Nurses for Reform Blog

This is a great analysis of the healthcare bill presented to the US Congress last week by Speaker Pelosi.  Grace-Marie Turner of the Galen Institute explains all that is wrong with it and why it breaks promises that President Obama made to the American people.

Breaking Promises

How can President Obama possibly endorse the bill that Speaker Pelosi unveiled to such great fanfare on Thursday? The House bill breaks major promises he has made to the American people about his goals for health reform. To name just a few:

Cost: The president has assured us that health reform would lower health costs. But the House bill would bend the federal cost curve UP, not down, according to the Congressional Budget Office’s preliminary analysis.

And only by using budget gimmicks were House leaders able to get the reported cost to $894 billion over 10 years, just barely under the president’s somehow magic $900 billion number. But that’s not the real cost. Robert Pear of The New York Times reports today, “By the most commonly used yardstick, the bill would cost $1.05 trillion over 10 years, roughly $150 billion more than President Obama had said he wanted to spend on the legislation.”

So the real cost will be over $1 trillion — and that doesn’t include the “Doc Fix.” The Speaker had the audacity to introduce that bill separately so the $245 billion price tag wouldn’t get counted in the total cost of the bill. Senate Majority Leader Harry Reid tried that trick last week, and went down in flames. Can the AMA possibly still stay on board with the House bill, since its deal has now been broken?

And health insurance premiums will soar, especially for younger families because the insurance regulations in the House bill allow only a 2 to 1 premium variation between the youngest and healthiest policy holders and the oldest and sickest.

And this doesn’t even count the huge economic distortions, cost-shifting, and new taxes that surely will be passed along to consumers.

Middle-class taxes: The president promised no tax increases on the middle class, but they surely will be paying the lion’s share of the $500 billion in new taxes to finance the bill. Americans for Tax Reform posted a listing of the new taxes in the House bill which violate the president’s pledge.

And add to that the estimated $33 billion in taxes the CBO says will be collected from individuals who don’t buy the expensive, government-mandated health insurance.

Keeping health insurance: A coalition of major business groups late Thursday sent a letter to Speaker Pelosi and Republican Leader John Boehner saying the House bill falls short of the bipartisan goal of controlling costs and could jeopardize group health insurance provided by employers to 160 million workers.

These are people who should know because they represent the companies that provide health coverage to the majority of Americans: The American Benefits Council, Business Roundtable, Corporate Health Care Coalition, the ERISA Industry Committee, National Association of Manufacturers, National Association of Wholesaler-Distributors, National Business Group on Health, National Coalition on Benefits, National Retail Federation and U.S. Chamber of Commerce.

No savings from the public plan: CBO concludes that the government insurance option would typically charge higher premiums than private plans available in the new Health Insurance Exchange. “That surprising conclusion raises doubts about Democratic promises that a government-run insurance plan would provide a lower-cost alternative to consumers,” Politico reports. And it adds, “At the same time, it calls into question Republican charges that the plan amounts to government takeover of health insurance — because only 6 million people would enroll in the plan, according to the CBO.”

The 400,000-word House health reform bill is absolutely astonishing in the level of government intrusion it would shove into the lives of every American, every business, and every health care professional. I won’t bore you here with the legislative jargon, but pick a page, any page, and you will see what I mean. Here is a link to the bill and a much more reader-friendly section-by-section analysis. You will see that all power and control vests to the government.

Hitting small business hard: Don’t miss the new analysis by WellPoint that mined its own actuarial data to model the basics of the plan incorporated in the House bill, using data from 14 states where it runs Blue Cross plans.

In all 14, it found that the legislation would drive up premiums for small businesses and individuals. Young and healthy consumers would see the largest increases, with premiums more than tripling in some states.

The head of the National Federation of Independent Business, Dan Danner, said the huge cost of the health reform bill “will ultimately come out of small business owners’ pockets and prohibit them from growing, investing in their business and hiring new employees.”

