Wyden in NYT: Expand consumers' choice of health plans

Charlie Burr

Ron Wyden, writing in this morning's New York Times:

Under the nation’s current employer-based system, most people have little if any choice about where they get their insurance. They just have to accept the plan that comes with their job. That insurance company, in turn, is provided a captive group of customers, so it has no incentive to earn their loyalty.

Empowering Americans to choose from a broad selection of health plans would turn the tables. Those insurers that charged affordable rates and provided good coverage would attract more customers, while those that treated customers badly would be forced to change their ways or go out of business. To stay competitive, insurers would need to follow the example of places like the Mayo Clinic and offer good, low-cost coverage.

The various bills making their way through Congress would, as the president explained, provide some consumer choice by establishing large marketplaces where people could easily compare insurance plans and pick the one that best suits their needs. Companies participating in these insurance exchanges would be required to offer coverage to anyone who wants to buy it, regardless of their age, gender or health status, and they would be barred from charging someone more for having a pre-existing condition.

The problem with these bills, however, is that they would not make the exchanges available to all Americans. Only very small companies and those individuals who can’t get insurance outside of the exchange — 25 million people — would be allowed to shop there. This would leave more than 200 million Americans with no more options, private or public, than they have today.

I understand the president’s fear of overreaching. Past reform efforts have failed in part because of the public’s distaste for government-imposed change. But walling off most of the health care system from choice and competition could create greater problems — enough to doom health care reform.

I believe there is a way to work with the present employer-based system to guarantee that all Americans have choices, and I am proposing it in an amendment to the latest Senate health care bill. My amendment, called Free Choice, would let everyone choose his health insurance plan.

Read the rest here.

Discuss.

Comments

  • (Show?)

    It is a good analysis and proposal. I have been bothered by the fact that employees of most business really don't have a choice under the current proposals, especially in small to medium size businesses; those big enough to offer insurance, but not big enough to have a menu of options.

    These employers, where the bulk of Oregonians are employed, also have to pay more and get less benefits than those in big companies, a real perverse economic barrier to new job creation. Why should insurance cost more based upon which employer you work for? I understand the concept of pooling for insurance companies and why it is necessary for them under the current system, but it really is wrong for most people. We don't price auto or home insurance this way and we need to have large insurance pools for everyone who doesn't work for the government or for an Intel or Nike.

  • bradley (unverified)
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    Huffington Post also has a story up about Wyden and his proposal and an appearance on tv this morning which is worth a watch. Has anyone else noticed that Wyden doesn't do that "uh" "um" thing anymore? He is actually pretty good on television, and I never thought I would say that.

    http://www.huffingtonpost.com/2009/09/17/senator-wyden-status-quo_n_290028.html

  • Bill R. (unverified)
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    Wyden seems to be the man of the hour. An appt. with the president yesterday. I wonder if his "Choice" amendment is gaining traction? The idea of choice is a strong selling point. If it can be worked into the health care plan, especially with the ability to choose a public option, that could generate a lot of support and diminish opposition. Most fears are based on the idea of being forced into something you don't want. And Americans are big on consumer choice.

    An article in the "O". http://www.oregonlive.com/politics/index.ssf/2009/09/ron_wyden_is_everywhere.html

  • OregonScot (unverified)
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    So has Wyden given up on his original plan of forceing everyone to buy private health insurance? This amendment doesnt sound bad, compared with the Baucus disaster now looming. But still forceing folks to buy insurance from private corporations leaves a bad taste in my mouth.

  • Joe White (unverified)
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    This type of plan will cost individuals and companies more, possibly much more.

    If you are an employer with 20 employees, currently you can negotiate with several carriers and get the best price you can for your 20.

    Wyden's proposal would force the employer to tell each prospective insurance provider 'I can't give you a group of 20, you might get 10 or 5 or 2. I really don't know how many.'

    And it will be priced accordingly.

    The price breaks on volume will be lost and everyone will pay more.

