Paul Krugman gets it:
But last week the budget office scored the full proposed legislation from the Senate committee on Health, Education, Labor and Pensions (HELP). And the news — which got far less play in the media than the downbeat earlier analysis — was very, very good. Yes, we can reform health care.
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Now, about those specifics: The HELP plan achieves near-universal coverage through a combination of regulation and subsidies. Insurance companies would be required to offer the same coverage to everyone, regardless of medical history; on the other side, everyone except the poor and near-poor would be obliged to buy insurance, with the aid of subsidies that would limit premiums as a share of income.
Employers would also have to chip in, with all firms employing more than 25 people required to offer their workers insurance or pay a penalty. By the way, the absence of such an “employer mandate” was the big problem with the earlier, incomplete version of the plan.
And those who prefer not to buy insurance from the private sector would be able to choose a public plan instead. This would, among other things, bring some real competition to the health insurance market, which is currently a collection of local monopolies and cartels.
The budget office says that all this would cost $597 billion over the next decade. But that doesn’t include the cost of insuring the poor and near-poor, whom HELP suggests covering via an expansion of Medicaid (which is outside the committee’s jurisdiction). Add in the cost of this expansion, and we’re probably looking at between $1 trillion and $1.3 trillion.
There are a number of ways to look at this number, but maybe the best is to point out that it’s less than 4 percent of the $33 trillion the U.S. government predicts we’ll spend on health care over the next decade. And that in turn means that much of the expense can be offset with straightforward cost-saving measures, like ending Medicare overpayments to private health insurers and reining in spending on medical procedures with no demonstrated health benefits.
The verdict is clear - if we do reform right, it doesn’t cost much, and the benefits, both economically and socially, are enormous. People get coverage, costs go down, and medical bankruptcies stop.
But this only works if you’ve got all the elements. A public option, shared responsibility where employer contribute, decent benefits, and subsidies to make it affordable. If you’re missing those elements, the costs go up, and on top of that, you don’t get real reform that meaningfully affects everyday Americans.
Will the Finance Committee follow suit here? If Chuck Schumer has anything to say about it, yes:
“If you did a consensus within the Democratic Party, you would find the level-playing-field public option to be the answer,” said Sen. Chuck Schumer, D-N.Y. “And now that we have 60 votes, it seems to me like we don’t have to turn it inside out for something we don’t like.”
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“[Sen. Chuck] Grassley hasn’t closed the door, but it seems in general that his model of co-op is little co-ops popping up like they do in farm country,” he said. “And the model that we are saying we need is they have to be strong, national and available everywhere from the first day. And I think we are very far apart on this.”
“So I don’t think the co-op way can work,” Schumer added. “So let’s go back and do what we should be doing: a public option.”
And they should. It’s better for the country, it’s better for consumers, and it’s better for America’s bank account. Just about the only people who don’t like it are ideological conservatives, and they just lost the election.
(also posted at the NOW! blog)