White House 'Official' Bad Mouths Labor Leader For Expecting Obama To Keep His Promises

Gerry McEntee is president of the American Federation of State, County, and Municipal Employees (AFSCME). He leads the one of the largest unions in America and has been one of the most vocal advocates for progressive health care reform. He is one of the few establishment figures willing to openly challenge Obama for repeatedly breaking his word in regards to health care reform. Apparently, demanding that someone at least attempts to keep their promises is an unacceptable slight, according to a cowardly anonymous “senior White House 0fficial.”

We have had just about enough of his gratuitous slaps,” said a senior White House official Friday, calling the politically charged language “outrageous and unacceptable” from an ally — even from one that had, the official noted, devoted substantial resources to health care efforts.

“He’s doing his members a real disservice,” said the official, who said that while all other labor leaders had been careful to keep their opposition to elements of health care proposals modulated and largely inside the tent, McEntee was “beyond the pale.”

That's interesting because the progressive community thinks Obama breaking most of his top campaign promises about health care with secret deals are the real gratuitous slaps. Having top progressive reform priorities (like allowing Medicare to save billions by directly negotiating drug prices) sacrificed in a back room in exchange for campaign ads from PhRMA is what is beyond the pale.

Looking back at Obama's campaign health care plan, it is shocking how many promises he broke without a fight. Obama promised:
-A new national health exchange open to all Americans
-A new public plan available to all Americans to compete with private insurance
-An employer mandate to provide health insurance
-A minimum medical loss ratio for insurance companies
-To allow people to import cheaper drugs from Canada or Europe
-To repeal the ban that prevents the government from directly negotiating with drug companies

Note none of these promise are part the Senate Finance Committee bill. Obama has made no effort to fight for the inclusion of some of these promises (public option, employer mandate, minimum medical loss ratio) and months ago even made secret deals promising to actively work to kill other promises (drug re-importation, and direct drug price negotiation).

During the election Obama actively campaigned against two policies. One was the individual mandate favored by Hillary Clinton (and the health insurance industry) and the other was a tax on employer-provided health insurance supported by John McCain. These two issues, that Obama fought against during the campaign, are part of the Baucus bill. Since taking office Obama has spent dramatically more time and political capital fighting hard to include these two provisions he opposed than he has spent trying to include top progressive/labor union priorities he supported like the public option.

Obama is now pushing for policies he claimed to strongly oppose (individual mandate and tax on health insurance benefits). He refuses to fight for provisions he promised to support (public option and employer mandate). And in a double whammy, during a series of secret back room deals (breaking his promise for complete and open transparency) he promised different industries to actively oppose popular ideas he once claimed to champion (drug re-importation, and direct drug price negotiation).

The question is who is gratuitously slapping whom. Is it the Obama administration, which with repeated broken promises stabbed in the back the labor unions? Or was it McEntee for simply calling bullshit when he sees it?

Finance Committee Vote On Tuesday

The vote on the Senate Finance Committee health care bill is scheduled for Tuesday. The committee has 13 Democarts and 10 Republicans. The big vote to watch for is Republican senator Olympia Snowe. She is seen by many as the only possible Republicans vote for any health care reform legislation. If Snowe does vote for the bill in committee it could be used as an excuse for including her worthless trigger idea in the bill which is brought to the full senate floor.

“The public option with a trigger would be a compelling thing to put in the merged bill if the Finance bill has the endorsement of Snowe,” said the aide. “When progressives howl, you can point to Snowe’s support.”

The other votes to watch are that of Democratic senators Ron Wyden and Jay Rockefeller. Both Wyden and Rockefeller have been treated poorly by Baucus throughout the process of writing the committee's bill. One or both (as long as Snowe is a yes) could cast a protest vote against the bill. Regardless, the bill is expected to pass out of committee.

The High Price Of Snowe

The public option has gotten most of the attention as of late, but sacrificing it is only the tip of the iceberg for Sen. Olympia Snowe (R-ME). Snowe is not just on the wrong side of the issue on the public option, she is demanding several incredibly bad provisions ans policies be part of a health care bill in order for it to garner her support.

Sen. John Kerry wanted the Senate Finance Committee bill to give the new exchanges some power to bargain with insurers. This would likely help reduce the price of insurance on the exchange. It is something that is part of all the bills that passed the four other committees. Why did Kerry's amendment fail?

