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A First Look at the Baucus Plan

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The Washington Post has gotten hold of the mark-up notes for the health care reform plan currently being revised by Senator Max Baucus (D-MT) in the Senate Finance Committee. His version of the bill, being created largely on his own authority as chairman of that committee, with limited outside input, is likely to be the basis for whatever final legislation passes the Senate.

Although they run 262 pages long, these notes are not the final bill. They are more like a commentary on the bill and an account of what is in it. Assuming they are truthful, they present a more understandable explanation of the bill's content than most readers would get from the bill language itself because of the multiple references to prior legislation which take a great deal of effort to track down and research.

The legislation, as described in these notes, shows a genuine effort on Senator Baucus' part to address many of the objections to various aspects of the original HR3200. Though there are still major issues for concern, the greatest complaint may end up being that the bill as currently revised is so watered down that it isn't likely to really accomplish many of the goals set for health care reform by President Obama.

Here are some highlights:

• The bill does allow for interstate purchase of health insurance, though under restrictions which will not allow for real competition unless the states actively make an effort to follow through with their own deregulation.

• There is still a mandate forcing individuals to buy health insurance or pay a penalty. Interestingly, the $750 penalty is referred to specifically as an "excise tax" which goes directly against President Obama's claim that it is not a tax. The effectiveness (and offensiveness) of the mandate is also substantially undermined by specific provisions against any of the civil or criminal penalties previously proposed for those who don't pay the tax and don't get insurance. The government could only collect the tax out of money already in the government's possession, such as an individual's tax refund. These are very positive changes if you didn't like the mandate, but for those who did like it they do mean that there will still be people who can remain uninsured by choice with few real consequences.

• Interestingly, the bill includes a provision requiring members of Congress to enter into the same insurance pool as the general population and give up the special coverage which they currently enjoy, though they would continue to have a higher employer-paid premium than most workers do, assuring them first-class coverage.

• The bill contains provisions for a substantial protective tariff on imported drugs and medical equipment, totaling almost $7 billion a year. This implies some lifting of the current restrictions on the importation of drugs, but the specifics are not clear from the document.

• There is a proposal for an excise tax on high-cost health insurance plans, where companies would be penalized for offering "Cadillac" health plans. I really don't see the logic behind this except as a revenue-raising measure.

• White there is no specific provision for tort reform, there is a vaguely worded proposal for a "sense of the Senate" resolution encouraging states to find ways to limit the cost of malpractice claims through alternative resolution methods. Not terribly meaningful, but well likely to be the best response to this problem you'll get from a Democrat-controlled Senate.

• Subtitle F is a very long section on the "Patient-Centered Outcomes Research Act of 2009," which is the much-ballyhooed source of the rumors about supposed death panels. It would create an institute to study the cost-effectiveness and outcome value of various types of treatment and make recommendations on which policy would be set. While it is certainly not the stated intention behind creating an organization like this, it is inevitable that one of the things this institute would issue guidelines on would be end-of-life care, including when it becomes cost effective to deny care to an elderly patient and let them die.

• There are a lot of provisions to increase the efficiency of Medicare and Medicaid and cut down on fraud. This is intended to raise much of the revenue needed to fund the other elements of the bill, but how effective a bunch of additional bureaucrats and mandates will be in doing this is certainly debatable. Additional savings also come from placing limits on the massively expensive Medicare Prescription Drug Plan passed under the Bush administration.

• The bill specifically states that none of the current state or federal policies regarding abortion would be changed in any way, including no additional federal funding for abortion or interference in state laws limiting availability of abortion. It also specifies that abortion would have to be included as an additional rider above and beyond the cost for minimum benefits on an insurance plan paid for by the government.

• Rather than providing a "public option" to compete with private health insurance, the bill expands Medicaid coverage to apply at least partially to people earning up to 300% of the Federal Poverty Level, with benefits inversely proportional to income. It would also provide a tax credit for insurance premiums paid by people earning up to 300% of the Federal Poverty Level, which would be about $30,000 for an individual or about $66,000 for a family of 4. It also provides $6 billion to help underwrite the creation of tax-exempt and member-run insurance co-ops as an alternative to traditional insurance. Relatively few specifics are provided on this proposal.

• The bill creates massive new health care bureaucracies, including boards to oversee insurance prices, drug prices, medical practices and treatment pricing. It inserts a government role in virtually every aspect of health insurance and medical care, from determining how you are insured to how you are treated to what drugs you are allowed to have. This means more rationing and more delay and denial of care. Most of this is in the interest of reducing costs and increasing efficiency, but I fail to see how government boards and commissions could ever do this better than the free market.

