Patrick Gilbert And The Danger Of Insufficient Reform

This remarkable viral campaign on Facebook has a very simple message. It happens to be the one that Harris Wofford rode to a Senate victory over a well-funded Republican opponent prior to the 1992 elections. It's what Bill Clinton pretty much ran on during those 1992 elections. It's an appeal to basic American fairness, and it's worked over and over again.

No one should die because they cannot afford healthcare. No one should go broke because they get sick, and no one should be tied to a job because of pre-existing condition. If you agree, please post this as your status for the rest of the day.

Before the day was out yesterday, Barack Obama had posted this message on his Facebook page, along with tens of thousands of others. It distills the entire debate about health care into something simple. An individual's health care should not be based on an individual's available funds. It's a winning message.

Except this message is exactly what's being bargained away, if reports are correct, in the latest round of capitulations.

Patrick Gilbert, an uninsured lumber company worker in upstate New York, is in a predicament that President Barack Obama and congressional Democrats believe they can solve. Gilbert and his wife have two children, but he says that on his family's $50,000 annual income, he can't afford the $600 monthly premiums for his employer's coverage.

"If I could find some reasonable insurance for about $100 a month, then I would do that," says Gilbert, 38, a lymphoma survivor who lives near Lake Placid. "Something reasonable, not with high deductibles. Something fair."

The House's health overhaul proposal would allow Gilbert to obtain family coverage for $250 a month, with the government picking up the rest of the premium costs. While that subsidy would make insurance more affordable for Gilbert, he could still be stuck with huge medical bills if he or his family members got seriously ill. In the worst case scenario, Gilbert could end up paying $4,400 in co-insurance and deductibles on top of $3,000 in annual premiums — adding up to 15 percent of his family's income.

Concern about the legislation's cost has overshadowed a major worry among some policy experts: Whether the Democrats' plans would protect low- and moderate-income earners from excess financial burdens, as backers have promised.

Under the House proposal, people receiving government subsidies could still end up spending 20 percent or more of their annual incomes on premiums, deductibles and co-insurance, according to estimates prepared by the House Committee on Ways and Means and obtained by Kaiser Health News. That financial load could grow substantially if the proposal's financing — $1 trillion over a decade — is pared back as congressional leaders come under pressure to reduce the legislation's costs.

The number now being put out there for the cost of the bill is $700 billion over 10 years. That may save rich people from a surtax, but it's impossible to provide affordable health coverage to everyone with those numbers. It probably needs to be twice that much. And so people will still die because they cannot afford health care. And people will still go broke because they get sick.

The problem is completely a lack of political will. There are plenty of savings that could be gathered from inside the health care system. But the White House wanted to protect industry profits and make deals to keep them from running attack ads. And unions don't want to go after the employer deduction, which keeps in place an inefficient system of employer-based health care that keeps costs high (because employers take them out of your wage increases, so they have little or no incentive to shop for good premium prices). By protecting most of the current system, the costs inside the system cannot possibly go down to the degree to make health care affordable. And as far as going outside the system, Democrats haven't made an argument about tax fairness since 1933, I think, and couldn't even pull off something as simple as lowering deductions for charitable donations back to where they were during the Reagan Administration.

A $700 billion dollar bill will have practically useless subsidies. And people just won't be able to afford insurance. So they'll remain out of compliance with the mandate. In fact, they'll probably qualify for exemptions from the mandate because insurance will be too expensive for them. And then insurers will complain that people aren't joining their system, making it unable for them to spread risk and lower costs. So they will raise premiums as a result, or maybe even go back to discriminating against people for medical history.

The subsidies and coverage expansion is crucial to the entire jury-rigged project here. You cannot take the subsidies away and expect the architecture to remain standing. Politically speaking, if the Congress accepts a $700 billion dollar spending bill and coverage remains unaffordable for those who need it, and prices continue to rise, it will be an unmitigated disaster just begging for repeal.