Jon Kyl - Objectively Pro-Discrimination

Under current law, health insurance companies can deny you coverage if they decide you actually might use a doctor. They can discriminate against broad classes of Amercians based on what they call in insurance-speak a "pre-existing condition." They can even go back after you turn in a claim and find some typo in your medical history form that allows them to dump you from the coverage rolls.

Jon Kyl, the #2 Republican in the Senate, thinks this is all fine and dandy.

The distance between the parties' leaders on health care was made clear on Tuesday when the No. 2 Republican in the Senate held a conference call with reporters.

Asked by ABC News about a package of insurance market reforms that have been endorsed not only by President Obama but also by the insurance industry, Sen. Jon Kyl came out against all three proposals.

In particular, the Arizona Republican signaled that he opposes requiring insurance companies nationwide to provide coverage without regard to pre-existing conditions; requiring them to charge everyone the same rate regardless of health status; and requiring all Americans to carry health insurance.

"One of the concerns I have about the approach of the Democrats ... is an assumption that there has to be a national mandate on all insurers to do various things," Kyl told ABC News when asked for his position the three issues.

"Those are techniques that states can, and some have, used in the past with fairly disastrous consequences," he said.

Part of what community rating would ban is allowing companies to charge women more money for health insurance, because they may use more care. And actuarial statistics show that the poor have a higher propensity for sickness due to environment and food choices, which means that they are discriminated against at a higher proportion in the insurance market. That's the system Jon Kyl wants to keep in place - a segregated system where large segments of society cannot even have the option of health insurance.

Even the insurance industry supports guaranteed issue and community rating. They want that along with a forced-market monopoly, with no competition from a public insurance option, so that the government can subsidize their businesses and turn people who cannot afford health insurance into criminals. But that would be LESS RADICAL than what Jon Kyl is proposing.

These are the people with whom we must engage in bipartisanship, or so it is told.

Tri-Committee Bill Released

I should mention that the Tri-Committee health care reform bill from the House has been released, and rather than bend to the dictates of marginalized Blue Dogs who value their relationships with the health care industry over their constituents, they created a pretty darn good bill. It's not perfect, of course, but it represents a far better bill on the left flank than, say, the Waxman-Markey bill did.

I'll post the brief on what the reform bill does for consumers:

LOWER COSTS
• No more co-pays or deductibles for preventive care
• No more rate increases for pre-existing conditions, gender, or occupation
• An annual cap on your out-of-pocket expenses
• Group rates of a national pool if you buy your own plan
• Guaranteed, affordable oral, hearing, and vision care for your kids

GREATER CHOICE
• Keep your doctor, and your current plan, if you like them
• More choice, with a high quality public health insurance option competing with private insurers

HIGHER QUALITY
• You and your doctors make health care decisions — not insurance companies
• More family doctors and nurses will enter the workforce, helping guarantee access
• Mental health care must be covered

STABILITY & PEACE OF MIND
• No more coverage denials for pre-existing conditions
• No more lifetime limits on how much insurance companies will pay
• No reason to ever make a job or life decision again based on health care coverage

The "national pool" refers to the insurance exchange, which is a hard concept to put into bullet points, but this is a pretty good list of how the average Americans would benefit from this plan.

As to the specifics, here's Ezra Klein, Scarecrow, Mcjoan and Jon Cohn. You'll notice a consensus. 97% of the population would get covered in 10 years. The subsidies are 400% of poverty and Medicaid gets expanded to 133% of poverty - both more generous subsidies than the Senate bills. Insurers are regulated against denying coverage for pre-existing condition or rescission, and the benefits floor is pretty decent. There are caps on out-of-pocket expenses, and efforts at controlling costs. It includes an individual mandate and an employer mandate that gets exempted for certain-sized small businesses. About the worst thing you can say about the bill is that some of the good stuff doesn't happen fast enough (to keep the size of the cost down):

I do have one, not minor concern: It will be a while before people see the best stuff. Most of the major elements--the insurance exchange, the subsidies, the insurance regulations, the public plan--won't come online until 2013 or later. This is, I believe, also true of counterpart bills in the Senate.

There's a sound policy rationale for going slow; it takes a lot of work to set up exchanges, regulations, and the like. But four years is a long time. And I suspect money has a lot to do with the pace. Slower implementation makes it possible to keep the price tag to around $1 trillion.

On the bright side, some provisions--filling in the Medicare drug donut hole, bolsteirng the primary care workforce, among others--would start in the next two years.

The cost of the bill, scored by the CBO at around $1 trillion dollars over 10 years, gets paid with $500 billion in internal cost savings and around $500 billion in new revenues, mostly with a surtax on the wealthy. I prefer other methods, but let's get real about this:

The details haven't been released yet, but most (if not all) of the families that fall under Rangel's tax plan will also be in this 1% range.

These are families that paid a lower rate in 2006 (the last date of available data) than they did 15 years ago. That's not an argument for upping the taxes, of course. But it puts it in perspective. (Confession: If you go back to the Reagan years, the top effective rate is lower. But the current rate is still below the historical average.)

