As soon as the House passed its health care reform bill Saturday night, two things became predictable: (1) The President would praise Nancy Pelosi and the House for moving the effort further than ever before and (2) an "anonymous" senior White House official would plant stories about how the House bill wasn’t as good as the Senate Finance bill.
We’ve seen this before, via the New York Times. When Obama gave his health reform speech to Congress in September, David Brooks obligingly relayed the White House message that Obama had signaled the three House committee bills were beyond the fiscal pale and only the Senate Finance bill met Obama’s "about $900 billion" budget limit:
[Obama] was flexible about many things, but not this: “I will not sign a plan that adds one dime to our deficits — either now or in the future. Period.”
This sound bite kills the House health care bill. That bill would add $220 billion (that’s 2.2 trillion dimes) to the deficit over the first 10 years and another $1 trillion (10 trillion dimes) to the deficit over the next 10 years.
There is no way to get from the House bill to deficit neutrality. The president’s speech guarantees that the more moderate Senate Finance Committee bill will be the basis for the negotiations to come.
That was then. The media has since become wise to the fact the earlier House bills went over budget because they paid for the "doc fix" for ten years while Baucus/Conrad’s Finance fix was only for one year. Pelosi promptly stripped the "doc fix" out and let Harry Reid fall on that sword.
When CBO declared Pelosi’s final House bill to be better than budget neutral, producing $100 billion in net savings, the White House needed another cudgel.
[That may have come from] the Times David Leonhardt, whose column criticized the House bill for "Falling Far Short of Reform." I don’t think David’s heart was in this one, though, because he focused solely on whether the House bill will reduce health care costs as much as the Senate Finance bill. Even there, the House and Senate bills are roughly comparable on 3 of the 6 big issues Leonhardt scores, and he ignores other measures that are at least equally important.
Leonhardt especially praises the Senate for allowing an independent Medicare advisory group to recommend and implement efficiency and cost-saving measures unless overridden by Congress. The House bill calls for pilot efforts to control costs and studies of regional differences and cost-saving measures. On the other hand, The House bill authorizes Medicare to negotiate with drug makers and demands further cuts from PhRMa than the White House deal.
Both bills fall short in broadening access to the insurance exchange(s), but at least the House bill gives the Secretary of HHS authority to open its exchange to larger employers by the third year.
Along with many economists, Leonhardt loves the Senate Finance tax on high-end insurance plans, but the argument this will significantly reduce the actual cost of health care has always been suspect. I don’t question that if you tax insurance, people will buy less of it, and if you tax care directly, they’ll likely demand less of that too. But the argument takes a leap in assuming that the people most likely to be adversely affected — those with higher health costs — are getting too much care now and that giving up that extra care has no cost to them. If they need that care, such as extra treatment associated with work-related illnesses, there is a cost, but no one is counting that.
The more telling problem is that it’s unclear that inducing people with high-end insurance to purchase less insurance/care will materially reduce the actual cost of providing care for anyone else. If this is the approach we’re relying on to "bend the curve," we better think again.
Reducing health care costs means we have to pay doctors, hospitals, insurers and drug makers less for what they do and provide. But we’re dealing with increasingly concentrated entities, with no efficient markets and insufficient regulation. Neither Congress nor the White House seems willing to confront that.
Leonhardt doesn’t mention that the White House, whose cost-cutting efforts he praises, has already diminished MedPAC’s future by capping "savings" via its secret deals with PhRMa and hospitals. And Rahm Emanuel has never stopped trying to ensure the public option does nothing except trigger Olympia Snowe’s vote.
If we’re seriously counting "costs," Leonhardt needs to account for the fact CBO scores the House bill as covering 36 million more people, compared to the Senate’s 29 million or so. And the House does so by providing far more generous subsidies for meeting the insurance mandate (and more expanded access to Medicaid). I don’t see how you can make a credible cost comparison while ignoring the real human costs of leaving an additional 7 million people uninsured.
