Incenting Shit Plans

Ezra Klein has his overview of the Max Tax here. After boasting of the plan’s affordability (!), Ezra’s biggest complaint is the lack of an employer mandate:

The employer mandate is pretty much the free rider plan that the Center for Budget and Policy Priorities tore apart here. It’s bad policy. An addendum though is that individuals whose employers offer them insurance are not eligible for subsidies, unless the insurance their employer offers would cost more than 13 percent of their income. I’d feel better about that if it were lower for low-income workers, but the plan says that the Secretary of Health and Human Services must revisit this number within five years to see if it should be lowered.

I’ll go further and say the Max Tax actually incents employers to offer shit plans. Here’s the whole section on what Bad Max euphemistically calls "Employer Responsibility:"

Employer Responsibility. Employers would not be required to offer health insurance coverage. However, employers with more than 50 full-time employees (30 hours and above) that do not offer health coverage must pay a fee for each employee who receives the tax credit for health insurance through an exchange. The assessment is based on the amount of the tax credit received by the employee(s), but would be capped at an amount equal to $400 multiplied by the total number of employees at the firm (regardless of how many receive a credit in the exchange). Employees participating in a welfare-to-work program, children in foster care and workers with a disability are exempted from this calculation.

As a general matter, if an employee is offered employer-provided health insurance coverage, the individual is ineligible for the tax credit for health insurance purchased through an exchange. An employee who is offered unaffordable coverage by their employer, however, can be eligible for the tax credit. Unaffordable is defined as 13% of the employee’s income. The employee would seek an affordability waiver from the exchange and would have to demonstrate family income and the premium of the lowest cost employer option offered to them. Employees would then present the waiver to the employer. The employer assessment would apply for any employee(s) receiving an affordability waiver. Within five years of implementation, the Secretary must conduct a study to determine if the definition of affordable could be lowered without significantly increasing costs or decreasing employer coverage.

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More on the Max Tax

A bunch of outlets have now released Bad Max’s framework on health care.

Here are some ways to think of Max Tax:

Maximum amount a family of four making $67,000 would have to pay for health care, per year: $20,610 (31% of income)

Total amount that family of four would pay in fine if they did not get health care insurance: $3,800

Total amount a corporation with more than 50 employees would pay in fine if it did not offer health insurance: $400 per employee

Total amount a corporation can pay for health care plans without paying 35% tax: $8000 individual, $21,000 family

The Bad Max Tax

Update: Here’s Bad Max’s "framework." 

Bad Max Baucus’ health care plan is, best as I can tell, an attempt to turn the middle class into serfs to the health care industry.

Consider the "limits" he places on health care costs for those who make between 300% and 400% of the poverty limit (between $66,150 and $88,200 for a family of four):

Another section of Mr. Baucus’s proposal would help pay insurance premiums, co-payments and deductibles for people with incomes less than 300 percent of the poverty level ($66,150 for a family of four). It would also provide some protection for people with incomes from 300 percent to 400 percent of the poverty level (up to $88,200 for a family of four), so they would generally not have to pay more than 13 percent of their income in premiums.

So Bad Max says that he will prevent these people from having to pay more than 13% of their income in health care premiums. For the family of four making $67,000, that’s $8,710. For the family of four making $88,200, that’s $11,466. For the family of four making $90,000, apparently, there are no such limits, so they may be paying much more. For what may well be utter and total junk.

Now, frankly, there are a lot of middle class families already paying more than that. Heck, mr. ew and I are paying more than $8,700, and that’s just for two of us, and that’s before Blue Cross starts whacking us for my pre-existing condition next year.

But that’s just the premiums.

Then, Bad Max has a limit for total out-of-pocket expenses (and this appears to include everything). For that family of four–regardless of whether they make $67,000 or $88,200, that limit would be $11,900.

Mr. Baucus would impose limits on out-of-pocket medical costs — the co-payments, deductibles and similar charges for covered items and services. The limits would be $11,900 a year for a family and $5,950 for an individual. The comparable numbers in the House bill are $10,000 and $5,000.

Now, of course families would only have to pay that limit if they used enough services to reach that limit–though in Bad Max’s plan, health insurance companies are asked to cover far less of actual expenses, so in Bad Max’s plan, families are going to reach that limit relatively quickly. If Bad Max asks families to pay 35% of their costs, then that represents just $34,000 in costs, or less. [Update] Bad Max says insurance companies have to provide 73% of costs if they want to be subsidized.

And the only way to keep those costs down under Bad Max’s bill is the co-op. Read more

“Believe”

Just two days before his joint session address to Congress, Obama said this in a speech to the AFL-CIO:

And I continue to believe that a public option within the basket of insurance choices would help improve quality and bring down costs.

