Carl Levin Takes Ownership of Corrupt Deal with PhRMA

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Here’s what my Senator, Carl Levin, said last night when he voted against the Dorgan reimportation amendment. (h/t powwow)

Mr. LEVIN. Mr. President, it has become apparent that passage of this Dorgan amendment relative to importation of prescription drugs, an amendment which I have long supported, could threaten passage of broader health care reform. If so, the perfect would become the enemy of the good. For that reason, I will vote ‘‘no’’ on the Dorgan amendment on this bill.

Presumably in an attempt to justify to constituents like me why he doesn’t think consumers should save $100 billion on drugs, he said he had to vote down the Dorgan amendment to preserve the overall health care reform bill.

Just as a reminder, here’s one of Jane’s many posts explaining the corrupt genesis of the PhRMA deal. As she described, in late spring and summer, at a time when the White House pretended it was letting Congress write bills, the White House made a series of closed door deals with big health care players to buy off their approval for health care “reform.” The deals would:

  1. Keep them from advertising against the White House plan
  2. Keep them from torpedoing vulnerable Democrats in 2010 so there isn’t a repeat of 1994
  3. Keep their money out of GOP coffers

As reported by Ryan Grim, here are the terms of the deal negotiated with PhRMA.

Commitment of up to $80 billion, but not more than $80 billion.

  1. Agree to increase of Medicaid rebate from 15.1 – 23.1% ($34 billion)
  2. Agree to get FOBs done (but no agreement on details — express disagreement on data exclusivity which both sides say does not affect the score of the legislation.) ($9 billion)
  3. Sell drugs to patients in the donut hole at 50% discount ($25 billion)

This totals $68 billion

4. Companies will be assessed a tax or fee that will score at $12 billion. There was no agreement as to how or on what this tax/fee will be based.

Total: $80 billion

In exchange for these items, the White House agreed to:

  1. Oppose importation
  2. Oppose rebates in Medicare Part D
  3. Oppose repeal of non-interference
  4. Oppose opening Medicare Part B

So now Ameican consumers have to continue to subsidize drug development for the rest of the world (and a great deal of erectile dysfunction ads) so the Obama Administration could buy off the PhRMA.

This is–as Scarecrow noted the other day–one big protection racket.

And this is the thoroughly undemocratic, anti-consumer process that Carl Levin has now taken ownership of.

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Health Care on the Road to Neo-Feudalism

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I believe that if the Senate health care bill passes as Joe Lieberman has demanded it–with no Medicare buy-in or public option–it will be a significant step further on our road to neo-feudalism. As such, I find it far too dangerous to our democracy to pass–even if it gives millions (perhaps unaffordable) subsidies for health care.

20% of your labor belongs to Aetna

Consider, first of all, this fact. The bill, if it became law, would legally require a portion of Americans to pay more than 20% of the fruits of their labor to a private corporation in exchange for 70% of their health care costs.

Consider a family of 4 making $66,150–a family at 300% of the poverty level and therefore, hypothetically, at least, “subsidized.” That family would be expected to pay $6482.70 (in today’s dollars) for premiums–or $540 a month. But that family could be required to pay $7973 out of pocket for copays and so on. So if that family had a significant–but not catastrophic–medical event, it would be asked to pay its insurer almost 22% of its income to cover health care. Several months ago, I showed why this was a recipe for continued medical bankruptcy (though the numbers have changed somewhat). But here’s another way to think about it. Senate Democrats are requiring middle class families to give the proceeds of over a month of their work to a private corporation–one allowed to make 15% or maybe even 25% profit on the proceeds of their labor.

It’s one thing to require a citizen to pay taxes–to pay into the commons. It’s another thing to require taxpayers to pay a private corporation, and to have up to 25% of that go to paying for luxuries like private jets and gyms for the company CEOs.

It’s the same kind of deal peasants made under feudalism: some proportion of their labor in exchange for protection (in this case, from bankruptcy from health problems, though the bill doesn’t actually require the private corporations to deliver that much protection).In this case, the federal government becomes an appendage to do collections for the corporations.

