Last weekend, progressives got in an uproar over what appeared to be an attempt by the Obama administration to chuck the Public Option from the current health care reform plans. What I finally figured out is that Obama and the White House cut deals with the health care lobbies (hospitals, insurance, drug makers, and doctors) which caused them to change their idea of what “Public Option” was meant to be. It went from a separate, Medicare like, plan to one that would have subsidies given to private plan providers and no chance at negotiation on pricing. It would be just like the corporate welfare given to the pharmacy industry under the Medicare Part D plan passed during the Bush administration.
Over the weekend, President Obama referred to the public option as a “sliver” of health care reform, and Sebelius said the public option wasn’t essential reform’s success. Though the White House’s core position hasn’t changed, the intensity with which it supports the public option has varied over the last several weeks, and this weekend’s remarks were the first indication that the administration doesn’t even regard the public option as particularly crucial.
White House Strongly Denies It’s Given Up On The Public Option
What I found out and why I liked the plan in the first place, was during the campaign, Senator Obama promised a separate public insurance plan that people could sign up for.
Specifically, the Obama plan will: (1) establish a new public insurance program, available to Americans who neither qualify for Medicaid or SCHIP nor have access to insurance through their employers, as well as to small businesses that want to offer insurance to their employees; (2) create a National Health Insurance Exchange to help Americans and businesses that want to purchase private health insurance directly; (3) require all employers to contribute towards health coverage for their employees or towards the cost of the public plan ; (4) mandate all children have health care coverage; (5) expand eligibility for the Medicaid and SCHIP programs; and (6) allow flexibility for state health reform plans.
(1) OBAMA’S PLAN TO COVER THE UNINSURED. Obama will make available a new national health plan which will give individuals the choice to buy affordable health coverage that is similar to the plan available to federal employees. The new public plan will be open to individuals without access to group coverage through their workplace or current public programs. It will also be available to people who are self-employed and small businesses that want to offer insurance to their employees.
Barack Obama’s Plan for a Healthy America
Basically the public option was a separate plan – similar to Medicare – where the Feds would make the rules and pay the bills. The only difference was that since it wasn’t Medicare one would need to pay a premium based on income.
Now today it seems the public option has been merged into the Insurance Exchange as one of many choices. The difference seems to be that it would be through a private insurance provider with the government paying them to provide the plan and you paying a premium based on income.
If that sounds familiar it is because it is the same model used when the pharmacy plan known as Medicare Part D was during the Bush administration. Insurance plans were given money to provide the plan, members paid for their drugs and a monthly premium. The other features included deductibles, a doughnut hole (where members had to pay 100% of the cost of their meds), and Medicare not being allowed to negotiate drug prices.
It seems like others see the same thing. Jane Hamsher at Firedoglake wrote:
The PhRMA deal on July 8 says that there won’t be any drug price controls, and the next day, Blue Dogs Heath Shuler and Debbie Halvorson author a letter demanding — no drug price controls
The American Hospitals Association deal was signed on July 8. The hospitals want higher medicare reimbursement rates for rural providers. On July 15, the Blue Dogs threaten to block health care reform — if it doesn’t increase reimbursement rates to rural providers.
And suddenly, the hospitals are spending $12 million running positive ads about health care reform with PhRMA and the AMA.
Mike Allen said earlier this week that “this weekend’s comments by White House officials simply acknowledged the long-obvious reality that the idea of a government-run insurance plan was partly a bargaining chip.”
The White House never cared about getting Republican votes — it cared about keeping the Republicans from peeling off the dollars of stakeholders like PhRMA. Giving in to “Republican” demands was cover for writing shitty things into the bill that would keep the stakeholders happy. They didn’t need Republican votes, they never did, and they never truly cared. As long as the money stayed out of their campaign coffers, it was all good.
The Baucus Caucus: PhRMA, Insurance, Hospitals and Rahm
So basically the reason why President Obama and the White House were shocked about the back lash is because Progressives, including myself, are expecting the original plan – a public plan that is a new and separate plan similar to Medicare. We don’t want an industry sell out that ends up lining the pockets of CEOs and screwing over members like the doughnut hole in Medicare Part D.