After the speech finished, Chuck Todd came on and said something like, "progressives have to be disappointed." Todd’s point, I think, was that Obama didn’t really mean it. It was weak tea designed to fire up Obama’s labor audience but ultimately Obama was going to drop the public option.

And it may well have been.

But what Todd doesn’t seem to get is that Obama stands to lose more if he utters those words–if he acknowledges our point, that the public option is key to real reform, to bringing down costs–than having not uttered them.

So while Todd may take Obama’s weak tea mention of the public option as so much weak tea, he seems to be missing that any such a mention is only going to further inflame progressives if and when Obama sacrifices something he "believes" in just a few days.


Here’s the complete speech, as written (note, he said "EFCA" instead of "Employee Free Choice Act" when he delivered it):

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Bad Max Provides More Details

Baucus Vs Baucus

Graphic by twolf

On Thursday, I pointed out how much better the health care plan presented by Max Baucus last November was than what he was proposing now. Well, Bad Max–the guy aiming to implement a giant subsidy for the insurance companies–has provided more details. Aside from the decision to tax Cadillac plans (which, the NYT points out, will probably be passed onto consumers), Bad Max hasn’t provided that many details.

But here’s what a comparison looks like so far.

Good Max
Mandate
Medical Exchange
Payroll deduction payment
Small business tax credit
Premium subsidies for <400% PL
Medicare buy-in for >55
Expand Medicaid
CHIP coverage to 250% PL
Public option
Preventative care
Payment incentives for quality
Health care IT
Patient-centered medical homes
Medical malpractice reform
Tax reform (incl taxing better plans) 

Bad Max
Mandate
Medical Exchange
Premium subsidies for <300% PL; protections for <400% PL
Expand Medicaid
No public option
Taxing better plans
<70% expense coverage
$11,900 family out of pocket

I’m warm and fuzzy for Bad Max and his plans covering less than 70% of care already.

Obama Doesn’t Want You To Know He Knows Public Option Is Popular

Greg Sargent has a really important find.

The White House is circulating happy poll numbers in favor of health care reform.

But the White House is not circulating the happy poll numbers–from the very same polls!!–in favor of the public option.

Okay, so the White House is circulating an upbeat polling memo citing a bunch of public surveys showing that public opinion still tilts heavily in Obama’s favor on health care.

The memo, by Obama pollster Joel Benenson, doesn’t mention the public option (the White House may not be committed to it) and largely cites general numbers showing support for action and for Obama’s plan.

But here’s the funny thing: We went back and checked, and virtually every poll cited in this memo also found strong support for the inclusion of a pulic plan.

Click through for Greg’s numbers: the White House doesn’t want you to know that 60%, 55%, and 59% (and 43% in a flawed MSNBC poll) of people surveyed want a public option.

So Obama is not just planning to ditch progressives and the rest of the majority of the country in favor of a public option. But he’s willing to be dishonest in doing so.

Another “Good Max” Sighting

Baucus Vs Baucus

Graphic by twolf

Steve Benen posted a follow-up to my observation that as recently as November, Max Baucus was pushing a good health care plan. Steve points out that as recently as April, Baucus was promising to work quickly.

That was Baucus in November, but let’s also not forget where Baucus was in April. At that point, he and Ted Kennedy co-signed a letter to the president, explaining that they’ve been "working together toward the shared goal of significant reforms to our health care system" for nearly a year, and they planned to "swift" action. Indeed, they saw smooth sailing ahead: "Our intention is for that legislation to be very similar, and to reflect a shared approach to reform, so that the measures that our two committees report can be quickly merged into a single bill for consideration on the Senate floor."

So, what happened? Where’d this Max Baucus go? How did the Baucus of November and April (champion of a progressive, ambitious plan) become the Baucus of June and August (leader of the Gang of Six, opponent of the public option)? Ezra Klein explains the circumstances behind the switch.

Baucus pulled a bit of a bait-and-switch. That paper proved less his plan than his effort to articulate the Democratic consensus in such a way that Democrats were comfortable with him leading the debate. In particular, Kennedy had to be happy with that paper, because Kennedy was the threat to Baucus’s leadership.

But Kennedy’s illness took him out of the game. Baucus no longer needed to worry about Kennedy stealing the leadership of health-care reform away from him, which meant he stopped looking over his left shoulder. The effect was a bit like shutting down a primary challenge against Baucus: His surprising leftward lurch stopped entirely, and he drifted back to the more centrist approaches that had defined his career. It’s hard to say how the process would have differed if Baucus had spent his days worrying about keeping Kennedy onboard, but it seems possible that the practical impact would have been to keep Baucus closer to the paper he’d written to attract Kennedy’s support.

