Opt-Out is a Cop-Out

For weeks leading up to the Senate Finance vote on the Baucus Bill – that still has not been given Legislative language (thus not a bill) – the White House and leading Democrats courted the vote of Sen. Olympia Snowe (R-ME). Now Senate Majority Leader Harry Reid (D-NV), who is fighting for his political future, announced Monday that the merged bill in the Senate will have an "opt-out" public option. The very type of option that Olympia Snowe and Senate "Blue Dog" Democrats are dead set against having as an option. The move by Sen. Reid may put him in the crosshairs of the White House as the Obama Administration has used a lot of political capital to make health care reform appear to be bi-partisan.

President Obama has been campaigning and fundraising for a number of Democrats embattled for political life in the past weeks. Will the move by Sen. Reid put his biggest political chip in jeopardy by putting in a public option? Only time will tell. Having an "Opt-Out" option will negate a slew of lawsuits, well that is if State's get a backbone, as forcing States to offer further expansion of Medicare is an affront on State Rights. As I have said before in previous blog entries, health care reform is needed to curb the escalating premiums and bring cost savings within the industry itself.

The goal of President Obama is to reduce costs and increase competition. The trouble with the public option is that it does neither. To increase competition, open the borders of the states to allow insurance companies to offer coverage across state lines. Roughly 1600 insurance options exist within the borders of the United States yet the majority of states have between 2 and 5 options. Looking to Economics 101 for an answer is required. Economics 101 sales, provided the price is at equilibrium, an increase in supply, while keeping demand the same, the price will drop. So, why are that so many politicians disregard this model of Economics?

The other goal is to reduce cost. Doctors must carry expensive insurance to shield themselves from lawsuits. The malpractice insurance does not discriminate. Surgeons, specialists, and family practioneers all must carry it to protect themselves. Tort reform is required. Without Tort reform doctors will need to earn more and more money to cover the cost of malpractice insurance. So, why doesn't the Democrat led Congress include Tort reform within their health care reform platform?

We can create legislation that will not cost $.01 but Congress lacks the courage to do so while achieving the goals of health care reform. So, why doesn't Congress do it?

Humana Gag Order: Abuse of Power or Warranted?

Humana is under investigation for sending out communication to their Medicare Advantage clients. The Huffington Post obtained a copy of the Humana mailing and can be viewed here: http://big.assets.huffingtonpost.com/humanamailer.pdf. I read the mailing sent by Humana and found nothing outlandish or misrepresentative of the reform being discussed on Capitol Hill but I suggest everyone to read the mailing to judge for themselves. The mailing does warn that "Some in Washington want to cut billions of dollars out of the Medicare Advantage program" and outlines changes that Humana will be forced to make if the cuts take place. Sen. Baucus took exception to Humana's mailer to their clients. "It is wholly inappropriate for insurance companies to mislead seniors regarding any subject – particularly on a subject as important to them, and to the nation, as health-care reform. The health-care reform bill we released last week strengthens Medicare and does not cut benefits covered under the Medicare program – and seniors need to know that," stated Sen. Baucus.

While I agree with Sen. Baucus that no company ought to mislead the public, did Sen. Baucus forget what was written in his bill? The bill calls for $123B in cuts to Medicare Advantage over the next ten years. Instead of recalling this fact Sen. Baucus complained to the Centers for Medicare and Medicaid Services (CMS). The CMS in turn ordered Humana on last Friday to cease and desist because their mailer was "misleading and confusing". Again, I suggest everyone to read it. The kicker is that Humana, and others, have supported ObamaCare with the exception of Advantage cuts and the public option (Wall Street Journal). So, why the gag order Sen. Baucus?

Americans see the warning here? The complaint by Sen. Baucus is a prime example why Government cannot be a participant and referee in any industry. Filing the complaint to the CMS is an abuse of power and a blatant attempt to restrict the communication of what is going on in Congress. The America's Health Insurance Plans, an industry trade group, expressed their outrage to the gag order by saying that proposed cuts "will have a devastating impact on the health security of the more than 10 million seniors enrolled in the program. If these cuts are enacted, seniors will face premium increases, reduced benefits, and, in some parts of the country, will lose access to their Medicare Advantage plan altogether" (www.npr.org). Again, why is the Obama Administration allowing a gag order on information being sent out to those that are impacted?

The Medicare Advantage program receives additional reimbursement rate which cost taxpayers an additional 14% per enrollee (www.courier-journal.com). Now if Sen. Baucus cuts ($123B) or President Obama cuts ($177B) to Medicare Advantage rates takes place the logic step of those provided the insurance option will need to cut back benefits in order to maintain margin expectations. All Humana, as I can tell from reading the mailer, is guilty of is warning their clients of how changes in reimbursement rates will affect their coverage. If Sen. Baucus or President Obama has trouble with that then offer an explanation on how Humana is incorrect in their assessment. Do not sick the CMS on them or others in the insurance industry to place a gag order on them. It is their right to communicate to their clients.

Don't take my assessment as gospel; rather read the mailer (link above) and determine for yourself if Humana violated any laws as to stating any misleading or confusing information. After you read it and make your own assessment call your Senators and Representative to voice your opinion. I wonder how long the CMS will take to determine if laws were violated.