have “health insurance that they can’t lose no matter what.” [NYT, June 21, 2009]

Nevertheless, key “centrist” Democrats, such as Sens. Max Baucus of Montana and Kent Conrad of North Dakota, are ready to scuttle the public option to secure a few GOP votes so they can claim their plan is “bipartisan.” Conrad has called for substituting a privately run, non-profit “cooperative” for the public option.

While Conrad’s “cooperative,” which would be ostensibly owned by its members, has some superficial appeal, it would require the creation of an entirely new bureaucracy – rather than relying on the government’s existing infrastructure for Medicare – and would likely be run by high-paid executives recruited from the existing private insurance industry.

Critics of Conrad’s plan also note that the cooperative would have far less leverage in negotiating lower prices from pharmaceutical companies and other parts of the medical industry, so the savings would be marginal – which is exactly why the idea appeals to industry groups.

Patrons and the People

It goes without saying that the medical-industry complex has made generous contributions to all the key lawmakers, especially those like Grassley and Baucus who are at the top of the influential Senate Banking Committee.

But the obsession of some Senate Democrats, like Conrad, to find “common ground” with Republicans seems to go beyond simply rewarding benefactors. Though it’s clear that many, if not most, Republicans have a single-minded goal – to sabotage the Obama administration – Democrats nevertheless continue in their quest for the elusive “bipartisanship.”

This quest goes on despite the fact that Republicans were trounced in the last two elections, are down to 40 senators, and are facing historically low approval ratings. Still, “centrist” Democrats insist on bending over backwards to accommodate the GOP desires, even when those desires fly in the face of popular opinion and do not represent the most sensible policies.

These Democrats – sometimes including President Obama – appear deeply influenced by Inside-the-Beltway chatter coming from pundits who still reflect the Ronald-Reagan-to-George-W.-Bush conventional wisdom that “government is the problem,” that tax cuts are the answer to every question, and that “self-regulating markets” have made bureaucrats largely irrelevant.

Despite the nation’s cascading crises – which can be traced to too little government, excessive tax cuts and a lack of sound regulation – the chattering class has not been shaken from its biases. So, the minority Republicans are given far more time and space than they reasonably deserve (and much more than minority Democrats got during George W. Bush’s presidency).

Amid Republican charges of “socialism,” the reaction of Democrats, like Baucus and Conrad, is to position themselves in what they must consider the safe center, earning praise from the pundits for their courageous willingness to stand up to the Democratic “base” – and to the overwhelming majority of Americans – in order to stop the public option.

But Baucus and Conrad will likely find that the safe center isn’t so safe. When half-measures and half-baked compromises leave the American people disappointed or angry, the fault will be laid on the government’s failure to do the job right.

And that failure will be cited by Republicans and the pundits as further proof of the superiority of the private sector.

False Health-Scare Ad on CNN

Original Link:

By Robert Parry

A right-wing group called Conservatives for Patients’ Rights is airing a political attack ad against the idea of a public option for health insurance by turning upside down an analysis showing that 119 million Americans would jump from their private health insurer to a government plan if one existed.

According to that analysis, 119 million Americans – roughly two-thirds of those now on private plans – would defect to a public option if they had a choice. But the right-wing group, in airing its ad on CNN, presents that number as a case of denying those Americans the choice of staying on their private plans.

“Experts say a government plan could result in 119 million Americans coming off their existing coverage,” a woman’s voice intones over the image of a Wall Street Journal article. “They’d end up on a government-run plan.”

However, those 119 million Americas would be “coming off their existing coverage,” according to the analysis, because many would choose a public health option over their existing private plan. In other words, what the CPR group wants to do is to deny those 119 million Americans the choice that many of them want.

In opening the ad, CPR leader Rick Scott explicitly flips the issue of “choice,” maintaining that a public option “could mean taking away your choice.”

Scott is a multimillionaire who built Columbia/HCA into the largest U.S. health-care company before being removed by the board of directors in 1997 after a fraud investigation that led to a guilty plea for the company on overbilling state and federal health plans and to a record $1.7 billion in fines.

Coordinating Scott’s anti-public-option attack ads is the CRC Public Relations firm that devised the “Swift boat” attacks on Sen. John Kerry’s war record during Campaign 2004. [Washington Post, May 11, 2009]

In one of the strange twists of the current health-care debate, the industry’s defenders have repeatedly cited the potential 119 million American defectors to a public option as an argument for denying them that choice. The argument is that so many Americans would vote with their pocketbooks against the private insurers and in favor of a government-run plan that the private industry would collapse.

“As many as 119 million Americans would shift from private coverage to the government plan,” one of the industry’s chief protectors, Sen. Chuck Grassley, R-Iowa, wrote in a column for, arguing that the result would be cataclysmic for the industry.

Though some analysts question the accuracy of the 119 million estimate, its use by industry defenders represents a remarkable admission of failure by private health insurers to meet the needs of their customers.

That failure was underscored again on Wednesday by the findings of a congressional investigation that two-thirds of the industry used a faulty database that overcharged patients for seeing out-of-network doctors. The use of the flawed database cost private insurance subscribers billions of dollars that they should not otherwise have paid, the report said.