The reason, several sources on Capitol Hill say, was opposition from Olympia Snowe, the Maine Republican who also sits on Senate Finance. Snowe seems to be concerned that a more aggressive exchange would amount to more government--which, in fact, it would be. But, as Massachusetts has shown, sometimes more government is exactly what health care needs.

Snowe almost singlehandedly made the exchange worthless.

Jon Kingsdale, who runs the Massachusetts exchange, calls that a recipe for "policy disaster," as consumers faced a dizzying array of more expensive, less regulated choices. "It would be like telling your grocery store they have to offer every single kind of bread baked by every single bakery. . . . The exchanges would be nothing more than an automated Yellow Pages."

This is not the only time that Snowe has demanded an awful policy change. Unlike the other bills, the Senate Finance Committee bill does not have an employer mandate. Instead, it has a form of “free rider” provision, which makes companies who don't provide insurance pay a fine for each employee who gets tax credits to buy health insurance. Besides being a bureaucratic nightmare to enforce, it could have serious negative consequences for low income job seekers. For some reason, Snowe wants this bad free rider provision instead of an employer mandate.

A worthless trigger instead of a public option, weak, poorly regulated exchanges, the terrible “free rider” provisions--these bad policies might all be part of reform legislation in order to win Olympia Snowe. (I think we will be finding out for months what other bad ideas Snowe demanded be part of the bill.) In an effort to win Snowe health care reform is being crippled. Winning her could cost the government hundreds of billions of dollars and regular American families a few thousand a year in higher premiums. Is one Republican vote really worth the high price of Snowe?

Senate Finance Committee Ends Amendment Process, Next Stop Reid's Office

The Senate Finance Committee late last night finished amending the chairman's mark. The amended bill will be sent to the CBO for analysis. It is assumed that by Tuesday the CBO will have a preliminary score of the bill. If bill scores as not adding to the deficit, the committee should vote on the piece of legislation.

The bill is expected to pass despite the fact that several Democratic members of the committee are unhappy with the shape of the legislation. Committee members have been lobbied by administration officials to keep the process moving forward.

The big question is whether Republican Sen. Olympia Snowe will vote for the bill. Snowe appears to be the only Republican senator who might possibly vote for health care reform. She could vote against the bill in committee, but eventually vote for the bill after it is amended on the floor. If she voted for the bill in committee it might give her greater sway in deciding on how the two Senate bills (FinCom and HELP) are merged. HELP Committee Chairman Tom Harkin does not see room at the table for Republicans when the bills are merged.

Once out of committee, the bill must be merged with the Senate HELP Committee bill. The HELP bill contains a public option, tougher regulations, and more generous subsidies. Majority Leader Harry Reid will be responsible for merging the two bills. It is up to Reid as to whether or not the bill that is brought to the floor contains a public option.

Schumer Vows To Fight On For A Public Option

With in hours of losing the vote in the Senate Finance Committee on his public option amendment, Schumer fired off an email to his supports vowing to fight on. Schumer calls the vote in the Finance Committee, only “the opening day of the fight.” The email concludes with:

If we continue to fight, I am confident we will pass health care reform with a robust public option.

Schumer has previously said that he always thought the committee was the least friendly battlefield. He believes that he would have a better chance of including a public option on the full Senate floor or as part of the bill which comes back from conference committee.

Amendments To Watch For Tuesday And Beyond

When the Senate Finance Committee starts work again on Tuesday things should get heated. Here are some of the more interesting amendments to watch out for.

Free Choice Amendment – Wyden C1
What it hopes to do: It would allow employee's who do not like their current employer provided health insurance to ask for a voucher to buy insurance for themselves on the new exchange.

Background:
Wyden's Free Choice Amendments is very important to the Senator. He has gone so far as to say that it is “a prerequisite to supporting the bill.” The CBO concluded it would have very little effect on overall health insurance and only save $1 billion. Wyden has been selling his amendments to conservatives as a way to increase choice and to liberals as a way to give more people access to the public option. This amendment is a wild card with the possibility of some bipartisan support. The amendment is opposed by the Chamber of Commerce.

What to look for:
Watch to see if any Republicans (especially Snowe) decide to back Wyden's free choice amendment. Also check out how Baucus and Conrad vote. The amendment may upset the delicate balance of back room deals and compromises Baucus has tried to achieve.


