ucation Center

Small businesses which the U.S. Small Business Administration defines as firms with less than 500 employees are critically important to the American economy.[1]  They represent 99.7% of all employer firms; generate one-half of America’s Gross Domestic Product (GDP), and two-thirds of new jobs every year. Smaller firms with fewer than 20 employees accounted for approximately 18 percent of private sector jobs in 2006, but nearly 25 percent of net employment growth from 1992 to 2005.[2] These businesses account for a large majority of jobs in start-up and are a key source of innovation and economic growth.   

The competitiveness of U.S. businesses continues to be negatively impacted by the rising costs of health care and a concurrent rise in the number of uninsured and underinsured workers.[3]  There is a substantial competitiveness gap between the United States and numerous other industrialized countries in the global economy, including the loss of jobs to competitor countries.[4] Small businesses with less than 50 employees are particularly challenged to both thrive and compete.[5]  The magnitude has lead some to suggest that employer-sponsored health insurance (ESI) as currently structured has outlived its usefulness.[6] 

Indeed, health care costs are a barrier toward greater economic success for the small business owners and their employees, as well as contributing to income disparities.[7]  Addressing how the cost of health care impacts small business is a major policy issue in the current health care reform legislation under consideration in both the Congressional House and Senate.[8]  While there are identifiable business organizations lobbying on the purported behalf of small business, a major survey of small business owners indicates that they are not adequately being represented.[9] 

The rise in health care costs and how it is leading to the growth in uninsured workers is a major salient issue in Texas because the state has the highest percentage (25%) of uninsured U.S. residents, a majority of whom works full-time.  In 2006, there were 386,422 small business employers in Texas who accounted for 98.7% of all employers, and 46% of the state’s private-sector employment.[10]  Small businesses with fewer than 50 employees accounted for 72% of Texas businesses.  About 2 million or 24% of private sector employees worked in these firms in 2005, and over one-half of these private-sector small firms have fewer than ten employees. Of these businesses, 33.6% and 25.9% offered health insurance for firms with less than 50 and 10 employees respectively. [11]     

The bienestar (well-being) and health of the Latino population in Texas is intertwined with the economic growth of small businesses and with the current national legislative proposal to reform the U.S. health care delivery system. More specifically, reform policies directed at addressing disparities[12] in health care access greatly affect Latinos in Texas.  Many Latinos are very worried about health insecurity and strongly support current national health reform initiatives.[13] The long-term implications are clear in light of Hispanic population growth and the projected impact on the states’ education system, the labor force, the health system, and overall economy.[14]  

Another important aspect of this debate is the concurrent underlying disproportionate negative impacts of these issues on the bienestar and health of uninsured Latino workers[15]because among Latino workers, the majority is employed in small businesses, many of whom are also small business owners.[16]  In fact, Latino small business owners are growing at three-times above the average of non-Latino owned small businesses.[17]  However, most Latino small business workers are low-wage earners whose overall bienestar is at risk because of health disparities (e.g., being uninsured and/or in poor health) that impact them.[18]  Only 40% of Latinos had employer-based health insurance in 2008 compared to 62% for non-Latino Whites.

Latinos are the most uninsured population in the nation and in Texas, a trend that has existed for well over a decade.  During the 1996-1998 period, the Latino uninsured rate (ages 19-64) in Texas was 38%; ten years later in 2008 it was 39%.[19]  Their uninsured rate is still twice that of non-Latinos after excluding non-citizens (documented and undocumented U.S. Latino residents).  Reasons cited for this severe health insurance disparity include:

·        Lower education and income levels;

·        High levels of employment in small businesses which do not offer health insurance coverage;

·        Work in service and other occupations with the least access to affordable health insurance coverage; and

·        Unaffordable premium-share when health insurance coverage is offered given their lower wages.

It is also worth noting that the health insurance disparity for Latinos persists when compared to the same level of education for Non-Latinos.[20] 

Texas Uninsured by Race/Ethnicity and Educational Attainment

Source: US Census Bureau: Community Population Survey 2007

Note: Percentages reflect individual racial/ethnic and educational attainment sub groups and will not add up to 100%

For Latino small businesses and low-wage workers, affordability is increasingly challenged by the cumulative changes in health insurance premiums, inflation, and workers’ earnings.  The trend has a direct impact on the question of what is affordable, and if disparities will be addressed. In Texas, severe affordability issues are exemplified by the following:[21]

·        Health insurance premiums for working families increased by 86.8% from 2000 to 2007, while the median earnings of Texas’ workers increased by only 15% ($23,032 to $26,484). Health insurance premiums rose 5.8 times faster than median earnings.  

