Insurance Companies Get the MAXimum Bang for Their Buck

From THINK PROGRESS:

Earlier this morning Senate Finance Committee Chair Max Baucus (D-MT) unveiled his committee’s health care bill, which has no public option and mandates that everyone buy insurance. While Baucus has failed to garner support from any congressional Republicans and has outraged progressives, there has been one very positive response to his proposal.

Following Baucus’ announcement, HealthNet shares increased by 3%, United Health Group Inc shares rose by 2.7%, Humana Inc. grew by 2.6%, Wellpoint stock gained 1.7% and Aetna Inc rose 1.6%

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Earlier this week, ThinkProgress interviewed Wendell Potter — a former health insurance executive — who pointed out that “every time there is an article in a big newspaper questioning the success of progressives in getting a good bill passed, the stock will go up.” “The analysts/investors don’t think any good reform is going to happen, or anything that would happen that would adversely affect the insurance companies,” he said.

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In fact, since the President signaled that he is backing away from the public option, health insurance stocks have been on the rise.

(Video at link)

From THE HUFFINGTON POST:

[…A]part from the Republicans from whom we expected outlandish lies and cartoonish behavior, Baucus and Conrad have been much more obstructionist and damaging to real health care reform, chiefly because they possess a disproportionate level of power in relation to the nine people in the upper Midwest they represent, and because their ideas would be laughable if they weren’t so ineffectual and dangerous.

To wit: Baucus Plan is just as craptastical as we all suspected it might be.

First, Baucus’ entire goal was to construct a bipartisan plan. Mission accomplished. Insofar as both parties hate it. Just as we predicted, Baucus tailored his plan to appeal to the Republicans who, as it turns out, don’t support the plan anyway. For example, one of his concessions to the Republicans was tort reform language which not only won’t work, but has also failed to bring in any Republicans (bad policy — bad politics).

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Furthermore, […] there are individual mandates, but no public insurance option. Baucus included his buddy Conrad’s pathetic co-ops which are destined to fail due to their limited bargaining power.

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The government subsidies in the Baucus Plan don’t extend deep enough into the middle class in order to protect families from massive health care debt if a family-member becomes sick or injured. Put another way, mandates would imprison families and force them to buy insurance policies that could still bankrupt them if they actually need to use their insurance for an emergency situation like an accident or being diagnosed with cancer.

The Baucus Plan also discriminates against low-income Americans. In one of the most awful provisions of the plan, the “free rider” provision, Baucus taxes businesses for each hiree who qualifies for subsidies. So this tax incentivizes businesses to not hire poor or disadvantaged workers.

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By Max Baucus’ own estimation, his plan carries a price tag of $880 billion over ten years. The press is tossing some very serious kudos and political cover his way because this is clearly less than the $1 trillion mark. It’s also $20 billion less than the number President Obama mentioned in his address to Congress last week. And it’s the Baucus Plan that many centrist Democrats — the budget hawks and fiscal conservatives — appear to prefer.

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If the centrist Democrats were legitimately worried about government spending and deficits, they ought to be supporting the Kennedy Bill (the HELP Committee bill) instead, which, according to the CBO, clocks in at $611 billion over ten years, due in part to the inclusion of the public option.

Unless we use backwards wingnut math, $611 billion is significantly less than $880 billion. So the incontrovertible reality is that the Kennedy Bill is the more fiscally conservative health care reform bill. So why aren’t the self-proclaimed fiscal conservatives in the Democratic Party flocking to embrace it?

The answers are obvious. One, the fiscal conservatives aren’t always fiscally conservative (most of them voted for the Bush wars, the Bush tax cuts and the Bush Medicare Part-D blank check). And two, the Baucus Plan forces you and me to pay more cash to their contributors in the health insurance industry. This works out very nicely for senators like Max Baucus who, as Roy Sekoff pointed out, has pocketed millions in contributions from the health care industry.

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Enter Senator Kent Conrad. Ryan Grim reported Tuesday that Conrad is changing the rules in the middle of the game in order give more weight to the Finance Committee bill and, in the process, “kneecapping” the bills with the public option — the Kennedy Bill and the House bill. In short, Conrad has asked the CBO to use cost projections that span 20 years instead of the 10 year terms the office had been previously employing.

This will make health care reform more difficult to pass because the cost projections will balloon and will be less accurate to predict over an unwieldy 20 year span — especially the bills with the relatively new public insurance plan. Plus, due to the political stigma on the more liberal bills, the significantly larger price tags will hurt those bills the most, allowing more room for demagoguery.

From THE HUFFINGTON POST:

The health care bill that Sen. Max Baucus (D-Mont.) unveiled Wednesday without GOP support has no room for legislative error. Democratic Sen. Jay Rockefeller’s declaration a day earlier that he would oppose the measure in its current form gives the chairman a one-vote margin on the Finance Committee, which includes 13 Democrats and ten Republicans.

On the House side, the Baucus proposal falls very, very short.

Rep. Anthony Weiner (D-N.Y.), who has become something of a spokesman for House progressives opposed to any bill without a public option, quickly convened reporters to respond to the Baucus offering and declared it “dead on arrival.”

And Rockefeller (D-W.V.) said he has company in his reservations in the Senate.

“A lot of them have come up to me and thanked me because I said what they’re thinking.[…]” Rockefeller told the Huffington Post.

The committee will consider amendments next week, hoping to pick up some GOP support without losing an additional Democrat. Opposition might come from an unlikely committee source: Florida Democrat Bill Nelson.

Nelson represents a large population of senior citizens who are nervous about proposed cuts to the Medicare Advantage program. While it’s mostly a boondoggle, offers little benefit to seniors and costs on average 14 percent more than standard Medicare plans, seniors are attached to it.

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Nelson, a finance committee member, told the Huffington Post he plans to offer an amendment that would grandfather in — an apt term, come to think of it — those currently enrolled.