My answer: A little of both. Let’s start with an assumption that the rumors are actually true. It’s an assumption, subject to change later. (Update: Here’s the official release from Harry Reid with no details but also no eulogy for the public option. Update #2: Talking Points Memo has some sketchy unconfirmed anonymous details that seem to mesh with my thinking.)
Medicare Expansion Age 55-65
This is a great development for people in this age group. It’s far better than what they would have gotten under the public option on the table. Medicare-negotiated rates for services are just lower than they would ever have gotten with the public option from the House or the Senate.
Why does it work for everyone? First, because it opens an existing program, so there aren’t a huge amount of administrative startup costs. It also solves the cash flow problem by requiring those of us in that aging baby-boomer age group to pay premiums in order to buy in. That brings additional cash into the Medicare system on some sort of actuarially calculated basis, while buying time for some of the cost-saving reforms to kick in and push the solvency range even higher.
Non-profit co-ops with rates negotiated similar to FEHBP
This would be a plan offered by private insurers, but with the same terms that the Federal government gets on its rates. The insurer must be a non-profit entity and approved by the OPM (Office of Personnel Management). Insurers are paid a fee of up to 1%, and the rates are significantly less than what we’re paying for individual policies now.
Don’t forget who would be covered
The only people eligible for this would be those who aren’t covered by employer plans. This is the primary issue. Yesterday there was an admission by one Senator that they wanted to separate health care/health insurance from employment but couldn’t, because they couldn’t get any agreement from big business.
For someone like me who is unemployed/self-employed with one uninsurable child, one healthy, a husband 4 years older than me, our options would look like this:
Husband buys into Medicare
Uninsurable kid buys into national high risk pool, or we release him as a dependent and he is covered under Medicaid.
Daughter and I go out to the individual market through 2013 when I turn 55.
It’s an incredibly piecemeal approach, but it would actually work for us.
Something to consider
One of the most-overlooked features of the reform packages is the standardization of benefit packages. It’s worth remembering this when evaluating the value of this bill. Right now, coverage is all over the place. Under the bill, there are minimums. Here just some of the main ones:
Also, standardized out-of-pocket costs and maximums, which are also covered by subsidies for low-income families and individuals.
That’s a pretty substantial list of benefits, and is certainly more than what I was able to find when shopping individual (affordable!) policies early this year.
But..but…no public option?
Remind me when this bill has been signed to share my prediction back when the process began. Until it gets through the entire legislative process, I’m keeping my big yap shut. Not because I think the powers that be listen to me, but because I don’t want to start a firestorm among those who read what I write before I have water to fight it with.
When is a public option not a public option but it is a public option? When they call it something else, pull other ideas in that can be supported, re-use existing institutions to accomplish the goal, and they get 60 to agree to it.
After all, we can tilt after this thing called a public option and pound this bill into oblivion, guaranteeing that Democratic majorities in the Senate and House will be ground to dust, or we can step back, figure out the goal, and see if there is a pathway to the goal that makes something that looks like a public option but is really called a non-profit national co-op and Medicare expansion.
(Note: rumors of Medicaid expansion seem to indicate that it’s not going to happen, but the Medicare expansion looks to be gaining traction.)