·        Family health coverage (employer and worker share of premiums combined) rose from $6,638 to $12,403.

·        Family health coverage for the employer’s portion rose from $4,879 to $9,191, while the worker’s portion rose from $1,759 to $3,212.

·        Individual health coverage (employer and worker share of premiums combined) rose from $2,627 to $4,385.

·        Individual health coverage for the employer’s portion rose from $2,220 to $3,613 while the worker’s portion rose from $407 to $772.

For small business employers and their employees the challenges include:[22]

·        Less than half of employees working in firms work for an employer offering coverage, compared to 93% in large firms. There are fewer in Texas than nationally.

·        Of the 1.9 million employees working in small firms, less than 800,000 (42%) are eligible for coverage and less than 650,000 (32%) are enrolled.

·        Texas families pay a higher share of premiums, deductibles, and out-of-pocket expenses for health insurance than nationally.

·        The majority of small business employers who do not offer coverage report that they can only pay $100.00 or less per employee per month for health insurance.

A recent Institute of Medicine report notes, “Businesses must realize there are real bottom-line costs associated with health disparities. Employers cannot afford to continue shouldering the costs and consequences (illnesses, disabilities, premature death) of unnecessary or unequal health care particularly in light of a more diverse workforce.”[23]  Racial and ethnicity minorities will comprise the majority of the U.S. population by 2042, and over 50% of the working-age population (30% Latino, 15% Black, and 9.6% Asian) by 2039, up from 34% in 2008.  Latinos are projected to represent over 53% of the Texas population in 2040 compared to 32% and 10% for Anglos and African Americans respectively.[24]

Documented research demonstrates that high risks pools, health saving accounts, and the like have had limited impact in helping small businesses acquire affordable health insurance coverage.[25]  Further, research shows that tax credits and subsidies must be well-developed and targeted to either the small business and/or individual employees to improve their chance of success.[26]  In Texas, legislative efforts have had limited success in helping small businesses or low-wage workers to successfully purchase affordable health insurance coverage through high risks pools or tax credits.[27]

In summary, research repeatedly demonstrates the disadvantaged position of small businesses, as exemplified by the following issues:[28]

·        A decade-old trend of rising premium cost;

·        Higher premium cost disparities between small and large businesses;

·        More limited health plan choices and less comprehensive health benefits;

·        Disproportionately higher operating costs for small businesses;

·        Health insurance access disparities between higher and lower-wage workers within small and large firms;

·        A more severe decline in their ability to offer affordable health insurance compared to larger businesses;

·        A lack of access to affordable health insurance coverage in private health insurance market for individuals or their families.

The current health reform proposals contain policies directed at addressing the negative impacts that health care costs are having on business, particularly policies that will assist small businesses to have access to affordable health insurance coverage.[29]  According to proponents, 233,000 small businesses in Texas could be helped, and they would also be exempt from any employer responsibility provisions.  Several important means are identified for providing access to affordable coverage: 1) a health insurance exchange that pools small businesses and their employees with millions of other Americans to increase purchasing power and competition in the insurance market: 2) tax credit for small businesses (with less than 50 employees); 3) termination of the ‘hidden tax’ on small businesses that provide health insurance, 4) prevention of arbitrary premium hikes; and 5) prevention of denial of coverage or high costs because of pre-existing health conditions.

There is, of course, heated debate about the impact that current health care reform proposals will have, and whether a final bill will either help or hurt small business regarding access to affordable health insurance coverage, as well as whether it will strengthen their long-term competitive growth and development. The strongest opposition has been from the U.S. Chamber of Commerce and National Federation of Independent Businesses, with some beginning support from the Business Roundtable.  Whereas other business groups such as the Small Business Majority, Main Street Alliance, and National Minority Business Council have indicated strong support for the proposed reforms.

The importance of meaningful health care reform for small businesses and the disproportionate large number of uninsured Latinos is evident.  As such, affordable health insurance expansion for small businesses and Latinos must consider:

Health Disparities - Over the next decade, the prevalence of disease will shift from White non-Latinos to Latinos who are primarily young and of working age. Therefore, socio-economic conditions coupled with existing health disparities and environmental circumstances of uninsured Latinos must be considered in order to successfully develop and implement effective policy solutions.

Affordability - Latinos are most likely to have lower education attainment, to live in poverty, have less disposable income, and be uninsured, and work in small businesses. Improvements to the system must include significantly reduced costs.