At a Senate Commerce Committee hearing, three health-care experts explained how insurers duck payments for sick people by using incomprehensible documents and by selling “junk” policies that don’t meet the needs of their customers.

The witnesses included Wendell Potter, insurance giant Cigna’s former vice president for communications, who said insurers deliberately make the paperwork confusing to deter customers from obtaining the payments they may deserve.

Now, Potter said the industry’s goal is to “shape reform in a way that benefits Wall Street far more than average Americans.” To do so, he said, "The industry and its backers are using fear tactics, as they did in 1994, to tar a transparent and accountable -- publicly accountable -- health-care option," Potter said. [Washington Post, June 25, 2009]

Given the many complaints that Americans have expressed over the years about denials, limits and cost of health insurance, it probably shouldn’t be a surprise that millions of Americans would trust a government-run insurance plan over a private one.

But the main point of U.S. public opinion has been that health care reform should offer a choice for Americans to pick one or the other. According to a New York Times/CBS poll, 72 percent of the American people favor “offering everyone a government administered health insurance plan like Medicare that would compete with private health insurance plans.”

However, the attack ad appearing on CNN has turned the choice issue inside out, with the goal of leaving the American people with only the choice of signing up with a private insurer or going without insurance.

Senators Opposed to "Public Option" Haul in Health Care PAC Dollars

Original Link:

By Aaron Kiersh

Twice in the past week, statistician and blogger Nate Silver has used CRP data to analyze the relationship between political spending by the health care industry and key Senate players' stances in the debate over health care reform. While CRP cannot vouch for Silver's methodology, his research has yielded some interesting observations.

Earlier today, Silver--a self-described supporter of President Obama--listed the top 10 recipients of health insurance PAC money since 2004. None of these lawmakers--seven Republicans and three Democrats--have endorsed the public option for health insurance opposed by insurers and championed by the White House. Most, in fact, have already rejected the proposal.

Sen. Max Baucus (D-Mont.), chairman of the Senate Finance Committee, has received the most money ($141,000) from health insurance PACs. Baucus has leaned in favor of a "co-op" plan as an alternative to government-provided insurance. Senate Minority Leader Mitch McConnell (R-Ky.) who has said he fears the public option may lead to a "government takeover" of health care, ranks second, having received $111,000 from insurance PACs since 2004. Sen. Ben Nelson (D-Neb.), who initially called the public option plan a "dealbreaker" but has subsequently tempered his opposition, checks in at No. 3. The remaining members of the top 10 list are all members of the finance panel that is crafting one of the main proposals for reform.

It is important to note that because PACs may file either on a monthly or semi-annual basis in 2009, many PACs will be reporting for the first time on July 31st, so it's difficult to make any conclusions about PAC giving so far this cycle. But long-term trends can certainly be instructive.

Last week, Silver compiled a ranking of senators in terms of contributions they have received from political action committees affiliated with health care and insurance companies over their careers.

The three senators who derived the highest shares of their campaign contributions from these PACs are all Republicans who oppose the "public option." Five Democrats are also among the top 10 recipients, and they all either support a public plan or have not officially come down on the subject either way. The last two senators on the list, both Republicans, disapprove of the public option.

Sen. Mike Enzi (R-Wyo.) leads the way, drawing 12 percent of his receipts since 1989 from health industry PACs, which are generally operated by insurance, pharmaceutical and medical equipment companies, as well as by hospitals and physicians' groups.

The Democrats on the top 10 list of Silver's study are all long-time fundraisers, bringing in anywhere between $12.9 million and $25 million since 1989. Sen. Kent Conrad (D-N.D.), who has declined to fully support or reject the public option, leads this Blue Quintet with 8.5 percent of his cash coming from health care PACs.

Health care PACs alone have already donated $4.9 million to federal candidates this year after contributing $49.3 million and $39.8 million in the 2008 and 2006 cycles, respectively. While medical professionals and the PACs and employees of insurance companies traditionally lean Republican, health care PACs have flipped dramatically in recent years. More than two-thirds of their donations so far this year have gone to Democratic candidates, while only a combined 34 percent of contributions went to the Democrats in the 2004 and 2006 cycles. In 2008, Democrats collected 55 percent of all the money that came from these PACs.

CRP will continue to analyze contributions from individuals in the health care sector and donations to lawmakers' leadership PACs. So stay tuned to "Diagnosis: Reform."

Friday, June 26, 2009

Un-Cooperative: The Trouble with Conrad's Compromise

Original Link:

By Jacob S. Hacker

In the fast-moving debate over health care, no idea invites more admiration or ire than the “public health insurance option”--or what I’ve been trying to get people to describe as “public plan choice”. The idea is overwhelmingly popular with Americans, garnering 85 percent support in a new independent poll from the Employee Benefit Research Institute. It’s also compelling and simple: If you don’t have coverage from your employer, you can choose from a menu of health insurance products that includes not just a range of private health plans but also a public insurance plan provided on the same terms nationwide.

