HEALTH INSURANCE LOBBY MAY BE ONTO SOMETHING

The Democrats in Congress and the Administration are aghast that the health insurance lobby has announced their subtle dismay with the Baucus proposed healthcare reforms. Big Insurance’s financial experts project that these reforms may increase health insurance costs to the majority of insured Americans even faster than originally projected without reforms. They cite the delay until 2013 in the mandate that everyone must buy insurance, the additional taxes on generous private plans, other fees imposed upon the healthcare industry, and the lower reimbursements from Medicare and Medicaid to hospitals and healthcare providers that will likely be passed onto the general public. Readers should remember the Baucus Bill is the only Congressional proposal that does not have a viable national non-profit public option.

If we enroll more uninsured people in private healthcare plans, costs will go up if they are the sickest policyholders and not the healthiest Americans. If new fees on the healthcare industry are enacted without having any public enforcement of healthcare costs through tough national regulations or competition from a public non-profit insurance option, health insurance companies will simply pass those extra costs onto their policyholders. Then public subsidies to buy private insurance will go up and so will the systemic cost of the overall Baucus reforms.

If anything, the recent about-face from the insurance industry was long overdue. The next groups jumping ship may be the Pharmaceutical Companies, big businesses and labor, the AARP, the hospitals and medical equipment providers, and most everyone else particularly the extreme left. Often when you try to please everyone, you only end up making everyone angry.

The moment wealthy large special interests do not get everything they want from a Congress they thought was essentially bought, they naturally get upset. They expect their Senators and Representatives to follow the company line. They now may estimate that doing nothing will be just fine for their profits and to hell with the uninsured, the sick, and the Federal deficits. With executive bonuses based upon short-term profits, the long-term best interests of their companies and of any other people, entities or nations, are simply irrelevant. This analysis also applies to the financial and banking sectors that are vigorously fighting reasonable new regulations and consumer protections. This will occur in many other big industries subject to possible long-overdue changes that the general public, our economy and our society really need.

As healthcare reform comes down the stretch, every possible tactic will be employed to dilute, dismantle or even derail the entire process. As those major players in the healthcare industry see any changes they do not desire, they will fight tooth and nail against them. Considering the byzantine Senate rules of procedure ensuring minority rule, healthcare still runs the risk of dying there if it cannot muster more than 60 votes (a supermajority of 60% of its membership) for its passage. It only takes some hard closed-door lobbying and a couple million dollars more in campaign contributions to a few key Democratic Senators to kill healthcare or water it down enough to render it toothless.

I argued in a prior post that CBO estimates have been wrong for many previous pieces of legislation, including President Bush’s Medicare Prescription Drug Program, which the CBO over-estimated. Humans are uniquely unable to accurate predict anything in the future, and healthcare costs and their impact on the overall economy and federal budget is also a stab in the dark. Cost estimates are meaningless when this year’s budget deficit will exceed $1.5 trillion in the middle of the worst recession since the 1930’s, and the fact that in 2006 very few people in the general public, government, business, or academia predicted the current state of affairs (yours truly being one of the exceptional few).

My experience in private business and start-up enterprises strongly indicate we can at best project out 2 or 3 years, with many initial assumptions being the core determinants for all future numbers. And since we cannot accurately predict changes to overall environmental and business conditions, the numbers get more inaccurate as the timeline is extended. Anyone who argues the contrary may be an arrogant imbecile or a complete liar.

I suggested many months ago in another post that it may be necessary for things to get far worse before there is comprehensive healthcare reform. What will likely happen is a very limited set of reforms will make it through the special interest gauntlet, through both Houses of Congress and finally to the President. Within a few years, it will become painfully clear that the reforms were too timid in extending regulatory protections against discrimination, covering the uninsured, limiting large insurance increases to businesses and individuals, and containing the overall costs of healthcare to Americans and its impact on our government’s finances. More meaningful reforms will only take place when the burdens on American society, its global economic competitiveness, and upon its Federal and State governmental budgets are no longer sustainable. Merely postponing the implementation of the 2010 reforms until after 2013 will only delay the inevitable a bit.

Some may argue that this is the time to take on all the special interests, forget compromise, and really pursue a single-payer, Medicare-for-all, simple national system with the full power to radically control all costs of healthcare, and ensure universal coverage. If the currently timid reforms are being vociferously opposed, what would a complete overall face? There is no likelihood whatsoever that our utterly corrupt, short-sighted, bickering, national legislature could pull off that feat this year or next. But it may become our only choice after a few more years of merely rearranging deck chairs on a sinking ship.

We are not living in an age of statesmanship, courage, or even great long-term vision. Instead we are quickly sinking into a huge morass of petty, vitriolic, nihilistic, ignorant, bigoted, and short-sighted partisanship. Who will be in power at that prophetic moment in time (about 3 to 7 years from now) is anyone’s guess, but by then we’ll probably have a few other major countries dictating some of our major national policies as we’ll be too broke yet still too financial dangerous to the rest of the world. Then all our special interest groups will be rendered powerless and they will have to shut up for the greater good of the country and the global economy and environment.

We’re all in for many roller-coaster rides with respect to healthcare reform, climate change and renewable energy legislation, and finding the funds to upgrade our long-neglected national transportation, energy, communications and educational infrastructures. However, as with any amusement park ride, despite all the ephemeral thrills, you end up back where you started.

The sad part for all of us will be the realization that our political system is only geared to ensure nothing ever gets accomplished, despite all the hopes, awards, and positive feelings we may have from around the world for our success, which would benefit everyone else on the planet.

It’s not very good for the ego of any individual or nation to perpetually let down everyone’s hopes and dreams. But it happens in real life far too regularly. Just ask Charlie Brown, Lucy, Linus, Snoopy and the whole Peanuts Gang, as well as the majority of the American people.

Marc Pascal in Phoenix, AZ