Applying Regulation To Large Group and Self-Insured Market – Rockefeller C1
What it hopes to do: It would apply all new insurance regulations to self-insured and large group market

Background:
The bill as currently written would exclude insurance provide by large employers from most of the new consumer protection regulations. While big business (i.e. the Chamber of Commerce) is opposed to the amendment it should be very politically difficult vote for any Democrats to vote against it. No one wants to be on record voting against protecting everyone from some of the worst insurance practices

What to look for:
Watch to see if any Democrat besides maybe Baucus votes against the amendment. Also important is to see how Snowe votes. If she supports the amendment it should make it into the final bill.

Various Public Option Amendments - Schumer, Cantwell, Rockefeller
What it hopes to do: Add a public option to Baucus' bill.

Background:
Senators Rockefeller and Schumer have been the most vocal supporters of the public option on the Senate Finance Committee. Rockefeller is likely to introduce a robust public option tied to Medicare, while Schumer plans to introduce a “level paying field” public option which must negotiate it's rates independent from Medicare. Schumer and Rockefeller have been working closely on the issue and have not yet decided on the best political strategy. They may choose to only introduce Schumer's weaker public option in an attempt to show the idea of a public option has strong support. They might also introduce two public option amendments hoping to give conservative Democrats cover of voting against the robust public option but supporting the weaker “compromise.”

What to look for:
First watch to see how many public option amendments are debated. Pay close attention to the CBO scores each public option gets. Baucus's use of the second lowest cost plan as the benchmark for determining tax credits may prevent the CBO from scoring the public option as saving money. Finally, pay attention to how conservative Democrats (Baucus, Carper, Lincoln, Conrad, Nelson) vote on Schumer's “level playing field” public option.

“Safety Net” Trigger Amendment – Snowe C1
What it hopes to do: It would trigger a weak state base public option if a low standard of affordablity is not met in any state at some time in the future.

Background:
The new message from prominent Democrats seems to be that what ever Sen. Snowe wants is a great idea. Despite being a worthless fig leaf Peter Orszag, Harry Reid, and Bill Clinton have all talked positively about it. The idea of a trigger is opposed by all the other Republicans on the committee along with many liberals who think it is worthless.

What to look for:
It is possible liberals could join with Republicans to kill Snowe's trigger. Pay attention to how the more progressives Democrats like Schumer, Rockefeller, Stabenow, and Cantwell vote. If they vote for the amendment it is probably because they got pressure to do so from leadership. Also pay attention to how Baucus votes. A trigger will likely insure that the final bill won't get more than 1-3 Republican votes in the Senate. If he supports the trigger amendment it is a clear sign he has fully given up on any hope of broad bipartisan support.

If Snowe's trigger amendment is not brought for a vote in committee it might be a sign that enough liberals on the committee have threatened to vote against it. If it failed in committee it would be more politically difficult for Reid to insert the idea when he combines the two committee bills.

Eliminating The CO-OPS - Rockefeller C11
What it hopes to do: Remove co-ops from the bill

Background:
Conrad created the idea of the non-profit co-ops instead of a public option in an attempt to find broad compromise. The idea failed miserably. Liberals Democrats and conservative Republicans both attacked the idea. The idea seems to be losing support with even Conrad admitting they should be stronger.

What to look for:
Watch to see which progressive members of the committee vote against the co-op idea. The votes of Republicans Snowe, Grassley, and Enzi should be interesting. All three were part of the Gang of Six that negotiated the co-ops idea. With Grassley and Enzi unlikely to support the bill, it is interesting to see if they will vote against the co-ops idea they helped create.

Bonanza For Insurance Companies

It is not often that progressives and the Wall Street Journal are in complete agreement, but sometimes the facts are plain for everyone to see. The Wall Street Journal is running a story today about what a massive boon to the for-profit health insurance corporations Baucus's health care bill would be.

The health-system overhaul proposed by Sen. Max Baucus would create millions of new insurance customers without subjecting health insurers to government-run competition -- two key victories for the much-maligned industry.

The math here is very simple:
Individual Mandate (millions of new customers) – Competition (public option) = Huge Profits

The health insurance companies got the individual mandate they wanted, even though Obama campaigned against it. They also scored a huge victory when Baucus did not include the a public option in his bill, something Obama did campaign on.