• Much of this plan seems to be drawn from the Massachusetts model, which has been enormously more expensive than anticipated and is considered a disastrous failure within Massachusetts, making service worse and costs higher for everyone while still failing to provide truly universal coverage.

So what you have here is very much a compromise bill, even if no Republicans have been willing to put their names on it. It makes many concessions, weakening elements which President Obama demanded like the insurance mandate, substituting ill-defined co-ops for the public option and making a mostly symbolic gesture at opening up the interstate insurance market. All of this comes with increases in cost for every taxpayer and a likely reduction in quality of service for many needing care. And at the same time it will still leave millions uninsured. But it does create thousands of new jobs in the massive new health care bureaucracy, so that's just fantastic.

Looking at these proposals for health care I'm left asking what is the point of all of this? It spends a lot of money and wastes a great deal of effort to accomplish very little of substance. Senator Baucus has clearly worked very hard to craft something which can satisfy enough Senators to pass, but in the process he's produced nothing which I can identify as a clear-cut plan for real reform. I really don't think that these small adjustments to how we do health care are the answer. We'd be better off going back to the drawing board, finding a few basic principles everyone agrees on and passing something simple and comprehensive and effective.

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About Dave Nalle

  • http://ruvysroost.blogspot.com Ruvy

    • The bill creates massive new health care bureaucracies, including boards to oversee insurance prices, drug prices, medical practices and treatment pricing. It inserts a government role in virtually every aspect of health insurance and medical care, from determining how you are insured to how you are treated to what drugs you are allowed to have. This means more rationing and more delay and denial of care. Most of this is in the interest of reducing costs and increasing efficiency, but I fail to see how government boards and commissions could ever do this better than the free market.

    Israel has a government mandated health system. It works well – usually. Sometimes the law just can’t get around culture. The work ethic in this country leaves much to be desired, especially in summer time.

    My wife took a medicine for narcolepsy that had to be imported, and required an import permit that had to be renewed every six months. Th board met monthly to consider requests for import permits – except when they didn’t. For two months in the summer of 2002, they didn’t meet, and my wife was half asleep most of the time. Finally, I decided to forget the medicine, and found a way to give my wife coffee in such a way that it would not disturb he oncoming ulcer. Now she drinks a couple three cups of coffee a day.

    A lot cheaper, no import permits, no bullshit, no baloney.

  • http://jeanniedanna.wordpress.com/ Jeannie Danna

    I was very pleased to learn that the Bill coming out of the finance committee will most likely not be passed.

  • http://www.republicofdave.com Dave Nalle

    Ruvy, you’re lucky that there was an alternative to the medicine in your wife’s case. For many other diseases and conditions there is no alternative to pharmaceuticals and if something like this plan passes in the US they will be rationed and restricted.

    Jeannie, right now the main opposition to the Baucus plan seems to be coming from the far left who feel it’s too much of a gift to insurance companies, but it’s actually far less favorable to insurance companies than HR3200 or Obama’s proposals were.

    If the Baucus plan doesn’t become the model for the final bill, we’re likely to get something far worse.

    Dave

  • Baronius

    People sometimes say that a good compromise is one that leaves all parties unhappy. That’s true; but you can say the same thing about a terrible compromise.

  • http://takeitorleaveit.typepad.com/ roger nowosielski

    Dave,

    You keep on claiming that whatever will be passed, shall end up being favorable to the insurance industry.

    Could you list a number of bullet points which, in your opinion, substantiate your claim?

  • http://delibernation.com/blog/3 Silas Kain

    Somehow I find it appropriate that my first comment in a couple of weeks addresses health care. Two weeks ago I fell while walking on a public sidewalk that was decayred and frankly, unsafe for public walking. Ironivcally the fall occurred at the junction of a handicap specific crosswalk on a main thoroughfare in Metro Boston. The result of the fall left me with a broken arm, fractured femur and knee injuries which may require surgery. Suffice it to say, I am angry at my own clumsiness but am more angry at the degradation of life in Massachusetts.

    Let me quickly address the sidewalk issue. The safety of sidewalks and quality of roads in the Bay State is directly linked to a total lack of planning on the part of city planners in accounting for infrastructure costs. We’ve become a society which has forgotten that those services we have like roads, sidewalks, public water and sewerage all cost money to maintain. But, being a disposable society, we don’t take a proactive approach. My first inkling is to sue the city where I fell and sustained my injuries. But what does that do? It costs money and takes money out of the public accounts which could be used for infrastructure maintenance. The way I see it, our infrastructure mirrors our health care dilemma.