The argument for this new public plan is that it would have lower administrative costs; greater leverage to hold down prices; and the transparency, broad patient data, and incentives for long-term investment in health to improve the quality and efficiency of care. Along with new regulations, it would also be the primary check on a private insurance industry that has, for too long, neglected both quality and efficiency, focusing its creative energies instead on new ways to shift costs onto and screen out the sick.

The idea of public plan choice was part of all the leading Democratic candidates’ health plans, Senator Max Baucus’ November 2008 White Paper, and the vision of reform articulated earlier this year by key congressional Democrats. All with little attention outside health policy circles--until conservatives, health insurers, and some provider groups decided the public plan was public enemy number one. And so, the misinformation campaign began: A public plan available alongside private plans only for Americans without workplace insurance was suddenly described as a “government takeover” of medicine, the “road to rationing,” and (that old standby) “socialized medicine.” Republicans drew their lines in the sand, and Democrats started their favorite parlor game: compromising among themselves even before the real debate begins.

In most of the discussion of public plan choice, including my own writings, the plan has been as described as “Medicare-like”--a national plan roughly modeled after Medicare that would, however, be separate from Medicare and compete on a level playing field with private plans. That is still the leading model, and thoughtful Democrats have usefully fleshed it out (more on that shortly). But the last couple months has featured a proliferation of putative compromise alternatives to the public plan, from creating a bunch of state plans modeled after self-insured health plans for state workers, to chartering some kind of nonprofit (national or state) plan that would be not quite governmental and not quite private, to “triggering” the public plan only if the situation in American health care got too bad. (Aren’t we there yet?) Some of these ideas had some of the elements of the original vision of a Medicare-like public plan, but none had substantial recommendations other that they were ostensibly more politically salable.

Which brings us to Senator Kent Conrad, Chairman of the Senate Budget Committee, who has announced with much fanfare that he has solved the public plan problem--er, “problem.” His solution? Allow consumers, states, and anybody else so inclined to create cooperatives that would purchase health care for their members. Conrad has not offered much in the way of specifics on what the cooperatives would look like or how they would be chartered. Most important, he has offered no reason to think that the cooperatives he envisions could do any of the crucial things that a competing public plan must do.

An easy way to think of the public plan’s functions is the three “B”s: We need a national public plan that is available on similar terms in all parts of the nation as a backup. This plan has to have the ability to improve the quality and efficiency of care to act as a benchmark for private insurance. And it has to be able to challenge provider consolidation that has driven up prices to serve as a cost-control backstop.

Cooperatives might be able to provide some backup in some parts of the nation, but they are not going to have the ability to be a cost-control backstop, much less a benchmark for private plans, because they are not going to have the reach or authority to implement innovative delivery and payment reforms. And so Conrad’s idea appears to be yet another compromised compromise that cuts the heart out the idea of public plan choice on the alter of political expediency.

That’s not to say that encouraging cooperatives would be bad policy. In fact, Conrad has resurrected an old health care idea that taps into Americans’ strong belief in direct community control (what the political scientist James Morone has called “the democratic wish.”) Cooperatives of various sorts have been discussed and sometimes created to provide health care in the past. After the Great Depression, the Farm Security Administration encouraged the development of health cooperatives--which at one point had about 600,000 members, mostly in rural areas. But the cooperatives crumbled in the face of physician resistance (including boycotts), the lack of financial wherewithal of the cooperatives themselves, and the eventual withdrawal of government support.

Even today’s remnants of the cooperative movement don’t provide the most inspiring of lessons. The only survivor of the 1940s experiment, Group Health Cooperative of Puget Sound, does continue to operate as a tightly managed health maintenance organization, paying doctors on a salaried basis. It is well regarded, and indeed, was found to be remarkably efficient by the RAND Corporation as part of a famous 1970s analysis of the effect of insurance cost-sharing. Unfortunately, it’s now little different from other nonprofit HMOs, with around a half million members in Idaho and Washington State. By contrast, WellPoint--the nation’s largest insurer and a major force behind the defeat of health care reform in another West Coast state, California--has more than 30 million members.

And that’s the story of purchasing cooperatives writ large. They have been hard to establish or extend, and when they have been established, they’ve been under constant siege from doctors and insurers and eventually largely operated as private insurance plans or weak purchasing arrangements. It is hard to see how any sort of decentralized cooperative model could do what a public plan can do.


But what if the cooperatives were national? In an interview with Ezra Klein of the Washington Post, Conrad has suggested that a national cooperative could be created on behalf of consumers. This would be a distinct improvement over the decentralized approach, especially if Congress established the cooperative and provided federal startup funds. Health law expert Timothy Jost has argued that the only viable cooperative strategy would involve “a federal charter to license and regulate a national non-profit coop, with coop governance prescribed by Congress.”

But a national cooperative would still fall so dramatically short of a public plan that it would only be attractive in addition to a national public plan, not as a substitute for it. Indeed, this point holds more generally. Given the need for countervailing power in the health care market, the federal government should encourage a range of consumer-oriented health plans and state-based public plan options, so long as there is also a national public plan capable of being a backup, benchmark, and backstop.