Accessibility - It is vital to healthy outcomes that services be accessible. Texas Latinos are not only the most uninsured, but are also more likely to reside in medically and health professions underserved areas.

National data indicate that over the next 10 years, Latino-owned businesses will have a growth rate of 8%–3 times the rate of U.S. firms overall, and their revenue and worker growth is also expected to be higher.[30]  The most recent business data (2002) indicated that 18.4% (319,340) of all (1,694,485) Texas business owners were Latino, which represented a 32.8% increase from 1997. According to the State Comptroller, Latinos help propel the Texas economy.  Latinos contributed more than 171 billion in 2008, and expected to rise to 252 billion by 2013 (47% increase), plus significant growth is expected in Latino-owned businesses.[31]

While all small businesses may share common concerns, it is imperative to determine if the experiences and perspectives of Latino small businesses are truly known and are accurately and adequately represented in the health reform debate. The disproportionate negative impacts are probably greater on Latino small businesses, their employees and families.  While Latinos continue to grow in population, labor force, and entrepreneurship, access to healthcare and prevention are negatively impacting Latinos, hence the economic well-being of Texas.  Latino small business opportunities are more limited regarding maintaining affordable and comprehensive health insurance benefits for their employees, while continuing to prosper in size and profits.

In summary, of 23 million Texans, one in three is Latino (36.5%), and their projected growth and economic contributions combined with improved health care access can further ensure our state’s productivity. Health insurance coverage increases the likelihood for regular access to a medical home for preventive primary care and access in the event of an unanticipated health care need. In short, access should provide the opportunity to maintain good health and not add to the risk of financial health care debt. Further, the coverage cost should not be a barrier to parents to pursue and retain individual and family financial security and self-sufficiency. The objective should be to reduce disparities, not increase them.  Provided with affordable opportunities to access coverage for themselves and their employees, small businesses can increase their growth and make significant contributions to reducing the number of uninsured Latinos while improving their overall health status. All of Texas and all of its residents will benefit, thereby insuring the economic growth and prosperity of the state for decades to come.

WASHINGTON — What’s all the fuss about? After all the noise over Democrats’ push for a government insurance plan to compete with private carriers, coverage numbers are finally in: Two percent.

That’s the estimated share of Americans younger than 65 who’d sign up for the public option plan under the health care bill that Speaker Nancy Pelosi, D-Calif., is steering toward House approval.

The underwhelming statistic is raising questions about whether the government plan will be the iron-fisted competitor that private insurers warn will shut them down or a niche operator that becomes a haven for patients with health insurance horror stories.

Some experts are wondering if lawmakers have wasted too much time arguing about the public plan, giving short shrift to basics such as ensuring that new coverage will be affordable.

“The public option is a significant issue, but its place in the debate is completely out of proportion to its actual importance to consumers,” said Drew Altman, president of the nonpartisan Kaiser Family Foundation. “It has sucked all the oxygen out of the room and diverted attention from bread-and-butter consumer issues, such as affordable coverage and comprehensive benefits.”

The Democratic health care bills would extend coverage to the uninsured by providing government help with premiums and prohibiting insurers from excluding people in poor health or charging them more. But to keep from piling more on the federal deficit, most of the uninsured will have to wait until 2013 for help. Even then, many will have to pay a significant share of their own health care costs.

The latest look at the public option comes from the Congressional Budget Office, the nonpartisan economic analysts for lawmakers.

It found that the scaled back government plan in the House bill wouldn’t overtake private health insurance. To the contrary, it might help the insurers a little.

The budget office estimated that about 6 million people would sign up for the public option in 2019, when the House bill is fully phased in. That represents about 2 percent of a total of 282 million Americans under age 65. (Older people are covered through Medicare.)

The overwhelming majority of the population would remain in private health insurance plans sponsored by employers. Others, mainly low-income people, would be covered through an expanded Medicaid program.

To be fair, most people would not have access to the new public plan. Under the House bill, it would be offered through new insurance exchanges open only to those who buy coverage on their own or work for small companies. Yet even within that pool of 30 million people, only 1-in-5 would take the public option.

Who’s likely to sign up?

The budget office said “a less healthy pool of enrollees” would probably be attracted to the public option, drawn by the prospect of looser rules on access to specialists and medical services.

As a result, premiums in the public plan would be higher than the average for private plans. That could nudge healthy middle-class workers and their families to sign up for private plans.