News reports have anticipated Rangel proposing a 1-3% surtax. Even a 3% increase across the board will leave an effective rate lower than it was in 1995.

The President approves of the general approach of the House bill, and the Education and Labor Committee will start markup this week. The bill text is here and a summary is here.

We're off and running.

...more on the surtax from Tim Foley.

Public Enemy

The health care debate thus far has really focused on creating a public option to compete with private insurance companies. The various players are choosing up sides. The Obama Administration, expressed by their Health and Human Services Secretary, supports it, as a means to encourage competition and innovation. The White House is joined by 70-odd members of the House who have said no public plan, no deal, and 21 members of the Senate (so far), including moderates like Claire McCaskill and Jim Webb. On the opposite side are, well, Republicans, and their paymasters in the health insurance industry, simply because they want to preserve their monopoly over the market and their advantages that don't impact the bottom line for consumers, but instead get shoveled into profit margins and executive pay. The health insurance lobby's view is that they will adopt modestly more fair practices (guaranteed issue, modified community rating) as long as the government forces individuals to buy health care and subsidizes them, an indirect payment from the Treasury to the insurers themselves. Not surprisingly, these views mirror those of "moderates" like Ben Nelson, who coincidentally has taken millions from the insurance industry in campaign contributions, and previously owned a major insurance company.

(By the way, memo to the media: what the insurance industry is offering does not add up to a concession. These are the same "concessions" made by the industry in 1993, and yet they bashed the final plan and stopped its passage. These measures would reform insurance but not reform health care, which can only come through increased competition and a resetting of the perverse incentives that insurers have to limit treatment. Only real reform would lower costs and provide better care, and forcing a monopoly doesn't exactly get all the way there.)

Chuck Schumer has tried to design such a plan, and does a good job of defending it and naming it ("Plan USA"), but under the guise of a "level playing field," it's hard for me to understand how his plan would be anything more than a non-profit insurance option doing little to truly lower costs unless it were scaled up massively. Sure, this kind of public plan would limit overhead and advertising costs, and wouldn't pay executives. But if it can't bargain for lower rates in the way Medicare can, in fact over time you'd probably see what happened in Medicare Advantage (the private insurance supplement to Medicare), where the playing field got tilted to the private market until the government stepped in this year to put a stop to it.

We all know that the only way to truly bargain down costs is through a single payer option. I'm willing to support a public option grafted onto the current system, for now, as long as it retains any ability to bargain for lower costs in the way that single payer would. However, we're getting a bit afield of the nut of the issue if we continue to discuss the mechanism of the public plan. Because a far bigger obstacle to meaningful health care reform is how the hell to pay for it. Literally every funding stream that has been discussed gets quickly shut within a matter of days. Today, Charlie Rangel ended the option of capping or taxing employer-provided health benefits. Earlier they cut out Obama's plan to cap charitable deductions. We're talking about well over a trillion dollars, with big outlays in the short term to get the system to bend costs downward, and if nobody wants to determine a way to pay for it, health care reform dies.

Health Care Sausage Making

If you thought the sausage-making on the stimulus was bad, wait until you see health care reform. The players are more invested in getting their way and more rigid in their opinions. Chuck Grassley seems to be mad about the Obama Administration cutting 60 worthless private tax collection jobs in Iowa (that were costing the IRS more money than the tax collectors were taking in), and folks are worried that he'll take it out on the bill. That's the silliness that we're dealing with.

Everyone's making goo-goo eyes at each other at this point, but when you get to the actual facts, there are yawning divides between the parties. Karen Ignani of AHIP, the health insurance lobby, thinks she's sketching a "deal" by offering guaranteed issue in exchange for an individual mandate. In other words, force everyone to buy health insurance and we'll sell it to everyone! But there's one missing ingredient:

The missing ingredient is affordability. And the expectation is that affordability will be guaranteed by "community rating," a policy that ends the ability of insurers to charge different customers different prices based on age, health status, location, etc. At Brownstein's forum, Ignani addressed this, too, and her comments are worth quoting:

She suggested an arrangement in which insurers and the government in effect would divide the cost of insuring the biggest risks through a combination of rating reform and public subsidies. "You have to think about the ratings and the subsidy in tandem," she argued. For instance, she noted, a pure form of community rating--in which everyone is charged the same premium regardless of their age or health status--would substantially increase rates on young healthy families (while reducing them on older or sicker people). In that instance, "you might decide well then we could subsidize those [young] individuals to cushion that," she said. Alternately, she said, you might allow insurers to vary rates somewhat based on age, but use subsidies to ensure that say, "nobody over 55 would have to pay more than 10 per cent of income" for premiums--as California did in its reform. More details on the issue are coming: "You will hear a great deal from us soon about rating," she said.

That just doesn't seem like it would work, but Ezra Klein argues that insurers are not even the main factor in affordability concerns (they take one out of every three dollars for themselves, so I'm not sure I agree), compared to pharmaceutical companies and device manufacturers and doctors and hospital associations.

