Mike Ross Being Super Unhelpful, Again

The Hill is reporting that Mike Ross is “suggesting” opening Medicare to all:

Ross (D-Ark.), who had emerged as a leader among centrist Blue Dog Democrats opposing the public health insurance option, has suggested something his colleagues consider even more drastic – opening Medicare to those under 65 without insurance.

Sounds like a dramatic about face for a man who fought diligently to make the public option less like Medicare. Ross bragged about killing the possibility of single payer, Medicare for all. He once pushed hard for the trigger. He worked secretly with Sen. Kent Conrad to try to replace the public option with worthless co-ops. Opening Medicare for all would be a dramatic flip-flop for Ross, but it is not. You see, the problem is Mike Ross does not even support his own suggestion.

"Let me be clear," Ross said in his statement, "I do not endorse this idea, as it was just one of many ideas we, as legislators, have brought up and discussed in the numerous, ongoing negotiations and discussions we have had on healthcare reform over the past several months."

Way to be super unhelpful Mike. The final bill should be on the House floor within a week or two, now is not the time to brainstorm ideas that you're not even sure you can support. Suggesting alternatives that can't even secure your own vote is a waste of everyone's time.

The Hill may have given some coverage to your transparent attempt to sound progressive, but the grassroots community won't fall for your posturing. If you want to be in the good graces of the Democratic bases, do what they overwhelmingly want. Don't stand with the insurance companies, vote for the real health care reform with a public option, like 74% of Democrats in your district want.

Is Opposing A Public Option Not A Top Blue Dog Priority?

Ryan Grim over at the Huffington Post has an update on the Blue Dogs' whip count.

The Blue Dogs have been surveying their membership over the last several days; coalition co-chair Stephanie Herseth Sandlin (D-S.D.) has been collecting the responses. She listed the four top priorities that have emerged: Keeping the cost under $900 billion, not moving at a faster pace than the Senate, getting a 20-year cost estimate from the Congressional Budget Office and addressing regional disparities in Medicare reimbursement rates.

So, the Huffington Post asked, the public option is not a top priority?

"Right, the group is somewhat split," she said.

It appears the rank and file Blue Dogs don't really think opposing a public option should be a top concern of their caucus. This seems to be in conflict with the Blue Dogs' health care task force chairman Mike Ross's firm opposition to any bill with a public option. Given the incredible cost saving potential of a robust public option, it might be getting hard to reconcile their claims of fiscal conservatism with opposition to a public option. It could also be that they have look at the public option's strong poll numbers in their districts and are having second thoughts.

There still seems to be concerns about a robust public option tied to Medicare rates, because most Blue Dogs represent rural districts. Rural areas tend to have slightly lower Medicare reimbursement rates. If this issue is really a sticking point may I offer a modest solution. In areas where the Medicare reimbursement for a procedure is less than the national average, have the public option's reimbursement rate tied to the Medicare national average (not the local Medicare rate) for that procedure.

Pelosi Makes The Public Option Robust Once More

Back before the August recess a deal was struck with a group of Blue Dogs, lead by Rep. Mike Ross, in the House Energy and Commerce Committee. The agreement was to make the public option weaker by not allowing it to pay modified Medicare rates. This deal dramatically reduce the cost savings that would come as a result of including a public option as part of reform. Since then Mike Ross has backed out of the deal and now publicly saying that he will not support any public option.

The Hill is reporting that Speaker Pelosi does not intent to stick to the deal which has already been violate. She plans to bring to the House floor a bill with a robust public option similar to the own originally proposed in the House.

Mike Ross's Lucrative Deal With Large Pharmacy Chain

The Politico is reporting that Mike Ross sold his pharmacy business in 2007, while a member of congress. USA Drug, a large pharmacy chain with an important stake in health care reform, overpaid for the property by roughly $160,000.

Ross sold Holly’s Health Mart in Prescott, Ark., to USA Drug for $420,000 — an eye-popping price for real estate in a tiny train and lumber town about 100 miles southwest of Little Rock.