Oh, and that budget neutral advantage in the Senate bill? It seems Harry Reid is considering an additional payroll tax in the Senate bill. Looks like Harry has realized that Max Baucus handed him a bill with a weakened mandate for unaffordable insurance and insufficient subsidies, so Harry has to fix that explosive problem, just as he’s had to fix the lack of a public option for saving money in the exchange(s).
Remember, the whole point of wasting those four months waiting for Baucus/Conrad/Grassley/Snowe et al was because we needed them to produce a bipartisan method to pay for health reform. We could have saved the four months and just let Harry do it.
[Edited 8:30 a.m. pst to remove the suggestion Leonhardt based his article on a WH leak. My misreading; my mistake.]





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Lets see, how do we get to deficit neutrality on those crazy little wars of choice we have ginned up over the last 10 years? Well, gee, I guess we’re going to have to tax somebody . . . But surely, with the economy in such a hole how can we even think of taxing the rich? And besides, our very national existence hinges on getting those last 100 al queada in Afgahnistan. This is what makes that deficit neutral requirement for Health Care Reform by the Obama Administration such a bald and cynical ploy. We’ve got 700 billion to spend on the military every year (plus what is not on the books for the crazy little wars we love to conduct so much), but somehow we can’t afford to spend 100 to 200 billion a year to provide our citizens with decent Health Care. I will bet you right now that there is going to be quite a push by the Administration behind the scenes to make sure those rich people’s tax breaks are not sunset. That will be the last pile of dung from the Obama Administration that I will be able to stand. I must say, though, Scarecrow, if we are waiting for Harry to figure out what to do we may have enough time to shut down this lock-step march to medical insurance slavery brought to us by a corrupt congress, an inexplicably virulent Administration and a piggish health care industry. Thanks for the enlightening piece of yet another NYT plant.
the plan that includes a surcharge on incomes above 500k for singles and 1m for couples AFTER deductions raises 500m (i believe). They earned the right to have the surtax with 8 years of UNPAID for, on our gransdchildren tax cuts.
You know, if I didn’t know better, I’d think that the White House wasn’t truly interested in seeing meaningful health care reform.
But that’s just crazy talk.
Actually, the four months spared us four extra months of Chamber of Commerce and 60 Plus ads plastered all over our TV screens during prime time and sports broadcasts. (You know, the scaaaaary ads that now run about twice every half hour on all natwork programming, especially FOX’s?) Those didn’t start up until after it was clear that the public option had managed (thanks to Jane and a few brave organizers) to avoid the axe.
Obama lost the health care fight when he stopped talking about health care reform and changed it to health insurance reform.
The really maddening thing across the board is the failure / refusal by the CBO to count savings from proaction to avert foreseeable medical (and cultural) effects from positive preventive measures – diet, exercise, nutrition counseling, check-ups for people who haven’t been able to afford them, etc. Sound health care includes rational agricultural policy, too. Nobody in power seems capable of whole systems thought…
Sec. 551. Surcharge on AGI in excess of $1 million. The bill would impose a 5.4% surcharge on adjusted gross income (AGI) above $1,000,000 (married filing a joint return) and $500,000 (single). According to the nonpartisan Joint Committee on Taxation, only 0.3% of all households in the United States have AGI in excess of these thresholds. As a result, 99.7% of all households would not be affected by this health care surcharge. This proposal has been estimated to raise $460.5 billion over ten years.
http://edlabor.house.gov/blog/2009/10/affordable-health-care.shtml
.3% of the population paying $460.5B is only about $45,000 per year on average. Chump change.
Good Morning Scarecrow and Firedogs,
NBC News Washington Bureau Chief Mark Whitaker joins in on the fun:
.
ah, but here’s my fave:
“surprised” ? really ?
When you realized that those are 10-year numbers, it’s clear Wall Street alone could have paid for this with only a fraction of the annual bonuses that have been announced. It truly is chump change.
There was a proposal in Europe to begin taxing inter-bank/investment financial transactions, and most supported it, including England’s Gordon – but the US is opposed. Imagine that.
460 billion over 10 years.
my math says your number is over 10 years.