So this is, simply put, a mess. And Max Baucus addressing costs by wanting to tax health care benefits, precisely what John McCain got hammered for during the campaign, is not helpful at all. I could possibly see capping the health care deduction at a certain level of care, but employers are really not the people to bargain with for revenue. It's far more important to bring down costs.

Meanwhile, Republicans are laying down markers.

Does that matter? It's hard to say. Rhetorically, the GOP has staked out a very narrow corner of opposition. Last week, Mitch McConnell, Chuck Grassley, Mike Enzi, Orrin Hatch, and Judd Gregg -- essentially, all the Senate Republicans with jurisdiction over health reform, and McConnell -- co-signed a letter to President Obama. I've obtained a copy, and it's up for download here. They draw two lines in the sand. First, they warn against using the budget reconciliation process to pass heath care. Doing so would "make it difficult to gain broad bipartisan support" and "do a disservice to this important issue." Substantively, they fear a public insurance option. "Forcing free market plans to compete with these government-run programs would create an unlevel playing field and inevitably doom true competition," they say. "Ultimately, we would be left with a single government-run plan controlling the market."

That leaves, of course, plenty of room for eventual argument and obstruction. But there's a caution worth recognizing here, too. Republicans do not want to begin in opposition. They have begun this debate by claiming that their objections lie at the margins of health reform, not at its core.

Ah, but it's on the margins where you can kill policy, and the Republicans know it. I think the health care debate is going to give me heartburn. Although one of these demands is silly. "Don't use budget reconciliation or the bill won't be bipartisan"? The POINT of using budget reconciliation is that you'd only need 50 votes. They're getting it backwards. And the Obama Administration should threaten to use reconciliation at every step to force Republicans to come along. They can either be involved in the process, or on the outside.

Mandates Are Go

There were three major issue silos that Barack Obama called for major progress on in last night's speech. On only one issue did he provide a guarantee that we'll work on it in this calendar year, and that's health care. Now Harry Reid is putting calendar dates to that request, calling for a start to the process in the summer before the August recess.

As for what form any bill will take, as I mentioned briefly, the Obama team is softening their resistance to an individual mandate.

Here's how it will work, according to the officials I've spoken to. The budget's health care section is not a detailed plan. Rather, it offers financing -- though not all -- and principles meant to guide the plan that Congress will author. The details will be decided by Congress in consultation with the administration.

One of those details is "universal" health care coverage [...]

The budget -- and I was cautioned that the wording "is changing hourly" -- will direct Congress to "aim for universality." That is a bolder goal than simple affordability, which can be achieved, at least in theory, through subsidies. Universality means everyone has coverage, not just the ability to access it. And that requires a mechanism to ensure that they seek it.

Administration officials have been very clear on what the inclusion of "universality" is meant to communicate to Congress. As one senior member of the health team said to me, "[The plan] will cover everybody. And I don't see how you cover everybody without an individual mandate." That language almost precisely echoes what Senate Finance Chairman Max Baucus said in an interview last summer. "I don’t see how you can get meaningful universal coverage without a mandate," he told me. Last fall, he included an individual mandate in the first draft of his health care plan.

The mandates argument during the Clinton/Obama primary took on a kind of mythic importance because it was among the few major differences between the candidates. Only it was not a giant difference at all, really. There was always room for mandates down the road in Obama's plan, if other approaches to get to universality didn't work. If this is the way for Congress to put their stamp on the policy, I don't think it's the worst idea.

However, I think an individual mandate would have to be carefully described. It would have to include guaranteed issue, ending the ability for insurers to deny a customer for a pre-existing condition. And it should have community rating, which would allow a flat rate of care for everyone in a community regardless of medical condition. There also must be a public option so that insurers would have to compete for this forced market on quality and price, and not have an incentive not to provide care. Finally, there has to be a focus on both prevention and overall population health, which includes nutrition and exercise and a recognition that income inequality contributes massively to poor health outcomes.

My preference would be single payer, but with all those crucial elements, an individual mandate can work.

There is a way forward with this plan, and if it includes these elements, Americans will support it. 7 in 10 “would favor a proposal that would increase the government’s influence over the health-care system in an attempt to reduce costs and expand coverage,” and most find it the number one pressing need after the economy. Of course, the two are linked. A rational health care system will increase global competitiveness and provide for worker security. This is a legacy builder. Health care is on the fast track to a solution.

SEIU and Health Care for America Now have a good action that will keep the pressure on.

And Say, Do You Want To, Make A Deal?

Ultimately, I do believe that universality is a key to driving down costs in the health care market. But you can definitely take it as a sign that an individual mandate may not be the way to go when the insurance industry is asking for it.

WASHINGTON — The health insurance industry said Wednesday that it would support a health care overhaul requiring insurers to accept all customers, regardless of illness or disability. But in return, the industry said, Congress should require all Americans to have coverage.