    Now to health care. During my stay in the hospital I asked everyone with whom I came in contact about this health care debate. And the one thing that remained common among all those with whom I spoke was the health care professionals find it completely immoral that what was once the greatest nation on the globe cannot even provide decent health care for all its citizens regardless of societal status.

    Nurses talked about the rising reliance on technology and computers, not for providing quality health care, but for tracking every line item in a patient’s treatment to report back to the insurance companies. Nursing and physician assistants talked about nights when they go home virtually in tears because
    of some of their experiences in working with patients who have been financially ruined or faced with making decisions because of lack of insurance. I met a woman who has multiple sclerosis and is in a wheelchair. Two years ago her husband had a debilitating stroke. They were middle class folks and he had worked all his life for a major jet manufacturing company. Following his stroke, medical insurance premiums skyrocketed, her disease advance and now they’re left with insurmountable medical costs and are forced to sell their home. They’re praying that they will be able to get into subsidized housing.

    I discussed the date with my PCP who was born and educated in China. He’s frustrated as well. He talked to me about how he cannot understand why Americans do not even get basic health care as a right. He discussed the insurance companies and their stranglehold on practices. And, he asked, why does everything in Americas have to be for profit? Good question, doc, I am asking the same thing.

    With all due respect to Dave and the rest of America, enough is enough. I am in full favor of a massive overhaul of the system. But health care reform in and of itself won’t solve this nation’s problems. We need a multi-faceted approach which includes health care, infrastructure, and most of all POLITICAL REFORM. Members of Congress are being paid very well for their service to the special interests. The bottom line is that special interests pay good money to legislators. Where do the special interests get their money? From consumers like you an me. Yes, my friends, it’s time for a redistribution of wealth. It’s time for massive regulatory reform. And if it’s time to adopt some socialist ideas into our system — so be it. Dramatic reform must be accomplished now. Without it, we are in danger of another civil war and that is no laughing matter.

  • http://takeitorleaveit.typepad.com/ roger nowosielski

    Talking about our priorities, Silas. And what’s with the infrastructure? I would have thought that the stimulus package’ first priority would be to rebuild our roads, highways and areas of public access. Why doesn’t the money go to the local communities which in turn could put it to good use by creating even temporary jobs rather than feeding the never satiated bureaucratic machine.

    Good to see you back, and I hope you’re recovering fast enough.

  • http://takeitorleaveit.typepad.com/ roger nowosielski

    And talking about another civil war, why don’t you watch the video that Zedd just posted on the “Vengeance . . .” thread, another one of Dave’s articles.

    You’re not that far off, buddy, not if that video is a fairly accurate representation of the mood of the “other America,” Glenn Beck’s edition.

  • http://jeanniedanna.wordpress.com/ Jeannie Danna

    Sen. Maj Leader Harry Reid appears ready to support the #publicoption for #healthreform #p2 #hc09 look

  • http://takeitorleaveit.typepad.com/ roger nowosielski

    Your link doesn’t work, Jeannie. Try again.

  • http://delibernation.com/blog/3 Silas Kain

    Funny you mention Glenn Beck. I’ve arrived at the point where I find Beck, Limbaugh and those of their ilk to be domestic enemies. They’ve taken free speech to a new level of slime and sensationalism which feeds ignorant masses into believing that the work they do is “righteous”. Limbaugh’s glee at Obama’s “defeat” in Copenhagen proves that Limbaugh doesn’t give a rat’s ass about America. He just wants to rake in advertiser’s dollars because he can. The fact that 20+ million Americans regard Limbaugh as their savior frightens me because it is a clear manifestation of the wholesale failure of our educational system. We need change and we need it fast. Otherwise, let’s just dissolve the union and create a new country, smaller, leaner and kinder which cuts out the ignorant and let’s them to continue to shop at WalMart.

  • http://takeitorleaveit.typepad.com/ roger nowosielski

    Perhaps it wouldn’t be such a bad idea, Silas, if it were workable – the Blue and the Red states, and let them go their own way.

    Unfortunately, you do need some territorial integrity.

  • http://jeanniedanna.wordpress.com/ Jeannie Danna

    Senate Majority Leader Harry Reid, D-NV, and Finance Committee Chairman Max Baucus, D-MT, once in polite disagreement over the idea of a public option component in healthcare legislation, are approaching a breaking point over the issue.

    Sen. Reid Favors Public Option
    Reid and Baucus have staked out opposing positions on the central question of a government role in health reform.

    Sen. Reid has consistently stood in favor of a public option, but Sen. Baucus has consistently said the idea doesn’t have enough Senate support.