I want to know why some progressives are still supporting this fiasco. Obama wants to use it as a vehicle to slash Medicare. BigPharma and BigInsurance are making out like bandits. Tens of millions will be forced to keep theoverpriced crap insurance they have. Tens of millions more will be mandated to buy crap insurance they can’t use. And all this for a public option so small and weak you need a microscope to see it. I guess progressives will continue to be had for as long as they let themselves be had.
I’m wondering what evidence we have that the White House was involved in planting this story? There’s no quotes from anonymous sources in Leonhardt’s column tha I can see. Granted, he pulls a quote from Emanuel that supports his position, but it’s from a different story. I’m not averse to criticizing the White House’s position on health care reform, but I’m just not sure what support the central thesis of this post has, i.e. that the WH deliberately leaked information to Leonhardt to spur the writing of this article.
One of the biggest regressive taxes of all time, and all just to increase insurance corp profits. Who could argue against that?
what is regressive about taxing incomes above $1m AFTER deductions????
there must be allot of con in economics.
The mandate is the regressive tax.
Yes, I understand. I may be wrong but:
.3% of 360M is about 1M. 46B per year divided by 1M is 46K.
Believe me, it won’t affect me.
I’m not convinced people who genuinely support the bill, despite it’s flaws, do so primarily because it has a public option. If the seed of something that can grow later and become effective is there, that’s fine, and its potential for transformation is important — but that’s hardly the only thing in the bill.
Providing insurance coverage for 36 million people who currently don’t have it, and raising a $ trillion over ten years to help them pay for it is a powerful reason all by itself. That’s a trillion dollars more towards helping low-income folks than we had before.
Banning rescission and denials for prior conditions is huge. And there are numerous smaller but important improvements in the system that would worth doing if packaged as individual bills — like funding lots to clinics that wouldn’t otherwise exist, providing screening, adding preventive care — they’re getting no attention.
Earlier this year, Congress renewed and expanded SCHIP to cover another 4 million kids, while leaving millions still uncovered, yet that was considered a victory. So getting 36 million more covered is not trivial — it’s huge.
I don’t blame people for being disillusioned over what coulda/shoulda been, especially if they were hoping for more radical transformation. We’ll never know what more could have been accomplished if only . . . and the opportunity cost — how this impacts future reforms — is unknowable.
But I don’t have any problem constructing a list of worthwhile things in these bills that should be passed, along with a list of disturbing things that shouldn’t, and I don’t see a clear litmus test for what a “progressive” or just human beings should or should not support as a package. If someone says the hit on abortions is enough to say no, I wouldn’t try to talk them out of it.
Obama has broken his fundamental campaign promise:
http://www.youtube.com/watch?v=7AOJBiklP1Q
this charade must be opposed by any progressive with a conscience.
Ambiguity is helpful. It would have been much worse if Obama had criticized the contents of the House bill. Instead he praised the House for moving the ball down the field.
It seems that Obama is neutral on content that does not affect the chances of passage. A public option now affects the chances for passage by creating a statemate. It is public pressure that will finally determine which way that statemate is resolved. The problem is that the forces that won’t no bill at all have a vested interest in preserving that stalemate, which means rolling compromises in their direction. Only strong public pressure can stop that, but the compromises thus far have caused the bills to lose public support despite the heroic efforts of a little band of bloggers.
The real bottom line for progressives is a bill that they can organize around for the 2010 election. Failure to deliver a bill will suck all of the air out of the effort like it did in 1994. But failure to have some hook in the bill for pushing for amendment in the direction of a real and strong public option will make progressives reluctant to continue the fight. After all, there are major battles over climate change, financial industry re-regulation, and EFCA yet to come. Not to mention the upcoming jobs summit, where fiscal scolds will have another chance to push Herbert Hooverism.
We are in for an extemely bumpy ride. Start getting those primary challengers ready.
It’s not Obama who will lose or lost, it’s the American people and
the Democratic party in 2010
The WH and its brain trust, along with the alleged “centrist” in the Senate, the anti choice cabal in the House will doom the Democrats to defeat in 2010 and again in 2012. What will emerge is a ultra gridlocked Congress and government which will be unable to govern. The disaster the Mayans may have seen for December of 2012 is brewing and its on both ends of Pennsylvania Avenue.
