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Tuesday, November 3, 2009

Republican Health Care Proposal: Tweedledumb and Tweedledumber

The Republicans and their Congressional leader, John Boehner, seemed to have just realize that health care reform has longer staying power than the Spice Girls. With the Democrats bringing bills to the floor, the Republicans announced their latest health care reform proposal. My response was a Groundhog Day-esque sensation of "Haven't they announced their health care proposals before?" Looking at their four key aspects, I realize, that yes, it's deja vu all over again as they have the same ideas which consist of two ideas that every reform policy has, the Tweedle Dumb idea, and Tweedle Dumber idea.

I have spent enough time writing about how the Democratic Public Plan Option is the health plan to nowhere that I feel truly bipartisan by spending an equal amount of posts about how the Republican health care reform ideas have just gone nowhere. They don't seem to think that there are any problems that changing the methodology for classifying the uninsured won't fix. It's like they are waiting for someone to announce that the health care debate was just a test of the American Democratic system and we can now return to our regularly scheduled programming.

Here are the 4 ideas in their proposal that they either copied from someone else or fall in the Tweedledumb category:

Allow individuals, small businesses, and trade associations to pool together and acquire health insurance at lower prices, the same way large corporations and labor unions do today. This is copied from everyone else who has thought about reform for the last 20 years. This is basically the concept of insurance or a risk pool or the Democrat's Health Care Exchange proposal where you bring a large group of people together and hope you have enough healthy folks to pay for the sick. The problem that no one has solved is how to get relatively healthy people excited about participating in these pools. Generally, the only people who are interested in participating are those who are sick enough to need insurance and they get really high rates or no insurance company wants to offer them a policy. I call this a great example of market failure.

Give states the tools to create their own innovative reforms that lower health care costs. This is the equivalent of an idea like "Let's paint the White House white" or copied from someone else. States have been creating their own innovative reforms with existing tools like Medicare and Medicaid waivers since those program were invented. The Oregon Health Plan made tough choices in 1993 about benefits in order to cover more people with the truly important services. Massachusetts launched universal coverage in 2006. Vermont and Hawaii have their own reform programs. What do the Republicans have in mind, giving these state back rubs while they continue to look at innovative reform proposals?

End junk lawsuits that contribute to higher health care costs by increasing the number of tests and procedures that physicians sometimes order not because they think it's good medicine, but because they are afraid of being sued. Texas enacted malpractice reform in 2003 and didn't even cause a dip in the medical cost trajectory. A 2006 Harvard study showed that most malpractice law suits aren't frivilous and their impact on medical costs is overstated. Malpractice reform will not solve the health care system. It will help with tort reform which is really a separate topic. I share the Republicans lack of interest in a litigious society. However, we're talking about health care reform right now, so let's stay on topic. I all thisTweedledumb.

Let families and businesses buy health insurance across state lines. This idea is Tweedledumber and it's the only remotely new idea that the Republican have offered. It rests on the premise that state mandates like requiring coverage of domestic partners, smoking cessation, or birth control is a significant driver behind medical costs. It ignores the Medicare data which shows how medical costs vary significantly from state to state or city to city in a universal benefit design (Medicare).

I help make decisions for the health plan that families purchase and I have no interest in letting families in other states purchase our plan. It would attract interest from those in high cost states like New Jersey which have higher medical costs based on the practice patterns. As a result, they would drive up the cost of my plan and I would become more expensive compared to competitors in Oregon which is a low cost state. I would also lose money on the New Jersey residents.

If this proposal was enacted, I would charge a higher rate to any out of state residents from high cost states or market my competitors plan in those states so they would have higher medical costs.

With proposals likes this, I view a bipartisan plan as one that moderate and more liberal Democrats agree upon. When I think of the Republican viewpoint, I am reminded of how passionate they were about the Terry Schavio, the woman who was going to be disconnected from life support. The Republicans considered that to be a very important issue while I personally spent most of my time wondering if Schavio was a Greek or Italian name and thought it was a bigger waste of network time than the OJ Simpson white Bronco car chase. The Republicans seem to reserve a similar amount of interest in health care reform.

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