    Baucus Inserted Co-op Plan
    Instead, Baucus has inserted insurance co-operatives into the bill that is scheduled for a final vote on Tuesday.

    After Tuesday’s vote it will be decision time for Reid.

    Reid plans to merge the Finance Committee version with the one passed by the Health, Education, Labor and Pensions (HELP) Committee in July.

    Reid Push for Public Option
    Reid has signaled that he is prepared to join Sen. Chuck Schumer, D-NY, and Sen. Jay Rockefeller, D-WV, who both pushed a public option amendment that failed in a committee vote last Tuesday.

    Sen. Reid Comments
    Reid said in a conference call with constituents on Thursday, “We are going to have a public option before this bill goes to the president’s desk.”

    He said, “I believe the public option is so vitally important to create a level playing field and prevent the insurance companies from taking advantage of us.”

    Sen. Harkin Comments
    Sen. Tom Harkin, Chairman of the HELP Committee gave The Des Moines Register the same message.

    Sen. Harkin said, “We will have a bill on the president’s desk before Christmas, a health reform bill. It will have a lot of good stuff in it. It will have a lot of prevention and wellness programs in there that I’ve been fighting for.”

    Harkin said, “And it will have a public option. The question of if it doesn’t isn’t even an option.”

    In another sign that Reid’s decision will hold sway, Harkin told The New York Times last weekend that Reid will be the Democrats’ “quarterback” as the bill moves toward the floor.

    Harkin said, “There will be wrangling. But Mr. Reid will make the final calls. Our quarterback is Harry Reid… We elected him to that position. He will decide how this is done.”

    Sen. Schumer, the No. 3 Democratic leader in the upper chamber, has been leading the charge for a public option.

  • http://jeanniedanna.wordpress.com/ Jeannie Danna

    Roger, My links are broken:(

  • http://delibernation.com/blog/3 Silas Kain

    Is anyone else as pissed of as I over the amount of special interest money going to Senators from insignificant states? I mean, come on, who the hell is Max Baucus? He comes from Montana, for goodness sakes, yet he controls the fate of health care. Time for a Constitutional Convention and perhaps a parliamentary form of government. I’m even willing to go so far as to support asking Her Majesty the Queen to take us back. For all the effort we made into securing our independence, we’ve totally screwed up this experiment in democracy. It’s time for solid, steady leadership free from the yoke of special interests. Please, Ma’am, take us back. We’ve been bad little children and it’s time to grow up.

  • http://delibernation.com/blog/3 Silas Kain

    “Our quarterback is Harry Reid… We elected him to that position. He will decide how this is done.”

    Ah yes, Harry Reid. From Utah. Mormon first, American second. A power mad little wimp of a man. Yet he is another who controls our fate more so thank Barack Obama. Wake up, America, we’re getting screwed, blued and tattooed!

  • http://jeanniedanna.wordpress.com/ Jeannie Danna

    Silas,

    The fact that 20+ million Americans regard
    Limbaugh as their savior frightens me because it is a clear manifestation of the wholesale failure of our educational system. We need change and we need it fast. Otherwise, let’s just dissolve the union and create a new country,

    Thankfully, that 20+ million is still just the lunatic fringe!

  • http://thingsalongtheway.blogspot.com/ Cindy

    And, he asked, why does everything in Americas have to be for profit? Good question, doc, I am asking the same thing.

    Let’s start with that. Here’s an entertaining video that will explain in simple terms, why profit markets are a bad idea. The Good Plan

  • http://thingsalongtheway.blogspot.com/ Cindy

    P.S. Sorry about your troubles, Silas. xxxooo

  • Doug Hunter

    “not if that video is a fairly accurate representation of the mood of the ‘other America,’ Glenn Beck’s edition.”

    I don’t think so. It’s fairly easy to target idiots in the street (especially when you can spot the worst offenders by the content of their signs). That bit has been done quite often to try and make a point, for comedic effect, etc. I think one of the conservative talkers had a similiar segment on their program trying to show how ignorant and stupid liberals were. Any movement with tens or hundreds of millions of supporters is going to have it’s fair share of idiots and they’re not that hard to find.

    I noticed I shared alot of the sentiments with the signs shown in the background (not necessarily the ones they focused on) and although you’re not likely to catch me in some demonstration like that unless I’m there for the curiosity factor, it’s very unlikely I would have ended up in their piece if I was. The filmmakers weren’t going there to get reasonable responses from reasonable people they were going there to entrap idiots and they succeeded.

    It’s just another extended form of personal attack which really is par for the course in modern politics. No need to debate ideas, let’s just paint ‘the other’ as idiot, racist, weak, etc.