Conrad’s proposal does have one virtue: It presses advocates to be clearer about what public plan choice should do. Moreover, it is reasonable to be concerned about whether a public plan will be overly politicized or compete on a playing field that is not truly level. But that is an argument for creating an independent governing body for the public plan and for making sure that the public plan competes on equal terms with the private plans--for example, by requiring it to abide by the same basic rules as private plans and ensuring that, outside of setup costs, it is self-sustaining (that is, funded by premiums and subsidies available to low- and middle-income enrollees in all plans, rather than general government revenues).

The saddest part of this is that Conrad’s announcement has overshadowed a truly constructive contribution to the debate by his colleague on the Senate Finance Committee: Jay Rockefeller. Rockefeller knows a thing or two about health care, having played a leadership role on the issue for decades. And this week he put out a compelling vision of public plan choice with the evocative title of the “Consumers Health care Act.” Rockefeller’s public plan would be called the “Consumer Choice Health Plan,” and it would be a self-sustaining national public plan that would have to be abide by the same rules as private insurance plans and be run by the federal government separately from the new insurance pool that would oversee the competition among public and private plans. As the press release that accompanied the plan puts it: “By bringing a competitive public plan option to the table, private insurance companies will be driven to provide Americans with better value for their health care at a better price, in contrast to the current private insurance framework, which is focused on avoiding risk and increasing their profits.”

Rockefeller also calls for creating an a nonprofit, consumer-driven organization to evaluate and give ratings to all health insurance products offered through the new insurance pool. Now that is a cooperative-sounding idea that might really work.


The attractions of Rockefeller’s consumerist proposal make all the more transparent that there’s no substantive case for Conrad’s cooperative idea as an alternative to a public plan. We can design a good national public plan focused on patients, not profits, that could be up and running quickly. But is there a political case for Conrad co-op cop-out?

Conrad says that abandoning public plan choice is necessary because there are few wavering Democrats in the Senate who won’t support it. If you have been following this debate, you are probably wondering why that is so consequential, since leading Democrats have suggested they could pass health care reform through the budget reconciliation process, which means they would need to get only a majority of Senate votes rather than the sixty needed to stop a filibuster. (Currently, the Democrats have fifty-nine votes, but most expect they will have sixty when the Minnesota election imbroglio is resolved.) But Conrad has consistently indicated that he does not think the reconciliation process is viable, notwithstanding his pledge to the White House to support its use if necessary. So he is saying that an anemic, almost certainly unrealistic proposal is what has to fill the check box on the Democrats’ wish list next to “public plan.”

But is Conrad right about the politics? A reform proposal that doesn’t have a public plan is bound to cost more (or do less), since a public plan can save money--and save money in ways that the Congressional Budget Office will score. Get rid of the plan, and reform’s overall price tag goes up, making it harder to pass. And if reform without a public plan were to pass, it would simply not work as well, or perhaps at all. It would be more likely to run into problems because budget expenditures turn out to be higher, or implementation problems when private insurance doesn’t live up to its promises. That could sink reform before it even gets underway. In other words, maybe there’s a political risk to including a public plan. But there’s also a big political--and policy--risk to excluding it.

Strategically, Conrad’s approach is more like capitulation than compromise. Reconciliation or no reconciliation, the right political path for achieving reform doesn’t run through a minefield of endless preemptive concessions. When President Bush successfully enacted tax cuts in 2001 (through the reconciliation process, it should be noted), the question was simple: tax cuts, yea or nay? Many Democrats eventually signed on, not because they liked what Bush was peddling, but because they didn’t want to be against tax cuts. And tax cuts mostly for the rich weren’t all that popular. By contrast, there’s little question about the popularity of bold action on health care.

Before the year is out, Republicans (and some Democrats) need to be asked: health care reform, yea or nay? And the reform package they’re asked to vote up or down had better be good--which means, among other things, contain a true public plan--because there will not be another bite at this political apple for a very long time.

Thursday, June 25, 2009

Health Care Showdown

Original Link:


America’s political scene has changed immensely since the last time a Democratic president tried to reform health care. So has the health care picture: with costs soaring and insurance dwindling, nobody can now say with a straight face that the U.S. health care system is O.K. And if surveys like the New York Times/CBS News poll released last weekend are any indication, voters are ready for major change.

The question now is whether we will nonetheless fail to get that change, because a handful of Democratic senators are still determined to party like it’s 1993.

And yes, I mean Democratic senators. The Republicans, with a few possible exceptions, have decided to do all they can to make the Obama administration a failure. Their role in the health care debate is purely that of spoilers who keep shouting the old slogans — Government-run health care! Socialism! Europe! — hoping that someone still cares.

The polls suggest that hardly anyone does. Voters, it seems, strongly favor a universal guarantee of coverage, and they mostly accept the idea that higher taxes may be needed to achieve that guarantee. What’s more, they overwhelmingly favor precisely the feature of Democratic plans that Republicans denounce most fiercely as “socialized medicine” — the creation of a public health insurance option that competes with private insurers.