“You can buy half the town for $420,000,” said Adam Guthrie, chairman of the county Board of Equalization and the only licensed real estate appraiser in Prescott.

Mike Ross is the Chairman of the Blue Dog Coalition's task force on health care. He was the lead Blue Dog negotiator in the House Energy and Commerce Committee. He held up the bill in committee for two weeks. NPR reports that,

So far this year, the Blue Dogs' political action committee has received $301,500 from health care and health insurance PACs. Ross, the coalition's lead negotiator, has received $100,600 for his campaign committee and a PAC that he operates.

Mike Ross now opposes the public option despite the fact that a plurality of his district favors the public option.

Mike Ross' District Supports A Public Option, He Does Not

Recently Mike Ross sent a letter to his constituents saying, “I remain opposed to a government-run public option,” and called the idea “controversial.”

Dailykos just published a new poll by Research 2000 showing that a plurality of Ross' district support the public option. 47% of those polled favor creating a “government-administered health insurance option that anyone can purchase to compete with private insurance plans,” while only 44% opposed. Support for the public option was overwhelming among Democrats in the district (74% favor vs 19% oppose) and supported by a plurality of independents (47% favor vs 43% oppose).

Interestingly, the public option was much more popular than Obama's health care plan as a whole. When asked, “generally speaking, do you favor or oppose Barack Obama's health care plan?” 40% of all those polled said they favor the plan while 48% are opposed to it.

If Ross continues to oppose the public option it could hurt him with his base. 32% of Democrats said they would be less likely to vote for Ross if he opposed a public option, while only 12% of Democrats would be more likely to support him for opposing a public option.

Mike Ross Likes Baucus' Bill, Loves Co-ops

From The Hill we learned that Mike Ross (D-Ark) sent a letter to his constituents praising the Baucus' bill.

Ross used most of the letter to strongly endorse Conrad's small state-based co-ops idea. This should surprise no one given the overwhelming evidence that Ross has being working directly and/or indirectly with Conrad to get the co-ops idea included in the House bill.

Last week, the Senate Finance Committee unveiled its health care reform bill – the fifth version of health care reform presented on Capitol Hill. The controversial government-run public option is not included. In its place is a uniquely (and familiar) American proposal - a co-op. Co-ops have been around for years and not just in health care. Many of you are probably familiar with electrical co-ops and farmers’ co-ops. As a nonprofit, member-owned group, a health care co-op would operate similarly in that they are controlled by their members, who actively participate in setting policies and making decisions, and a member-elected governance board. And, unlike private companies where voting power is based on the number of shares you own, each member gets one equal vote.

Membership would be completely voluntary and open to any individual or family interested. The co-ops could operate on state or regional levels and startup money would most likely come from the federal government through grants or loans.

(emphasis mine)

It is too bad that Congressman Ross used his letter to mislead his constituents about the co-ops idea. Membership with in fact not be open to “any individual or family interested.” According to Baucus's Mark “CO-OP grantees would compete in the reformed individual and small group insurance markets.” Therefore the co-ops would not be an option for “any individual or family interested,” but would be restricted to only accepting memberships from a very small segment of the population.

Ross Admits experts believe a “co-op would need at least 500,000 members in order to succeed.” Given that Arkansas has just under 3 million people and the strong restricts placed on co-op membership, it would be nearly impossible for an Arkansas statewide co-op to ever get enough members to be viable.

Conrad's Co-ops Are No Compromise Because They Are Designed To Fail

The problem with Conrad/Ross' state based co-ops idea is not just that co-ops have proven to be a mostly unsuccessful model for health insurance. The real problem is that they are purposely designed to fail. Conrad wants there to be 51 co-ops (50 states plus DC), and he would restrict the co-ops to only offering plans to the individuals and small businesses using the new health care exchange (roughly 10% of the population). According to Conrad's own admission a health insurance co-op needs a minimum of 500,000 members to be able to negotiate competitive rates.

