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Health Care Reform 2009: A Train Wreck In Slow Motion

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As July starts to wind down and the August recess by Congress fast approaches, the debate over health care reform enters a late stage with increasingly bitter partisan differences over very divisive issues. Every day we hear about more Democrats siding with the Republicans, especially the Blue Dogs worrying about the high costs of plans on the table. Senate leaders are threatening that higher taxes and the public option will be deal-breakers. With President Obama pressing both parties for an early resolution of their differences, the hope for a bipartisan bill this year is rapidly fading. Each day brings new terms into the debate, ranging from triggers to exchanges and coops, without enough details or track record to gain our confidence that any real reform is on track.

As the debate gets more heated and polarized, confusion increases among the public. Not surprising, especially since that is the goal of stakeholder disinformation campaigns. Since the stakes are enormous -- health care being 17 percent of our economy -- market stakeholders are pulling out all the stops in their lobbying and advertising efforts to make sure that their markets aren't bothered too much.

Individual mandates are part of the proposals being developed in both the House and Senate. Employer mandates can also be expected from the House and (except for small employers) from the Senate. The Senate's Committee on Health, Education, Labor and Pensions (HELP) recently approved, by a party-line vote of 13-10, a proposal that would stop the ability of insurance companies from denying coverage based on pre-existing conditions and provide a public option for those unable to find an insurance plan. The House proposal calls for an individual and employer mandate, a public option, various attempts to offer guaranteed coverage and insurance market reforms, a government-run insurance exchange, graduated surtaxes on those making more than $350,000 a year, and government subsidies for those with incomes up to 400 percent of the federal poverty level ($88,000 for a family of four). Tax credit support is being considered by Senate committees for those with low to middle incomes.

The most intense disagreements are now whether (and how robust if included) a public option will be in "keeping the insurance industry honest", changes in tax policies for employers and employees, the cost of a reform bill, and how and who will pay. After a charm offensive in recent months by the major corporate stakeholders -- insurers, business, PhRMA, hospitals, and the AMA -- which included voluntary pledges to save up to $1.5 trillion over ten years, most are now starting to backtrack on what were never solid or enforceable commitments. And now we are starting to see a circular firing squad forming up among the stakeholders intended to shift more risk to other stakeholders. For example, business organizations are describing the employer mandate in the more than 1,000 page House bill as a job-killer by requiring employers to pay a fee or penalty of 8 percent of wages and increasing the costs of hiring a new worker.

So doesn't all that give us hope that health care reform is just around the corner? Unfortunately, no. All of these proposals are based on faulty assumptions:

• We are asked to assume that the private health insurance industry is worth preserving, that it offers increased choice, that its products offer better value, that it best fits our culture; all of these claims have been discredited by its track record, as documented by my recent book Do Not Resuscitate: How The Health Insurance Industry Is Dying, and How We Must Replace It.

• There is nothing in these various proposals that can rein in uncontrolled inflation of health care costs; they lack significant cost containment mechanisms; they relate only to federal spending on health care, not total health care spending or that which patients will pay; the costs of government subsidies are not clear, and the costs of expansion of Medicaid have not even been scored by the Congressional Budget Office (CBO).

• The non-partisan CBO today gives us the following sobering assessment of costs: "In the legislation that has been reported, we do not see the fundamental changes that would be necessary to reduce the trajectory of federal health spending by a significant amount and, on the contrary, the legislation significantly expands the federal responsibility for health care costs."

So while we are getting assurances from the President and some legislators
that this year's health care reform effort is on track, there is growing evidence that it will soon leave the track when and if an actual bill emerges from Congress.

You might think that the current legislative debate draws from health policy science. We do have such a science, with a substantial literature of what works and what doesn't, but that knowledge is unfortunately not driving the debate. Instead, the debate goes forward based on unfounded ideology, corporate money and influence. Subsequent posts will examine some of the elements of the reform effort in more detail.

John Geyman, M.D. is the author of The Cancer Generation and Do Not Resuscitate: Why the Health Insurance Industry is Dying, and How We Must Replace It, 2008 by John Geyman. With permission of the publisher, Common Courage Press.

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