With his big health care policy victory killed in the night, Wyden likely to vote against the budget deal

Kari Chisholm FacebookTwitterWebsite

Wyden plan's would cost the government nothing, provide health care for 300,000 people, and inject some market competition into the health insurance market. And somebody killed it. Who?

As you all know by now, budget bills - especially must-pass budget bills - can often become a vehicle for totally unrelated policy changes. The high-profile fights over defunding the non-abortion services of Planned Parenthood, for example.

But not all fights are so high profile. In fact, sometimes the policy changes that show up in must-pass budget bills are ones that are done in the dark of night - without notice to interested parties.

One such under-cover-of-night knifings happened to Senator Ron Wyden. From Eric Lichtblau at the New York Times:

At a quarter till midnight last Friday, with a deal to avert a government shutdown barely an hour old, Senator Harry Reid phoned a fellow Democratic senator, Ron Wyden, at home and startled him with some bad news. “You lost free-choice vouchers,” Mr. Wyden recalls Mr. Reid telling him.

Here's the deal: Imagine that your employer offers you a health care benefit, but the employee portion of the premium is too expensive for you, so you turn it down. Under the new health reform law, if you're below 400% of poverty and that payment is more than 9.9% of your income, you can turn it down and get subsidized health care through the new exchange system. That's not changing.

But Senator Wyden was concerned about the 300,000 people whose premiums were more than 8% of their income (and less than 9.9%). For those folks, he devised a solution that cost the government nothing -- they'd be able to convert their employer's health care contribution into a "free-choice voucher", take that money and spend it to buy another health care plan - presumably a more affordable one - in the health exchanges. (Read more about how it would work in Senator Wyden's post on the Huffington Post.)

In short, Wyden had devised a plan that costs the government nothing, provides health care for 300,000 people that would otherwise not have it, and injects some market competition into the health insurance market.

So, who killed it? Good question.

Writing for the Washington Post, Ezra Klein notes:

This doesn’t serve anyone’s ideological interests, it doesn’t save the country any money and it takes an experiment in cost control off the table.

Senator Wyden told the Oregonian's Charlie Pope that no one is fessing up:

Wyden said Tuesday he was “blindsided” by the decision to include language to the budget bill that neutered his hard-won plan.

Even worse, he has been unable to identify who was behind the effort. ... “When you go and talk to all the parties, they all say ‘somebody else did it.’ And you can’t ever prove it,” he said. ...

“I’m flabbergasted,” he said. “I’ve never seen anything like this in my time in public service. That something that is a hard fought battle in public that everybody knows about is killed behind closed doors so quickly after the public fight.”

Unless something changes, Wyden now says that he won't vote for the budget deal:

“I can’t conceive of voting for it in its current form,” Wyden said Tuesday in an interview.

“Without this provision more than 300,000 people would just be in health care no-man’s land. Those are the people who, as a result of the action last week, are just going to be out in the cold,” he said. ...

Wyden would not say whether he would filibuster the bill, which must be approved by Friday to avoid a government shutdown. Nor would he say if he intends to apply some other tactic to express his displeasure. “I’m going to wait and see what the White House has to say; wait and see what the legislative leadership has to say. But I am not going to support this kind of raw special interest power,” Wyden said.

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    Full disclosure: My firm built Wyden's campaign website. I speak only for myself.

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    One additional note about the numbers.

    The O's Charlie Pope wrote: "Repeal saves $4 billion over 10 years, though the savings would not begin until 2014." He doesn't say where he got that number.

    According to a CBO analysis I obtained from Senator Wyden's staff, CBO's "latest budgetary estimates of repealing section 10108 do not show a change in outlays for exchange subsidies as previous estimates had done."

    The CBO analysis did indicate that there would be relatively small effect in reducing tax revenues -- because the few people who would turn down employer-based health care and talk their employers into handing over the cash (and thus pay taxes on it) would now use the tax-exempt voucher instead. "Repealing section 10108 is expected to reverse that effect and thus increase the share of workers' compensation that is taxable. That change is estimated to generate an increase in revenues of $0.4 billion over the 2011-2021 period."

    Yeah, so to the extent that anyone is claiming that it was the money, well, we're talking $40 million in 2011 -- out of a $38 billion budget deal (on a $3.6 trillion budget.)

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      Kari, I am sometimes math challenged, but I think $0.4 BILLION equals $400 MILLION, not $40 Million as you stated above. That's a bit over 1% of the $38 Billion budget cut, and less than a fraction of a drop in the bucket for the overall budget. And that comes to ~$1330 per-person cost for 300,000 participants. Do I have this math correct? As I said, challenged...

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      Looks like Charlie Pope either just added a 0 somehow, or misinterpreted the ten year $0.4 billion as a one-year figure. It is slightly weird of CBO to write $400 million as $0.4 billion.

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    Ah, yes. Once again we learn that transparency means nothing in the dark.

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    "So, who killed it?"