For all the recent talk from Republicans about Kennedy’s absence undermining bipartisanship — a cheap talking point, to be sure — the real consequence of Kennedy not being able to serve is the effect it had on Baucus, who quickly embraced "bipartisanship," delayed the process, and continues to prefer to Read more

Will Obama Even Meet with the Progressives?

In their letter to Obama warning him that progressives won’t vote for a health care bill without the public option, Representatives Woolsey and Grijalva twice mention meeting with the President.

Thank you for continuing to work with Members of Congress to draft a health reform bill that will provide the real health care reform this country needs.

We look forward to meeting with you regarding retaining a robust public option in any final health reform bill and request that that meeting take place as soon as possible.

[snip]

We look forward to meeting with you to discuss the importance of your support for a robust public plan, which we encourage you to reiterate in your address to the Joint Session of Congress on Wednesday. [my emphasis]

I checked with Greg Sargent (who first reported the letter), and he confirms that the Progressive Caucus does not have a meeting scheduled–rather this is a request for a meeting.

Now Rahm has pretty assiduously been blowing off progressives throughout this fight. Will Obama continue to do so? Or will the progressives actually get to meet with the President they got elected?

Journalism Is Killing America

Five years ago, the traditional media helped Bush pitch a war that got 4,337 service men and women killed in Iraq (to say nothing of the thousands and thousands of Iraqis killed).

Now, traditional media journalism is back to killing Americans, in this case by deliberately misrepresenting public views on health care reform. EJ Dionne describes how at least one network refused to cover civil, informative town halls.

But what if our media-created impression of the meetings is wrong? What if the highly publicized screamers represented only a fraction of public opinion? What if most of the town halls were populated by citizens who respectfully but firmly expressed a mixture of support, concern and doubt?

There is an overwhelming case that the electronic media went out of their way to cover the noise and ignored the calmer (and from television’s point of view "boring") encounters between elected representatives and their constituents.

[snip]

Over the past week, I’ve spoken with Democratic House members, most from highly contested districts, about what happened in their town halls. None would deny polls showing that the health-reform cause lost ground last month, but little of the probing civility that characterized so many of their forums was ever seen on television.

[snip]

The most disturbing account came from Rep. David Price of North Carolina, who spoke with a stringer for one of the television networks at a large town-hall meeting he held in Durham.

The stringer said he was one of 10 people around the country assigned to watch such encounters. Price said he was told flatly: "Your meeting doesn’t get covered unless it blows up." As it happens, the Durham audience was broadly sympathetic to reform efforts. No "news" there. [my emphasis]

But Dionne is conveniently blaming this on the "electronic" media and ignoring his own paper’s complicity. From OmbudAndy, we learn that 85% of the health care reform stories appearing in the WaPo’s A section have been about the horserace and the deathers.

In my examination of roughly 80 A-section stories on health-care reform since July 1, all but about a dozen focused on political maneuvering or protests. The Pew Foundation’s Project for Excellence in Journalism had a similar finding. Its recent month-long review of Post front pages found 72 percent of health-care stories were about politics, process or protests. 

And as a result, Americans are confused and politicians are backing off the reform they know is needed and legislation supported by a huge majority may not get passed.

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A Decent Health Care Reform Plan–from Max Baucus

Baucus Vs Baucus

Graphic by twolf

Tell me how this sounds for a health care reform plan.

  • A national health care exchange
  • Buy-in to Medicare at age 55
  • No discrimination against those with pre-existing conditions
  • No waiting period for Medicare for disabled
  • CHIP covers up to 250% of poverty level
  • Credits for small businesses and individuals to make health care affordable

Oh, and don’t forget this bit:

  • A public option

Now, it may surprise you to learn this. But the architect of this program is none other than Max Baucus–the guy who has been pushing against a public option since the insurers were allowed to drive this debate. Here’s the language from his white paper–dated November 12, 2008–on the public option:

The Exchange would also include a new public plan option, similar to Medicare. This option would abide by the same rules as private insurance plans participating in the Exchange (e.g., offer the same levels of benefits and set the premiums the same way). Rates paid to health care providers by this option would be determined by balancing the goals of increasing competition and ensuring access for patients to high-quality health care

It’s worth reading the whole thing. It’s like a journey through the looking glass, to a time when even a conservative Democrat would openly espouse doing what’s right to truly improve health care. It’s a voyage to a time before the corporations started running this process. And it’s proof that Max Baucus doesn’t believe the option (or lack thereof) that he is currently pitching is the best for this country.

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