The proposals, put forward by the insurers’ two main trade associations, have the potential to reshape and advance the debate over universal health insurance just as President-elect Barack Obama prepares to take office.

In separate actions, the two trade groups, America’s Health Insurance Plans and the Blue Cross and Blue Shield Association, announced their support for guaranteed coverage for people with pre-existing medical conditions, in conjunction with an enforceable mandate for individual coverage.

What's important here is what's missing, as Ezra Klein notes. If you are forced to buy health insurance and the insurers won't make it affordable, that's not really a positive for the individual. Guaranteed issue must be combined with community rating (baseline insurance at the same cost for everyone in a community) for the mandate to work. And that's not what the industry is proposing.

I e-mailed Robert Zirkelbach, AHIP's spokesman, to ask if this proposal had a community rating provision:

"the proposal we issued yesterday was for guarantee issue combined with an individual mandate.

We also need to take steps to ensure coverage is affordable for all. There needs to be an adequate safety net and we should provide tax credits to low and moderate income workers. We also have to address the key medical cost-drivers that drive up the cost of coverage."

In other words, no. At least not yet.

Not to mention the intimation that they'll keep raising their rates and let government pick up the bill through tax credits.

Considering that the insurance industry is a useless, inefficient middle man that does practically nothing to make people more healthy, I don't think they should be in the business of making ultimatums. But the fact that they're at the table means that they know change is coming and they had better try to get something out of the deal than scuttle it. Hopefully, their attempts at negotiation will be met with hardline opposition unless they capitulate on price.

We have a long way to go on health care reform, and there are a lot of elements we need to make sure are included (public option and a mandate that insurers pay a hefty amount of their premiums on treatment being at the top of the list). But more than anything, this is an acknowledgement by the insurance industry that they're going to have to make a deal.

The Health Care Moment Has Its Epiphany

There's something of a consensus that Netroots Nation didn't offer enough adversarial panels and instead largely consisted of bloggers agreeing with one another. But that's not true. I personally witnessed the most adversarial panel of the weekend, and it was spectacular, because finally, both factions of the debate about health care policy on the left were able to come together and understand the political contours of the brewing fight in the Congress.

The panel was entitled "Time for Action: How the Netroots Can Lead on Healthcare Reform," and was put together by Eve Gittleson, who blogs at Daily Kos under the moniker nyceve. There's a good liveblog of the panel here, but what you need to know is that Gittleson stacked the deck. She had some great health care activists who are doing great work in different areas of the space: Giuseppe Del Priore, MD, MPH a New York cancer surgeon; Hilda Sarkisyan, whose daughter, Nataline, died after being denied a liver transplant by Cigna; Rocky Delgadillo, Los Angeles City Attorney, who is pursuing civil and criminal investigation into insurance practices; Geri Jenkins, RN a member of the Council of Presidents of the California Nurses Association/National Nurses Organizing Committee. And then Ezra Klein, associate editor for The American Prospect and a health care policy guru, appeared at the end of the panel. The aforementioned speakers were all powerful advocates. Sarkysian, whose family HAD health insurance and still couldn't get their daughter what she needed, said bluntly "This is not a good country anymore." Del Priore discussed the need for doctors and patients to handle questions of care and the need to arrest insurance executives for their crimes in denying coverage. Rocky Delgadillo outlined the schemes, like rescission (even based on spousal applications), that insurers are engaging in to maximize profit at the expense of patient care. He also mentioned how California regulators ignored a million-dollar fine to Blue Cross because they feared they would lose the case if it went to court, which is just unbelievable. And Jenkins argued that the insurance industry will play no role in reforming health care, and we need to move immediately to a not-for-profit system.

Good points all. And then Eve turned to Ezra:

Eve: Ezra, why does HCAN want to condemn Americans to this kind of system? I get confusing emails from Elizabeth Edwards and MoveOn talking about the atrocities of the insurance industry, then marginalizing the only viable solution. Can you explain this new Edwards HCAN initiative, the TV commercials, etc. . . What's it all about? What are they trying to do? It seems there are three initiatives on the table--676, Wyden and HCAN. What's wrong with Wyden and Edwards? And a follow-up...what can we realistically expect from President Obama?

I hope you don't mind that I'm sand-bagging you. I love you, really, Ezra. I just don't agree with you on this point.

This apparently startled Mr. Klein. But for him to not know the position of Eve and the CNA and an activist like Hilda Sarkysian speaks a lot to his cloistered state in Washington. Because I know all about this fight. I made one positive comment about HCAN upon their launch and took massive amounts of crap for it. I was called a defeatist and admonished for not being true to the cause. My only point was that having an organization with $40 million dollars to spend on calling out health insurers on their garbage is going to be tremendously helpful to whatever reform we get through the Congress, and furthermore I didn't see them having much of a place at the table in the policy debate. In other words they were finally an organization concerned with moving public opinion and playing the health care debate out on political grounds rather than policy grounds. And on the panel, Klein echoed the importance of politics over policy:

You can take a lot of approaches to health reform. You can emphasize policy, politics, principles, or some mix thereof. Judging from the panel, Health Care for All, and the California Nurses, could use a bit more politics in their approach. It was a panel about "health reform" -- not care or policy, but "reform" -- at a conference of engaged politicos that never mentioned the Senate, or votes, or the conditions required for presidential signature.

