Why Don’t Big Media Matt and Ezra Ever Use the Word “Profit”?

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I got to this Matt Yglesias post and this Ezra Klein post via this Joke Line post (which sends you on a wild goose chase in search of this Ezra post) via this Lawyers Guns and Money post. I’ll return to Joke Line if I get a hankering to whack a piiñata.

But in the meantime, I’m wondering why Big Media Matt and Ezra don’t ever use the word, "profit"?

Both, you see, struggle to talk about how cool insurance companies are and how they could be the route to huge cost savings. Matt, apparently taking issue with this post (which never claimed identifying Liz Fowler’s role in the Max Tax was a "big scoop"), uses two farcical hypothetical examples to suggest that it’s not a bad thing for our public legislature to be proposing legislation written by private industry. First, he argues that a plan that uses public funds to improve bus routes would make both bus riders and bus drivers happier, which would be a good use of tax dollars.

Well, for starters you would want the buses to run more frequently. That would require, among other things, additional buses and additional bus drivers. That’s something the union representing bus drivers would like, and also something that companies that build buses would like. You could even imagine such a plan being hatched in close collaboration with the Transit Worker’s Union and the insidious forces of Big Bus. That, however, wouldn’t make the plan bad for New York City bus riders. It would be good for New York City bus riders. The city would be using tax dollars to give more buses to bus riders—it’s win-win for bus riders and bus drivers and bus makers all.

Note, first of all, how hilariously in-apt this analogy is. He’s talking about NY Transit–run by the public benefit corporation MTA and ultimately accountable to elected  officials (the private parts of which, though, have a history of paying bus workers less money for the same work). He’s talking about a highly regulated monopoly. So it’d be a great example to use if we were discussing implementing a government health service, or at the very least a public plan. But of course we’re not. So in Matt’s first analogy, he can avoid discussing whether "Big Bus" (as he calls it) would have objectives that might differ from those of both the riders and the workers, as well as the clout to piggyback those objectives on top of the plan to increase route frequency.

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The Max Tax Distribution List

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Well, this is interesting. Not only did Bad Max send the MaxTax plan out with the name of WellPoint’s former VP still on it, but he distributed it to the industry hacks too. Only the industry hacks.

QUESTION: The Finance Committee — well, actually, Senator Baucus’s draft has been, now, bouncing around for a few days on Capitol Hill.

First, has the president seen it (inaudible) his outline?

GIBBS: I don’t — I don’t believe — I don’t believe anybody here has — I’m — we’ve seen what we’ve read in the paper, but I do not believe that we’ve seen paper on the plan.

QUESTION: I understand it’s bouncing around K Street.

GIBBS: Not surprisingly, but I have not seen it here.

[snip]

QUESTION: What did you just mean…

(CROSSTALK)

QUESTION: I’m sorry. What did you just mean by it’s bouncing around K Street ?

GIBBS: I was told that — that K Street had a copy of the Baucus plan, meaning, not surprisingly, the special interests have gotten a copy of the plan that I understand was given to committee members today.

QUESTION: And…

GIBBS: It wasn’t cryptic. It’s who…

QUESTION: I mean, who is that a…

(CROSSTALK)

QUESTION: Are you impugning somebody here? I mean, it sounded like you were impugning, like, well, K Street has it. I mean, what…

BTW, it was none other than Chuck Todd worried that mean Robert Gibbs was "impugning" the parasites from K Street. I’m glad you’re looking out for the important issues, Chuck.

And, as Kagro X added, Bad Max didn’t share a copy with Harry Reid, either. 

Senate Majority Leader Harry Reid (D-Nev.) said he had not seen Baucus’s draft either, when asked during a briefing at the White House after a meeting with Obama, Vice President Joe Biden and Speaker Nancy Pelosi (D-Calif.). 

Now, I know that Obama and (particularly) Reid have made a career of letting people walk all over them. But this is the kind of thing that might really piss them off–particularly the control freaks at the White House. 

I mean, embarrassing the President like this, regarding the plan he’s been pitching since June? And Rahm’s lackey (and Bad Max’s former lackey) Jim Messina didn’t tell his bosses about this?  

Bad Max released this without sharing–I mean, sharing with any but his clients on K Street. I’m not entirely sure what that means, but I get the feeling that the White House was none too happy about that. 

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The Max Baucus WellPoint/Liz Fowler Plan

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All this time I’ve been calling Max Tax health care Max Baucus’ health care plan.

But, as William Ockham points out, it’s actually Liz Fowler’s health care plan (if you open the document and look under document properties, it lists her as author). At one level, it’s not surprising that Bad Max’s Senior Counsel would have authored the Max Tax plan. Here’s how Politico described her role in Bad Max’s health care plan earlier this year:

If you drew an organizational chart of major players in the Senate health care negotiations, Fowler would be the chief operating officer. 

As a senior aide to Baucus, she directs the Finance Committee health care staff, enforces deadlines on drafting bill language and coordinates with the White House and other lawmakers. She also troubleshoots, identifying policy and political problems before they ripen. 

“My job is to get from point A to point B,” said Fowler, who’s training for four triathlons this summer in between her long days on Capitol Hill.

Fowler learned as a sophomore at the University of Pennsylvania that the United States was the only industrialized country without universal health care, and she decided then to dedicate her professional life to the work. 

She first worked for Baucus from 2001 through 2005, playing a key role in negotiating the Medicare Part D prescription drug program. Feeling burned out, she left for the private sector but rejoined Baucus in 2008, sensing that a Democratic-controlled Congress would make progress on overhauling the health care system. 

Baucus and Fowler spent a year putting the senator in a position to pursue reform, including holding hearings last summer and issuing a white paper in November. They deliberately avoided releasing legislation in order to send a signal of openness and avoid early attacks. 

“People know when Liz is speaking, she is speaking for Baucus,” said Dean Rosen, the health policy adviser to former Senate Majority Leader Bill Frist (R-Tenn.).

What neither Politico nor Bad Max himself want you to know, though, is that in the two years before she came back to the Senate to help Max craft the Max Tax plan, she worked as VP for Public Policy and External Affairs at WellPoint.

So to the extent that Liz Fowler is the Author of this document, we might as well consider WellPoint its author as well. 

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Incenting Shit Plans

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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

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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

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The Bad Max Tax

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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 →

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“Believe”

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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

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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.

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

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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.

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Another “Good Max” Sighting

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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 →

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