The Most Complete & Honest Comparison of Health Proposals...so far
Of the plans they chose to review, the only plan that both covers everybody and actually controls total costs is the plan that most closely adopts features of single-payer, which is the latest proposal from Pete Stark who is chair of the Health Subcommittee in Ways & Means.
The more publicized proposals – Obama, Baucus, Wyden, the "moderate" consensus plan now known as Building Blocks – are all objectively worse.
In addition, this from an organization that does NOT support single payer!
It will also provide a follow-up my earlier diary on this report, why the Commonwealth Fund did not include the Conyers bill HR-676 which is a single payer proposal, which Stark's is not, among their many reviews.
Follow me for more details...
1. Comparison of the Obama, Baucus and Building Blocks Plans:
The table below compares the main features and goals three very similar plans: the latest version of the Obama plan, the proposal from Senator Baucus who as chair of the Budget committee will be playing a major role in whatever passes, and what has come to be known as the "Building Blocks" plan. The Building Blocks plan is the latest version of the mixed-mandate private-public multi-payer proposal from the mainstream beltway liberal coalition, similar to the Edwards and Clinton plans also associated with Jacob Hacker. Indeed all three of these proposals are similar in their essence: build on the current system of mostly employer-based coverage purchased from private-for-profit insurance companies, with various mixes of tax breaks and employer and individual mandates to promote more such purchasing from the private for-profit insurers, and some expansion of public options to make up the difference.
Since details of the Obama plan and the Baucus plan are not fleshed out, since they all derive from the same assumptions and same group of policy wonks, and are as noted so similar, the Commonwealth/Lewin folks decided that they can be lumped together with the Building Blocks plan in most of the further analyses. To reiterate, Building Blocks, just like Obama and Baucus, aims to achieve universal coverage through a mix of private and public group insurance with a shared responsibility for financing.
The table below shows many of the rest of the plans in congress, from key Senators and Representatives, Republicans and Democrats:
2. Comparison of the All the Rest of the Plans:
The Wyden (D-OR) plan establishes a mandate for non-elderly, non-disabled individuals to purchase private insurance, called Healthy Americans Private Insurance (HAPI). HAPI plans would be offered by private insurers through "Health Help Agencies" created by each state or territory, or through an employer under the Senate bill, or through the federal government if there were not a private plan available in a region. The income tax exclusion for employer health benefits would be eliminated and a standard tax deduction (Senate version) or tax credit (House version) would be substituted. Additional subsidies would be available for low-income individuals. Token proposals from Republican senators Enzi and Burr also mimic the Wyden plan, and McCain's presidential proposal, in offering the center-right's favorite solution of eliminating the current employer tax incentive to offer insurance, but replace it with even less than Wyden's does.
Commonwealth also chose to look at several proposals that do not even claim to care about universality: Senator Bingaman/ Representative Tammy Baldwin (D) and odd couple Senators Feingold (D) and Lindsey Graham (R), offer the ridiculously timid proposal of some state demonstration grants.
Bingham/Green (D) expands the disability part of Medicare.
Kerry/Waxman (D) expands coverage for children via Medicaid/SCHIP and incentives for employer and private coverage.
Johnson/Buchanan (R) expands what organizations can create private health association plans.
Durbin/Kind (D) expands access of small businesses to private insurance pools.
Cantor (R) suggests an expansion of Bush's Health Savings Accounts for individual purchase of private insurance.
More seriously, Representative Pete Stark's (D–Calif.) "AmeriCare Health Care Act of 2007" (H.R. 1841) and Senator Edward Kennedy (D–Mass.) and Representative John Dingell's (D–Mich.) "Medicare for All Act" (S. 1218 and H.R. 2034), expand Medicare to (nearly) everyone, while leaving in place employer-based coverage and private insurance.
Alas, Commonwealth and Lewin chose not to analyze the Conyers' single payer plan, HR-676. I will come back to why Stark is not single payer and why Commonwealth chose to ignore Conyer HR-676 in item 8 below. But for now, the Stark plan stands in for the best there is (here, in this comparison) from a progressive point-of-view.
3. Summary of Coverage and Costs Of The Proposals:
So... how many of the currently uninsured will be covered? And how much will it cost? And an important, and often neglected, question... who pays what?
The table below provides an overall summary:
4. Number of the Uninsured Who Would Become Newly Covered:
Looking first at how many of the currently uninsured will become covered?
Out of the estimated total number of 48.9 million, only the Stark Plan, like the Conyers HR-676 plan, would automatically assure that everybody is covered.
Commonwealth/Lewin finds that the Wyden and Building Blocks (including Obama and Baucus to lesser extents) come relatively close but don't actually acheive universal coverage.
