Baucus Plan: The War of the Pages

Senate Finance Chairman Max Baucus added yet another healthcare reform proposal to the already headache inducing pile. This one, it was pointed out more than once in the news coverage, is only 28 pages.

I don't get it. All through August America's town halls echoed with numbers––page numbers––and echoed is the perfect word, because most of them were just picking up something they heard from someone else. What is this new system that rates bills by numbers of pages, inflated numbers to boot. HR 3200 comes in at only 328 pages. When Senators, Representatives, bloggers, and screaming talk show hosts talk about 1000 pages, they are including all the different proposals. By that count, Senator Baucus just made it 1028. So does that count as simplification or complication?

A complication, definitely. First, the proposal can afford to be short because the main part of it, regulations on private insurers requiring things like guaranteed issue and no denial for pre-existing conditions, is already covered at length in HR 3200. The main thrust of the Baucus proposal is in two areas: Expansion of Medicaid to those without insurance making 133% of the poverty level, and funding to establish healthcare cooperatives. This combination has the additional benefit of appearing to cost $100 billion less than HR3200

This proposal is a sop to those seeking a public option. Here's why they add nothing, and possibly detract from HR 3200.

Expanding Medicaid instead of a public option appears to save money, because Medicaid is only partly funded by the federal government. The rest is funded by the individual states. They also administer the plan under broad government guidelines. I can't imagine that states, many of which are struggling under their own huge budget deficits, will be very keen on this one. As you can see from the report linked to above, overall spending on Medicaid nearly doubled between 1998 and 2003. It spends more than Medicare, which is a government run plan, and the variations in administration make it less efficient. If we're looking to expand an existing plan rather than start a new one, we'd be better gradually lowering the eligibility age for Medicare.

With regard to healthcare cooperatives, I'm not clear whether this refers to medical cooperatives or insurance coops. I covered both in an earlier post and I see nothing wrong with adding some incentives into the bill for those so inclined to try something like this, but both types are difficult to get off the ground and would require more than just money. To provide guidance for start-ups as well as compliance monitoring would, no doubt, require another government agency.

While I haven't seen a lot of detail about Baucus' idea for funding his proposal, what I've read so far sounds reasonable. I don't think any Democrat is against trying to save more money if it doesn't cut back on the number of people covered.

One of the major problems I see with the so-called compromise proposals is that shorter, in the long run, does not mean less complicated. Somewhere along the line it became the mantra of health reform––on both sides––that people want choice. Really? Did you ever try to assist a senior in choosing a Medicare Prescription Drug Plan? It makes choosing a cell phone plan seem easy. As a Benefits Manager, it was my experience that individuals felt overwhelmed by choices in healthcare coverage and would often call may office hoping we could just tell them which plan to enroll in.

That's one reason why I don't see coops of either type getting off the ground. Even on entering an already established coop, individuals will gamble on whether the cost savings today will be there five years later, or whether additional cost equates to more or better care, or whether a lump sum outlay will get as good a return as it would in a standard investment.

Whether 28 pages or 328 or 1028, it's time to stop coming up with so-called compromise proposals that do nothing but complicate the issue even more.