“The concern was that the public option would destabilize the bulk of private insurance, but in fact what Congress has fashioned is very targeted,” said economist Karen Davis, president of the Commonwealth Fund. “It’s not going to be taking away the insurance industry’s core business.”

It’s unclear whether there are enough votes in the Senate for a public plan. The version that Majority Leader Harry Reid, D-Nev., has offered would let states opt out, probably leaving a smaller plan that the House would want.

Insurers aren’t buying the budget office analysis. Asked if it might soften that opposition, industry spokesman Robert Zirkelbach of America’s Health Insurance Plans responded with a curt “No.”

While a government plan might start out modestly, insurers fear that Congress could change the rules later, opening it up to all people and setting take-it-or-leave payments for hospitals and medical providers, instead of negotiating, as the House bill calls for.

For the same reason, employer groups also remain wary. Big companies don’t want to lose control of their health care budgets and instead have the government send them a tax bill.

“That cost is going to come back to you one way or another … and it’s coming back in the way of taxes and liabilities,” said Eastman Kodak’s chief executive, Antonio M. Perez, speaking for the Business Roundtable. “We just don’t believe that there are miracles out there.”

If Congress passes a public plan that’s not much of a sensation, Democrats might have reason to regret all the time and energy they invested in it.

HEALTHCARE Q & A

How Nancy Pelosi’s healthcare bill would affect taxes, Medicare prescription drug benefits, and more.

By Kim Geiger and James Oliphant

November 1, 2009

Reporting from Washington

Some reader questions on the national healthcare debate, focusing on the House bill unveiled Thursday by Speaker Nancy Pelosi (D-San Francisco):

Would the House Democrats’ bill raise my taxes more than the other bills making their way through Congress?

It depends on your income. The House bill would impose a surcharge on individuals who make more than $500,000 and couples who make more than $1 million. The previous House bill would have imposed the surcharge on individuals who make $280,000 and families that make $350,000. The current bill also would impose a tax of 2.5% of income for those who make more than $250,000 and fail to purchase health insurance.

How would the bill affect my prescription drug benefits under Medicare?

The bill would speed the closing of the Medicare Part D “doughnut hole” — the coverage gap that occurs when a patient’s prescription costs exceed a certain yearly amount. Over time, this bill would create a 50% discount for prescription drugs bought in the doughnut hole. That process would be completed in 2019 — five years earlier than proposed in the original House bill. The bill also would require the Health and Human Services secretary to negotiate for Medicare drug prices.

Why do insurers say this bill would raise healthcare costs?

Insurers are not happy that the bill includes a “public option,” a government-run plan that would be funded through an increased payroll tax for those who choose it. The public option would compete with private options in a regulated insurance exchange. Insurers say the public option will disrupt the healthcare market and could force some companies out of business. The bill also ends insurers’ exemption from antitrust laws that prohibit price-fixing, another element that they say could drive up costs.

How would the bill affect small businesses?

It would exempt more small businesses from a requirement to provide insurance benefits to employees. Employers with yearly payroll costs of less than $250,000, compared with $500,000 under the previous House bill, would be exempt from the requirement.

What parts of the bill would take effect as soon as it became law?

The bill would immediately eliminate lifetime coverage limits and rescission, the process an insurer uses to cancel a policy because the policyholder failed to disclose a preexisting condition.

In addition:

* People could keep their COBRA plans until the insurance exchange designed to offer affordable options is in place.

* Young people could stay on their parents’ insurance plans until they turn 27.

* Co-pays and deductibles for preventive services to Medicare patients would be eliminated.

* It would create a temporary insurance program for people who have been uninsured or denied coverage due to a preexisting condition.

I keep hearing that none of the Democratic healthcare bills would cover everyone. Who won’t be covered?

Under the most recent Senate version of the bill, people who don’t earn as much as four times the federal poverty level — amounting to $43,320 for an individual or $88,200 for a family of four — would be offered government assistance to buy insurance. But there would be no assistance for people who earn slightly more, though they could apply for an exemption from the insurance requirement if they can prove that the most inexpensive policy they could buy would exceed 8% of their income. That’s why experts have estimated that 3% to 6% of those eligible would remain uninsured.

Would a “public option” make it possible for everyone to be covered?

A so-called public option could make affordable insurance more accessible to those whose incomes are above the subsidy limit, but it is not likely that everyone would be covered.

The House bill, which does contain a public option, is estimated to cover about 97% of those eligible, more people than the Senate Finance Committee bill, which does not include a public option and would cover 94% of the population.