The WSJ story concludes with:

The outcome is still uncertain. "I think there's only a limited chance that this could get worse [for the insurance industry]," said Sheryl Skolnick, who follows health-care services at financial-services firm Pali Capital Inc. "When all is said and done, the health plans should say a prayer of thanks to the Senate Finance Committee."

I couldn't have said it better myself.

Baucus: Public Option Amendments Votes Likely On Tuesday

Senate Finance Committee Chairman Max Baucus said at the begin of today's hearing that there would not be time to get to the public option amendments today. He expects to debate and vote on the public option amendments on Tuesday.

Yesterday, Sen. Schumer and Rockefeller pushed hard for a vote today on their public option amendments.

The order in which the three public option amendments and Snowe's “safety net” trigger amendment are brought up for a vote should be the focus of intense back room negotiations over the weekend.

Another wild card on Tuesday will be the issue of co-ops. The idea has drawn bipartisan opposition on the Committee. It is possible that the liberal Democrats could join with conservative Republicans and strip the co-ops idea from the bill.

Carper Public Defends Secret PhRMA Deal In Exchange For Support Ads

In a stunning moment during the Senate Finance Committee markup Sen. Tom Carper defended a secret deal that the White House, Baucus, and PhRMA had reached. The White House has long denied the deal. Carper publicly acknowledges that part of the deal was that PhRMA would run millions of dollars worth of campaign ads in support of health care reform.

According to Carper the “golden rule” in Congress is that secret back room deals in exchange for advertising buys must be honored. Carper's statement below,

I was not involved in negotiations with PhRMA but I believe that the administration was, obviously PhRMA was, and I presume this committee was involved in some way in those negotiations.

And what PhRMA agreed to do through those negotiations is to pay about
80 billion dollars over 10 years to help fill up half the donut hole. That's my understanding. And they are prepared to go forward and to honor that commitment. As I understand it, the commitment from our colleague Senator Nelson would basically double what was negotiated with PhRMA.

And whether you like PhRMA or not -- remember I talked earlier today in our opening statements, I talked about four core values, and one of those is the golden rule, treat other people the way I want to be treated?

I'll tell you -- if someone negotiated a deal with me and I agreed to put up say, 80 dollars or 80 million dollars or 80 billion dollars and then you came back and said to me a couple of weeks later -- no no, I know you agreed to do 80 billion and I know you were willing to help support through an advertising campaign this particular -- not even this particular bill, just the idea of generic health care reform? No, we're going to double -- we're going to double what you agreed in those negotiations to do. That's not the way -- that's not what I consider treating people the way I'd want to be treated.

That just doesn't seem right to me.

Carper was speaking in opposition to an amendment from Sen. Bill Nelson and Sen. Jay Rockefeller. The amendment mirrors what Henry Waxman did in the House to close the Medicare Part D doughnut hole by requiring drug manufactures to provide rebates for the overcharging of dual eligible Medicare/Medicaid recipients. Recently a group of House Democratic freshmen sent a letter to Waxman to asking him a rewrite the bill to reflect the Medicare Part D language in the Baucus bill.

PhRMA's board approved the $80 billion in price reductions on June 19. On June 30, the Hill reported that PhRMA began running ads in the districts of vulnerable Democratic House freshmen.

Delay Delay Delay

Senator Baucus has just abandoned hope of marking up a health care bill in his committee before the August recess. This is by my count the 8th deadline Baucus has missed and will put his committee three months behind schedule. The move will farther promote the Republicans desire to kill reform through continuous delay.

The chance of Baucus finding a bipartisan compromise grows increasingly remote.

Conrad's Co-ops Plan Is Worthless

I previously wrote how you would be able to tell if Conrad's co-ops proposal is worthless. The point of the public plan is to provide strong competition for the for-profit health insurance companies. Competition would steal some of their customers and drive down their profit margins. Real competition would be bad for their corporate bottom line.

Yesterday, following reports that the Senate Finance Committee might embrace Conrad's co-ops as a replacement for the public option, stock prices of for-profit health insurance companies soared. From Reuters:

The S&P Managed Health Care index of large U.S. health insurers closed 6.5 percent higher.

Aetna rose 12.6 percent, Coventry was up 12.7 percent and Cigna was 7.7 percent higher, all on the New York Stock Exchange. Centene rose 7.9 percent.