There was a lot of talk about "fighting" insurers and other special interests, but not much about what that fight will look like, or where it will take place, or who decides the winner. My argument, was that, for reformers, insurers aren't the real enemy. Setting them up as the opponent actually gives them too much credit. Insurers are stupid, profit seeking beasts -- the enemy is American politics, and in particular, the structural feature of the US Senate that have repeatedly killed health reform in the past. No matter what your policy preference, that's where your organizing has to be focused, because that's where the actual fight happens: In Congress. Not on panels, or on blogs, or among the Left. In the US Senate, where you have to get to 60, or at least figure out how to get rough Democratic unity for using budget reconciliation and then convince Kennedy and Carper to vote "aye" on the same bill.

This is basically the same argument Ezra makes continuously on his site, but it appeared to hit the audience like they never heard it before. And considering that it's largely the correct analysis, it was generally well-received, I thought. I spoke later with Eve, who told me that she had a conversation with someone from HCAN and "they are not the enemy." What a concept - all elements of health care advocacy on the left working together, for a change, toward a common goal.

Now granted, this week they all had a big juicy target. AHIP, the health insurance lobby, put together a fake grassroots front group called The Campaign for an American Solution. Of course, that "solution" involves funneling more cash and customers to the same broken insurance system we have now. Now, who was the very first group to coordinate a counter-attack on this front group on the first stop of their listening tour in Columbus, OH? That's right, HCAN

Well, that didn’t take long.

A day after Politico reported the health insurance industry is launching a health care reform campaign next week, the progressive reformers are firing back.

Health Care for America Now announced Friday that it plans a news conference and a rally next week to counter the insurance industry’s Campaign for an American Solution, which launches in Columbus, Ohio, on Tuesday with a roundtable discussion among uninsured locals.

“They’re pretending that the health industry represents the American public, and we need to make it really clear to them and the public that all they represent are their own profits,” said Richard Kirsch, national campaign manager for Health Care Now.

Indeed they did attend the launch, and got to ask some tough questions, confronting the head of AHIP and asking her how an insurance industry group could possibly be objective in pushing for lower rates and higher quality coverage when they are concerned solely with the profit motive. It got heated, and I'm glad they did. And all of a sudden, Daou's Triangle started closing. Rep. Pete Stark came up with a great quote:

"America's Health Insurance Plans' new 'Campaign for an American Solution' rings as true as the tobacco industry's efforts to end smoking. There is nothing grassroots about it. It is designed, financed, and coordinated through their Washington trade association with the singular goal of protecting their profits.

"I hope it is true that these companies intend to be a positive force in health reform efforts, but I tend to be cautious when the fox starts drawing up plans for a new henhouse."

HCAN called up the hotline for the Campaign for an American Solution that they set up for the public to provide input... and they got an answering machine. They've trickled this out one by one and pretty much ruined the launch of AHIP's front group. That's REALLY important for the future of health care reform. Because on the policy the views are far closer on the left than most people imagine. Everyone knows that whatever system is ultimately put forward can be paid for in a far better manner than the current wasteful, inefficient system. So expense should never be a deterrent, meaning we can build whatever system we choose and it is extremely likely to go revenue-neutral very quickly once we eliminate the shoddy budgeting of the current broken system. We know that health insurers will not jeopardize their profit margins unless they're forced to. Once you recognize these two realities, the policy goals become fairly clear. The political goals have to include attack dogs pushing back on the false memes of the right and the insurance industry, and pressuring the Senate to do the right thing.

Now Obama's plan includes some better regulation toward insurers (including guaranteed issue and community rating) and a public option to compete with the private insurance market and take the step toward a sequential single-payer. (His latest addition to the plan, a tax credit for small businesses who offer quality health care, is borrowed directly from the Clinton plan, raising hopes that eventually he'll just borrow all of it, as he should). Despite this being a fairly modest set of reforms, McCain and the right are going to denounce it as government-run "Hillarycare" anyway. So it's vital to have a broad coalition to give as good as they'll get from the right and give the lawmakers backbone to push the policy forward. Matt Stoller writes:

Coalitions are strange beasts, with multiple moving parts, but they are also the only way anything gets done. A coalition has a core of organizers behind it, and a variety of groups out in front who each take different roles. Some people can talk to Republicans, some people can talk to Democrats, some people threaten, some people cajole, some people talk to businesses, etc. HCAN is driven by labor in the form of SEIU, the NEA, AFSCME, and United Food and Commercial Workers, as well as groups primarily funded by labor such as Americans United for Change and the Campaign for America's Future. It is also driven by direct mail and Foundation based organizations, such as La Raza, Planned Parenthood, Center for American Progress Action Fund, Center for Community Change, and the National Women's Law Center.