Or to put it another way, in effect voters support the health care plan jointly released by three House committees last week, which relies on a combination of subsidies and regulation to achieve universal coverage, and introduces a public plan to compete with insurers and hold down costs.

Yet it remains all too possible that health care reform will fail, as it has so many times before.

I’m not that worried about the issue of costs. Yes, the Congressional Budget Office’s preliminary cost estimates for Senate plans were higher than expected, and caused considerable consternation last week. But the fundamental fact is that we can afford universal health insurance — even those high estimates were less than the $1.8 trillion cost of the Bush tax cuts. Furthermore, Democratic leaders know that they have to pass a health care bill for the sake of their own survival. One way or another, the numbers will be brought in line.

The real risk is that health care reform will be undermined by “centrist” Democratic senators who either prevent the passage of a bill or insist on watering down key elements of reform. I use scare quotes around “centrist,” by the way, because if the center means the position held by most Americans, the self-proclaimed centrists are in fact way out in right field.

What the balking Democrats seem most determined to do is to kill the public option, either by eliminating it or by carrying out a bait-and-switch, replacing a true public option with something meaningless. For the record, neither regional health cooperatives nor state-level public plans, both of which have been proposed as alternatives, would have the financial stability and bargaining power needed to bring down health care costs.

Whatever may be motivating these Democrats, they don’t seem able to explain their reasons in public.

Thus Senator Ben Nelson of Nebraska initially declared that the public option — which, remember, has overwhelming popular support — was a “deal-breaker.” Why? Because he didn’t think private insurers could compete: “At the end of the day, the public plan wins the day.” Um, isn’t the purpose of health care reform to protect American citizens, not insurance companies?

Mr. Nelson softened his stand after reform advocates began a public campaign targeting him for his position on the public option.

And Senator Kent Conrad of North Dakota offers a perfectly circular argument: we can’t have the public option, because if we do, health care reform won’t get the votes of senators like him. “In a 60-vote environment,” he says (implicitly rejecting the idea, embraced by President Obama, of bypassing the filibuster if necessary), “you’ve got to attract some Republicans as well as holding virtually all the Democrats together, and that, I don’t believe, is possible with a pure public option.”

Honestly, I don’t know what these Democrats are trying to achieve. Yes, some of the balking senators receive large campaign contributions from the medical-industrial complex — but who in politics doesn’t? If I had to guess, I’d say that what’s really going on is that relatively conservative Democrats still cling to the old dream of becoming kingmakers, of recreating the bipartisan center that used to run America.

But this fantasy can’t be allowed to stand in the way of giving America the health care reform it needs. This time, the alleged center must not hold.

Sunday, June 21, 2009

The American Empire Is Bankrupt

Original Link:

By Chris Hedges

This week marks the end of the dollar’s reign as the world’s reserve currency. It marks the start of a terrible period of economic and political decline in the United States. And it signals the last gasp of the American imperium. That’s over. It is not coming back. And what is to come will be very, very painful.

Barack Obama, and the criminal class on Wall Street, aided by a corporate media that continues to peddle fatuous gossip and trash talk as news while we endure the greatest economic crisis in our history, may have fooled us, but the rest of the world knows we are bankrupt. And these nations are damned if they are going to continue to prop up an inflated dollar and sustain the massive federal budget deficits, swollen to over $2 trillion, which fund America’s imperial expansion in Eurasia and our system of casino capitalism. They have us by the throat. They are about to squeeze.

There are meetings being held Monday and Tuesday in Yekaterinburg, Russia, (formerly Sverdlovsk) among Chinese President Hu Jintao, Russian President Dmitry Medvedev and other top officials of the six-nation Shanghai Cooperation Organization. The United States, which asked to attend, was denied admittance. Watch what happens there carefully. The gathering is, in the words of economist Michael Hudson, “the most important meeting of the 21st century so far.”

It is the first formal step by our major trading partners to replace the dollar as the world’s reserve currency. If they succeed, the dollar will dramatically plummet in value, the cost of imports, including oil, will skyrocket, interest rates will climb and jobs will hemorrhage at a rate that will make the last few months look like boom times. State and federal services will be reduced or shut down for lack of funds. The United States will begin to resemble the Weimar Republic or Zimbabwe. Obama, endowed by many with the qualities of a savior, will suddenly look pitiful, inept and weak. And the rage that has kindled a handful of shootings and hate crimes in the past few weeks will engulf vast segments of a disenfranchised and bewildered working and middle class. The people of this class will demand vengeance, radical change, order and moral renewal, which an array of proto-fascists, from the Christian right to the goons who disseminate hate talk on Fox News, will assure the country they will impose.

I called Hudson, who has an article in Monday’s Financial Times called “The Yekaterinburg Turning Point: De-Dollarization and the Ending of America’s Financial-Military Hegemony.” “Yekaterinburg,” Hudson writes, “may become known not only as the death place of the czars but of the American empire as well.” His article is worth reading, along with John Lanchester’s disturbing exposé of the world’s banking system, titled “It’s Finished,” which appeared in the May 28 issue of the London Review of Books.

