The Mandate Fight Is the Wrong Fight

The health care “debate” among progressives has crumbled into a fight over the mandate to purchase insurance. This is the wrong fight. We all need to refocus and look at the bigger picture.

At Firedoglake, Jon Walker writes that the Senate bill with a mandate is unacceptable because the Senate bill’s provisions for insurance industry regulation are weak. Well, worse than weak. Jon Walker is right about that. And the Senate bill with no public option, no regulation of the insurance industry, and a mandate to purchase insurance would be a mess that would mostly benefit the insurance industry.

But the Senate bill would not be the final bill. There’s a House bill, remember? And the House bill is much stronger in the regulation department. The House bill strips health insurance companies of their antitrust exemption and outlaws price fixing, bid rigging and “market allocations” by health insurance companies. With those provisions, we’d end up with something that is closer to the systems in The Netherlands and Switzerland that Jonathan Cohn writes about at The New Republic.

No, it wouldn’t be exactly the same, but it would be close enough to be a big improvement over what we have now. It would be a big improvement over what Mitt Romney established in Massachusetts, because there would be much stronger regulations than a state could impose.

If by some miracle, someday, we really got somewhere with universal healthcare, it’s going to be some variation of single payer or some kind of mixed public-private system that mandates insurance purchase, as is done in The Netherlands or Switzerland. In other words, there will either be universal coverage provided by a government or through an individual mandate. Nothing else is possible.

Jon Walker is right to say that the Senate bill provisions are way different from what works in Switzerland. But if we ever did get a fair and workable system short of single payer, a mandate would be a necessary part of that. That’s because caring for the uninsured is one of the biggest factors driving up cost for everyone. And if a substantial part of younger, healthier people are opting out of the risk pool, it drives up premiums for everyone else.

So if hell does freeze over and we get a shot at passing a reasonable universal health care bill that is something like what they’ve got in The Netherlands and Switzerland, it will have to include the individual mandate. And all the arguments against the mandate progressives are making now will be hauled out of mothballs and used against it.

But insurance industry regulations are essential also. Without the regulations in the House bill there really is no reform, just a big social welfare program that funnels money into private industry.

So put aside the mandate for a moment. As I see it, there are three issues we should be discussing (in my order of preference):

1. Insurance industry regulations in the final bill. Instead of fighting to take out the mandate, we should be fighting to put in the regulations from the House bill. The Senate bill is completely unacceptable on that score.

The Senate bill even has the ridiculous “buying insurance across state lines” provision, which is an invitation for the insurance industry to set up shop in Texas and sell junk policies to the young and healthy. Older and sicker people would be left behind in higher-risk pools, driving up their premiums. And the young folks might pay premiums for years before making a claim and finding out they’ve been ripped off — Dear Policy Holder: This policy doesn’t cover whatever it is you have. Sorry.

If we can’t get traction with regulations, the next option is —

2. Go to reconciliation. I’d say do this before going to a final bill without regulations. However a healthcare bill passed under reconciliation would have to be rewritten so that it would reduce the federal deficit over five years by at least a billion dollars and be deficit neutral after that. Plus, any part of the bill that does not significantly impact the budget could not be included in the bill. Most people who understand how this works say you’d lose insurance industry regulations and other good stuff with reconciliation, although you could include the public option. So reconciliation is not a magic bullet that will make everything the way we want it to be, but it might give us something somewhat less obnoxious than the current Senate bill.

3. Kill the bill. This really is a nuclear option, because if the bill is killed it may be years before we get another shot at reform. But if the final bill is mostly the Senate bill as it is now, we’re better off without it. If this weakens the Obama Administration, so be it; the President might learn something, and he’s got three more years to change his modus operandi. But this has got to be followed up by a very strong effort to defeat every “centrist” Democrat up for re-election in 2010 and 2012.

These three issues are what we should be discussing, not the mandates.

15 thoughts on “The Mandate Fight Is the Wrong Fight

  1. The Senate bill even has the ridiculous “buying insurance across state lines” provision, which is an invitation for the insurance industry to set up shop in Texas and sell junk policies to the young and healthy.

