On the surface, comprehensive health reform sounds like a fabulous idea. Why wouldn’t Americans want everyone to have guaranteed health care coverage? However, insurance for everyone comes with a price tag that isn’t only about the approximately $1 trillion (yes, with a TR) that it will cost to implement over the next 10 years.
All of the bills under active consideration require people to obtain health insurance coverage, known as an individual mandate. According to the Senate Health, Education, Labor, and Pensions (HELP) Committee’s health reform bill, by 2013, all individuals would be required to have health insurance coverage. Those who don’t will be assessed a tax up to the cost of the minimum benefit plan.
Other proposals require employers with more than 25 employees to provide qualified health insurance coverage. One bill being considered requires employers with more than 25 employees to provide coverage and requires them to pay 72.5 percent of each employee’s premiums for “acceptable” coverage and 65 percent of the cost of those employees’ family coverage premiums. What is deemed “acceptable” is up for discussion, too.
Additionally, the bill mandates coverage for part-time employees and requires employers to pay for a portion of the costs on a pro-rata basis. Many employers now can’t afford such contributions to their employees’ health plan costs. Employers that fail to comply would incur a penalty of eight percent of the company’s payroll, along with the potential for additional payments and penalties down the road.
“President Obama waxed enthusiastic about countries that 'spend less' than the US on healthcare. The Journal explored the United Kingdom's National Institute for Health and Clinical Excellence, or NICE, which has become in practice....a rationing board. As health costs have exploded in Britain as in most developed countries, NICE has become the heavy that reduces spending by limiting treatments. Obama and Democrats claim they can expand subsidies for tens of millions of Americans, while saving money and improving the quality of care. It can't possibly be done. The inevitable result of their plan will be some version of a NICE board that will tell millions of Americans that they are too young, or too old, or too sick to be worth paying to care for,” according to a July 7 editorial in The Wall Street Journal.
The HELP Committee’s bill also proposes the establishment of a National Health Insurance Exchange by 2013 to replace the current individual health insurance market and provide an option for employers and public program enrollees in Medicaid. The bill also proposes expanding Medicaid eligibility for all individuals to 133 percent of the federal poverty level ($14,000 for an individual) and requires an 85 percent medical loss ratio for Medicaid managed care organizations. It also establishes new preventive services benefits, increases payments for primary care, and implements a medical home pilot project to reduce costs and improve outcomes through use of preventive services and care coordination.
Additionally, by 2013, DHHS would develop and offer a public plan through the exchange to compete with private insurers. The public plan would comply with the same requirements as private health plans, but provider payments would be similar to Medicare rates and providers participating in Medicare would be required to participate in the public plan for five years.
However, a government-run public plan would not be subject to the same rules for financial solvency and would not be required to pay taxes. Because these plans would operate with advantages unavailable to private plans, that could eventually force everyone into the government plan, which could result in long lines and rationing such as in Canada and Great Britain, according to the National Association of Health Underwriters.
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