“This means the end of the dollar,” Hudson told me. “It means China, Russia, India, Pakistan, Iran are forming an official financial and military area to get America out of Eurasia. The balance-of-payments deficit is mainly military in nature. Half of America’s discretionary spending is military. The deficit ends up in the hands of foreign banks, central banks. They don’t have any choice but to recycle the money to buy U.S. government debt. The Asian countries have been financing their own military encirclement. They have been forced to accept dollars that have no chance of being repaid. They are paying for America’s military aggression against them. They want to get rid of this.”

China, as Hudson points out, has already struck bilateral trade deals with Brazil and Malaysia to denominate their trade in China’s yuan rather than the dollar, pound or euro. Russia promises to begin trading in the ruble and local currencies. The governor of China’s central bank has openly called for the abandonment of the dollar as reserve currency, suggesting in its place the use of the International Monetary Fund’s Special Drawing Rights. What the new system will be remains unclear, but the flight from the dollar has clearly begun. The goal, in the words of the Russian president, is to build a “multipolar world order” which will break the economic and, by extension, military domination by the United States. China is frantically spending its dollar reserves to buy factories and property around the globe so it can unload its U.S. currency. This is why Aluminum Corp. of China made so many major concessions in the failed attempt to salvage its $19.5 billion alliance with the Rio Tinto mining concern in Australia. It desperately needs to shed its dollars.

“China is trying to get rid of all the dollars they can in a trash-for-resource deal,” Hudson said. “They will give the dollars to countries willing to sell off their resources since America refuses to sell any of its high-tech industries, even Unocal, to the yellow peril. It realizes these dollars are going to be worthless pretty quickly.”

The architects of this new global exchange realize that if they break the dollar they also break America’s military domination. Our military spending cannot be sustained without this cycle of heavy borrowing. The official U.S. defense budget for fiscal year 2008 is $623 billion, before we add on things like nuclear research. The next closest national military budget is China’s, at $65 billion, according to the Central Intelligence Agency.

There are three categories of the balance-of-payment deficits. America imports more than it exports. This is trade. Wall Street and American corporations buy up foreign companies. This is capital movement. The third and most important balance-of-payment deficit for the past 50 years has been Pentagon spending abroad. It is primarily military spending that has been responsible for the balance-of-payments deficit for the last five decades. Look at table five in the Balance of Payments Report, published in the Survey of Current Business quarterly, and check under military spending. There you can see the deficit.

To fund our permanent war economy, we have been flooding the world with dollars. The foreign recipients turn the dollars over to their central banks for local currency. The central banks then have a problem. If a central bank does not spend the money in the United States then the exchange rate against the dollar will go up. This will penalize exporters. This has allowed America to print money without restraint to buy imports and foreign companies, fund our military expansion and ensure that foreign nations like China continue to buy our treasury bonds. This cycle appears now to be over. Once the dollar cannot flood central banks and no one buys our treasury bonds, our empire collapses. The profligate spending on the military, some $1 trillion when everything is counted, will be unsustainable.

“We will have to finance our own military spending,” Hudson warned, “and the only way to do this will be to sharply cut back wage rates. The class war is back in business. Wall Street understands that. This is why it had Bush and Obama give it $10 trillion in a huge rip-off so it can have enough money to survive.”

The desperate effort to borrow our way out of financial collapse has promoted a level of state intervention unseen since World War II. It has also led us into uncharted territory.

“We have in effect had to declare war to get us out of the hole created by our economic system,” Lanchester wrote in the London Review of Books. “There is no model or precedent for this, and no way to argue that it’s all right really, because under such-and-such a model of capitalism ... there is no such model. It isn’t supposed to work like this, and there is no road-map for what’s happened.”

The cost of daily living, from buying food to getting medical care, will become difficult for all but a few as the dollar plunges. States and cities will see their pension funds drained and finally shut down. The government will be forced to sell off infrastructure, including roads and transport, to private corporations. We will be increasingly charged by privatized utilities—think Enron—for what was once regulated and subsidized. Commercial and private real estate will be worth less than half its current value. The negative equity that already plagues 25 percent of American homes will expand to include nearly all property owners. It will be difficult to borrow and impossible to sell real estate unless we accept massive losses. There will be block after block of empty stores and boarded-up houses. Foreclosures will be epidemic. There will be long lines at soup kitchens and many, many homeless. Our corporate-controlled media, already banal and trivial, will work overtime to anesthetize us with useless gossip, spectacles, sex, gratuitous violence, fear and tawdry junk politics. America will be composed of a large dispossessed underclass and a tiny empowered oligarchy that will run a ruthless and brutal system of neo-feudalism from secure compounds. Those who resist will be silenced, many by force. We will pay a terrible price, and we will pay this price soon, for the gross malfeasance of our power elite.

How Obama is Blowing the Chance for Real Health Care Reform

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If you want to fix the disaster that is called the American healthcare system, the first thing to do is to clearly point out what its major failings are, and there are two of these.