Using Conrad's own 500,000 member threshold, even if every single person using the new exchange joined a new state based co-op, over half the states in the country would not have a sufficient population to create a competitive co-op. Using a more reasonable assumption that as many as one fourth of individuals on the new exchange would choose to join a new state based co-op, only four states (CA, TX, NY, FL) might have enough people sign up for their state's co-op to barely reach the important 500,000 membership mark.

The restrictions placed on the new health insurance co-ops would make it financially impossible to create 51 new co-ops. With the restrictions, it seems that creating even 15 viable co-ops nationwide would probably be impossible. From what information I have, I suspect that between 4-8 is the maximum number of viable competitive co-ops that could be created nationwide. That would only be possible with a massive capital investment, focus on creating national not state based co-ops, and serious start up help from the government.

If the legislative restrictions were not bad enough to kill the co-ops, the absurd way they are set up should. According to Baucus' framework,

Grants and loans will be awarded by the Secretary of HHS based on recommendations made by an advisory board. The advisory board will be chaired by the Secretary (or a delegate) with other members appointed by the Majority Leader of the Senate (4 members), the Minority Leader of the Senate (3 members), the Speaker of the House of Representatives (4 members) and the Minority Leader of the House of Representatives (3 members).

This means that Senator Mitch McConnell and Congressman John Boehner would likely appoint half the board who decides which groups receive help establishing co-ops. Both have been highly skeptical of the whole idea of co-ops and health care reform. They have a strong political reason to make sure the co-ops fail. Giving them this power is like hiring a butcher to start a vegan restaurant.

I've previously explained how the trigger idea can very easily be made worthless with only a minor change. Robert Reich has done a great job explaining how Washington is filled with highly paid lobbyists whose job is to make sure things like a trigger are never pulled.

Neither Conrad's co-ops or Snowe's trigger are a compromise on the issue of a public option. They are fig leaves designed to fail. Their only purpose is to be a face saving measure to pretend that Obama did not break another campaign promise. A real “compromise” would be something (or group of things) that could fulfill the many goals of a public option in another manner. Small state based co-ops and triggers are not compromises, they are surrender.


Note: None of the Gang of Six represent a state large enough to support a state based co-op. In fact even if there was only one co-op for all six states it would still lack sufficient membership to be able to be competitive.

Conrad and Ross Double Team Against Progressives

When the House Energy and Commerce Committee was marking up the health care bill Rep. Mike Ross submitted an amendment that gutted the public option and include legislative language to create small non-profit health insurance cooperatives. It is now clear comparing the language in Baucus' framework dealing with co-ops to Ross' amendment, that either Conrad directly or through some third party (Rahm Emanuel, Baucus, etc...) provided Ross with his legislative language for co-ops. The two documents are almost identical and and sometimes use the exact same wording:

Ross' amendment:

The governing documents of the cooperatives incorporate ethical and conflict of interest standards designed to protect against insurance industry involvement and interference in the governance of the cooperative.

Baucus' framework:

Its governing documents must incorporate ethics and conflict of interest standards protecting against insurance industry involvement and interference.

At the time Ross' amendment was submitted many Democratic senators and congressmen were both concerned and confused by Conrad's co-ops idea. It seemed that Conrad was not sharing with most of his own party what his idea of co-ops would really be, but some how Rep. Ross was provided the document.

Ross reached a “deal” to support the bill in committee if he could cripple the cost savings of the House's robust public option and insert the co-ops into the House bill. Now that the legislative language for the co-ops is included in the bill, surprise Ross no longer supports the public option.

It appears that some group of House blue dogs and conservative Democratic senators likely conspired against Speaker Pelosi and are trying to force her to accept the co-ops idea.

The Long Arm Of Chuck Schumer

New York Senate Democrat Chuck Schumer is a natural deal maker. He is the type of guy who was born to be in politics. As health care reform moves forward, it is interesting to see how much he is shaping the debate behind the scenes. His public plan, his campaign language, and his strategy to promote reform are all slowly being adopted by the vast majority of Democrats.