The bill requires detailed recordkeeping on employee health insurance, imposes new taxes and new civil penalties for not complying with the barrage of new federal health insurance laws, and puts burdens on virtually every company to pay for this expensive insurance, in perpetuity. See my article, linked below, in Tuesday’s Wall Street Journal for a report on how this is (not) working in Massachusetts.

Lock out: Speaker Pelosi’s announcement of the House bill had all the trappings of a major campaign rally. The only problem was that the public was locked out. Big chain link fences surrounded the West Front of the Capitol — usually a very open, public space — to make sure only supporters of the bill were allowed in.

This is so symbolic of the whole process: The American people are being shut out of the debate. All congressional recesses have been cancelled since August to keep members away from their constituents as much as possible, doors are locked while negotiations over the bills are taking place (breaking another presidential promise of an open and public process), and now, the public was even shut out of the public space outside the Capitol for the announcement rally.

This legislation is going to have an impact on the economic and health care freedom of Americans for decades to come. It is beyond irresponsible for Congress to be on the verge of passing these bills with this kind of disregard for the will of the people.

Politico carried a full-page ad yesterday with the pictures of 36 former members of Congress defeated in the 1994 elections in the aftermath of HillaryCare. It could happen again unless members open up this process to heed the fears of their constituents about a government take-over of the health sector.

The Independent Women’s Forum conducted its own poll that found women want to make their own choices and decisions about their and their family’s health care and they do not want politicians intruding.

This is a great article from Grace-Marie Turner of the Galen Institute commenting on President Obama’s key note speech on his healthcare reform made earlier this week to both houses of congress in the US.

A Speech Not A Plan

President Obama’s speech last night soared with oratory but fell flat in delivering on his promise to present details or any substantive new policy initiatives for his health reform plan. He may get a few days of lift from the passion and cheers in the House chambers, but the hard realities of policy will continue to chill prospects for getting sweeping reform legislation enacted. A few examples:

Paying for reform. The president said “the plan I’m proposing will cost around $900 billion over 10 years” and that “we’ve estimated that most of this plan can be paid for by finding savings within the existing health care system, a system that is currently full of waste and abuse.” 

He dropped talk of higher taxes on the rich to pay for the reform plan, perhaps after realizing that much of the burden would fall on small businesses. So that means that, apart from some new taxes on health insurance (which will just be passed along to consumers), the massive coverage expansions will be paid for by curtailing Medicare and Medicaid waste and abuse and making them more efficient. 

That doesn’t pass the laugh test. I testified before the House Energy and Commerce Committee in 2008 about seven rules that the Bush administration had written to curtail documented fraud and abuse in the Medicaid program. The fraud was documented by the Government Accountability Office and the Inspector General at the Department of Health and Human Services — things such as using Medicaid money to take people shopping for party dresses and to Bingo games. 

But Congress has done everything it can to stop implementation of the Bush rules to stop documented fraud. What do you think the chances are that they will be able to pay for their $900 billion reform plan mostly with savings from Medicare and Medicaid?

Rising health costs. Gone is the campaign promise that every family will save $2,500 a year on health costs when the Obama plan is implemented. It has been replaced with new language that says reform “will slow the growth of health care costs for our families, our businesses, and our government.” 

Slowing the growth of health costs is a much different agenda. But even with that, he offered little or nothing of substance to explain how he would achieve that goal.

Keeping the coverage you have now. The president has changed his rhetoric about no one losing the coverage or doctors they have now. Now he says “nothing in this plan will require you or your employer to change the coverage or the doctor you have.” The operable word is “require.” 

But the employer mandate is still in place, and the president still wants the new public plan. So there would be every incentive for employers to drop coverage, pay the new tax, and send their employees packing to the public plan, many involuntarily. The Lewin Group says between 88 million and 120 million Americans would find themselves in the new government-run health program. But they wouldn’t be required to join. 

Do you find that reassuring?

So what we heard last night was a campaign speech which was, by the way, alarming in his threats to those who oppose him. Promises made are not promises kept. Michael Tanner of Cato has a good new paper out that details the very difficult challenges of getting from promise to policy. The president began his speech by saying: “We know we must reform this system. The question is how.” We’re still waiting for answers.