The first is cost. America is the most expensive or one of the most expensive places in the world to get sick or injured. The corollary of that is that it is one of the best places to make a killing if you are in the medical business, whether as a doctor, a hospital company, a pharmaceutical firm or a nursing home owner.

The second is access. One in six Americans—a total of 50 million people at latest count—have no way to pay for that care. Too young for Medicare, too “well off” for Medicaid, but too poor to buy private health insurance or too sick to be admitted into a plan, or employed by a company that doesn’t provide health benefits, these people get no medical care until they get so sick that they are brought into a hospital emergency room where they get treated (often too late) at public expense, or at the hospital’s expense, with the cost shifted onto taxpayers or onto insured patients’ premiums.

Any reform of this atrocious “system” must address these two major failings or it is no reform at all.

And that’s where all the various versions of Obamacare fall flat.

Simply put, you cannot solve either of these problems by leaving the payment system for medical care in the hands of the private insurance industry, since the whole paradigm of insurance is to make money by keeping high-risk people out of the insured pool, and by keeping reimbursements and coverage for premium payers as low as possible.

Having a so-called “public option” plan working in competition with private insurance plans will not solve this problem. Either the public option will become like the private options—trimming benefits and rejecting some applicants—or it will become a dumping ground for all the high-cost, high-risk people that the private sector insurance industry doesn’t want. At that point, the public plan will become a huge cost burden on the taxpayer, who will begin demanding that it cut back in the benefits it provides, taking us right back to where we started.

The fact that the Obama administration and the Democratic Congress are both raising the issue of the high cost of health care “reform,” and are talking about ways to raise revenues to pay for it tells us all we need to know about the alleged “reform” schemes they are contemplating. They are doomed and, even if implemented, will not work.

Real reform of the American health care system would not cost money. It would save money.

There is a level of dishonesty in what passes for the debate over health care “reform” in both Congress and the media that is stunning in its brazenness and/or venality.

Of course real reform would cost more in government spending. But that is because real reform would remove the cost of medical care from both employers and from workers (who over the last 20 years have been shouldering an increasing share of their own medical care). And that shift would mean more profits for US companies, which would free up more money for wages, and it would mean less money deducted from paychecks, meaning higher incomes for workers.

If President Obama had any political courage at all, he’d simply get on TV and say this: I will create a plan that will cover everyone, lift the burden of paying for healthcare from individuals and employers, and have the government pay for it all. You the taxpayer will pay for this plan with higher taxes, but you will no longer have any significant medical bills, you will no longer have health insurance premiums deducted from your paycheck, your employer will no longer be paying for employee medical coverage, and you will never have to worry about losing health benefits again, even if you are laid off. (Incidentally, eliminating employer-funded health insurance would go a long way towards allowing workers to fight to have unions, and to strike for contracts, by ending the threat that they would lose their benefits.)

Of course, to do that the president would have to be talking about what is variously known as national health care or a single-payer plan, in which the government is the insurer of health care for all.

This option isn’t even being discussed in this so-called debate. As I’ve written earlier, even though there is an excellent single-payer system in place that has been running for a third of a century just to the north in Canada—a system where patients have absolute freedom to choose their doctor, get instant access to a hospital and to expert specialist care in emergencies, and have a healthier society by every statistical measure—all at a fraction of the staggering cost of healthcare in the US, not one Canadian expert working in that system has been invited down to discuss its workings with the White House or with members of Congress.

There has been a lot of negative propaganda spread about Canada’s single-payer system, by right wing, business-funded “no-think” tanks, and by medical industry lobbies from the American Medical Assn. to the pharmaceutical industry, but no government committee or agency has bothered, or dared, to bring in Canadian experts to respond to and debunk that propaganda. The corporate liars talk about waiting lists and lack of access to CAT-scan or MRI machines. But all we really need to know about the Canadian, and other similar single-payer systems, is that nowhere that they have been instituted have they been later terminated, even when, as in Canada, right-wing governments have been elected to power. The public, whether in Canada, or France, or England, or Taiwan or elsewhere, loves their public health insurance system, whatever flaws or problems with underfunding those systems may have at certain times. Trying ot eliminate such systems would be political suicide for a conservative government, as even arch-free-marketer British Prime Minister Margaret Thatcher, who never met a government activity that she didn’t want to privatize, learned.

Right now, with half of all Americans reportedly fearing that they could lose their jobs, and with one in five Americans reportedly either unemployed, or involuntarily working part-time, we have a situation where a majority of Americans either have no health insurance, have lost their health insurance, or are in danger of losing their employer-funded health insurance. It is a unique moment when a bold president and Congress could act to end private health insurance and establish a public single-payer insurance plan to insure and provide access to affordable medical care to all Americans.

Instead of this, we are being offered half measures or no measures at all by leaders who are shamelessly in hock to the health care industry or who are afraid of its power.