Mind you, not only will citizens be required to pay private corporations. But middle class citizens may be required to pay more to these private corporations than they pay in federal and state taxes. Using these numbers, this middle class family of four will pay roughly 15% in federal, state, and social security taxes. This family will pay around $10,015 for their share of the commons–paying for defense, roads, some policing, and their social safety net share. That’s 15% of their income. They will, at a minimum, be asked to pay 9.8% of their income to the insurance company. And if they have a significant medical event, they’ll pay 22%–far, far more than they’ll pay into the commons. So it’s bad enough that this bill would require citizens to pay a tithe to a corporation. It’s far worse when you consider that some citizens would pay more in their corporate tithe than they would to the commons.

And, finally, while the Senate bill does not accord these corporate CEOs a droit de seigneur–the right to a woman’s virginity the night of her marriage–if Ben Nelson (and Bart Stupak) get their way, it would make a distinction in this entire compact for how the property of a woman’s womb shall be treated.

Single payer for the benefit of corporations

And for those who promise we’ll go back and fix this later, once we achieve universal health care, understand what will have happened in the meantime. The idea, of course, is to establish some means to get people single payer coverage (before Lieberman, this would have been through a public option or Medicare buy-in) and, over time, expand it.

In fact, this bill will move toward single payer, too–though not the kind we want. For the large number of people who live in a place where there is limited competition, this bill will require them to get health care through the oligopoly or monopoly provider. Read more →

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“Taking Care” of Almost-Seniors

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Brian Beutler reports Joe Lieberman’s excuse for supporting Medicare buy-in three months ago, but not now.

“I didn’t change my mind,” Lieberman insisted. “I’ve been in this position for the last few weeks.”

“We’ve got this very strong network and system of subsidies for people, including people who are 55-65 so the idea of the Medicare buy in no longer was necessary because they’re taken care of very well under the Finance Committee proposal,” Lieberman said.

Steve Benen points out one big problem with Lieberman’s so-called excuse: subsidies were in place in September, when he supported Medicare.

Second, the substance of Lieberman’s claim doesn’t stand up well to scrutiny: “Back when Lieberman endorsed Medicare buy-in in September, the basic subsidies for people in the 55-65 age range were part of the House health care bill, and were clearly going to be part of whatever emerged from the Senate. Nobody imagined a health care bill that would do nothing for people aged 55-65. What’s more, even if Lieberman were completely unaware of even the most rough outlines that health care reform was taking, it’s hard to imagine how he or anybody could believe that Medicare buy-in was desirable on its own but, in combination with other subsidies, so undesirable as to be a cause for filibustering reform. There’s no way anybody would design their policy priorities this way.”

Understand what Lieberman is saying. Under the Medicare buy-in plan, monthly rates were estimated to be around $750 (note, this says $633/mo). But under the Senate bill, without Medicare buy-in, insurance companies would be permitted to charge older people three times as much as they charge younger people. So if you assume that a monthy premium for a young person is $400/month, then you’re agreeing that insurance companies could charge seniors $1,200/month for health care.

More than $400 a month more, or around $5,000 a year. And whether that $5,000 is subsidized or not, someone is going to have to pay for it–either those almost-seniors, or the federal government. That’s Joe Lieberman’s idea of “taking care” of those between 55 and 65 years of age.

Update: I’m having math problems this morning. I’ve been informed the ratio is 3:1 (at least right now), which does make it more than $5,000 a year more.

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Rahm’s Making the White House Look Terrible

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Picture 166This morning, the Politico made news by reporting that someone at the White House had ordered Harry Reid to cut a deal with Joe Lieberman on health care.

The White House denied the report.

“The White House is not pushing Senator Reid in any direction,” spokesman Dan Pfeiffer says. “We are working hand in hand with the Senate Leadership to work through the various issues and pass health reform as soon as possible.”

But since, then, two more reoprters have confirmed Politico’s account: TNR’s Jonathan Cohn and HuffPo’s Ryan Grim. In fact both Cohn and Grim pass on the ID of this anonymous White House figure: Rahm Emanuel. (Yeah, I know, gambling in the casino, even.) Here’s Ryan’s report.