It is clear that the people who have billions invested in health insurance believe that Conrad's idea of a loose association of co-ops simply will not provide strong competition. They believe it would not drive down the cost of premiums for average Americans and will not hurt the massive profits of the insurance companies. Wall Street has spoken, Conrad's “alternative” is worthless compared to a real public option.

Blanche Lincoln Has Good Reason To Reject Baucus' Compromise

Democratic Senator Blanche Lincoln sits on the Senate Finance Committee. She represents the state of Arkansas. Wal-Mart is headquartered in Arkansas and is the largest private employer in the state.

A month ago Wal-Mart angered many other large businesses by coming out in support of an employer mandate. Wal-Mart's support for the employer mandate was a needed boost to Obama's effort to reform health care.

What Wal-Mart is strongly against is the idea of a “free rider” provision. A “free rider” provision would make businesses not providing their employees with health insurance benefits pay a fine if their employees are getting health insurance from the government. They would be responsible for paying part of the cost of an employee's subsides on the exchange and half the cost of employees on Medicaid. The “free rider” provision would be very bad for a company like Wal-Mart, which employs a lot of low income workers and many individuals with disabilities.

Baucus's possible “compromise” health care legislation is expect to include the “free rider” provision which Wal-Mart strongly opposes. As long as Baucus' proposal includes the “free rider” provision demanded by the Republicans, he should have a tough time gaining Senator Lincoln's support. It is not just possible defection from the liberals on the Senate Finance Committee that Baucus should be worried about.

You Think $1 Trillion Is A Lot, Wait Until It Is Only $20,000

DaveJ at Openleft.org has made an excellent point. When middle class Americans find out what efforts to reduce the price tag of reform by reducing subsidies means to them, it could be very bad.

My understanding is that the Senate Finance Committee bill will likely force any family making over 300% of the FPL to buy insurance from a private insurance company at full price. That means an older couple making around $45,000 could be forced to pay a private insurance company over $10,000 in premiums alone. Add in co-pays and deductibles, and that couple could be forced to spend upwards of $20,000 on health care a year.

Voters when polled claim to care about the federal deficit and the cost of government programs, but it rarely becomes an election issue. In the abstract, voters might think for awhile that $1 trillion or $1.5 trillion sounds pricey. But when reform kicks in, they will know $20,000 is very expensive for them.

Reducing the official price tag might sound like smart politics now, but almost no one is going to change their vote because the official CBO number was $950 billion instead of $1.3 trillion. People's votes will change when they find out what Democrats consider “affordable” - forcing citizens to pay over 20% of their income to a private insurance company.

Politically it would be a very bad idea if the Democrats' compromises, intended to gain a handful of Republican votes, ended up making their signature program very unpopular.

Simple Test To Determine If Conrad's Co-ops Are Worthless

The Senate Finance Committee bill will likely include Senator Conrad's private co-ops idea instead of a public option. I plan to eventually write a piece explaining why Conrad's co-ops will likely prove unworkable. But there is a simple test to determine if Conrad's idea is completely worthless.

Obama has repeatedly explained that he wants a public plan to provide competition to drive down cost and keep insurance companies honest. Any student of economics would know that no business wants to face competition. Competition takes away market share and reduces profit margins.

The health insurance industry will (and frankly should) fight anything that would provide real competition. Competition will take away customers, drive down the premiums that they can charge, and reduce their profits. Competition would be good for average Americans but bad for the large health insurance corporations' bottom line.

Whether it be a public plan or private co-ops, the for-profit health insurance companies will fight anything that has a good chance of reducing their profit margins through real competition.

If the private health insurance companies do not fight Conrad's co-op proposal as vigorously as they are fighting against the public plan, you know they don't think it has a chance of driving down the premiums they are charging Americans. If the insurance companies do not fight Conrad's co-op proposal tooth and nail, you will know his idea worthless and useless. If the health insurance lobby endorses a bill that includes Conrad's co-ops proposal, that is proof it is a terrible idea.

Is Cover What The Blue Dogs Are Really Demanding?

Politico published a list of changes to health care reform demanded by a large group of Blue Dogs. Overall, the demands are a grab bag of cost-cutting proposals, cost-increasing changes, vague ideas, and strange modifications.

What is most important about their list is that it very closely resembles what are likely to be the differences between the House bill and the bill from the Senate Finance Committee. The strong similarity is no coincidence.