That’s fair, and I didn’t intend to accuse Leonhardt of stenography.
I think you are mistaking health insurance for actually receiving healthcare. They are not the same.
As for rescission, pre-existing conditions, and extension of SCHIP, those are all fine. Put them in a separate bill and pass them. But it is simply untrue that they counterbalance the sellouts contained in the current bills.
The thought that really hurts is that their is very little evidence he was ever engaged in a fight.
No, no, deficit neutrality is for health care, not for wars. Wars go on the credit card.
No, I never claimed that receiving care and having insurance are the same. But not having insurance does lead to health/death consequences, so there is link. And if the new regulations specify the coverage, the loss ratios, and rules against discrimination, than better insurance will lead to better care.
And I didn’t claim that any specific advantages “counterbalance the sellouts.” People can make their own judgments.
This is all meaningless. There is no reason for ANY progressive blog to be supporting this pile of dung in any way. It’s just for the insurance companies.
The American people deserve true universal health care like any other civilized nation. Not this patchwork monstrosity which enriches and entrenches the current failed health care delivery system. I say KILL THE BILL and start all over. We want and deserve real change, and the time for incrementalism is loooooong past…
I read your article and the Leonhardt column, so I know it had nothing to do with the WH view of the House bill. Can you provide a link to what you’re talking about, please?
How does this really provide insurance to 36 million?
Trying to force people who can not afford insurance to buy it anyway is not providing insurance. I am right at the 300% mark and the subsidies won’t do hardly anything to help.
My guess, then, is that you will probably pay the penalty. Perhaps if Jane Hamsher is right and there will be a bill, then our efforts ought to go toward keeping the penalty low.
Bottomline: I see lots of massive negatives. As I said before, the few positives could be treated with in a separate bill.
How would crap insurance substantially change this?
After rereading the article, I’ve edited the lead in to Leonhardt, which unfairly suggested his story was leaked to him from the White House. His article doesn’t suggest that. My mistake.
Ok, but now it seems the entire premise of your piece is mistaken (including the title). I like your writing so please explain if I’m wrong. It seems like this is just one of a thousand FDL posts that incorrectly and paranoidly blames the WH for something they’d never do (unless you believe everything you read in anonymously-sourced columns like Mike Allen’s which are challenged by the WH the minute they’re published.)
scarecrow, is there any evidence (that you know of) that there are the kinds of insurance problems in MA (as seen, for example in CA) with massive denial of coverage for medically necessary healthcare, dropping people’s insurance for faux fraud when they get sick, etc?
I’m not aware of any, but I haven’t looked for that either.
Another payroll tax? You have to be kidding. The mandate itself is a regressive tax. Remember that the payroll tax applies only to “earned income” (ie: wages). Income from dividends, capital gains, rents, etc. totally escapes the payroll tax. Even the hedge fund managers found a way to reclassify their “earned income” to something not taxed by the payroll tax. This health care bill is an attack on the middle class! We’re replacing the progressive income tax (which isn’t even very progressive anymore) with taxation by unfunded mandate!
thanks. i haven’t seen any either, but likewise have not made a comprehensive search. might try to see what i can find.
I agree on the Leonhardt article and edited the lead in (and the title).
You may disagree with the premise that the WH has generally preferred the Senate Finance effort, but they did send Orszag to the gang of six meetings, worked to protect the drug deals in Committee markup, and kept pushing for Snowe’s trigger in lieu of a public option, while Obama and other kept suggesting it wasn’t all that important and praising the bipartisan efforts of the Gang. There’s a story today saying the WH thinks a trigger is better than an opt out. I don’t think it’s paranoid to have noticed this apparent preference. There may be an alternative theory of what they’re doing and why, but it’s not obvious.
According the AP report (see Times link), the extra payroll tax Reid is reportedly considering would only kick in for incomes above $250,000.
