Friday, July 15, 2016

When you're talking about Freedom-Haters and planned-decline enthusiasts, you know what the endgame is

Moderate Democrats are in a somewhat similar situation to that of conservative Republicans: They're being elbowed out of any meaningful role in their party.

That's why their alarm at this veer to the left doesn't amount to much:

Barack Obama and Hillary Clinton both launched efforts to get Congress to revive the “public option” for ObamaCare, claiming that a lack of competition makes it increasingly difficult for consumers to find health insurance. The Hill reports that not all Democrats have much enthusiasm for this argument, however:
The idea of adding a government-run insurance option to compete with private insurers is making a comeback in the Democratic Party, with President Obama endorsing the idea Monday, two days after presumptive Democratic presidential nominee Hillary Clinton emphasized a public option as part of an effort to win over Bernie Sanders and his supporters after a contentious primary.
But among more centrist members of the Senate, where the “public option” was stopped in 2009, there is little enthusiasm for the idea.
So who has cold feet? Some of the usual suspects, such as Heidi Heitkamp and Joe Manchin, two Senators from conservative states. But The Hill’s Peter Sullivan also reports that swing-state Senators Joe Donnelly (IN), Bill Nelson (FL), and Mark Warner (VA) aren’t terribly keen on answering questions about it.
Even Tom Carper from solidly-blue Delaware put off responding to the idea until he sees a concrete proposal — and hinted that he won’t consider any additions to ObamaCare that require a party-line vote to pass:
“I had not heard that, so let me just take a look at it,” Carper said. “When we passed the Affordable Care Act, unfortunately we had to do it very much on a party line vote, and it’s unfortunate, because if it had been a bipartisan bill, it would have been better, I think.”
Correction: If it had been a bipartisan bill, the blame for the failure would have been easier to spread around.
The irony of floating this proposal now is that recent events proved what a disaster the public option would have been. In my column for The Fiscal Times, I argue that demanding a public option after the collapse of the federally subsidized co-ops is akin to prescribing a second iceberg to rescue the Titanic:
Unfortunately for Obamacare cheerleaders, almost every co-op has hit their own icebergs over the past year. In the past two weeks alone, two of the few remaining (in Oregon and Illinois) have closed their doors, leaving both patients and providers in the lurch. They have blamed a decision by Congress to limit risk-corridor payouts to taxes collected on “excess profits” by other insurers, but that acknowledges a core criticism of the public-option concept: they are incapable of sustainable operations without large infusions of federal subsidies.
As critics predicted in 2009, the public option in the form of co-ops turned out to be unsustainable. The biggest problem for Obamacare advocates is that they turned out to be far less sustainable than private-sector insurance, even under the onerous conditions imposed on insurers in the ACA’s mandates. The icebergs turned out to be so large that the government’s ships sunk immediately without general-fund dollars to keep them afloat, making arguments that the government could operate better than private-sector insurers [obviously false].


Check that out. Without the slightest sense of irony, the Freedom-Haters are calling the public option an injection of competition into the health-care sector of the economy.

It's not just the co-ops; the exchanges are on shaky ground, too:


McKinsey reported that in 2014 the cumulative losses for the health-insurance industry in the individual insurance market, which is now dominated by the ACA exchanges, was $2.7 billion. Since then, things have only gotten worse. Scores of insurers have reported significant losses since the program launched, and many have pulled out of various markets. So far, 16 of the 23 publicly subsidized co-op plans — precursors to a “public option” — have gone bust from large financial losses. And the insurers who are planning to stay in the exchanges in 2017 are asking for very substantial premium increases, often well above 20 percent, in order to stem their losses.
The basic problem is that those buying insurance plans on the exchanges have been higher users of health services than the insurers priced for. Why did insurers underprice their products? The official answer is that they expected more young and healthy customers to enroll. But there was never really any reason to expect the risk pool in the exchanges to resemble what large employers experience. In fact, given the ACA’s requirement that insurers charge all customers the same premium (with restricted adjustments for age), it was to be expected that enrollees in exchange plans would have more health problems and also use services at a high rate. What really happened is that insurers succumbed to the explicit and implicit pressure coming from the Obama administration to lowball the premiums they were charging to make the program look more affordable than it really was in its early years.
Still, the F-Hers plan to forge ahead.

Why? Do you really need to ask?

The president and Clinton want consumers to be able to select enrollment in an insurance plan run by the federal government, presumably using payment rates tied to Medicare. This is the logical next step for those who would like to see all Americans enrolled in a government-run insurance plan. Plans issued by private insurers must negotiate payments with a network of providers to ensure that their enrollees have access to needed care. Not so with public insurance. Medicare doesn’t negotiate payment rates; the program issues a regulation setting payments, and providers have no choice: They either accept what Medicare pays or they leave the program. The same would be true of a public option in the exchanges. Artificially low payment rates would allow the government to set low premiums for the coverage, but enrollees would have no assurance of ready access to care.
It is telling that President Obama is once again calling for the public option as he ends his time in office. He has spent the past several years denouncing opponents of the ACA for using the overheated rhetoric of a “government takeover.” But a public option would bring millions of Americans into a Medicare-type insurance plan and make it very difficult for private insurers to compete for customers. The president knows this, which is why he supports the idea. He believes in government-run health care and has been pushing to bring it about throughout his time in office, even if he won’t admit it. 

It's advisable to stay healthy in post-America.

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