Rahm Emanuel visited Senate Majority Leader Harry Reid in his Capitol office on Sunday evening and personally urged him to cut a deal with recalcitrant Sen. Joe Lieberman, two Democratic sources familiar with the situation said.

Now, aside from the fact that the White House looks stupid to us, as they try to insist Reid wasn’t visited by the Ghost of Health Care past, consider how they look to those close to the negotiations, who not only are being jerked around by Lieberman and Rahm, but who also risk losing their job as Senator and Majority Leader over this legislative failure. Here’s how that frustration sounds.

The report, however, according to the two sources, was entirely accurate. “We’re long past time for these kinds of games,” one source said.

But as bad as Rahm is making the White House look right now, consider how bad he’s going to make the White House look, if Lieberman refuses to deal. After all, Lieberman has taken just days to refuse the last compromise, based on claims of opposing a policy he supported three months ago. Lieberman doesn’t give a shit about health care, Obama, or Rahm Emanuel. (Or Harry Reid, for that matter.) So after forcing the White House to lie repeatedly about his strong-arm tactics, Rahm is going to make the White House look still worse after the Lieberman refuses the next deal he makes.

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One of Few Things Growing as Fast as Health Care Costs Is Income of Richest 1%

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Picture 165The Economic Policy Institute provides a much needed counter-weight to those cheerleading the use of Cadillac-as-Chevy taxes to pay for the Senate health care bill. It shows, generally, that the millionaire’s tax used to fund the House bill is far more progressive than the Cadillac-as-Chevy tax used to fund the Senate bill, which ends up taxing those at $20-30,000 more than it taxes those at $500,000 to 1 million a year.

In fact, it makes an even more striking point. Given the way the economy has worked in the last several decades, one of the few ways to fund health care in such a way that will keep up with rising health care costs is to tax the rich.

While a funding source that grows with health care costs is a desirable goal, it should be noted that for the last three decades one of the only things in the American economy that actually has grown as fast as overall health costs is the incomes of the richest 1% of households.

The paper points out two central reasons why the excise tax won’t be as progressive as its champions claim.

Most importantly, it shows that the cost of a plan does not reflect exclusively on how generous the benefits of that plan are. On the contrary, plan cost has more to do with group size and overall health than it does with the benefits granted.

The assumption that high-cost plans are high-value plans is flawed. Many health plans are expensive because the population covered is older or sicker than average, but they still do not provide more comprehensive coverage. Moreover, this is a much larger problem than is often recognized. Gould and Minicozzi (2009) have shown that some of the most powerful predictors of a plan’s high cost are the size of the firm and the age of its workers. This is surely not a coincidence—small firms and firms with older workforces tend to have less bargaining power with insurance companies and this leads to higher prices for insurance coverage that may be no more comprehensive than lower-priced coverage for larger or younger firms. It should be noted that the Senate bill recognizes this reality and specifically exempts some health plans (those covering high-risk professions, for example) from the excise tax or raises the threshold of the tax explicitly on the grounds that high-cost is not synonymous with high-value.

Furthermore, Gabel et al. (2010) find that only 3.7% of the variation in premiums for family plans is determined by a plan’s actuarial value, that is, the share of average medical expenditures paid for by insurance (instead of by outof-pocket spending). It is also worth noting that the Joint Committee on Taxation’s (JCT) scoring of the excise tax indicates that plans with fewer enrollees are more likely to be affected by the excise tax. Given that previous research has shown that smaller firms pay premiums 18% higher than large firms pay for equivalent health coverage, it seems clear that this excise tax will be affecting many workers who have only high-cost—not high-value—health coverage (see Gabel et al. (2006)). [my emphasis]

So workers at smaller firms and those with sick co-workers will be asked to pay for the health care reform, not primarily a bunch of Goldman execs who have luxurious benefits.

Read more →

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Correction: Bad Nelson and Holy Joe Think Up a New Excuse

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The press, other members of Congress, everyone have to stop reporting over and over again that the Bad Nelson and Holy Joe “oppose” some aspect of health care reform.