17 years ago, the Clintons had a similar opportunity to grab the health care industry by the neck, strangle it, and produce a single-payer alternative. They blew that chance by trying to keep the health care greed-heads happy. Now, almost a generation later, we have another shot at it, and Obama and his Democratic Congress are doing the same thing again. There is a strong likelihood that they will fail, like the Clintons before them. If they succeed in coming up with some kind of hybrid public-private Frankenstein of a system that includes a public insurance option, it will simply delay the inevitable disaster, as medical costs, already 20 percent of GDP—the highest share of any economy in the world—continue to soar, and as the cost of the public plan, which will inevitably become a dumping ground for high-cost patients, becomes politically untenable. In the end, we will have even more expensive and inaccessible healthcare than we have today.

It doesn’t have to be this way, but only if Americans rip their eyes away from their crisp new digital-image TV screens and start demanding real health care reform will we get honest reform. A good place to begin would be to start writing and phoning your local media outlets to ask why they are not reporting on single-payer, and in particular on the single-payer bill sponsored by Rep. John Conyers (D-MI), which is being silently blocked and killed by his colleagues in the Democratic congressional leadership and by the White House. A good place to begin would also be to start calling your elected representatives to demand that they support Rep. Conyers’ single-payer bill.

Congre$$, Heal Thyself

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By Amy Goodman

As the Obama administration pushes for a vote on health-care reform before Congress recesses in August, has health-industry money too thoroughly polluted the process for anything good to come of it?
Sen. Max Baucus, D-Mont., chairs the Senate Finance Committee, key to any health-care reform. Baucus has held several high-profile Senate committee hearings on health care, with no single-payer advocates. They were present, though, until Baucus had them arrested-for standing up one by one in the audience, protesting the exclusion of a single-payer representative on the panel. Baucus is only parroting President Barack Obama's pledge that "single-payer is off the table." Yet single-payer health care has significant support among the U.S. public, and increasingly among health-care providers. With single-payer, the government pays the bills, but people still choose what doctors to see. Private health-insurance companies and HMOs-the profiteers-go out of business.

Mike Dennison, a reporter for The Montana Standard, found that Baucus has received more campaign money from health- and insurance-industry interests than any other member of Congress. Dennison told me, "We're talking about the health-insurance industry and ... HMOs, hospitals, physicians, pharmaceutical companies-that's probably where the bulk of his money has come from ... out of about almost $15 million he's raised in the last six years, both for his campaign and his leadership PAC, 23 percent of that came from insurance and health interests ... which we believe is probably more than any other member has received."

At a public forum in New Mexico, Linda Allison asked Obama about Baucus' finances: "[S]o many people go bankrupt using their credit cards to pay for health care. Why have they taken single-payer off the plate? And why is Baucus on the Finance Committee discussing health care when he has received so much money from the pharmaceutical companies? Isn't it a conflict of interest?"

Obama dodged the issue of Baucus, but did admit: "If I were starting a system from scratch, then I think that the idea of moving towards a single-payer system could very well make sense. That's the kind of system that you have in most industrialized countries around the world."

Allison's concern about bankruptcy is timely. According to a recent Harvard Medical School study, "62.1 percent of all bankruptcies in 2007 were medical." Many of these people are not from the 50 million or so uninsured Americans, but from among the estimated 25 million who are underinsured. That a person can have health insurance and still be driven to bankruptcy over hospital bills and pharmaceutical costs is a national disgrace.

Just days before Obama addressed the American Medical Association this week, the AMA announced that it would oppose a public health option.

In response, at least one doctor canceled his membership. In his resignation letter, Dr. Chris McCoy of the Mayo Clinic in Rochester, Minn., wrote that the AMA "couldn't get through the second paragraph before bringing up the issue of physician reimbursement ... the AMA represents a physician-centered and self-interested perspective rather than honoring the altruistic nature of my profession. ... I advocate first for what is best for my patients and believe that as a physician, as long as I continue to maintain the trust and integrity of the profession, I will earn the respect of my community. The appropriate financial compensation for my endeavors will follow in kind."

Recent congressional financial disclosures show that many key members have major investments in the health-care industry. The Washington Post reported this week that almost 30 members of Congress who hold key committee memberships that will impact the health-care debate also have significant investments in health-care companies. The bipartisan group of investors includes Senate Majority Leader Harry Reid, D-Nev.; Sen. Judd Gregg, R-N.H.; the family of Rep. Jane Harman, D-Calif.; Sen. Johnny Isakson, R-Ga.; Sen. John Kerry, D-Mass.; Sen. Michael Crapo, R-Idaho-in all, amounting to between $11 million and $27 million (the number is imprecise, since the disclosure forms allow some ambiguity).

According to The Associated Press, Jackie Clegg Dodd, wife of Sen. Chris Dodd, D-Conn., serves on the boards of four health-related companies and earned more than $200,000 last year. Sen. Dodd is sitting in as chair of the Senate Health, Education, Labor and Pensions Committee, in place of Sen. Ted Kennedy, D-Mass.

Congress will soon break for its "summer recess," with members going back to their home districts to raise money, of course, and, perhaps, to visit their hometown health-care provider-paid for by their publicly-funded congressional health-care plan.