    My understanding was that this was coupled with Federal standards for minimum coverage, in which case that could actually be a good thing–an increase in competition rather than a race to the bottom. Maybe I’m wrong, or maybe the Federal standards are weaker than they should be, in which case the across-state-lines provision would be problematic, but in itself it doesn’t have to be a negative and can be a real positive.

  2. I am wondering about a combination of these options? First, put the bill up for a vote (including Medicare buy-in or public option) fully knowing that it will be voted down by Liberman, et al., providing fodder for getting those Dems who opposed it out next election. Then craft Bill 2 which includes just the regulatory reforms of the House bill, and which it looks like would have an easier time getting through the Senate. Finally, craft Bill 3, which has just the Medicare buy-in/public option and budgetary bits through reconciliation.
    I am new to much of this, so please help me understand the flaws in this.

  3. Or else what? You’ll hold your breath till you turn blue? Kudos to you sir – you are tuning into the GOP wavelength. We who have the majority (supposedly) need to start kicking them in the balls like the repubes do. Sleeze Sleeze Sleeze they love to hurl it like monkeys in the zoo – why can’t we? I for one would cash out my 401k to be able to kick Mitch McConell in the balls. And he DOES so need it. Peace Out – the vicodan is starting to work it’s magic

  4. Slacker, that’s my preferred path.

    Maha, gotta disagree with you on killing the bill as an option. The problem is that if we went through all this and end up with nothing… Well, the “centrist” democrats will be defeated all right, they’ll be defeated by Republicans, or, God help us all, Tea-Baggers. We’ll be extremely lucky to hold on to majorities in the house and senate. Imagine what the reupublicans would produce if they had majorities and they decided it was THEIR turn to try and do HCR…

    I think the path would be to pass something, THEN work on defeating “centrist” dems with more progressive dems, THEN work on making changes to whatever got passed. Adding in stronger regulations, for instance.

    With any luck, though, the combined bill will be closer to the house version than the senate version, and we can pass medicare buy-in or a public option, or really whatever would make Joe Lieberman the most unhappy, under reconciliation rules.

    And if we can work in tarring and feathering holy joe in there somewhere, I’d pay to watch it.


  5. Not sure who FtGF is talking to, but I for one value the fact that we are not like republicans, even if it does make for some extraordinarily frustrating politics…


  6. Let’s get what we can in the Senate. Get this part passed.
    The bill then goes before committees of both the House and the Senate. Let those two groups come up with a compromise.
    THEN, if needed, let the Senate go to “reconcilation,” which has been used a few dozen times in the last couple of dozen years. COBRA under Reagan happened this way. S-CHIP, Medicare and Medicaid increases and decreases, as well as , if I remember correctly, Medicare Part D, were all passed via reconcilation.
    I’m starting to believe that we need to get our foot in the door first, and then start to make changes. If we fight this small ‘Change’ now, we’ll have none for at least 20 years.
    I hate to say it, but I disagree with Howard Dean. He’s waaaay smarter than me, so thake that for what it’s worth…

    *** Can I ask something I’ve wanted to ask for a long time? If the the Senate is divided 59 to 41 on this, or any other, issue, does Joe Biden get to pass the “deciding (tie-breaking) vote? I mean, the original job of the VP was to be the deciding vote in the Senate if it were tied 50-to 50. Since 59 to 41 is now a tie, and it takes 60 to pass, is Biden’s the deciding vote in the New Senate? This enquiring mind want’s to know…
    Am I stupid for asking this, or am I missing something in the old tie-breaking rules, and how they apply to today’s disfuctional Senate? (And yeah, I know, the difference between cloture, filibuster’s, and the real vote. I’m just trying to be obnoxious).

  7. It seems to me that everyone (Howard Dean and friends) were willing to over look all the bad things in the bill as long as it had a public option or Medicare buy-in. I find the sudden opposition to the bill curious, where was all these objections before? If the bill now is god dam bad how did a public option or Medicare buy-in make it so much better? When you consider the public option was only going to be available to a tiny minority and the Medicare buy-in only for those between 55-64, the fact that the opposition is so vocal seems disingenuous at best. I mean the mandates were in the Bill before the public option and Medicare buy-in were stripped so?

  8. And yeah, for anyone who thinks I’m really stupid, I know it wasn’t originally to break a 50 v 50 tie. Just a tie of the states and their Senators that may have existed at that particular time on any vote.