It is also possible that a public option would include a “firewall” that would prevent some people from enrolling — specifically those who work at a company that already offers coverage, even if that policy is not affordable for the employee.

I work at a small business, and my employer doesn’t offer health benefits. Will healthcare reform require my employer to cover me?

It depends on the size of the business, but many small businesses are exempt in the House and Senate bills. The final Senate bill is likely to exempt businesses with fewer than 50 employees from a mandate to offer coverage. The House bill exempts or reduces the requirement for businesses that have yearly payrolls of less than $400,000.

I have been denied health insurance because of a preexisting condition. Will any of these bills guarantee that I can buy insurance?

The bills appear to explicitly prohibit an insurer in the individual marketplace from denying you coverage because of your health status, regardless of whether you have been denied coverage in the past.

Of course, the bills do not guarantee you will be able to find an affordable policy.

And under the bills as they stand now, insurers will still be able to price policies based on your age or past tobacco use.

Some Democrats have proposed ending the insurance industry’s antitrust exemption. What exactly is that?

A 1945 law prevented the federal government from regulating all forms of insurance, leaving that duty to the states. As a result, the law also shielded insurers from federal antitrust laws that prohibit price-fixing and collusion. This is seen as a problem for residents in many areas where only one or two health insurers operate. Rather than go to a neighboring state where another insurer might be offering a better deal, residents are forced to choose between the insurers that are regulated by their state government. Some Democrats are proposing to repeal a portion of the law that relates to health insurers specifically.

Some Republicans have proposed allowing insurers to sell plans across state lines. Can’t they do that already?

A proposal to allow this was part of the bill that passed in the Democrat-controlled Senate Finance Committee last week. Republicans, however, have been the ones arguing the loudest in support of the idea. Currently, a resident in one state cannot buy a policy offered in another state because it would not meet state requirements and there would be no government regulator to ensure that the policy was honored. If the law were changed to allow interstate sales of health insurance, this could open the industry to federal antitrust laws because an interstate insurance regime would have to be regulated by the federal government.

What are some other proposals for increasing competition?

The one that draws the most attention is the “public option” — a government-run health insurer. Proponents say such an entity could offer cheaper insurance rates because it could deliver healthcare services in a more cost-effective way, particularly if it paid doctors at the same rate, or slightly higher, than Medicare does. Some members of Congress favor private, member-owned cooperatives that they say would compete with insurers without government involvement. And some believe that simply requiring all residents to buy insurance will give insurers enough incentive to compete for those new customers.

What about allowing national insurance plans?

That’s another proposal that proponents say would give consumers more choices and drive down premium costs. A provision in the Senate Finance Committee healthcare bill would allow insurers to offer national plans that would compete with state-based ones. Critics say such plans would evade tougher state regulations. The bill does allow states to opt out of the national plans, but some question whether states would be willing to do so if it meant preventing residents from buying less expensive plans that don’t meet state standards.

How can we be sure that there will be no rationing of healthcare or pharmaceuticals under the bills being considered in Congress?

Democrats argue that there is rationing in the current healthcare system, in part because insurance companies can rate consumers on the basis of preexisting medical conditions or drop them if they get sick. Those practices would be outlawed as part of the current legislation. As for pharmaceutical coverage, it’s possible that some consumers could end up with more coverage for prescription drugs than they have now.

Why is that?

It is likely that private companies seeking to participate in the new insurance exchanges — which would be created to help lower-income consumers — would have to offer prescription drug coverage as part of their essential benefits package. That could mean new coverage options for people who right now can’t afford such plans. At the same time, some consumers who obtained insurance through the exchanges might have to buy drug coverage they did not want or need — if they had other options for buying low-cost drugs, for example.

Will I have to pay more for my pharmaceuticals if I buy insurance through an exchange?

That would depend on what level of plan you chose. Under a less expensive plan, you would probably have to cover the cost of your prescription drugs until you reached a set deductible, something like $100 or $250. (This is separate from your overall insurance deductible.) At that point, your insurance would cover some or most of the cost. If you purchased a higher-priced plan, it’s likely there would be no deductible, and perhaps no co-pays either.

What about prescriptions under Medicare?

The overhaul proposals in Congress improve the drug benefit by reducing the so-called coverage gap or doughnut hole that exists for recipients of Medicare Part D, which affects about 4 million seniors each year. Under the $80-billion deal struck with the pharmaceutical industry, the prices of drugs that fall within the gap would be slashed by 50%.