The other plans, including all the ones from Republicans do not come close and mostly don't really even try.
So, what about costs?
5. Change in Spending Just of the Federal Government:
The graph below shows just the direct costs to the Federal government, not the total cost.
In other words, not the additional costs by individual and families such as premiums, deductibles co-pays, out-of-pocket due to refusals of insurance company to pay. It does not include additional costs by employers. It does not include the additional costs by state or local government.
Not surprisingly, the Wyden Plan, which like the McCain plan from the campaign, takes away the tax corporate deduction for providing insurance and does little to offer pay directly for coverage, saves the Federal Government the most. While the proposals from Stark, Enzi, Burr and the Building Blocks plan cost the Federal Government the most.
When the Congressional Budget Office comes out with favorable analyses of the Wyden plan, this is what they mean. But as we shall see, this is a very incomplete and essentially dishonest view.
6. Total Change in National Expenditures on Health Care:
This table shows the change in total costs, the total national expenditure on health care. This is the one that corresponds with Percent of GNP spent on health care, that infamous statistic that shows that U.S. spends twice as much as other developed industrialized nations, but is the only one not covering everybody and the only one bankrupting families if they get sick... and the only one dependent on for-profit private insurance companies.
Notice the complete turn-around compared to the JUST federal government view in the prior table. While the Wyden plan saves the Federal Government money, it actually increases total costs and dumps those cost onto others.
Indeed most of the other plans... Enzi, Baldwin, Burr and alas even Building Blocks (including Obama and Baucus) amount to huge giveaways and supports for the private for-profit insurance companies. Only the Stark Plan (like Conyers HR-676) actually saves money for the overall system, the country as a whole. Only Single-Payer like plans can actually control overall total costs. And this from an organization that does not support single payer, and supports Obama/Baucus/Building Blocks.
7. Who Pays by Stakeholder Under the Different Plans:
This is the real story, typically ignored by proponents of the other plans including the Wyden plan, the various variations of mandate plans (Obama, Baucus, Clinton, Edwards, Building Blocks, etc.) and the Republican proposals.
The Building Blocks plan, like the Obama and Baucus plan, would increase costs overall, and to the federal government and for employers. The Wyden plan dumps even heavier on employers. Regardless of what the CBO or GAO or beltway mainstream may say, being "revenue neutral" and saving the Federal government money is not the most important goal of health care reform.
We do need to control costs, but it is overall total costs that are what really count.
And, we also need to provide coverage that is truly Universal for all people, Comprehensive in covering all health needs, and does not bankrupt you if you get sick. The Stark proposal, like the Conyers' HR-676, takes on access to health care coverage as a national responsibility, paid for by federal taxes, but reducing direct and total costs to states, local governments and for individuals and families. And as noted, they are the only plans that make a significant overall cost reduction and control. And they are the only plans that actually result in coverage for everybody!
Of course, worst of all, essentially fraudulent nonsense, are the Republican plans (Enzi and Burr) that provided minimal addition coverage, while lining the pockets of the for-profit private insurance companies even more than now.
8. How Does Stark plan differ from Conyers HR-676 and Single Payer and why did Commonwealth Ignore it?
Several us have asked the head of the Commonwealth Fund Karen Davis (email: email@example.com ) and Sara Collins (email: firstname.lastname@example.org ) why they did not include Conyers' HR-676, since it is the proposal with the broadest grassroots support and the most sponsors in the House. One common excuse for ignoring it has been that it has "no chance of passing", but neither do many of the proposals that they did include and it has more support than many. Commonwealth's reply has been consistent (several of us got the same reply):
Thanks for your note and interest in work of the Commonwealth Fund. We do include HR 676 on page 29 of the report as one of several bills that would expand coverage through Medicare or through a central financing mechanism. Of those bills we opted to model Rep. Stark's Americare bill. We discuss similar bills as part of a set but had to choose one to model, and in the case of this set, we settled on the Stark bill given his chairmanship of the key Ways and Means Health Subcommittee with jurisdiction over health reform.