I think many of the Blue Dogs genuinely want to see at least some of these changes implemented. But most importantly, I think what many of them want most of all is political cover and reassurance.

(Do the Blue Dogs really plan to do battle to make the Exchange state-based with national oversight instead national with state-based variations?)

They don't want to be on record having voted for a more liberal bill if what emerges out of conference is basically going to just be the Senate Finance Committee bill. I think their most important demand is that they aren't forced to stick their neck out any farther than is absolutely necessary.

Similarity Between Blue Dog Demands And Possible Senate Finance committee Bill:

--Adjust the value and cost of subsidy levels (The Finance bill's early draft language had less generous subsidies and lower standards for what would be considered a minimum plan.)

-- Provide affordability credits on a sliding scale from 100-300 percent FPL (Early draft language from Finance Committee also sets subsidies at a limit of 300% FPL instead of the House's 400%)

--Establish consumer-driven, state-based co-ops (Very likely to come out of Finance Committee)

--Create state-based exchanges with a federal fallback (State-based exchanges are in Senate HELP bill and likely in Senate Finance, unlike the House's current national exchange)

The Very Conservative House Democrats' Health Care Reform

While the health care reform bill released by the House Democrats will be to the left of whatever bill comes out of the Senate Finance Committee, it is important to note just how very conservative the bill is. It more a set of patches fixing the worst problems in our health care system than it is true reform.

The House bill is neither transformational change, radical reform, or a system wide overhaul. It is not “socialized medicine” (VA health system for all), universal single-payer (Medicare for all), a Medicare buy-in open to all, or even a complete individual self-selecting exchange system (Federal Employees Health Benefits Plan for all).

It is more notable for what the bill does not change than what it does. It does not change how insurance is paid for, who pays for it, or where most Americans get it from. The vast majority of Americans will only experience minor change.

Americans currently getting insurance from a federal program like Medicare, Medicaid, VA, and Tricare will continue to receive basically the same insurance. The majority of Americans who get employer provided insurance will receive the same or similar insurance from their company. The main change they will see is no longer fearing coverage denied for a pre-existing condition and perhaps a small reduction in co-pay for preventative care. Health insurance for the millions on a current federal program will be paid for with the same taxes as always, and the exclusion for employer-provided health insurance will remain unchanged.

Only the small percentage of Americans currently uninsured, self-insured, and employees at very small businesses will see a lot of change in their health care (at least for the first decade).

The poorest from that group will be given Medicaid, and the rest will get federal assistance in the form of credits to small businesses and subsidies for individuals to purchase an insurance plan offered on the new regulated market place. The new public plan which is supposed to provide “competition and keep insurance companies honest” will only compete for the roughly 8% of Americans who can get coverage through the exchange.

The bill does fix most of our health care system's worst problems. New regulation will hopefully stop the most morally reprehensible private insurance practices. The Medicare Part D “doughnut hole” problem will be improve, and a new Medicare payment structure should hopefully arrest the increase in cost. People who currently fall through the coverage cracks will get help buying decent health insurance which will be expensive but not crushingly burdensome.

The House bill does not transform our health care system, instead it patches most of the problems with our current confusing quilt of coverage. It is inherently very conservative because it tries to fix our current system, not replace it.

Bipartisan Health Care Reform Nearly Dead?

During the Sunday talk shows the most important line came from White House advisor David Axelrod. His statements indicate the chance of bipartisan health care reform is becoming increasingly remote.

On This Week, David Axelrod redefined bipartisanship as simply including Republican ideas in the bill. He only “hopes it will come with Republican votes.”

This is new willingness on the part of the White House to go it alone on health care reform. I suspect what happened is the White House saw just how watered down legislation would need to be to get Republicans' support and was very not happy.

I looked at a draft outline of the “bipartisan” Senate Finance Committee's bill, and it is terrible. All the recent reporting has indicated that it has only gotten worse.

I don't know if the Obama administration concluded that the Finance Committee's bill would be unworkable politically, practically, or both. On a political level, there are probably enough liberal members of the House and Senate who will kill any reform resembling the Finance Committee's bill. They would rather take the “swiss cheese” version of a good bill that would be the result of using reconciliation over the complete version of a bad “bipartisan” bill.