He suggests that those here illegally be kept from taking part in an insurance exchange set up by the government. Some on the left say that’s bad policy that panders to the likes of Joe Wilson.

By Peter Wallsten

September 16, 2009

Reporting from Washington

Trying to quell a conservative uproar over his healthcare agenda, President Obama has proposed barring illegal immigrants from a possible government-arranged health insurance marketplace — even if the immigrants pay with their own money.

The move has surprised some of Obama’s fellow Democrats and infuriated immigrant advocates, who on Tuesday attacked the position as political pandering and bad policy.

The White House revealed its stance Friday, after a renewed debate over illegal immigration that was triggered when Rep. Joe Wilson (R-S.C.) heckled Obama on the issue during the president’s televised address to Congress.

Wilson yelled out, “You lie!” when Obama said that illegal immigrants would receive no benefit from his healthcare proposals.

But some on the political left say that the White House — wary of more damaging battles with the right — has given in to Wilson and other conservatives.

Wilson “acted like a buffoon, and everybody criticized him — but then at the end of the day he sort of got his way,” said Brent A. Wilkes, national executive director of the League of United Latin American Citizens.

“It rewards bullying in a way that begets more bullying,” said Frank Sharry, who directs the pro-immigrant group America’s Voice and has been advising the White House and congressional Democrats on broader immigration issues.

After a sharply partisan debate Tuesday, the House voted 240 to 179 to formally rebuke Wilson for his outburst.

A White House official said that Obama’s stance barring undocumented immigrants from participating in the insurance marketplace did not reflect a change of heart after Wilson’s outburst — only that the specific question had just come up in recent days.

“The president has been clear since the campaign that he does not intend for health insurance reform to cover undocumented immigrants,” said the official, who spoke on the condition of anonymity while discussing official White House policy.

But several White House allies said Tuesday that the policy was a shift designed to position Obama to the right of his critics.

Rep. Luis V. Gutierrez (D-Ill.), an early Obama ally, said Tuesday that members of the Congressional Hispanic Caucus were reevaluating their support for the healthcare overhaul.

Wilson’s outburst, Gutierrez said, was “said in a mean, ugly way. And what the president did was create an even meaner, uglier public policy to accompany it.”

Congress is working on plans to give low- and moderate-income people subsidies to buy health insurance in an effort to reduce the number of uninsured in the country.

None of the measures would allow illegal immigrants to receive subsidies.

Obama’s proposal, circulated in an e-mail to reporters, would go further, barring undocumented immigrants from an insurance marketplace designed to make it easier for consumers to find coverage.

As they can today, undocumented immigrants still could buy insurance in the private market. But the White House e-mail noted that if the Democratic legislation passed, private insurers could be expected to sell more insurance through the so-called exchange and less coverage outside of it, leaving the private market to shrink over time.

The White House also has embraced a verification system to validate that people buying insurance were in the country legally. That idea had been rejected by House Democrats, who cited studies showing that such systems were costly and prone to mistakes.

The White House has not, however, proposed changing the law that requires emergency rooms to treat people who need care, including illegal immigrants.

Immigrant advocates said Tuesday that the insurance issue could be a political headache for the White House if members of the Congressional Hispanic Caucus, after hearing from their constituents, felt pressured to vote against the healthcare legislation.

Some said they intended to organize activists in the coming days to push the White House and Democratic leaders to make the bill more favorable to illegal immigrants.

Obama’s policy statement, some activists said, was motivated by politics — an effort to build credibility with conservatives and defuse criticism that the president was soft on illegal immigration.

Latino leaders and immigrant advocates aired their concerns during a meeting Monday at the White House. Administration officials said that the insurance coverage restriction was needed for the sake of clarity, according to several meeting participants.

One official, White House Deputy Chief of Staff Jim Messina, assured the group that Obama supported allowing legal immigrants to participate in the insurance exchange. Advocates said they presumed that meant legal immigrants would be eligible for subsidies.

Conservative critics have said that allowing illegal immigrants to participate in a government-run system rewarded lawbreakers. Moreover, they said, any ban on subsidies to illegal immigrants would be ineffective without an enforcement mechanism, such as requiring consumers to show that they were in the country legally.

But others have argued that imposing hurdles on illegal immigrants who want to buy insurance forces those people to hospital emergency rooms and raises taxpayer costs. And because illegal immigrants tend to be younger and more fit, some say their participation in insurance risk pools could actually drive down costs.