  9. “It seems to me that everyone (Howard Dean and friends) were willing to over look all the bad things in the bill as long as it had a public option or Medicare buy-in. I find the sudden opposition to the bill curious, where was all these objections before?
    “If the bill now is god dam bad how did a public option or Medicare buy-in make it so much better?”

    My opinion is that if the government is going to require that every man, woman and child purchase any product, it better have some sort of not-for-profit provider of that product. Otherwise, the profit-driven companies that provide said product will simply jack the price up, knowing that there’s not much any regular person can do about it.

    The public option should have been open to everybody. That would have guaranteed that private insurers had a competitor, which would keep pricing pressure on them. But of course, it got watered down, again and again, until it was only that tiny little sliver of people that were eligible to access it.

    It seems to me the Medicare buy-in would be much easier, logistically, since the apparatus is already in place. I personally was much more enthused about that proposal than the wimpy public option that was floated, because it would have been relatively easier to slowly expand the eligibility to buy into the program until universal coverage was reached.

    And, as an aside: I believe I saw plenty of criticism of the bill from both sides, both before, during and after the bill was introduced and subsequently eviscerated. The disappointment I feel personally about the current status is directly related to the fact that the mandate for coverage remains, yet a not-for-profit option has been taken out. It’s a boondoggle, no matter how you slice it. It’d be like requiring every adult to buy an I-Phone, then questioning why people are accusing you of giving preferential treatment to Apple.

  10. I am encouraged to learn from Bruce Webb at Angry Bear and from a commenter on Ezra’s WaPo blog that one version of the bill still has a statutory floor for Medical Loss Ratio, which serves to limit how much premiums can be jacked up above payout for actual medical care. The original figure was 90%, which the insurance companies regard as austerity to the point of starvation (I think Aetna is currently around 80%, and trying to get to 75% by dropping coverage on thousands of policy holders that are costing it too much money). If the conference bill includes an MLR floor of 85% or so, I can live with that.

  11. From the beginning Dems have done a poor job at articulating what the objective of health care reform ought to be. I would have said: is the point supposed to be provide health care for people or to allow corporations to make a profit? If this whole scheme is to give corporations an additional avenue to profit (from people suffering?!? crazy…), than we are doing a great job!! Of course the Dems didn’t really ever address the question that directly, they talked about how not enough people can get health care and how the prices are too high.

    Going to Maha’s points: we can’t just kill the bill, its taken all freakin year! Do we really want to let these jerks squander a whole year of our lives with talking about nothing? Sigh…

  12. The main problem of objectors like me doesn’t have to do with the little helpful things that may be in the bill. The overarching problem is right up front – this bill will require everyone to buy private insurance. The subsidies fade out at very low levels $32K for a single person, $66k for a family of four. The insurance cos can’t drop you if you get sick, but why can’t they quintouple your premiums next year?

    This will land hardest on contractors and other people who do project work which is becoming more and more common these days. Also kinds out of college are having the most difficult time finding permanent work and now, in addition to student loans they have to pay for insurance that they may or may not be able to afford.

    Mandates are great if there is a choice of affordable options. The bill must force that to happen al least through strict price controls or mandating the same price by geography, but instead it relies on the wonkish “well if we force a bunch of healthy low cost people to buy private insurance the companies will lower costs for everyone because free markets rule NAFTA forever!!!!oneone1!

    • fledermaus — we need everyone to purchase insurance to keep costs down. Listen, I pay for my own insurance and I’m scraping bottom financially, so I know how tough it is, but it’s necessary. A really big reason health care is so expensive is that medical bills have to be jacked up to cover the people who can’t pay. So people are billed $100 for an aspirin to pay for other people’s care. And then insurance premiums are jacked up to pay the bills. This has to be combined with insurance regulation with teeth, and then maybe we can rein in costs.

  13. I believe that if a mandate is required at this time, with no choice other then the insurance companies whom the public has lost trust in to work with, they must be forced to offer policies which are a bare bones to cover emergency room visits and other basic costs to allow individuals to not be a financial drain but to participate in a system fundamentally flawed only as absolutely necessary.

Comments are closed.