A few months ago Baucus asked him to come up with a compromise public plan which could win over the conservative wing of his party. Chuck Schumer did as he was asked and created his “level playing field” plan. It would be a government-run plan but would not use Medicare's payment rates. I suspect Schumer worked with his party to find a compromise that would be acceptable to over 50 Democratic senators, but probably not all 60.

Senator Grassley threw a hissy fit over any public plan, so Baucus scrapped Schumer's well constructed compromise. Baucus than asked Conrad to come up with anything that would make Grassley happy, and he completely cut Schumer out of the negotiations.

Conrad created the idea of co-ops with federal seed money. Schumer told Conrad his idea was unacceptable, but would work with him to find a compromise of his compromise. He created an outline of a national co-op that might be acceptable to enough liberals. Reporting indicates that Conrad rejected Schumer's suggestions. Not surprisingly, there is now a near full blown rebellion against the Conrad's co-ops in the Democratic Party.

While Conrad and Baucus have remained cloistered in their secret meetings, Schumer's “level playing field” public plan has caught fire. The Senate HELP committee adopted a public plan nearly identical to Schumer's compromise. Not surprisingly, in the House the Blue Dogs and the Progressive Caucus have tentatively agreed to a public option nearly identical to Schumer's compromise. In fact Blue Dog Ross' amendment which changes the structure of the public plan used the subtitle: “Level Playing Field for Public Option.”

I expect to hear the phrase “level playing field” a lot in the coming months. Schumer was also railing against the insurance company villians long before it started getting fashionable.

Currently all the focus in the Senate has been on Senator Baucus because he is the Chairman of the Senate Finance Committee. But Baucus works in near isolation from his party and is sowing an incredible amount of ill will with the rest of his caucus.

All this time Schumer has been unusually quiet about an issue that he is personally invested in. Schumer got almost a fourth of all Democratic senators elected while head of the DSCC in 2006 and 2008. I'm very interested to see when and how he plans to weigh in on co-ops versus the public option. Indications are that Schumer could put together a large group to bring down the co-ops proposal.

Ross' Crippled And Useless Co-ops

One of the changes that the Blue Dogs demanded be part of the House's health care bill was health insurance cooperatives. Today, Blue Dog Mike Ross' amendment which includes language for the state-based cooperatives passed in committee.

The language about establishing and regulating the the co-ops is good. The entire idea suffers from a single massive problem which will cripple the cooperatives. The amendment states:

the Commissioner may make grants and loans for the establishment and initial operation of not-for-profit, member run health insurance cooperatives (in this subtitle individually referred to as a "cooperative") that provide insurance through the Health Insurance Exchange or a State based Health Insurance Exchange under section 208.

The biggest problem with Ross' co-op idea is that it cripples the state based co-ops in the cradle. By only allowing the cooperatives to sell insurance on the “Health Insurance Exchange” or state exchanges, it will be nearly impossible for cooperatives to ever gain significant market share or negotiating power.

By 2019 the CBO projects that only around 36 million Americans will use the Exchange. That will be only around 10% of the population. Kent Conrad has repeatedly said a health insurance cooperative will need at least half a million members to be able to negotiate competitive rates.

Even if every single person using the Exchange signed up for a same (and only) insurance cooperative in their state, roughly half the states would simply not have enough potential members to be workable. Assuming as many as a third of all Americans getting insurance through the Exchange signed up for the same (and only) insurance cooperative in their state, only the 4 largest states (CA, TX, NY, and FL) would have barely have sufficient membership. If only 15% of people using the Exchange wanted to use an insurance cooperative, no cooperative would likely ever be able to achieve a workable market concentration.

Restricting the public plan to the Exchange was done purely for political reasons. It was done to prevent people from being “force on to government-run health insurance.” Restricting private cooperatives to only the Exchange is just stupid. There is just no way the cooperatives as designed by the Ross amendment will ever be able to provide true competition. The Exchange will need to be expanded dramatically before the idea could even legitimately be entertained. If the Blue Dogs truly want to give health insurance cooperatives a chance of succeeding, they must make them available to everyone.