Buried on page 29 of the full report (.pdf) (which few will read), we find the following:
People of all ages would be eligible to enroll in Medicare or a Medicare-like program under three bills introduced in 2007. Senator Edward Kennedy (D-Mass.) and Representative John Dingell (D–Mich.)introduced the "Medicare for All Act" in April 2007 (S. 1218 and H.R. 2034), and Representative Pete Stark (D–Calif.) introduced the "AmeriCare Health Care Act of 2007" (H.R. 1841) in March 2007. In addition, two bills would cover everyone through a central financing or "single-payer" mechanism. Under Representative John Conyers' (D–Mich.) "United States National Health Insurance Act," introduced in January 2007 (H.R. 676), the federal government would collect payroll and income taxes to finance a system of health insurance under which all residents would be eligible for a set of covered benefits. Representative Jim McDermott's (D–Wash.) "American Health Security Act of 2007," introduced in February 2007 (H.R. 1200), would use a similar financing mechanism. The federal government would distribute tax revenues to states, which would design their own programs subject to national benefit and regulatory guidelines. The Lewin Group estimated the coverage and cost impact of Rep. Stark's bill.
That is not a serious answer. They did not analyze/compare the Conyers HR-676 and the fact is that that the Stark proposal is not at all like Conyers Single Payer and cannot be honestly lumped together with the Conyers proposal.
Moreover, they did include as individual separate analyses multiple versions of "eliminate the corporate tax credit" plan. For shame, for shame!
Indeed, as everybody including Stark himself and Lewin Group acknowledges, the Stark proposal is in fact multi-payer and just the further end of the Baucus/Obama/Building Blocks spectrum. It is at best "public option on steroids" as it were, but like the other "mixed-mandate private-public multpayer plans" leaves in place employer-based private-for-profit insurance companies as well as the for-profit hospital chains. Stark's proposal is like the others a "play or pay plan in which employers would still offer private insurance or, if they did not, pay into a public fund to pay for this Medicare-like program. Alas, even the so-called public option in the Stark plan includes the not-public entirely private for-profit insurance companies'-based FEHBP as an option. It is an "all-of-the-above" plan that does not fully reform the system, but just requires that everyone buy into it.
Both Conyers and Stark project savings based on reduced/controlled payments to doctors and hospitals. Single-payer has the advantage of true monospony. However, under Stark's version of a multipayer plan, like those of Building Blocks/Hacker/Obama/Baucus and the present system, wealthy patients and the doctors and hospitals that serve them could refuse to take the public plan. We have seen in some public schools systems (e.g., NYC) what happens when the wealthy and upper-middle class opt-out. As to Stark (and others like HR-1200) have the States significantly involved, this will likely result in a race-to-the-bottom such as we see with Medicaid.
So, real Single-Payer represented by John Conyers HR-676 is significantly different from the Stark proposal. It is the plan with the most co-sponsors in the House. It is the plan with the most grassroots support including the national network of PNHP, HealthCare Now, Guaranteed Health-Care, etc. and the endorsement of hundreds of Unions, religious and other and civic organizations. But it must be ignored by the Beltway mainstream.
Admittedly, HR 676 would require that investor-owned providers be converted to not-for-profit status, and that the investors be compensated by public funds at the appraised value of the converted facilities. As only one example, the hospital corporation HCA has a book value of $24 billion. In the short-run, that would reduce by close to half of the short-term savings of the Stark proposal. But that is made up for over the long run with the cost-control and planning that Single-Payer would allow. Indeed the short-term one-year-out aspect of the Commonwealth/Lewin analysis is another severe shortcoming. Commonwealth's great service in doing this report is severely compromised by not having included HR-676. It deserved and deserves to get it own analysis.
Many of us believe that the true reasons for Conyers HR-676/Single Payer being left out include:
- A planned policy by the moderate insider powers that be to exclude and ignore Single Payer, as a matter of supposedly honest but we feel, misguided strategy.
- . That funding sources and board members of these organizations includes folks who come from companies that are opposed to single payer for personal financial and ideological reasons, and that they exercise a de facto veto power over allowable discussion. I have personally heard this from senior staff and management of both HCAN and the Kaiser Family Foundation; that they would lose funders if they provide support for single payer. While I have not heard anything so specific about Commonwealth, its board includes folks like Samuel C. Fleming who "is managing director of Briland LLC, which specializes in healthcare investments. He is chairman emeritus of Decision Resources, Inc., a leading provider of strategic information to the global biopharmaceutical, medical device, and healthcare insurance industries. Mr. Fleming founded Arthur D. Little Decision Resources. In 1989, he led a buyout of the firm to form Decision Resources, where he was chairman and chief executive officer through 2003...."
- Also Lewin Group is now owned by United Health, one of the largest for profit health insurance companies. So, the fact that they went out of their way to ignore Single Payer, and frankly any of their results has to be considered suspect and at least subject to critical scrutiny.
- . If Commonwealth, and for that matter Kaiser Family Foundation and the rest, really want to lay such objections to rest, they could prove otherwise by a including real Single Payer in the future. All we ask for is fair seat at the table. Perhaps as Commonwealth moves forward with part two of this series they will reconsider.