Sure, they’ve discussed back-up options…and maybe they’ve got a formulation where they can get a more robust public option attached to a trigger (you can easily make it a hair trigger) than an opt-out. None of this is likely to matter, since 60 Senate votes will be very hard to get and the likely outcome will be a plain old public option passed in reconciliation. The WH clearly wants to make sure something gets passed if the preferred public plan that the vast majority of Democrats wants (including the WH) ends up failing. But to say that the WH WANTS to weaken the House bill is RIDICULOUS.
Yeah, I plan on it, I have no choice.
That is why the “coverage for 36 million people” it total BS.
And this bill is supposed to help me…
actually i think you are on the money
I truly don’t understand the positions of some self-identified progressives that attempt to parse “triggers”, “public options”, PO’s with triggers, “no comprehensive health care for women”, on the altar of “something is better than nothing”, or as they like to spin it, “don’t let the perfect be the enemy of the good”. There is NOTHING good about any of the bills stinking their way through both our houses (a pox be upon them). They do not begin to represent what the American public needs for true health care reform, they are all give-aways to big Pharma and the insurance mafias. This is not true reform, needs to die, and we need to start over again, with pure intentions and hearts, and an implacable will, to get single-payer, or socialized medicine, so that we can join the rest of the civilized world. Now, the problem is , “what next”? I can only encourage people to look deep into their souls and perhaps we can arrive at a new frontier of progresive populism. Let me know what you come up with?
Couldn’t have said it better myself. I’m feeling cheated by this Administration.
As progressives, our only real course of action at this point is to kill this corporate welfare/anti abortion rights bill. It is so bad that triggers and opt outs aren’t going to make it that much worse. We need to just get the insurance reforms for pre-existing conditions and rescission past in stand alone legislation and either get back to it next year or just primary the whole lot of them out even if it means waiting until 2012 and primary Obama out of the White House. If we wait four more years to get a real progressive in POTUS and get reform passed that first year that goes into effect immediately (that used to be one of our prerequisites), it is still the same time frame as this turd they want to pass now.
Thinking you’ve got a point. I’m wondering how we get more “we”? Seems as if the populist movement is fracturing along the lines of appeasement.
I am now a fan of cbsunglass. Great wording
Corrupt, virulent, piggish. Yup. Now what? Canada?
Scarecrow,
There are good things in HR 3962, but they could have been enacted without the bad things, and the big picture is disturbing. It’s ironic that everyone is trying to protect a public option as some sort of beachhead for single-payer. In the House bill, certainly, it’s nothing more than a well-contained pen for a straggling band of risky cases. I explained it at another site as follows:
If you think this is too cynical or callous toward those who are now uninsured or subject to arbitrary exclusions and rescissions, if you think I should forget that our employer-based system is crippling our manufacturing sector, if you (with your background) think I’m too worried about regulatory capture, please do let me know.
I’m serious. But I have gone through a lot of what’s in this bill, and I think the good things could be enacted without the bad, and without instituting a five-year plan for gluing the status quo in place and throwing government-sponsored insurance into a deep freeze for at least another five years.
OK, why do people keep listening to anonymous sources?
How many anonymous sources said Obama was shitting on the Public Option and yet time and time again those sources were proven wrong?
He did shit on it. He’s routinely demeaned its importance, called it inessential, limited its scope, and insisted he’s not threatening insurance companies. The House fulfilled this vision, whittling the option down to almost nothing, at least through 2015, which is as far out as the legislation looks and about when a trigger would have been pulled. Snowe, the insurers, and Republicans all protest too much — or haven’t read the bill.
See my comment to Scarecrow — #49, just above yours — and tell me if you think this bill is more like a potential first step toward single-payer or a carefully constructed plan to derail it.
carefully constructed plan to derail it. and not just single payer, affordable universal healthcare of any kind.
fwiw, my 2 cents.
well said, ckoeber! it’s because many progressives would rather see themselves as the lone voice of reason in an all-or-nothing fight. they don’t want to get most of what they want and compromise – that’s not very sexy. it seems that most people’s definition of Progressive has less to do with Progress and more to do with Agressive.
Agreed here, too. The premiums won’t be so much affordable as they are extortable. There was definitely a more honest name to slap on HR 3962.