Bart Stupak’s (D-MI) group of “pro-life” House members--and their crazy demands about abortion language--has once again emerged as the major focus of the health care debate. This should not surprise anyone. Stupak originally made his concerns known back in July. The Stupak amendment became the big fight back in November, when the House first passed their health care bill, and since then, Stupak has not stopped warning Democrats that his demands would not go away. If instead of ignoring Stupak for months, hoping the problem would magically go away, Democrats possibly could have slightly redesigned the basic structure of their health care plan to create a satisfactory solution for Stupak and his sympathizers.
Rep. Stupak has been relatively clear throughout in his demand that the bill must fit his interpretation of the Hyde amendment, and "maintain current law." In his view, if the government gives an individual tax credits that cover some of the cost of a private insurance policy, and that policy covers abortion, that means the federal government is funding abortion. The idea of having the insurer create a special fund made up of just private dollars they collected to pay for the abortion services on policies bought by people with the help of subsidies simply does not fly with Stupak. While I don't agree with his logic and think that the current Nelson abortion language would effectively end coverage of abortion on the exchanges, it is Stupak's vote Democrats need, not mine. So, here are six ways Democrats might have constructed health care reform to satisfy Stupak’s concerns.
1. Medicaid/SCHIP/Medicare for the people who can't afford insurance
This is the simplest solution. All current public insurance programs are covered by the Hyde amendment, which Stupak says he supports. Instead of tax credits to buy private insurance on the exchanges, the bill just needs to put people who currently don't have insurance on public programs; Stupak would have no abortion-related objections.
2. Greater Medicaid expansion with exchanges only for small businesses and the wealthy
If expanding Medicaid/SCHIP/Medicare to cover all the uninsured was too expensive or too radical, a slight modification would be the current bill, just with a greater expansion of Medicaid and SCHIP. Most people making above approximately 300% of the federal poverty level are not going to get very large tax credit,s and people getting exchange coverage through a small business are also not getting government tax credits.
The bill could be changed to expand public programs like Medicaid to everyone without insurance making under 300% FPL, with the current exchange/individual mandate structure left in place for small businesses and everyone making over 300% FPL, but no one on the exchange would qualify for tax credits.
3. Subsidize care, not insurance
People making between 200% and roughly 350% FPL will need subsidies to afford the insurance on the new exchange because the insurance sold on the exchange will be relatively comprehensive, and, so, relatively expensive. You can make the plans cheap enough for the people to afford without giving them government subsidies to buy insurance by dramatically scaling many of the basic services these plan would be required to cover. This would not be a bad thing for individuals in these income brackets if the money currently directed to subsidies to buy insurance was instead used to just directly subsidize some of their basic health services.
You could create a public health supplemental program for these people. The public supplemental program would cover, say, yearly check-ups, preventive care, disease screening, dental, and immunizations. Everything else would be covered by their cheap, very bare-bones insurance policy--one individuals bought with their own money.
A slight variation would be to give this group of people money in a special health savings account that can pay for all medical procedures expect abortion. While they would technically only be able to afford high-deductible insurance on the exchange with their own money, that would not be a problem because they would have an HSA from the government to pay those high deductibles.
This scenario would allow for an exchange where people buy insurance only with their own money, but still could get the full level of care they need. One would hope that this would make the issue of abortion coverage in plans on the exchange moot.
4. Catastrophic coverage but no subsidizes
The reverse of the previous suggestion is to have the government provide extreme catastrophic coverage for everyone on the exchange through a public program like Medicare. A lot of the cost of insurance comes from the few people who get very sick and rack up huge medical bills. If, instead of subsidizing insurance for everyone on the exchange, the government just took over coverage when people got really sick, it would make insurance much cheaper.
Effectively, this would mean individuals would buy relatively cheaper coverage on the exchange with their own money that would only cover all medical costs up to, say, $80,000 a year. If your cost went over $80,000 for the year, all of your large medical costs would now be paid by Medicare through a new, public catastrophic insurance program. This should make insurance cheap enough on the exchange that even those not on Medicaid could afford coverage without subsidies.
5. Tax deduction instead of tax credits
Stupak claims he is trying to maintain current law. As a result, he has not yet claimed that the tax deduction status of employer-provided health insurance is the same as the government giving people tax credits or subsidies to buy insurance. One solution Stupak might agree to is the Republican proposal of letting people who buy individual insurance to get the same tax deductible treatment for their premiums as people who get employer-provided insurance instead of tax credits. This would not be as progressive as the current tax credit formula in the Senate bill, and, to work, would probably require increasing the Medicaid income level somewhat, but it is a possible solution.
6. Subsidize only basic packages with several supplemental choices
This option is based on the Swiss health care system, and Stupak accepting abortion riders. I have explained it in more detail before. Basically, instead of giving people tax credits to choose between four levels of insurance policies (bronze, silver, gold, platinum), insurance companies on the exchange would only be allowed to offer the basic bronze package. Subsidies could only be used to buy that package. But insurance companies could offer to their customers that bought the basic package up to three levels of supplemental packages--which would, in effect, produce a silver, gold, or platinum level of total coverage--that must be bought with only private money. Only these supplemental packages could offer abortion coverage.
These are only some of the ways Democrats might have slightly redesigned their health care bill with Stupak's complaints in mind to find a solution that could possibly make both pro-choice and pro-life members of Congress happy. Many of the ideas could work alone or in concert to achieve an exchange in which people buy insurance with only their own money.
Of course, Stupak’s real goal might be to secretly end all abortion coverage by private insurance companies. If that is the case, he would probably reject any solution designed to address the complaints he claims to have with the current bill. These ideas would still be worth bringing to Stupak, even if he rejects them, to show his colleagues and the media that he is after radical change, and not simply maintenance of the status quo. That might shake a few of his gang loose. But for reasons I can't quite understand, it seems Democrats became pathologically wedded to this exact design for health care reform because I have not heard of even one attempt in all these months to slightly redesign the basic structure of the exchanges to address abortion concerns. Clearly, just wishing the problem would go away was a bad decision.