Hacker on Health Care

Posted by jrosenhouse on December 20, 2009
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For an eloquent statement of what I have been trying to say for the last few days, have a look at this essay by Yale University Political Science Professor Jacob Hacker. Hacker is generally considered the father of the public option. In his view, the Senate health care bill still does more good than harm, and provides a needed platform for future reforms:

As weak as it is in numerous areas, the Senate bill contains three vital reforms. First, it creates a new framework, the “exchange,” through which people who lack secure workplace coverage can obtain the same kind of group health insurance that workers in large companies take for granted. Second, it makes available hundreds of billions in federal help to allow people to buy coverage through the exchanges and through an expanded Medicaid program. Third, it places new regulations on private insurers that, if properly enforced, will reduce insurers’ ability to discriminate against the sick and to undermine the health security of Americans.

These are signal achievements, and they all would have been politically unthinkable just a few years ago.

To be sure, the bill also contains a requirement on individuals to have coverage, which has become the main target of criticism from the left. Without the public option, this mandate amounts to forcing people to buy private insurance without creating an affordable public alternative with which insurers must compete.

But the correct response to this critique is to make the requirement less necessary by providing greater assistance with the cost of premiums and by facilitating enrollment in the exchange–in other words, by making coverage more attractive and easier to obtain.

Well said. You should go read the rest of the essay. It is the best short summary I have seen of the strengths and weaknesses of the Senate bill.

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  1. #1 Pierce R. Butler
    December 20, 2009

    … new regulations on private insurers that, if properly enforced …

    Given that the current administration, the most progressive that the US political system seems capable of producing, refuses to enforce even the Geneva Conventions, elementary anti-trust laws, or its own campaign promises, that condition seems particularly over-optimistic.

    … providing greater assistance with the cost of premiums …

    I.O.W., even greater corporate welfare. Now that’s a guaranteed area of bipartisan consensus!

  2. #2 Joe Shelby
    December 20, 2009

    sorry to be a cynic to #1 above, but it is far easier for a bureaucrat to enforce some financial restriction on a person than it is for the DOJ to enforce a law like Geneva on a corporation with more money than the government.

    telling a credit agency that you are in debt to some corporation or hospital is a trivial thing to do (when the law is written to permit it), with insane consequences at times. the alternative you mention, that a company is in violation of a law or a government agency is in violation of a statute, has too many safeguards that protect the members of said agency to have any weight at all.

    apples and oranges and all that…which pisses me off as much as any, of course.

  3. #3 NewEnglandBob
    December 20, 2009

    It is a start, but I am not optimistic that congress will take the steps that Hacker says are necessary.

  4. #4 Tyler DiPietro
    December 20, 2009

    “To be sure, the bill also contains a requirement on individuals to have coverage, which has become the main target of criticism from the left.”

    He doesn’t get it. The mandate forces people to buy private insurance without any caps on premiums or deductibles. This will simply lead to a situation where people who presently can’t afford insurance can then “afford” crappy plans. Medical bankruptcy will still be a problem, access to actual care will still be a problem. Meanwhile, the insurance industry gets a whole truckload of corporate welfare while the rest of us suffer. Yeah, nice “reform”.

  5. #5 Lyle
    December 20, 2009

    However to answer #4 they will get the wholesale price for their medicine, not the retail price. One of the gotchas if you don’t have insurance is paying 2 or more times what someone with insurance pays. That at least is some progress.
    Now the way to avoid the credit bureau is to live the way the grandparents did, cash only and below your means.

  6. #6 Tyler DiPietro
    December 20, 2009

    “However to answer #4 they will get the wholesale price for their medicine, not the retail price.”

    Oh woohoo, they pay a little less for already vastly overpriced (by international standards) drugs.

    “One of the gotchas if you don’t have insurance is paying 2 or more times what someone with insurance pays.”

    But that doesn’t have anything to do with medical bankruptcy. 3/4′s of those who declare medical bankruptcy have insurance. This bill does nothing, nothing to stop this travesty.

  7. #7 zhaphod
    December 20, 2009

    Analysis is good. But politics is also about heart as much as it is about mind. And in the heart of many progressives it feels like Obama didn’t give a damn about what they thought. This is going to cost him and democrats in the next election.

  8. #8 llewelly
    December 21, 2009

    This is going to cost him and democrats in the next election.

    Fixed it for you.

  9. #9 Jeff D
    December 21, 2009

    On balance, I’d prefer that the highly imperfect Senate bill — or something a little better — make it through conference committee and into law, but I’m disappointed, and for reasons that Prof. Hacker barely touches in his essay.

