Public Option on Life Support? Can Single-Payer September Vote Resusitate Debate For Real Healthcare Reform?

Posted by 26Dems
Aug. 14, 2009

President Obama has been calling for Congress to enact a strong public option to rally nationwide support for meaningful healthcare reform through Organizing For America and presidential town halls.

Because so much media attention has recently focused on the wild town hall riots intended to drown out public health reform debate, the public has a vague understanding and unawareness of the status of public option in Congress, and even less understanding about how Medicare works.

The American people deserve a real debate on what contributes to the rising costs of health care and how Medicare is structured. It's time to do the math! Investigative journalist Greg Palast reminds us that Big Pharma really didn't promise to cut costs; "they just said that over ten years, they will reduce the amount at which they would otherwise raise drug prices." Palast used government figures to determine the percent "savings" Big Pharma promised:

"I checked out the government's health stats (at HHS.gov), put fresh batteries in my calculator and totted up US spending on prescription drugs projected by the government for the next ten years. It added up to $3.6 trillion."

In other words, Obama's big deal with Big Pharma saves $80 billion out of a total $3.6 trillion. That's 2%.

Many have been reassured that a bill Congress has been working on still contains a robust public option and are urging members of Congress to support it. But members of Congress aren't saying what the public option will offer. Rep. Gabrielle Giffords, in a recent Arizona Daily Star article has indicated that there are 5 bills working their way through Congress. She said that it is too soon to settle on a health reform plan that would spell out who will be eligible for the public option, what type of coverage will be offered, and what it will cost. Much emphasis has been placed on choice-- that people will be able to choose to stay with their private plan if they like it or choose access to a public plan.

The public option was originally conceived as a Medicare-for-all, or single payer public option that would eliminate co-pays, deductibles and coinsurance. When Congress recessed, what you might not realize is that congressional committees have already compromised away the heart of the public option in bills awaiting a September vote ceding the advantage to the powerful insurance interests that are spending huge sums of $1.4 million a day to "kill" the public option not to create a better health care system but to keep on increasing their profits at public expense.

In an Access Tucson presentation, World Harmony, Can it Happen, hosted by Stuart Thomas on August 13, Raymond (Rick) Graap, M.D. a Tucson Endocrinologist dropped this bombshell.

The public option in H.R. 3200 has been sliced and diced so much by the special interests for practical purposes it leaves the private insurers in the driver's seat. Click on this audio link to the World Harmony Access Tucson program. Listen to Dr. Graap's comments and the hour-long conversation about health care reform with Tucson physicians, Dr. Michael Hamant, M.D., Secretary of the Arizona Medical Association, and Dr. Arlene Kellman, D.O. It is clear that a large segment of the medical community is fed up with insurance bureaucrats getting between them and their patients.

According to Graap, the so-called significantly weakened"public option" in H.R. 3200 would disappointingly not be available to the public until 2011, and then only a restricted number of people will be able to get it. Then the plan will be processed by private insurance companies. Graap concludes that is "exactly why we are losing 20-30% of our health care premiums". Graap says that there are many good elements in the proposed bill, but without a truly public option this bill has only "borderline value."

Graap added that "if an amendment by Rep. Weiner goes through," then the single-payer bill, H.R. 676 would replace it. Graap adds that it is time to talk reality about costs and coverage. He said that "single payer is the most conservative, fiscally responsible way to meet our health care costs." Giffords and other politicians believe that a single-payer delivery system would represent a "radical" departure from the employer-based insurance Americans are used to and for that reason she believes that single-payer is unrealistic.

Physicians for National Health Care has long argued for single payer as the best option to lower costs and deliver high quality health care for all. H.R. 676, introduced by Rep. John Conyers, D (MI) currently has 78 cosponsors, including Rep. Raul Grijalva, (AZ-7)

Powerful insurance interests have poured seemingly unlimited money into a deep-pocketed astro-turf campaign and deceptive advertising to disrupt town halls and confuse the public to keep single-payer off the table. They have also succeeded in diminishing the possibility of a public option in an effort to keep the status quo.

Before the August recess, a vigorous counter-effort was mounted by Rep. Anthony Weiner of New York's 9th Congressional District to put single payer on the table. On July 31, Congressman Henry Waxman, (D-CA) Chairman of the Energy and Commerce Committee announced that Speaker Pelosi has pledged to give Single-Payer an up-or-down vote when healthcare reform is considered in September.

Rep. Weiner's office issued this statement:

“Single-payer is a better plan and now it is on center stage. Americans have a clear choice. Their Member of Congress will have a simpler, less expensive and smarter bill to choose. I am thrilled that the Speaker is giving us that choice."

Many people doubt that a single-payer option has much of a chance because they have bought into the argument that people are happy with their private plans. But is that really true? There is abundant evidence that employer based insurance is precarious when people are losing their jobs and insurance costs are escalating. Most people report rising premiums that will soon make health insurance unaffordable for middle class families. Fear of losing a job-related insurance plan keeps many people from finding more satisfying work.