Leighton Ku, a health policy professor at George Washington University, said that immigrants’ healthcare costs about half as much as citizens’ care.

“They’re low-risk people,” Ku said. “It’s advantageous to have low-risk people in insurance pools.”

It was unclear how the policy would affect families in which parents were in the country illegally and the children were citizens, or how it would affect illegal immigrants who get their insurance through their employers, if the employers choose to participate in the new insurance exchange.

Experts said Tuesday that the dust-up over immigration amid the broader healthcare fight underscored the political challenges that await the White House later this fall and next year, when Obama has said he hoped to overhaul the immigration system.

Obama has said he supports creating a pathway to citizenship for the estimated 12 million illegal immigrants in the U.S. But some say that his new restrictive policy violates the spirit of that old pledge.

“It’s a contradiction in terms,” Gutierrez said, “to say that people live in the shadows, that they live in a constant state of exploitation — and then to push public policy that simply pushes them further into the shadows, further onto the periphery of society.”

peter.wallsten@latimes.com

American presidents have tried seven times to bring us into the community of nations that provide health care to all citizens. Seven times the effort failed. More accurately, it was blocked. In the 1940s, the anti-reform movement was led by doctors, through the American Medical Association. In the 1990s, it was led by the insurance and small-business lobbies.

This time everything has been different. The town hall meetings and right-wing distortions of this summer drew attention away from a far more significant fact: Most of the traditional enemies of reform have been quiet, absent, or divided. Many — including the conservative American Medical Association — are almost supportive of reform. Large and small businesses understand that reducing their health-care costs and making them predictable will be good for their bottom line, and the chief lobbyist for the U.S. Chamber of Commerce, Bruce Josten, has said, “The reality with the business community is that we want reform.” Even the National Federation of Independent Business, which took the lead in opposing reform in the Clinton years, now participates in some pro-reform coalitions. And while insurance companies have much to lose from legislation that includes a public option and tight regulations, many large insurers know that they can survive and thrive when every American purchases insurance.

Still, new obstacles emerged to take their place. Some, like the traditional opponents, fought the legislative battle, using public fear and political manipulation to try to stop the bill from passing or to influence it so it fails to achieve the goal of universal coverage. Other obstacles will not fully emerge until a health-reform bill becomes law. The bill that is coming together as of this writing is a product of delicate and complex maneuvering around not only the outright opponents of reform but also around the fallout from choices made earlier in the game by supporters of reform. The course taken around those obstacles will define the legislation and its ultimate direction. Will it lead to universal coverage? Will it reduce costs and bring insurance companies under control? Or will it do too little and create the wrong incentives? Worst of all, will it lead to a public backlash, like the one that led to the abrupt repeal of catastrophic care for seniors in 1989?

Those questions won’t be answered on the day that President Barack Obama signs a bill. His signing ceremony will be just one momentous step along the road to universal coverage. The forces that seek to undercut the promise of reform will still have plenty of room to maneuver. And the choices made by reformers will still define the path of what’s possible, for better or worse.

Unhinged Republicans

Before the 1994 health-care battle, William Kristol wrote a legendary memo advising Republicans to block everything that had to do with reform — but not everyone stayed on message. Moderate Republicans participated in the process because they did not want to be seen as obstructing a popular reform, and a bipartisan group of senators came surprisingly close to agreeing on a bill.

In the current episode, however, Republican legislators have been almost unanimous in taking Kristol’s advice. Claims from critics like the long-discredited Betsy McCaughey that the legislation would create “death panels” moved smoothly into the GOP bloodstream and became arguments not just to delete the elusive offending provision but to kill the entire bill. Even the small-business and insurance lobbyists have been more cooperative than the party they bankroll. The result of opting out of the legislative process is that Republicans have sacrificed the opportunity to craft the bill, and if they fail to block it, they have one option: Incite a backlash.

And that is not a far-fetched option. One of the great advantages of broadly bipartisan legislation is that, with both parties invested in it, neither can exploit a backlash. But if there is even a single moment of hesitation about the costs, slow implementation, or some unintended consequence, the GOP will aggressively remind voters of the “Democrat bill.” While the conventional wisdom — assumed by the Kristol strategy — is that health reform will be a lasting political victory for Democrats, there is still potential for trouble after the initial glow wears off.