Stoller goes on to make the point that HCAN should broaden their mandate and make this a fight about general health, and I agree. Going after convenience stores that sell fatty, sugar-laden food to kids sounds like it could be a part of their mandate. The farm bill, the transportation bill (more mass transit and more livable, walkable cities means healthier lives), and others could be brought onto the field of battle. But the larger point is that coalitions of this nature are built because they work. And the benefit is that they give lawmakers breathing space to do their job and the spine to do it right. This moment in health care demands that everyone understands the political spade work necessary to reach the desired outcome. So out of the ashes of that contentious NN panel came something pretty special. Groups across the center-left ideological spectrum working together to end the health care crisis in America and restore treatment as a basic human right.

The Value Of Leadership

Turning to a positive portrait of the candidates after that bit of negativity, it struck me that a couple of the newer themes that both candidates used on Thursday night at the debate have the potential to move the national conversation on those matters.

Hillary Clinton talked very strongly about eliminating the pre-existing condition requirement from the health insurance industry, in a new way. She said, "how is it unconstitutional for us to discriminate against Americans on the basis of race, sex or gender, but it's OK to discriminate against the sick?" I had never heard it put in those terms before, but it's surely a lot more powerful than the wonky term "guaranteed issue." Sure enough, Rep. Steve Kagen, (D-WI), himself a doctor, is sponsoring a bill called the "No Discrimination in Health Insurance Act."

This essential legislation will guarantee access to affordable care for every citizen in America by bringing an end to discriminatory practices employed by insurance companies who deny life-saving coverage to millions of Americans solely because of their pre-existing medical conditions.

The grim reality is our Constitution does protect you against discrimination, until you become ill. Well, my legislation puts discrimination where it belongs -- in the past.

Ending all forms of discrimination is essential, but it's also time we pull back the veil of secrecy and inject transparency into our health care marketplace. Shouldn't health insurance companies be made to openly disclose all their prices, so everyone sees the lowest price for insurance policies? Like prices for gas at the corner service station or food prices in your closest grocery store, every citizen should have the equal opportunity to pay the same price for the same product. It's called competition -- a uniquely American concept.

Go to your favorite restaurant and you'll find a simple solution for solving our health care crisis. They'll hand you a menu with a list of prices before you order.

This is just common sense, and when framed this way it's very hard to refute other than falling back on some kind of "socialized medicine" nonsense. Recission, the practice of retroactively cancelling policyholders, is not something that has a constituency. The $9 million dollar award to a female cancer patient who suffered from recission may put an end to the policy all by itself. But framing this as a rights and discrimination issue is absolutely the way to go. And Clinton's leadership in putting that perspective on display at the highest level makes it easier for people like Kagen to put forward this bill. For his part, a central part of Obama's health care plan, allowing children up to the age of 25 to be covered on their parent's plan, is being picked up by a number of different states.

In addition, Obama showed some leadership in boldly stating what we all know about Cuba policy.

And it's absolutely true that I think our policy has been a failure. I mean, the fact is, is that during my entire lifetime, and Senator Clinton's entire lifetime, you essentially have seen a Cuba that has been isolated, but has not made progress when it comes to the issues of political rights and personal freedoms that are so important to the people of Cuba.

Donna Edwards was on Hardball this week and basically said the same thing.

If there's anything to be gained by this slightly extended primary season, it's that liberal and progressive ideas will be pushed more and more into the mainstream as the media focuses on Sens. Clinton and Obama. I'm worried that will come to an end in a series of divisive attacks at the debate on Tuesday. But so far, the net effect has been positive. And considering that negative attacks have become progressively less effective throughout this campaign season, I think that dynamic will remain.

Your Semi-Regular Blue Cross of California Outrage of the Day

Today we find them asking doctors to break doctor/patient confidentiality and report back to them on their customers so the insurer can knock them off their plans.

The state's largest for-profit health insurer is asking California physicians to look for conditions it can use to cancel their new patients' medical coverage.

Blue Cross of California is sending physicians copies of health insurance applications filled out by new patients, along with a letter advising them that the company has a right to drop members who fail to disclose "material medical history," including "pre-existing pregnancies."

"Any condition not listed on the application that is discovered to be pre-existing should be reported to Blue Cross immediately," the letters say. The Times obtained a copy of a letter that was aimed at physicians in large medical groups.

Fortunately, doctors are recoiling at this effort to enlist them as de facto employees for Blue Cross. This is why eliminating pre-existing condition has to be the very first priority of any major health reform. If the insurers weren't spending so much money trying to get sick people kicked off their roads, maybe they could afford to actually help people get well.

Meanwhile, it turns out that one interest group is really interested in single payer healthcare: employers:

Many large employers are struggling with the obligation to cover the rising medical costs of retirees, but last year officials in Michigan found a way to save at least $40 million on care for retired teachers and other public-school workers: Send the bills to Washington.