  • fbear (unverified)
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    Joe, thank you for making the argument for single-payer, where everyone is in one pool, thus giving everyone a price-break on volume (not to mention the decrease in administrative costs).

  • joel dan walls (unverified)
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    Gee, on the other hand, Joe, if you had, say, MILLIONS of people covered, that ought to really force down prices. So remind me why the single-payer idea is no good.

    Oh right, I just remembered: No Insurance Company Left Behind.

  • (Show?)

    Joe,

    An employer with 20 employees gets almost no breaks on volume. We went from 25 employees to being part of a bigger company when we were acquired. Our cost went down and we added vision, dental, and sharply lower deductables. When we were small we would have been much better off getting the rates from being part of a bigger pool as in the Wyden plan.

  • Greg D. (unverified)
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    If it is going to be illegal for insurance companies to deny coverage or price insurance based upon pre-existing conditions, there HAS to be mandatory coverage for everyone. Otherwise, people could go uninsured till something bad happens and then run down to Blue Cross and sign up for non-deniable non-rated coverage for whatever health disaster they are facing. Nobody dislikes the insurance companies more than I do, but obviously that won't work. The tricky / dangerous part is a mandate to purchase insurance without price controls and coverage mandates on the insurers.

    I think I will go to my on line broker now and buy some stock in United Heath Care. Money, money, money .....

  • OregonScot (unverified)
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    Greg, The trouble I see is down the road. Its OK if we get regulation and price control from a Democrat Congress, but i a few years when the GOP takes over they just abolish the controls..then it would be a mess. I hate mandatory anything,especially health care from Private Corporations. Will we then see credit scores being used to increase prices like in Car Insurance?

  • (Show?)

    Joe W, you really need to read up on how the health exchanges would work - as included in almost every single plan. Your argument is based on the current system, not on how it would be reformed.

  • RyanLeo (unverified)
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    Kari,

    Yeah, but if I am reading it right, then the so-called "Health Exchanges" will "create a regulated primary insurance forum. A government agency or committee will then create guidelines regarding the level of coverage to be offered within the exchange. The committee's primary objective will be to fulfill the government mandate for equality in insurance coverage. As a result, the committee will limit competition within the exchange to only companies that are willing to offer such coverage levels."

    Source: http://www.examiner.com/x-21037-Illinois-Statehouse-Examiner~y2009m9d13-The-Difference-between-President-Obamas-health-insurance-exchange-and-a-marketplace

    If I have been reading Joe White correctly, the most sensible way to lower health insurance costs is to allow health insurance companies to sell policies across states and allow businesses to form coalitions in order to buy insurance policies as one pool. Joe, correct me if I am wrong.

    What Obama wants to do with Health Exchanges is: 1. Enlarge health insurance pool and 2. Provide equality in coverage.

    I can understand the first theoretical point of enlarging the insurance pool to spread the cost over more individuals, but having a Governmental Board decide who is providing "equality in coverage" (Attorneys and various appellate courts will have a field day with this) will lead to the usual nepotism, favoritism and lining of bureaucratic pockets that is so prevalent in D.C. where you have Congressmen and Senators being bought by special interest campaign donations.

    The best option would be to ditch the primary insurance forum and allow health insurance companies to sell policies across state lines with less regulation and allow business to band together in coalitions in order to purchase health insurance policies as a single entity.

  • Joe White (unverified)
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    fbear wrote:

    "thank you for making the argument for single-payer, where everyone is in one pool, thus giving everyone a price-break on volume (not to mention the decrease in administrative costs)."

    Do you really pretend to believe that there is any incentive to provide low cost service in a government sponsored monopoly?

    Cuts will be made in service, not cost.

  • Joe White (unverified)
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    jdw wrote:

    "if you had, say, MILLIONS of people covered, that ought to really force down prices."

    Yes, if there is competition vying to take those customers from you.

    In a single payer scenario, there is no competitive pressure.

  • fbear (unverified)
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    Do you really pretend to believe that there is any incentive to provide low cost service in a government sponsored monopoly?

    Well, it seems to work that way in much of the rest of the world, which seems to enjoy better health outcomes (for one thing, they live longer), and pay less for their health care.