Two key senators criticized the most recent healthcare compromise Sunday, saying the policies replacing the public option are still unacceptable.

Sens. Joe Lieberman (I-Conn.) and Ben Nelson (D-Neb.) both said a Medicare “buy-in” option for those aged 55-64 was a deal breaker.

“I’m concerned that it’s the forerunner of single payer, the ultimate single-payer plan, maybe even more directly than the public option,” Nelson said on CBS’s “Face the Nation.”

Rather, Bad Nelson and Holy Joe have simply “thought up a new excuse” to oppose real health care reform.

Until we stop pretending these two men are brokering in good faith, we will never get to the point in the discussion of how we get the best health care reform without some industry mole spiking the reform. These men will not support anything less than an out and out bailout of the health care industry, and to hell with the federal budget, and pretending they will just poisons the efforts of those bargaining in good faith.

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The Truth about Harry Reid’s Lifetime Cap Loophole

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family premiumsHere is how Ezra Klein’s sources explain why Harry Reid snuck a loophole into the Senate bill allowing insurers to put a cap on lifetime coverage.

Hill sources explain that this was inserted because CBO said premiums would “go through the roof” if insurers couldn’t cap benefits. The official quote from Jim Manley, Harry Reid’s spokesperson, says much the same thing. “We are concerned that banning all annual limits, regardless of whether services are voluntary, could lead to higher premiums,” he explained. “We continue to work with experts on how best to accomplish our goals of preventing insurance companies from imposing arbitrary coverage limits while providing the premium relief American families need and deserve.”

Wrong!!!!

Note carefully who told Reid that “premiums would go through the roof” if no lifetime cap were imposed: CBO.

Reid, of course, carried on about a week-long back-and-forth with CBO as he developed the bill to introduce to the Senate (of course, he’s doing precisely the same thing this week–going back and forth with CBO on a bunch of proposals suggested for the compromise bill). As a result of Reid’s last back-and-forth with CBO during which presumably they told him premiums would go through the roof if he didn’t eliminate the lifetime cap, he came out with a bill that cost $849 billion. That was a real feather in his cap because it came in significantly cheaper than the House bill, which cost $894 billion (though the Senate bill covers 5 million fewer people), which meant he didn’t have to justify why the Senate bill shouldn’t just accept the House bill as a base.

Of course, the House bill uses a different strategy for keeping premiums down: including, but not limited to, more subsidies, a lower limit on what people will be expected to spend on health care premiums, and a viable (though not robust enough) public option. Also, the House bill doesn’t do one thing that the Senate bill does, which may raise premiums: tax employer provided health care insurance.

So what Ezra’s sources really mean is that the Senate bill–partly because it has traded off other means to keep premiums down–has had to eliminate a key promise of health care reform: that families experiencing a catastrophic health care event wouldn’t lose coverage at the time they needed it the most. What Ezra’s sources really mean is that, because they chose not to pursue other strategies which would have made it unnecessary to eliminate the cap, they have instead been forced to eliminate the caps to keep the bill competitive with the House bill.

Don’t let Harry Reid fool you. The problem is not that health care “premiums would go through the roof” without caps. The problem is that Harry Reid has deliberately chosen not to use other means to prevent health care premiums from going through the roof, means that wouldn’t make families bear the brunt of the problem.

From this point forward, the debate should never be about what Reid claims is necessary. The debate should be about what Reid has claimed to be necessary because he has made other ill-advised choices that mean he can’t match the House bill outcomes without some awful gimmick like lifetime caps.

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Joe Lie Even Pissed Off the League of Women Voters

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I didn’t even know the League of Women Voters advocated on political issues.

But here they are, spanking Sanctimonious Joe. (h/t joejoejoe)

The League of Women Voters will launch a anew advocacy campaign next week that asks Senator Joseph Lieberman (I-CT) to reconsider his recent threats to oppose any health care reform bill that includes a public insurance option. The League-sponsored campaign in support of the public option includes a 60-second radio ad, “Real,” and a new Facebook Page, “Do The Right Thing, Joe!,” that has already generated hundreds of comments from Connecticut voters.