Almost overnight, by taking advantage of a little-understood feature of Medicare, the school retirement system shifted a big chunk of the healthcare costs of more than 100,000 retirees off its budget and onto the federal government. This year, the state is shifting its civil service retirees too.

Michigan is not alone. Across the country, state and local government agencies, big nonprofit organizations and major corporations are rushing to do the same. One result is that the Medicare trust fund is evaporating even faster than expected.

At the heart of what critics say is a major cost-shifting maneuver is a program called Medicare Advantage, which pays private insurers a bonus to take over Medicare coverage for seniors.

The payments to the private insurers average more per senior than the cost of care with regular Medicare. The bonus payments enable insurers to offer features that seniors in regular Medicare don't get.

That has made the private plans attractive to individual seniors, with nearly 9 million -- about 1 in 5 -- now enrolled in them.

Medicare Advantage payments were floated as one way to pay for SCHIP, by the way. If you want a public program, that's one thing. But a public program that actually uses the private insurers, allows for all the same pitfalls as the private system, and has no funding source whatsoever, that's not the way to go and will crumble the only safety net left for the poor and the elderly.

Bonuses For Cancelling Insurance

This is the benign face of the industry that will undeniably get richer in a for-market "universal" health care approach:

One of the state's largest health insurers set goals and paid bonuses based in part on how many individual policyholders were dropped and how much money was saved.

Woodland Hills-based Health Net Inc. avoided paying $35.5 million in medical expenses by rescinding about 1,600 policies between 2000 and 2006. During that period, it paid its senior analyst in charge of cancellations more than $20,000 in bonuses based in part on her meeting or exceeding annual targets for revoking policies, documents disclosed Thursday showed.

The revelation that the health plan had cancellation goals and bonuses comes amid a storm of controversy over the industry-wide but long-hidden practice of rescinding coverage after expensive medical treatments have been authorized.

Cancellation GOALS. That's right. One man's catastrophic medical and financial situation is another man's new boat.

This is of course nothing new. It's standard practice for most insurers. When you get sick and put in a claim to actually use your health insurance, your file is immediately sent to the cancellation department and people review it for the slightest rationale to dump your coverage.

Now, market reforms like guaranteed issue, which would mandate that insurance companies cover anyone who wants health insurance regardless of pre-existing condition, would stop this practice. California's latest iteration of a health reform bill includes this policy. But let's not be so naive that insurers will not find other ways to stop paying their claims, and use the spectre of "affordability" to do so:

Insurers maintain that cancellations are necessary to root out fraud and keep premiums affordable. Individual coverage is issued to only the healthiest applicants, who must disclose preexisting conditions [...]

The documents show that in 2002, the company's goal for Barbara Fowler, Health Net's senior analyst in charge of rescission reviews, was 15 cancellations a month. She exceeded that, rescinding 275 policies that year -- a monthly average of 22.9.

More recently, her goals were expressed in financial terms. Her supervisor described 2003 as a "banner year" for Fowler because the company avoided about "$6 million in unnecessary health care expenses" through her rescission of 301 policies -- one more than her performance goal.

In 2005, her goal was to save Health Net at least $6.5 million. Through nearly 300 rescissions, Fowler ended up saving an estimated $7 million, prompting her supervisor to write: "Barbara's successful execution of her job responsibilities have been vital to the profitability" of individual and family policies.

Let's not claim that "but in the future, this will be illegal" and clap our hands in self-congratulation. This is ALREADY illegal in the state of California. You can't tie bonuses to claims reviews. But they did it nontheless.

So when you make deals with a for-profit health insurance industry, don't be surprised if they ever so slightly go back on them.

A Sick System

I think at this point I'm deeply frustrated by all sides of the health care debate in California. You have the purity trolls who believe that anything to the right of single-payer healthcare is the work of the devil and are feeding into right-wing attacks on the Speaker (some of them completely well-deserved, we'll get to him in a moment) to advance their goals. You have dissemblers like Arnold and his Hoover Institute backers who will claim that their plan is universal health care "just like Hillary Clinton's" when it offers no cost controls on insurers and essentially just creates an expensive forced market. And then you have the "go-along-to-get-along" folks who talk about "expanding access" while driving us into the ditch of strengthening employer-based health care, applying a 1940s solution to a 21st-century problem.

Nobody's working together because nobody has the incentive to work together, and there's the safety valve of the ballot box which all sides see as a panacea. So nothing will advance in this special session, and remarkably, that's probably a good thing.

The Republican position on health care is that people have too much health insurance. They want to make lousy insurance cheaper so people will buy it and "be covered," but not be able to use it as much. As the insurance industry LOVES this approach, it's the only thing they'll ever champion, in the name of "universal health care." This is why I disagree with some in the lefty blogosphere who think that just getting people like John Boehner to address universal health care is a win. No, it devalues the word. They've already turned it into something deceptive like the forced market Schwarznegger has put forth in his failed bill. The end result is confusion, leading to blurring like "Arnold's strategy is the same as Hillary's." Actually, that's almost completely untrue.

