Barack Obama on health care
Obama outlined his health care reform proposal during a speech in Iowa today. His plan holds a lot in common with the one outlined by Hillary Clinton a few days ago, with some notable differences.
First, the Obama bullet points:
Obama’s plan will provide affordable, comprehensive and portable health coverage for all Americans by:
- Making available a new national health program that will allow individuals and small businesses to buy affordable health care similar to that available to federal employees. No one will be turned away or charged more due to illness, and everyone who needs it will receive a subsidy for their premiums.
- Making available a National Health Insurance Exchange to reform the private insurance market. Any American could enroll in participating private plans, which would have to provide comprehensive benefits, issue every applicant a policy, and charge fair and stable premiums.
- Ensuring all of the 9 million currently uninsured children have affordable, high-quality health coverage.
- Expanding Medicaid and SCHIP and ensuring they continue to serve their critical safety net function.
- Requiring employers to make a meaningful contribution to the health coverage of their employees.
The first bullet mentions a nation-wide program that looks a lot like an expansion of Medicare to cover anybody who wants to buy into it. In this document, he describes that program as "a new public insurance program, available to Americans who neither qualify for Medicaid or SCHIP nor have access to insurance through their employers, as well as to small businesses that want to offer insurance to their employees." Clinton has proposed no such new program.
Expanding Medicare (or something like it) to cover the uninsured and small businesses sounds like a good idea to me.
The second bullet, about the national exchange, sounds like an expansion of the Federal Employee Health Benefits Program, in which different insurance companies compete in different regions of the country for federal employees' business. When I worked for the government (back in the late 12th century), I had a choice of several different plans provided by several different insurance companies. The coverage was very good, and the premiums were relatively low compared to the health insurance available to non-federal employees. An expansion of this program to cover the private sector would give small businesses the same price breaks and pooling leverage as Hillary Clinton's proposal to pool all the uninsured together.
Both plans sound like they could reduce the number of uninsured by significant numbers.
Obama has already promised to pass a law ensuring universal coverage, but the only mandatory coverage in his plan specifies that children must be covered.
In the detailed plan, he also advocates the importation of prescription drugs (as does Clinton) and a massive streamlining of information technology as a cost-saving measure (as does Clinton).
Both candidates have outlined some interesting ideas, but Obama's proposal to both expand something like Medicare and pool the uninsured/under-insured for the purpose of buying private insurance sounds like a more flexible approach and one that is more likely to cover the 47 million uninsured.
Like Clinton, Obama doesn't really address the outlandish rate of inflation in medical costs over the last couple of decades, except to acknowledge the over-consolidation in the insurance industry as one contributing factor. As larger insurance companies gobble up smaller ones, the number of insurance providers shrinks, thereby reducing competition. He claims the "exchange" mentioned above would increase competition (and who knows if it really would?).
Obama also says he "will prevent companies from abusing their monopoly power through unjustified price increases. In markets where the insurance business is not competitive, his plan will force insurers to pay out a reasonable share of their premiums for patient care instead of keeping exorbitant amounts for profits and administration."
Somehow, I doubt the insurance lobby will sit idly by while Obama tries to enforce price controls on their industry. It needs to happen, but it won't.