Thursday, September 17, 2009

Baucus Health Care Bill is start to bipartisan solution.

Yesterday Sen. Max Baucus (D-MT) unveiled his health care reform. Originally the plan was touted as a bipartisan bill but the support from Republicans has evaporated while raising the ire of those on the far left of the Democrat party. I perused the 223 page bill (http://finance.senate.gov/sitepages/leg/LEG%202009/091609%20Americas_Healthy_Future_Act.pdf) to get a brief overview of what Sen. Baucus is proposing. Perhaps the most glaring point missing from the health care reform plan is the absence of a public option. "Liberal Democrats and unions recoiled at Baucus's proposal to compromise with moderates on the government-sponsored insurance option by establishing nonprofit insurance co-ops instead" (The Boston Globe).

The bill does however place a mandate on all Americans to purchase health insurance or face paying a fine. Really? The president made the comparison of health insurance to car insurance during this speech to the joint session of Congress the other week. The comparison is unfounded as it is a privilege to drive a vehicle and one does not have to have a driver's license to live in the United States. To say that I have purchase something I may or may not want to goes against the very essence of the United States. We are the land of the free. Our Forefathers fought against tyranny and undue taxation. The requirement that all American's must purchase health care insurance is similar to the tyranny that colonial American endured under English control.

There is a smarter way to achieve the end goal of driving down costs. The Baucus bill does take a step in that direction by allowing states to establish compacts with other states to allow health insurance purchasing across state lines. While I foresee a 10th Amendment battle over a public option and the mandating of health insurance, allowing for compacts to be developed will not create a 10th Amendment battle. Yet, the compact concept falls short because it still allows lobbyists to shape them. Does one really believe that HealthPartners or Blue Cross Blue Shield will allow Minnesota to join in a compact with another state that offers similar health insurance coverage at lower rates than theirs?

The only mandate on business to ensure health insurance benefits are not dropped is that companies with more than 50 employees will have to reimburse the government in the event their employees take advantage of the new subsides. Taking into consideration the administration costs that large companies face with health insurance benefits it may be more cost effective to pay the reimbursement fee than to offer health care insurance; especially when the company weighs the number of employees that would require subsides vs. those that will not. Even though AFL-CIO President John Sweeney said it "absolutely fails to meet the most basic health care needs of working families" (USA Today).

Sweeney wants to see a public option as it will help alleviate some of the legacy costs that Unions face. What Sweeney fails to realized is the Trojan Horse still exists in the bill because the lack of a mandate on business to keep current coverage or provide coverage in the future. The new rating system that will determine premiums and coverage limits will be more stringent and all insurance offered will need to meet by 2013. The bill will also impose fees on insurance companies to a tune of $6B annually. The fee is to help offset the start-up costs for the non-profit insurance cooperatives that will not be "run" by the state.

At the end of the day the Baucus Bill or any other bill currently on the table will not be the bill finally passed. The Baucus bill is the closest thing to a compromise to come from Congress since the year has begun. Since both sides are a bit miffed and disappointed – Left by no public option and the Right by no tort reform – means the bill is taking the right steps to compromise.