    Where are the provisions or mechanisms to move away from fee-for-service medicine and reimbursement? What will this bill actually do to begin to reduce costs and make our current system more transparent to individual insureds and patients — so that they can get information about the potential costs of various treatments and procedures and not be insulated from the effects of their decisions?

    Over the past 8 months, the best things I’ve read about the problems with our health care system — and ideas for real, sensible reform — were David Leonhardt’s August 26 op-ed in the N.Y. Times, David Goldhill’s long article in the September Atlantic Monthly, the August 2009 Brookings Institution paper “Bending the Curve,” and the July 2007 discussion paper by Ezekiel Emanuel and Victor Fuchs advocating “universal health care vouchers” (published by the Hamilton Project and the Brookings Institution).

    In my opinion, the Senate bill does virtually nothing to address the fundamental flaws and distortions in a broken system that consumes too much money and already relies too much on employer-provided group health insurance. Effective reform will result (at least in the short term) in lower profit margins for health insurers, for-profit and non-profit hospitals, physician groups in specialty fields, and other entities (labs, imaging centers) that are owned by hospitals and/or physicians. I don’t hear any of these “stakeholders” complaining much right now.

    Leonhardt op-ed: http://www.nytimes.com/2009/08/26/business/economy/26leonhardt.html?scp=7&sq=Leonhardt&st=cse

    Goldhill article: http://www.theatlantic.com/doc/200909/health-care

  10. #10 FastLane
    December 21, 2009

    I’ve tried looking through the bills (ok, skimming), and I haven’t seen what it actually does if someone gets laid off, or otherwise changes jobs.

    Currently, all employer options offer ‘COBRA’, which essentially allows one to maintain coverage, but at the ‘full’ price. Right when people can’t afford it, their insurance premuim goes up by about 4X.

    Will this bill at least allow people to maintain the buy in at the same rate?

  11. #11 Tony61
    December 21, 2009

    The bill is flawed, but it truly is the best bill given the circumstances. Realize that a significant percentage of people still don’t see health care as a right— when every ER in the country is mandated to treat it as a right.

    The eery thing is that the ass-hats on Fox news are “outraged” at the political horse-trading when it’s the republican party that necessitated the 60 vote supermajority. The GOP is so far out to lunch on this issue that I cannot see how this will cost Obama the election.

  12. #12 notedscholar
    December 21, 2009

    Characteristically, his post leaves out the fact that forced health insurance means forced medical treatment, like vaccines! Many people reasonably oppose such measures, however misguided.

    Cheers,
    NS

  13. #13 Gerry L
    December 21, 2009

    Yesterday on Meet the Press, Sen Sherrod Brown insisted the bill kept insurance cos. in check by limiting non-medical use of premiums to “just” 15 or 20 percent. I was troubled when I thought the current version of the bill limited non-medical expenses to 10 percent!
    I know we are really constrained in what we can expect to come out of the conference committee, but something has to be done to regulate the profit-taking. I’m not very hopeful that our constipated congress will be able to improve the system while they are being seduced with big fat campaign contributions from insurance company lobbyists — contributions that we are paying for with that missing 15-20 percent of our premiums.
    Next time someone comes asking me for a campaign contribution, I intend to print up a check on the Bank of Cigna and tell them to go cash it where they sent all our money.

  14. #14 James Sweet
    December 30, 2009

    Oh woohoo, they pay a little less for already vastly overpriced (by international standards) drugs.

    Um, yeah, that’s kind of fucking important. Perfect being the enemy of the good and all that.

    This health care bill is pretty god-awful, and of course it’s a boon to private health insurance companies at the expense of the consumer, BUT… do not underestimate the importance of a foot in the door. When every single American has health insurance, it will no longer be a politically tenable position to say, “Universal health coverage is socialism! I want to take away what little piss-poor insurance you have!” Don’t underestimate the importance of that.

    It may be that we are going to have to live through the effects of this shitty bill so that our children will be able to live in a country with meaningful reform. If that’s how it is, so be it. Rejecting all change because it isn’t enough change is just going to shoot future generations in the foot, because they’ll have to have the same “death panel” debate all over again.

  15. #15 James Sweet
    December 30, 2009

    But politics is also about heart as much as it is about mind. And in the heart of many progressives it feels like Obama didn’t give a damn about what they thought.

    So you are saying that, in order to remain electable, Obama should have pushed for there to have been no health care bill at all?