By John Geyman MD on Thursday, Nov 5, 2009. Dr. John Geyman is professor emeritus of family medicine at the University of Washington School of Medicine in Seattle, a past president of Physicians for a National Health Program and author of “Do Not Resuscitate: Why the Health Insurance Industry Is Dying, and How We Must Replace It.”
The new House bill for health care reform (HR 3962), unveiled by Speaker Nancy Pelosi on October 29th, will not fundamentally reform U. S. health care. If you would believe the hype that accompanied its release, you might think that it would be as important as Medicare and Social Security. The New York Times concluded that “This bill will take a long stride toward universal coverage while remaining fiscally responsible.” Nobel laureate economist Paul Krugman added: “The political environment is as favorable for reform as it’s likely to get. The legislation on the table isn’t perfect, but it’s as good as anyone could reasonably have expected.”
But this bill is not good enough to pass. It will not make a big enough difference in addressing the three main problems requiring reform—containing the spiraling costs of health care, providing universal access to affordable health care, and improving its quality. If we look at the provisions of this 1,990-page bill concerning just the first two of these three goals, we see that it will fail to deliver real reform.
After all of the political compromises along the way that have led to the introduction of the new bill (HR 3962), on the positive side we can say that it will introduce some reforms to the health insurance market, expand coverage by about 36 million to health insurance by several means (especially through government subsidies to individuals and small employers and expansion of Medicaid), and help to address some other major system problems, such as the growing shortage of primary care providers.
But the negative side far outweighs the positive:
• There are no effective cost containment mechanisms built into the bill, either
for the costs of health insurance or for health care itself. As it whines about
loosening of the individual mandate that will likely limit some of its big increase
in the insurance market, the health insurance industry is already warning that
sharp premium increases will result. The most the bill will do is to require
disclosure and review of premium increases, without any regulatory teeth.
Although the bill would set up a Health Benefits Advisory Committee to
recommend a minimal essential benefits package (with four tiers), insurance
industry lobbyists will argue for the most minimal levels of coverage, and we can
anticipate an exponential growth in underinsurance. Moreover, there are no price
controls to be applied anywhere in the system, except perhaps in authorizing the
government to negotiate drug prices with manufacturers. But that provision will
almost certainly not clear the Senate, where we can expect even less concern for
affordability and prices.
• Although the public option has been the target of intense controversy, it will
play a negligible role in health care reform. The CBO has concluded that it would
cover no more than 6 million Americans, just two percent of the population, in
2013, and will cost more than private programs, mostly due to adverse selection in
attracting sicker individuals and its inability to set reimbursement rates for
physicians and hospitals as is done by Medicare. Moreover, middle-income
families may be required to spend 15 to 18 percent of their income on insurance
premiums and co-payments.
• HR 3962 will not result in making health care more affordable, despite
allocating some $605 billion over ten years for subsidies to low- and middle-
income Americans to buy insurance on Exchanges. We can count on continued
increases in the cost of health insurance as far as the eye can see, together with
less actuarial value of coverage.
• Buried in the fine print of this monster bill are many provisions that will benefit
corporate stakeholders in the medical industrial complex on the backs of patients
and their families. These examples make the point:
• Although medical loss ratios (MLR) (the proportion of premium
revenue actually spent on medical care) are specified at a minimum of 85
percent, this loophole has been added—“while making sure that such a
change doesn’t further destabilize the current individual health insurance
market.” By way of comparison, the Senate Commerce Committee has
found that the average MLR for the largest insurers in the individual
market is only 74 percent, with 26 percent of premium revenue going to
marketing, administrative overhead and profits.
• Although the bill would create a much-needed Center for Comparative
Effectiveness Research, it would have no say over reimbursement and
coverage policies. As the bill says, it “contains protections to ensure that
research findings are not construed to mandate coverage, reimbursement
or other policies to any public or private payer.”
In sum, this $1.055 trillion plan over ten years will not fix the major problems of cost and affordable access to health care in our deteriorating system, will add new layers of bureaucracy and complexity to the present system, is not fiscally responsible, and is not sustainable.
What to do now? Rather than accept an unworkable bill that is politically
expedient, we would be better off to make a major course change. The best first option would be to call for a floor vote, as originally promised by the House Speaker Pelosi, for
the amendment proposed by Anthony Weiner (D-NY) to substitute HR 676, a single-payer proposal, for HR 3962. If that fails, shelving this bill would be the best option, but if that is not possible, lawmakers should be pressed to retain the amendment proposed by Dennis Kucinich (D-OH) to allow states to experiment with single-payer plans, as a number of states would like to do (eg. California, Colorado, Illinois, Maine, New Mexico, New York and Pennsylvania). That amendment has already been passed by a rare bipartisan vote of 27-19 in the House Education and Labor Committee.
Whether a health care bill survives the end game in both chambers of Congress in this session is still up in the air. If a bill is finally enacted into law, however, it will be ineffective in remedying the big problems of cost and access to health care. We should be gearing up for an intense effort in 2010 to push for real health care reform—Medicare for All.
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