The radio ad will begin airing on stations in Stamford and New Haven and directly addresses the Senator:  “Please do what’s right,” because “the need is real, the time is now” and “the choice is yours.”

“The League has supported the public insurance option without reservation from the beginning as the only way to adequately control costs and protect consumer choice,” said Mary G. Wilson, President of the League of Women Voters of the United States. “Senator Lieberman now has to make a choice about whether he wants to protect consumers or insurance companies.”

Is there anyone who doesn’t hate Joe Lieberman?

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Late Night: Max Tax Baucchanal Grabs The Dental Floss

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There seems to be no end to the duplicitous clean livers that are hiding cirrhotic private lives and peccadillos. Now, if you ask me, no one should be all that shocked Tiger Woods prowls like a big cat. He has been known to feel a kinship and run with Michael Jordan and Charles Barkley pretty much since he left Stanford for the bright lights and big city attractions of the PGA traveling circus. Tiger didn’t want to be like Mike, he already was like Mike. The “right stuff” that makes the greatest athletes stand out above the mere all stars and all pros generally comes with a healthy quotient of carnivore like killer instinct and desire.

But the discovery that a holier than thou condescending family values prairie dweeb like Max Baucus (R-Dentalflossville) is footing the shack up of his latest shag, well that is a whole nuther thing. Who knew Max chased the skirts and dental floss just like those hedonists in California? And considering the Max Tax concubine was, at least for a while, one of his staffers, there is of course some relief it was not an intern. So he has got that going for him I guess.

Before the moment that is the Passion Of Max fleets from memory though, let the proletariat he arrogantly betrays daily in his day job as an elected representative of the people, nation and the collective interest not be lost as to the real upshot. But lost it will be if left up to the puerile panty sniffers in the main stream political media. For instance those deer hunting manly men over at Politico have two stories on their front page (here and here) on the Max Tax plan to boost his squeeze with an elite appointment to a coveted US Attorney position and, yet, not one mention of the hypocrisy exhibited by the revelation as framed against the Baucus constant braying for fiscal responsibility and reticence to provide a health care bill covering women equally and fairly. Go figure.

As an extra Late Night bonus, check out this story of the evil terrorist Christmas elf:

A man dressed as an elf is jailed after police in Georgia say he told a mall Santa that he was carrying dynamite.

Police say Southlake Mall in suburban Atlanta was evacuated but no explosives were found.
…
Police say Caldwell got in line Wednesday evening to have his picture taken with Santa Claus.

Police say when Caldwell reached the front of the line, he told Santa he had dynamite in his bag. Santa called mall security and Caldwell was arrested.

Caldwell faces several charges, including having hoax devices and making terrorist threats.

Awesome.

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The 7 Lies of Lieberman

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Steve Benen has been cataloguing all the lies Joementum has given to explain his opposition to the public option. Here are the first six…

Believe it or not, we’re up to seven arguments over seven months, none of which makes sense.

In June, Lieberman said, “I don’t favor a public option because I think there’s plenty of competition in the private insurance market.” That didn’t make sense, and it was quickly dropped from his talking points.

In July, Lieberman said he opposes a public option because “the public is going to end up paying for it.” No one could figure out exactly what that meant, and the senator moved on to other arguments.

In August, he said we’d have to wait “until the economy’s out of recession,” which is incoherent, since a public option, even if passed this year, still wouldn’t kick in for quite a while.

In September, Lieberman said he opposes a public option because “the public doesn’t support it.” A wide variety of credible polling proved otherwise.

In October, Lieberman said the public option would mean “trouble … for the national debt,” by creating “a whole new government entitlement program.” Soon after, Jon Chait explained that this “literally makes no sense whatsoever.”

In November, Lieberman said creating a public plan along the lines of Medicare is antithetical to “the way we’ve responded to the market in America in the past.” This, too, was quickly debunked.

Click through to see Lieberman’s latest lie.

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