  • http://ruvysroost.blogspot.com Ruvy

    Silas,

    I hope you experience a full recovery from the broken bones – as we say in Hebrew, refuá shlemá.

    I agree with you that your nation needs some kind of universal health care that provides a high level of health care for everyone. I investigated moving to Australia, New Zealand and Canada for precisely those reasons. I am grateful as all hell that the founders of Israel were socialists; we DO have universal health care here.

    But at this point in time, you cannot afford to pay for the toilets in the army, let alone universal health care. Your country is so deep in hock to other nations round the world, that your mighty leader, that beacon of moral clarity (cough, cough, gag, barf) postponed a trip to see the Dalai Lama so as not to piss off your major creditors, the commie Chinese; and, to top it all off, the Empire State Building in New York, now (once again) the tallest building in NYC, was decorated in red and yellow to celebrate the 60th anniversary of the accession to power of the commies in China. Forget “who lost China?” Who lost America?

    In other words, don’t delude youselves with bullshit that you can no longer afford. Universal health care, at this point in time, is a delusion you cannot even waste time thinking about – unless you mean to bomb your creditors to nuclear dust and cancel your debts THAT way…. When you have as many nukes as you do, that is a doable action – though likely suicidal.

  • http://takeitorleaveit.typepad.com/ roger nowosielski

    Lunatic fringe, maybe, but because of ineffective leadership from the White House and our Congress, it’s gaining momentum.

    Never underestimate the limited intelligence of the free and the brave. We have bred a nation of morons – no doubt by design. And now we’re reaping the harvest.

    Jeannie, try again the hyperlink formula I gave you. It does work.

  • http://ruvysroost.blogspot.com Ruvy

    By the way, Silas, in case you are wondering why I keep bringing up that nasty issue, money, and you guys not having enough of it. I know what it is like not to have even enough money to put a decent Sabbath meal on the table. When you are really low on cash, you see how utterly idiotic debates over universal health care by a bankrupt country are.

  • http://takeitorleaveit.typepad.com/ roger nowosielski

    Well, Doug. You can’t deny that the respondents WERE idiots. I sure hope it’s not representative, but even those few who were interviewed should be cause for concern.

  • Doug Hunter

    #24 No argument there.

  • http://ruvysroost.blogspot.com Ruvy

    Dave,

    I just noticed your comment #3. Truth of the matter is this. There is such a thing as healthy eating. While the details can differ as to geography, personal preference and even religious beliefs, there are certain basics to it.

    1. Drink plenty of water, especially in the morning BEFORE eating breakfast.

    2. Eat fruit in the morning with a minimum of grains, but do make sure you have healthy grains (preferably grain you grow yourself).

    3. Eat vegetables in the evening.

    4. Have as little meat as you can manage.

    5. Eat only fresh organically grown fruits and vegetables; eat meat that is not from drugged animals; buy a food processor so you can make all sorts of meals that taste good; stay away from processed sugar and products that have processed sugar.

    6. Exercise daily.

    7. Meditate daily.

    There is more, but this is not the proper venue for that discussion. The points are these.

    1. What I described is preventive medicine of the best kind.
    2. A person can get from a pill popping dependent to a reasonably healthy person who has dicarded nearly all of the medicines that need to be bought from doctors.

    Am I following this regimen? No. I cannot afford vegetables or fruit, let alone organic vegetables or fruit. I cannot afford the food processor. This kind of reegimen does take (there’s that nasty five lettered word again) m-o-n-e-y.

  • http://www.republicofdave.com Dave Nalle

    You keep on claiming that whatever will be passed, shall end up being favorable to the insurance industry.

    Actually, Roger, in this article I point out that the Baucus plan is substantially less favorable to the insurance industry than HR3200 was.

    Could you list a number of bullet points which, in your opinion, substantiate your claim?

    The main and most obvious one is the mandate which was in HR3200 and exists in a less malevolent form in the Baucus bill which required all uninsured citizens to purchase private insurance or pay a tax/penalty to the government. This effectively added up to a 200 billion dollar transfer of funds directly from the pockets of taxpayers to the insurance companies on a yearly basis. That seems like a hell of a payoff.

    Dave

  • http://jeanniedanna.wordpress.com/ Jeannie Danna

    #22 Roger, I loved this one:

    Never underestimate the limited intelligence of the free and the brave. We have bred a nation of morons – no doubt by design. And now we’re reaping the harvest.

    If a health care public option is not adopted, then these words are truer than ever!

  • http://www.republicofdave.com Dave Nalle

    Jeannie, I see the rise in the desire of people to think for themselves and be more responsible for there own lives as a sign we’re not as stupid as I thought.

    Dave

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