Cantwell Amendment Passes

It's not much, but for people making between 133-200% of the federal poverty level it's a good start.

Senator Maria Cantwell (D-Wash.), taking a page from a program originating in her home state of Washington, has successfully maneuvered an amendment through the Finance Committee that comes close to a public option while not quite getting there.

The program, which made its way into the finance committee bill by one vote, would affect those above the 133% of the federal poverty line (those below this threshold are currently covered by Medicaid) up to 200% of the FPL. This would include a family of four earning up to $44,000.

Rather than handing over the $6500 health insurance subsidy that these people would have qualified for under the initial Baucus plan, that money would be handed over to the states to create a negotiating fund to be controlled by the state.

Participants would not get their insurance from the state through some sort of state operated public insurance option. Rather, the state would combine all this federal subsidy money and use the clout of controlling this large sum of cash to negotiate with private insurers on behalf of participants in order to get them the best deal.

It’s something of a collective bargaining approach for those in a low income bracket, with the state functioning as the local labor negotiator.

I wouldn't call it "close to a public option." It's a good policy to bundle federal monies together and allow states to bargain with it, and it will allow for competition at that low end. Of course, insurers might have to raise prices on everyone else to compensate for either lower rates on that pool, or missing out on having them in their systems. But there are caps for that, theoretically, and I would have expected those insurers to push to the max of those caps anyway. So overall, this is a good policy, and I'm glad Cantwell got it through.

Among Democrats, only Blanche Lincoln voted against it.

What's In A Name?

What's In A Name?

by dday

Harry Reid is now saying there will be a "public option" in any final health care bill. I'm sure nobody knows precisely what he means by that.

U.S. Sen. Harry Reid, D-Nev., said today there will be a "public option" in whatever health insurance reform bill comes out of Congress.

"We are going to have a public option before this bill goes to the president's desk," Reid said in a conference call with constituents, referring to some kind of government plan.

"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," he said.

Tom Harkin said almost exactly the same thing today - and he said that Republicans wouldn't be at the table when the two Senate bills get merged together.

Here's the good news about this. Reid is acknowledging that he absolutely cannot get away with having a final bill without something he can call a "public option." And progressives have done a good job of very specifically separating out triggers and co-ops as something that would not fit that definition. This is almost entirely due to grassroots activism. The public option would have been thrown out months ago if nobody was advocating for it from the bottom up. It was certainly not the intention of anyone in Washington to go into October with this issue still up for grabs. They were perfectly content to jettison it to protect insurance industry profits.

That said - there is no definition here for what public option means. And if you asked Sen. Reid point-blank, I'm sure he wouldn't give you a definition. He wants something that he can call a public option so the grassroots can be satisfied. What will that be? Probably not co-ops or triggers because they've been too well-defined by the grassroots. There are other alternatives coming in their place.

Tom Carper is pushing the idea of giving the states the ability to create a public option, which states could then link together for increased bargaining power. They wouldn't be able to use Medicare bargaining rates and they wouldn't have Medicare's provider network. And being state-based, they wouldn't have much leverage to gather the client base necessary to force a lot of competition with the private market. Of course, a lot of the "public options" out there offer weak, "level playing field" provisions similar to Carper's amendment. Jon Cohn says that actually, this is already in the bill:

One interesting question is whether the proposal is already redundant, thanks to an amendment that another member of the Finance committee, Ron Wyden, introduced that Chairman Max Baucus accepted before the hearings even began.

It's Wyden amendment C8, which appears on page two of the modified bill Baucus introduced formally for markup:

Amend Title I, Subtitle A to allow a State to be granted a waiver if the state applies to the Secretary to provide health care coverage that is at least as comprehensive as required under the Chairman’s Mark. States may seek a waiver through a process similar to Medicaid and CHIP. If the State submits a waiver to the Secretary, the Secretary must respond no later than 180 days and if the Secretary refuses to grant a waiver, the Secretary must notify the State and Congress about why the waiver was not granted. – Insert at the end of b)(1) ―and with citizen input through a referenda or similar means;‖ – In b)(2) strike ―a‖ and insert ―this‖ – Insert b)(4) ―the State submits a ten-year budget for the plan that is budget neutral to the Federal government.‖ – Insert at the beginning of c)(2) GRANTING OF WAIVER.— The Secretary shall approve the plan only if it meets criteria consistent with that of the America’s Healthy Future Act, including that it shall lower health care spending growth, improve the delivery system performance, provide affordable choices for all its citizens, expand protections against excessive out-of-pocket spending, provides coverage to the same number of uninsured and not increase the Federal deficit.

What does the gobbledygook mean? Wyden's staff says it's designed to encourage state experimentation. I haven't yet gotten an official reading from Finance Committee staff on their interpretation.

But my own reading, which I've run by a few analysts, is that it gives states the ability to implement coverage schemes that bolster coverage, control costs, and improve quality at least as well--and hopefully better than--the Senate Finance bill. That would include creating a public option. (You could even read it to allow a state-based single-payer plan.) So it's the Carper amendment, but without the restrictions.

Cohn notes that the HHS Secretary would have to rule, in the Wyden Amendment, on whether any state proposal met the proper criteria. Which means that, under a Republican Administration, you could see nothing helping people allowed to go through, or even scale-backs to benefits (though there is presumably a federal floor).

Still, maybe this is what Reid will determine as a "public option." Or maybe he'll dump Wyden's amendment and pick up the Carper idea and call that a public option. Or maybe Maria Cantwell's proposal, which allows states to negotiate on behalf of the uninsured below 200% of poverty level for a basic plan, will fit the bill, even though it sounds like a good policy but in no way a substitute for the public option.

The point is that all the activism and advocacy has gotten us far further than we would normally be in this debate. But there are still plenty of compromises out there that politicians will call "the public option" as an escape valve. It will be important to see these policies for what they are, instead of applying the name and being done with it.