I'm not immune to an incremental approach while we continue to build the coalition for the end to for-profit health care in California. Here are two small things you could put on a ballot tomorrow that would pass: guaranteed issue, which would eliminate the practice of denying health care to anyone based on a pre-existing condition; and community rating, mandating that all insurers provide their coverage to a community at the same price regardless of age or relative health. Those two steps alone would be vastly preferable than trying to jerry-rig an approach that will inevitably take steps backward rather than forward. The insurance industry is hated in this state and in this country, and nothing beyond the status quo or forcing a market to them will placate their concerns. So if you're going to have a vigorous opposition, at least have it be in service to something that makes sense.

UPDATE: Ezra preaches it:

On the micro level, a health crisis can leave you bankrupt if you lack insurance, have too little insurance, have too high a deductible, or your insurance decides not to cover the costs of your treatment. On the macro level, the spiraling cost of health care is a massive threat to our economy. Looking into the future, if we don't restrain the growth in health spending, effective GDP-per-person (i.e, what's left after health costs) will actually begin to go down (here's a graph!), and we'll all become poorer. And my hunch is that the only way to restrain health costs in a humane and politically palatable way will be through integrating the system, bargaining down prices, and rearranging consumer incentives so soft rationing -- i.e, ineffective drugs receive less reimbursement, and so aren't as often used -- becomes possible.

These should be the minimum requirements of a sound policy. The conservative position, again, is "people use too much health care." Why this can't be honed into a fine point is beyond me.

Health Care Special Session Update - A Document Appears

So out of the "magic fax" in Sacramento where all bills without authors are created comes new "legislative language" on a compromise health care proposal, language that nobody has claimed as their own and that everyone is disavowing, but which looks mysteriously like the Governor's handiwork. You can take a look at this language yourself here.

We are disappointed that we seem to back to square one with something very similar to the Governor’s January proposal, with only a few of our comments and concerns raised over the course of the year addressed. While we would have preferred having the Governor’s language much earlier in the year, we do appreciate having the language to seriously respond and react to--if that is what it takes to move the conversation forward.

It's like when you work really hard on a document, but then the computer crashed, and you have to reboot and start again. It's frustrating, but the goal doesn't change.

This could have played out over the regular session if the governor would have distributed this and negotiated at that time. But as he jets off to China, this gets dropped in everyone's lap - and look what's in there:

• The elimination of quarterly complaint and greivance reporting for HMOs, which seems to remove an important oversight over insurers.

• The apparent increase in the permissible premium, for those making 150-200%FPL (federal poverty level), at a level that is still too high--5%, which does not include out-of-pocket costs.

• The lack of any standards for out-of-pocket costs in the subsidized pool. Given that one can drive the cost of a premium down by raising deductibles and cost-sharing, the limit of premiums provides small comfort.

• An exemption from the minimum level of coverage for any and all employer plans. The draft still has, as a placeholder, an unacceptable $5,000 deductible (and $10,000 out-of-pocket max) plan as a minimum level of coverage under the individual mandate... but that even that low minimum does not apply to individuals who take up employer-based coverage, meaning they could have coverage with very skimpy benefits, or no out-of-pocket maximum.

• A weak definition of the minimum Medical Loss Ratio (the amount spent on patient care rather than administration and profit), so that it applies to an insurers’ entire portfolio of business, meaning this rule would no longer provide assurance that any specific product is of good actuarial value. A limit that was product-by-product, or even market-by-market, would be more helpful to consumers.

• The Healthy Action benefit seems to be less than advertised as well, since it only requires an insurer to offer such a product, but does not include smoking cessation or obesity programs as a mandated benefit. With no requirement, the policy seems more likely to be a way for insurers to identify risk, rather than a viable new benefit for consumers. If this is truly a priority, it needs to be a mandated benefit.

• And most concerning, the guaranteed issue protections in the individual market seem hollow with the new details. Only a few high-deductible, low-benefit products will be guaranteed issue to begin with--so those with "pre-existing conditions" will only have access to the coverage in the market that is least suited to them. There would be little assurance that we would ever get to a second phase of having the full market guaranteed issue. Insurers will be able to use benefit design, marketing, and pricing to avoid those California customers that have health risks and needs. In particular, we believe older Californians will simply be priced out of the individual market, and the guaranteed access an illusion.

I can live with an individual mandate if it included guaranteed issue and significant cost controls, in addition to a baseline of coverage for the insured and a cap on prices. But this proposal seeks to eliminate practically all of those checks on the insurance companies while maintaining the individual mandate. This is nothing but a license to print money for the insurers.

Since nobody will claim this document, it's hard to know whether or not this is the result of any negotiation or if it's the Governor's response to AB8. Therefore, it's hard to know whether or not the end result will be something in the middle, or something pretty close to this orphan document. If the latter is the case, health reform should be torpedoed in the special session without delay. These terms are unacceptable.