    Someone who has received hefty contributions from the health insurance industry. You can bet on it.

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    Sen. Wyden believes the Business Roundtable is responsible for killing his voucher proposal. Most of us are familiar with the Roundtable. Where ALEC is the firebreathng radical bunch, the Roundtable folks are the conservative elder statesmen from Wall Street. ALEC is Tea Party. The roundtable is cocktail parties. ALEC is Libertarians. The Roundtable is country club Repubs and limosine liberals. ALEC is Koch. The Roundtable is Imelt. Mr. Obama won't be seen with the Kochs. Imelt is his new best friend. Here's the catch. ALEC and the Roundtable are the same people. They are in large part the same group of corporations. They got what they wanted. Good for Wyden if he withholds his vote. We need an open revolt in the Democratic party. Shoulda' happened a couple of years ago.

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    I don't know who was fighting this provision but my guess is that it is the same employers (particularly large employers) who killed Sen. Wyden's (and former-Sen. Bennett's) broader proposal to allow most workers to opt out of group plans.

    Large employers believe they can better control health care costs if they can control the composition of the employee group that is covered. This has some positive implications--incentivizing employers to support wellness programs for their workers, for example--and some negative implications--incentivizing employers not to hire unhealthy or high risk people in the first place.

    But what it mostly does is scare the bejeejus out of employers to think that healthy, low-cost insureds will have the chance to opt out of their company plan and thereby raise the cost of insuring the remaining workers covered by the group plan.

    I don't blame Sen. Wyden for being upset but perhaps he can use this to generate greater discussion of the on-going challenge of maintaining a largely employer-based health insurance system in America as he has been pointing out all along.

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      Jack, I thought Republicans believed in individual choice. Seems that doesn't hold when it comes to corporate profits.

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        Bill, surely you've been around long enough to understand that Republicans believe in choice when it serves their interests. In other words, just like Democrats.

        The one thing I can say with a high degree confidence about any issue: Ultimately, it's never really about choice, local control, diversity or fairness. Those are just the wrapping paper members of all parties and ideologies choose to hide their real present.

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          "present" - nice euphemism.

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          Dismal, Jack, just dismal. On the other hand, when it comes to the ideology of destroying Medicare, the GOP seems quite willing to serve up their own political destruction in the service of that ideology.

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          I think that's a fair point regarding things like choice, local control, small v. big government, etc.

          Perhaps the most important distinction between liberals/conservatives, Republicans/Democrats is empathy, or more specifically the capacity or willingness to empathize. Conservatives have a difficult time putting themselves in someone else's shoes which is why their lives and politics are driven by selfishness. This selfishness combined with massive ignorance and religion has brought us today's ugly conservative movement.

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            Just a put a little twist on your statement, based on my conversations with conservatives, it boils down to public vs. private compassion. Conservatives, at least mine anyway, believe it is the job of the private citizens to care for the hungy/sick/homeless and not the government. I don't think most conservatives lack empathy, they just believe in a different delivery method.

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              The distinction you point out reinforces my claim. The profit driven free market is unempathetic by nature opposed to government, which is at least supposed to be working for the common good. Take healthcare. Generally speaking conservatives are happy with the free-market system which leaves tens of millions uninsured and underinsured while liberals prefer a system that delivers healthcare for everyone. In fact most liberals would be happy with a mostly private not for profit system that focused on delivering affordable healthcare opposed to increasing corporate profit. Liberals are clearly more concerned about the welfare of the poor, the elderly, and the disabled when it comes to healthcare. The examples are endless. Conservatives have a hard time empathizing with women, with non-heterosexuals, with non-whites, Latinos, animals, and the environment.

              My empathy theory is very well supported. Cognitive scientist, professor, author, and all around communication guru George Lakoff has written extensively on what makes conservatives and liberals tick. It wasn’t just his writings that convinced me. I did spend the first 30 years of my life living and working with conservatives of all shapes and sizes and have followed politics closely for over a decade.

              I highly recommend reading at least one of his books. “The Political Mind” is the one he wrote for the masses…short and sweet, but if your up for the long version try “Moral Politics: how liberals and conservatives think.” The man is brilliant.

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                I am totally in favor of taking the profit out of health care as well. Let doctors decide what to do and then audit the doctors to make sure they are staying on the "up and up."

                I will add Mr. Lakoff to my future reading list. Thx.

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              So, in other words, conservatives want to return to the days of workhouses and orphanages, kicking seniors, disabled, widows, and orphans to the curb. No housing, no medical care, no food, and rampant disease and death. Children chained to their factory machines. It worked out so well in the 19th century, why not bring it back??

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                You know darn well that conservatives are in love with the past...or at least that fairy tale version they have conjured up in their minds.

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      I might be sympathetic if I didn't think businesses were going to play the adverse selection game anyway. If businesses get to play, why shouldn't government?

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    I would just add that I think Wyden's vote on this is pure symbolism and if it were needed to pass the compromise rather than shut down the govt. he would capitulate.

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