More and more families are going bankrupt and being denied coverage. The present healthcare system that bankrupts families and the federal budget is not sustainable and certainly not practical if we care about making Americans healthier. The President has also been saying that a single-payer plan is not practical, urging a public option instead. What I think he means is that single-payer would need broad public support to overcome the power and money of the special interests.

If we as a nation are to grab this opportunity to reform healthcare first we must get clear about the motives and proper roles for for-profit insurance companies; we must educate ourselves on what single-payer is and is not and the key elements President Obama has proposed for a public option that is much stronger than H.R. 3200.


Here are the facts:

Medicare and the Federal Employee Benefit Plans are not radical departures from the private insurance model. For questions about Medicare, call 1-800-Medicare or visit the web site.


Medicare Is A Single-Payer Model, NOT Socialism

• Medicare is not a "free" program. Monthly premiums, deductibles and coinsurance that emulate private plans all apply. Medicare is a public single-payer plan that is administered by the government.
  
• 97% of all physicians accept Medicare.
• The Medicare program operates with just 3% overhead, compared to 15% to 25% overhead at a typical HMO. Provincial single-payer plans in Canada have an overhead of about 1%.
  
• Enrollees can choose their own doctor and hospital and are not restricted to a list of network providers.
  
• Services are delivered by private providers.
• Medicare Part A Hospital Insurance. There is no premium if a person has 40 or more quarters of Social Security credits. You pay a $244 monthly premium for 30-39 quarters of Social Security credits. With less than 30 quarters of Social Security credits, the monthly premium for 2009 is $443.00. Inpatient hospital deductible is $1,068. You pay co-insurance $26700 a day for 61st-90th day; $534.00 a day for 91st-100th day.
  
• Medicare Part B Insurance Enrollees pay premiums of approximately $100 a month with $135 deductible for enrollees earning less than $85,000 or $170,000 a year for a couple. The government pays 80% for covered claims. Premiums are based on a sliding scale that increase with income over $85,000.
  
• Medicare Part B enrollees pay 20% coinsurance.
  
• Private Medi-Gap insurance is available to cover the 20% that Medicare pays for covered services.
  
• Providers are paid by the agency Centers for Medicare Service that contracts out claims administration to various regional insurance companies.
  
• The government uses its large pool of members to negotiate prices and keep costs down.
• Ballooning costs of Medicare have increased because of Medicare Choice options. Under the Bush Administration Republicans pushed through the Medicare Advantage plans that cost the government an average of 13% more than original Medicare, but gives Medicare enrollees the choice to enroll in a private plan that offers perks and widely divergent premiums and copays, but imposes restrictions on choice of providers and may not offer the same coverage as regular Medicare if a patient has a chronic, expensive illness.
  
• Also under legislation passed during the Bush years, Medicare Part D is not allowed to negotiate lower prices for prescription drugs. Seniors who select prescription drug coverage pay monthly premiums and select from a complex menu of plans.
  
• Medicare bureaucrats do not interfere with physician treatment choices. There is an appeals process for tests that are initially declared medically unnecessary.
  
• Eligibility for Medicare is based on FICA taxes deducted from monthly pay checks and contributions from employers paid through the duration of lifetime employment.
• Spouses who do not qualify on their own may enroll for Medicare using the spouse's social security number.
  

The Obama Public Option--An Expanded Federal Employee Plan

• President Obama has recently defined that what he would like is a public option modeled on the Federal Employees Health Benefit Plan, an insurance exchange that offers many different types of plans from consumer driven with high deductibles to full coverage fee for service.
• The FEHBP is administered by the Office of Personnel Management. For more information visit the web site. Members of Congress can elect coverage under this plan.
• Federal Employees pay for this plan through payroll deductions.
• Federal employees pay different premium amounts depending on the amount of coverage they choose, whether they choose individual or family options. The employer, the U.S. Government pays a share of the premium.
• The government sets the parameters and insurance companies are free to submit benefit packages to bid for federal employee enrollment. Millions of employees are in the pool so the government can use its negotiating power to lower treatment costs.
• No plan is allowed to deny coverage on the basis of pre-existing conditions.
  
• Almost all FEHBP plans restrict enrollees to limited provider networks, limiting the choice of doctor and hospital.
  
• If a hospital opts out of a network anytime during an enrollment period, a patient is exposed to risk of interrupted treatment and/or financial risk of under coverage billed by a non-network provider who may charge exorbitantly high amounts.
• Federal Employees can change plans only at certain times of the year.
• Some plans are limited to a specific geographic region or HMO, others are broader and offer access to a national network of providers.
  
• The Federal Employee is a secondary payer for Medi-Gap insurance. Retirees pay the same premium as they did before they retired if they choose to keep this insurance. In addition each pays premiums every month to Medicare which is deducted from the monthly annuity.
• Depending on the plan, Medicare premiums and coinsurance are waived.
• Some plans offer prescription drugs at affordable government negotiated prices.