Health Care Checkup
By Brian Wingfield and David Whelan
August 18, 2009 | Forbes.com
Feeling a bit lost in the debate over health care reform? It's understandable.
America's health care system was already confusing even before Congress' ideas for changing it. Now, special interests have made things yet murkier. The White House has backed away from its initial support of a government-run insurance program; town hall meetings are brimming with scorn for the ideas on the table, and health care chatter has consumed the airwaves.
Lawmakers will determine this fall what's in the final bill, but as the debate rages this summer, here's a guide to help you get up to speed and back to the beach as quickly as possible:
What's been proposed?
President Obama wants to see reform that includes, among other things, coverage for all Americans, allows people to choose their providers and lowers the growth in health care costs. Congress has to figure out the dicey details.
In July, leaders in the House of Representatives proposed a bill that would create a government-run insurance plan, or "public option," to compete with private insurers. It requires individuals to have coverage and mandates that large businesses provide it or pay a tax to the government. To help pay for the public option, it would increase taxes on the wealthy. Several House committees have produced their own, slightly different, versions of this bill.
The Senate's health committee also proposed a plan in July, and it too includes a public option and individual and employer mandates. However, the Senate Finance Committee, which determines how to pay for the Senate proposal, is deliberating until at least mid-September.
For this reason, "ObamaCare" doesn't really have a formal definition. It's basically still a handful of proposals.
What's still on the table?
Technically, everything; but in fact, a lot has been cut out. Most recently, the White House has backed off from its support of a public option, the most expensive part of reform and an idea that might not pass the Senate. The idea of taxing the wealthy is also probably gone. And the president doesn't support the idea of killing a tax subsidy for employer-provided coverage because it might raise taxes on the middle class.
So what's left? Proposed cost reductions in Medicare, Medicaid and prescription drugs. Perhaps a plan for health insurance to be provided by nonprofit cooperatives instead of the government. The main thing that remains: the problem of figuring out how to insure an additional 46 million people without adding to the deficit.
What's likely to get done, if anything?
Democrats in control of Congress and the White House aren't going to walk away from this battle without being able to claim victory, so expect some type of health care reform to happen this year. Much depends on what the Senate Finance Committee determines.
Reform will most likely cost less than $1 trillion, paid for by entitlement savings and various tax increases. It will likely expand health insurance, though probably not as much as the president hopes. And it seems increasingly likely that it won't include a public option.
What's it likely to cost?
With a public plan, the bill is projected by the Congressional Budget Office to cost just under $1 trillion over 10 years. That's $3,333 for every man woman and child. Take out the public plan completely and that drops by $773 billion, so the administration will have more room to spend that money on other proposals, like health co-ops or expanding Medicaid eligibility, promoting electronic health records or comparative effectiveness research. Removing that cost could also allow the final bill to include fewer Medicare cuts to hospitals or doctors.
What would it mean to the way I get medical care?
If you are part of the demographic that right now is not well served by the private insurance market and you don't qualify for Medicaid, Medicare or S-CHIP--you could suffer without a public plan option. The public plan would be ideal for small businesses that can't afford double-digit annual premium increases or low-to-middle income individuals with preexisting conditions who, in many states, can't even find an HMO to buy a plan from.
Co-ops could provide another option for these patients, but where they already operate, there's no evidence that they solve the uninsured and under-insured problems.
If you work at a big company, have Medicare or qualify for Medicaid, likely your medical care will not dramatically change, though the long-term fiscal pressures on the government plans will likely lead to cost-cutting and tax increases down the road.
What happens next?
Supporters of the public plan will likely make a push to ensure it's in the final bill. If they succeed, the final passage will happen, but it will be a bruising battle until the end. Expect more angry town halls. And forget about beer and car ads during football season. It will be all health care all the time.
If they don't get it back in, it will be much easier to get congressional support from moderates and even Republicans--but the president and the original band of reformers will face criticism that they didn't accomplish what they set out to do.