    But let's not let the facts get in the way of our taken-on-faith ideology.

  • (Show?)

    The health exchanges are generally viewed as a way to establish a minimum standard for acceptable coverage - not "equality" of coverage.

    I can't say that I've studied every permutation that's out there, but that's the general idea.

    In other words, if you want to sell a plan that has absurd exclusions (no cancer coverage!) or absurd deductibles or absurd copays or something, you wouldn't get the Good Housekeeping Seal of Approval :) and you wouldn't get into the Exchange (where subsidies are available for low-income and middle-income folks, and other inducements are available.)

  • Joe White (unverified)
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    fbear wrote:

    "much of the rest of the world, which seems to enjoy better health outcomes (for one thing, they live longer)"

    Yeah, it has nothing to do with the fact that Americans take very poor care of themselves in respect to diet, lack of exercise, smoking, alcohol, drugs, stress, risky lifestyles, sedentary behavior, exposure to chemicals in foods......

    All we have to do is put our dollars in the hands of Congress, and they will supernaturally cause us to live longer with no effort on our part.

    I don't have the blind faith that you have, sorry.

  • Joe White (unverified)
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    Kari Chisholm wrote:

    "The health exchanges are generally viewed as a way to establish a minimum standard for acceptable coverage"

    Aren't state insurance departments already empowered to do this?

    The problem is that most midsize and large corporations are exempt from state insurance regulation because they 'self insure'.

    I think that if an employer wants to 'play insurance company' then he should be regulated like one.

    But that's just my 'mindless laissez faire philosophy'.

  • (Show?)

    "Yeah, it has nothing to do with the fact that Americans take very poor care of themselves in respect to diet, lack of exercise, smoking, alcohol, drugs, stress, risky lifestyles, sedentary behavior, exposure to chemicals in foods......"

    If only they had reasonably available access to health professionals who could really help them understand the importance of healthy food and exercise! Man, I sure wish someone were trying to work on a plan for that...

  • (Show?)

    On Wyden and the Free Choice amendment:

    First, it's an amendment without parents if it gets attached to a bill without a public option. Giving everyone the chance to avail themselves of a fully private exchange with no mechanism to stanch costs is like setting a kid loose in Toys R Us with $1.50--many shiny objects you cannot have.

    Secondly, I have to continue to ask what the response is to the President's point that flooding the exchange with a third, half or say 2/3 of the country all at once or nearly so would be economically wrenching (not to mention a logistical nightmare). As nasty and pointless as the private insurance system is, it employs many many people and holds many many dollars in invested capital. No one intentionally destroys an industry overnight, even if it's one of suspect societal benefit. It does us no good to disemploy millions to give the rest access to cheaper health care.

    There has to be some kind of tradeoff made to prevent an en masse movement, if we're not going to take on the idea of single payer straight up. What if you could enter the exchange and leave your employer's plan, if you agreed to something like an 8% reduction in subsidy (or 8% surcharge if you don't qualify for subsidy) and took one of the low or middle tier plans? That is essentially the option that businesses are being given as I understand it with an employer mandate--you can drop your employees, but you'll incur an 8% payroll tax. I think many businesses will take that surety and do so, but not so many as to flood the exchange. A similar individual mechanism might work.

    But it all can only come with a public insurance option. And for Wyden to discretely stay away from active support of a public option--a fine example of which his own state colleague has been displaying for months now--makes me distrust the motives of his entire effort. It's as if he wants to have a totally different debate on health care, which indeed might be a preferable one--but it's not the debate the rest of us are having, and his absence is felt.

  • Joe White (unverified)
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    torridjoe wrote:

    "If only they had reasonably available access to health professionals who could really help them understand the importance of healthy food and exercise!"

    Do you really think people are so stupid that they require a doctor to explain that they should eat well and exercise?

    Isn't this something their parents, science teachers, PE teachers etc have been telling them since they were born?

    Seriously, how many people do you personally know who do not know that they ought to eat nutritious food if they want their bodies to stay healthy?