The White House may also be concerned that the Finance Committee's bill would on a practical level be unworkable. It would be implemented too slowly, not do enough to make health care affordable, and not slow the growth in cost. If Obama signs a health care “reform” bill that could still leave low income people with medical bills in the ten of thousands, it could discredit the reform, the president, and the party.

No one yet knows what final shape the bipartisan Finance Committee's health care bill will take, but it is not going to be pretty. Obama has said he would rather have 85% of what he wants with 70 votes than 100% with 52 votes. The problem is any bill that can get 70 votes in the Senate will probably be closer to 35% of what he wants. Obama needs to ask himself if that is good enough for him personally, and also if he will be able to sell it to the more progressive members of his party. Axelrod is indicating the answer might be no.

Baucus's Health Care Plan Is Worse Than The Health Insurance Industry's Plan

Ezra Klein at the Washingon Post released a health care reform draft proposal from the Senate Finance Committee. The plan is not just bad -- it is worse than I would have ever imagined it could be. Just how bad is Senator Baucus's draft proposal? It is worse than the proposal put forward by America's Health Insurance Plans (AHIP). That is correct -- the health insurance industry wrote a better proposal than the Democrats on the Senate Finance Committee.

For the most part Baucus's proposal is almost identical to that of the AHIP lobby. Both do not include a public option and would offer a bare bones insurance plan. Both have an individual mandates, a form of community rating, and some type of health insurance exchange. Both would also limit out-of-pocket cost based on the current HSA standard. In the few places the proposals differ, Baucus's proposal is in fact less generous than the AHIP.

Paying for private insurance

Baucus Proposal – People making below 300% of the federal poverty level (FPL) would get subsidies to help buy insurance. If you make more than $31,500 you are on your own for the full cost of insurance.

AHIP Proposal – People making below 400% of the FPL would get subsidies to help buy insurance. Also everyone buying private insurance would get to deduct the full cost of their plan.

Medicaid Eligibility

Baucus Proposal – Every adult below 100% of the FPL would be eligible for Medicaid. Children below 133% of FDL would be eligible.

AHIP Proposal – Every adult below 100% of the FPL would be eligible for Medicaid. Children below 300% of FDL would be eligible.

The conclusion is simple. To claim that the health care reform plan put forward by the Democrats on the Senate Finance Committee was written by health industry lobbyists would be an insult to the lobbyists. Their plan was slightly better and did more to help average Americans buy health insurance.

Senator Grassley Lies About Public Option

Senator Grassley, along with eight other Republican senators on the Senate finance committee, sent a letter to President Obama voicing their opposition to creating a public health insurance option. In their letter they dramatically misstate the conclusion of a study by the Lewin Group.

The letter states, “actuaries at the Lewin Group ave concluded that such a plan open and offering Medicare-level reimbursement rates, would result in 119.1 million Americans losing their private coverage. The term “losing” is a completely distortion of the facts.

The Lewin Group concluded that a public plan structure like Medicare would be dramatically cheaper than private insurance and as a result people would choose to purchase it instead. Saying that millions of Americans would “lose” their private coverage is like saying that satellite TV service has caused millions of Americans to lose their cable TV service. Individuals decided to abandon cable TV and choose satellite TV instead. They choose satellite because they preferred its services or its price. They did not lose their cable TV service.

The repeated pattern of Republicans lying and distorting the basic fact about the health care debate will make bipartisanship impossible. It is clear from their statements that Senator Grassley, and the rest of the GOP senators, have no desire to negotiate in good faith.

Soda Tax Just For Show, According To GOP Senator

On Monday, Senator Baucus and Senator Grassley released a paper outlining possible sources of revenue to pay for health care reform. Among the several proposals was the idea of imposing new “lifestyle taxes.” One possible “lifestyle tax” would be a new excise tax on sugar-sweetened beverages. Some in the media have dubbed this the “soda tax."

Several news outlets (1, 2, 3, 4) have jumped on the story of a possible “soda tax,” even though there is almost no chance that it will ever be enacted. When Grassley was asked last week if there would be a new tax on soda, he responded with an unequivocal “No.” He explained that the soda tax is only being brought up to “get it shot down early so it doesn't become part of the debate. I don't think it's going to have any legs at all.”

While talk of a “soda tax” might make for good headlines, it is not really news. Its inclusion as one of many possibilities is more about window dressing and less about serious policy debate.