    Do you really think that the adults in this society need you to treat them like they are still children?

  • Greg D. (unverified)
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    Allowing consumers to purchase insurance across state lines - without some sort of national minimum standards for coverage, deductibles, co-pays, etc. - is a race to the bottom for health care and health insurance. Does anyone actually believe that allowing Oregonians (or Washingtonians or Californians) to purchase policies designed and underwritten to the lax standards of the Mississippi Insurance Commissioner is going to solve anything? The consumers will be fleeced of their premium money by slick cross-border marketing campaigns on late night TV, but when they get sick in Oregon I predict they will soon discover that those Mississippi reimbursement rates and coverage exclusions won't quite cover treatment costs for open heart surgery at Good Sam or Providence or wherever.

  • fbear (unverified)
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    Do you really think people are so stupid that they require a doctor to explain that they should eat well and exercise?

    One need only look at Rush Limbaugh to see the answer to that question.

    Are you really so naive to think that prodding by doctors doesn't have an effect on people's behavior? Sure, people may lapse into bad behaviors, but if they're asked about their smoking habits every six months, or their unhealthy weight is pointed out to them, with a support system for helping them, you don't think that will make a difference?

  • Joe White (unverified)
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    Greg D wrote:

    "Allowing consumers to purchase insurance across state lines - without some sort of national minimum standards for coverage, deductibles, co-pays, etc. - is a race to the bottom for health care and health insurance."

    This argument about 'buying across state lines' shows several basic misunderstandings about insurance.

    Consumers and companies already buy from companies that are not headquartered in their state.

    But the policies are underwritten using data on the people in their state.

    Insurance companies aren't going to want to sell someone in NYC a policy based on underwriting data from Montana residents. Ain't gonna happen.

    So, I think the whole discussion is kinda pointless.

  • Joe White (unverified)
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    fbear wrote:

    "Are you really so naive to think that prodding by doctors doesn't have an effect on people's behavior? Sure, people may lapse into bad behaviors, but if they're asked about their smoking habits every six months, or their unhealthy weight is pointed out to them, with a support system for helping them, you don't think that will make a difference?"

    Is that really the whole point of 'health care reform' for you?

    You want people to have to report in to the doctor every 6 months to be nagged about smoking and their weight?

    That's not gonna be a real efficient use of tax dollars, fbear.

    People are going to make bad choices, even if you make those choices illegal.

    You aren't going to be able to legislate a longer span of life in the US. And that was my point to you.

    You claimed that longer life span was the result of government run health care.

  • joel dan walls (unverified)
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    Joe White: the great increase in longevity since the 19th century is primarily the result of PUBLIC HEALTH MEASURES to eliminate the causes of infectious diseases. Think clean water and sanitation. Heroic medicine plays a tiny role. Those heroic medical procedures are primarily performed on people who, a hundred years ago, would have been long since been dead of some infectious disease or other.

  • Joe White (unverified)
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    jdw,

    We weren't talking the difference between 'then' and 'now'.

    We are talking the differences between 'now here' and 'now somewhere else'.

    fbears claim is that a government run health care system is responsible for longer life span in other countries NOW, not 100 years ago.

    My counter was that people's bad choices (I listed 'diet, lack of exercise, smoking, alcohol, drugs, stress, risky lifestyles, sedentary behavior, exposure to chemicals in foods') are primarily responsible for their poorer health and shorter life span, in comparison to those in other countries.

    Do you agree with that?

  • fbear (unverified)
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    So, Joe, are you denying the fact that not having access to health care has an effect on longevity? Are you denying that people going bankrupt due to health care bills has an effect on longevity? Are you denying that when insurance companies deny coverage for life-saving care that it has an effect on longevity?

  • joel dan walls (unverified)
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    I have no idea, actually, whether longevity in the United States as compared to other industrialized countries is matter of "people's bad choices", to use Joe White's term. One could certainly try look for correlation specific, well-defined "lifestyle choices" and longevity, but correlation is not causality.

    One could also look at the correlation between longevity and, say, exposure to environmental toxins, which are rarely a matter of choice by the people so exposed.

    Suppose someone's medical problems ARE caused by exposure to industrial toxins. Suppose that someone needs a lot of medical care as a result. It seems to me a hell of a lot more sensible that that medical care be provided more or less automatically than forcing the victim through the years-long agony of applying for workers' compensation, filing lawsuits against the company, and so on. There's a real difference in perspective here: is your focus on helping the victim, or on punishing the guilty party?

  • Joe White (unverified)
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    jdw wrote:

    "I have no idea, actually, whether longevity in the United States as compared to other industrialized countries is matter of "people's bad choices"......One could certainly try look for correlation specific, well-defined "lifestyle choices" and longevity, but correlation is not causality."

    funny, that's exactly what the tobacco companies said.

  • Joe White (unverified)
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    yeah fbear,

    I think I'm coming round to your way of thinking.

    I needed to go to the doctor today, so I called up an insurance company and they refused to cover me. Some nonsense about 'they only cover their customers, and only pay for what their policy sets forth'

    How dare they.

    Where do I get my single payer tshirt? I'm ready man.

  • fbear (unverified)
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    Haha, Joe.

    I bet you wouldn't be making jokes about it if what they were telling you they didn't cover is life-saving care, and you'll die without it, and it costs $100,000. Or $250,000.

  • Joe White (unverified)
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    fbear,

    Your state insurance department already has the authority to specify what is and isnt covered by policies in your state.

    Since your state is controlled by blue people, I'm assuming that they have already brought state law in line with what you are saying.

    So exactly which treatment is NOT covered by policies sold in your state, and why has the reigning Democratic party not done something about it?

    See, it doesn't take a federal law. Insurance is run by the states.

  • rw (unverified)
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    There's old Joe again: assumptive arse. :)

  • rw (unverified)
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    Hmmmm... so the regular dustups characterizing States Rights vs Federalism, Joe, are not an historic feature on the American landscape?

    Often Federal actions are taken when individual states refuse to let go of archaic, backward policies and come forward. Perhaps the most famous example? Ummmmm.... maybe you remember that little family feud, the desegregation process?

    This is no smaller than that. It's pretty base on that also-famous Maslow's Hierarchy of needs....

  • Joe White (unverified)
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    rw,

    My point, which you apparently missed, is that it's a lot easier to change a state law than a federal one.

    So if you think that insurance regulation in your state is lacking, don't look to Washington. Talk to those who are ALREADY empowered to deal with it.

    Certain procedures not covered that you think should be? Talk to your state legislature. You blue folks own it, it shouldn't be a problem getting them to listen to you.

    Why are you absolutely helpless unless a federal program is created?

    Change the state regs NOW to suit yourself. What are you waiting for?

  • Karl Smiley (unverified)
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    I'm so disgusted. The majority of Americans and doctors want a single payer free choice system similar to medicare and yet it's not even being discussed. Where are the people and lawmakers discussing and examining the health care systems in Canada or England or Germany etc...any of the countries where the cost vs. outcomes are so much better than ours? Why is it that almost all the proposals require mandatory insurance, bringing in a huge windfall of uninsured young people to pump up the already bloated profits of the parasitic health insurance companies? How can we make health care affordable if we don't have a real, available to every one, public option to compete with the price colluding, profit before health middle men...and in the mean time lack of affordable health care kills off the equal of 10 to 20 9/11s of Americans a year. This is democracy? I don't think so.

  • Peter Hall (unverified)
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    The reason the insurance companies don't want Wyden's plan is the same reason they don't want the public option. They want to limit competition. We don't have pools for any other type of insurance, so why health care. The ending of price discrimination would have to be part of the plan and would go a long way to creating affordability

  • rw (unverified)
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    Yep Joe, you have it right: I'm absoluuuuuuuuuuuutely helpless.

  • Karl Smiley (unverified)
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    <h2>Don't forget that the insurance companies are exempt from anti trust laws.</h2>

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