Diffident Democrats

While Republicans bowed out of the health-reform game, the fear they stoked infected key Democrats, most notably Senate Finance Committee Chair Max Baucus of Montana. Baucus and his colleagues like Bill Nelson of Florida or Blanche Lincoln of Arkansas have never needed an excuse to avoid all political risk (even though they won their last elections with an average of 63 percent of the vote), but the Republican fear campaign about Medicare cuts, “death panels,” and government takeover sent Baucus and his ilk fluttering to safety, opposing strong versions of the public option and weakening the bill in other ways. Some of these Democrats are conservative “Blue Dogs,” but more often they seem driven less by ideology than by a conditioned response to the Reagan-Gingrich years and have resumed old patterns of learned helplessness.

Even that may be giving them too much credit. While the Republicans are actually doing few favors for their lobbyist allies, the Democrats causing the most difficulty often seem to be the most deeply embedded in the culture of influence. A recent study by the Sunlight Foundation, for example, found five former Baucus staffers lobbying for 27 different companies with interests in the bill.

Deficit Hawks

The recession and the urgent need for fiscal stimulus created a brief moment when we genuinely didn’t have to worry about the federal budget deficit. The Obama administration embraced the view, promulgated by Peter Orszag when he was head of the Congressional Budget Office, that the fiscal problem is a health-care problem and that over-hauling the entire system is the only way to bring the costs of Medicare and Medicaid (the entitlement programs driving the long-term deficit) under control.

By late summer, both ideas seemed to be fading away. The economic stimulus and other costs had set us on a path toward annual deficits in the trillion-dollar range that even most liberals recognize as unsustainable, and Orszag’s successor at the CBO, Doug Elmendorf, in his critical role of “scoring” the legislative proposals, was much more hesitant to embrace the idea that health reform creates savings. Meanwhile, the well-funded fiscal-responsibility lobby has been insistent that health reform not add to the deficit. There are savings possible in Medicare without reducing services, but the mere mention of changing Medicare created an opening for Republicans to stoke fear among the elderly.

As a result, the political obligation to satisfy deficit hawks like Sen. Kent Conrad, together with the diffident Democrats’ fear of even painless Medicare cuts, forced the legislation through the eye of a very small needle.

Deal-Makers

As George W. Bush loved to say, “I’m not going to negotiate with myself.” Long before the health-reform debate began, progressives began to make a series of negotiations with ourselves and with interest groups. The deals were probably necessary, and some were brilliant, but each came at a cost.

The first and savviest deal, embraced by all the major Democratic presidential candidates in 2008 and the main pro-reform coalition, Health Care for America Now, was to push not for single-payer health care but for a “public option” in a system of regulated private insurance. Candidate John Edwards promised that a well-designed public option might eventually become the main source of health insurance for Americans, a de facto single-payer system. That hope drew most of the single-payer constituency to the public option, even though the vision of a public plan that covers most Americans has long been abandoned.

What if single-payer advocates had stuck to their guns and then fallen back on the public option as a compromise? That’s a question progressives have been asking themselves all year. The answer is probably that the single-payer advocates would have been marginalized and left without much leverage, as was the case in 1993. This deal may have been necessary for reform, but it nonetheless limits the possibilities.

Other deals cut by the White House helped placate the pharmaceutical companies, hospitals, and doctors. Each compromise with lobbyists limited Congress’ freedom to craft a bill that might be more appealing to voters or expand coverage at a lower cost. The deals did successfully keep the old enemies of reform at bay. But as health reform moves toward implementation, the cost of making these deals will be undeniable.

Historians

Although a child born during the last health-reform fight would now be preparing for her SATs, the lessons of 1993 and 1994 loom over the current debate. Don’t write the bill in the White House. Don’t be too complicated. And above all, don’t mess with what people already have. Not surprisingly, it was Hillary Clinton, as a candidate in 2007, who set the tone — if you like the plan you have, you’ll get to keep it. Obama and the other candidates followed suit, and that promise — nothing will change, and you have nothing to fear if you are already insured — has become the one pillar of reform.

Like the deals, that assurance was probably necessary. Health-policy wonks often forget how closely fear is associated with health care and insurance. And as behavioral economics shows, people’s fear of losing what they have, even if it’s inadequate, outweighs the value they place on getting something better. But the promise that nothing will change creates a perception that reform benefits only the uninsured — it’s a program for “them,” not “us.” Members of the insured majority, then, bear the cost but see no benefit. The assurance that nothing will change excluded some of the most promising approaches to reform, notably those that would end employer-based health insurance completely.

It’s also a false promise. Any major change in health-insurance markets is likely to ripple through the entire system. And insurance changes in dramatic ways of its own accord — within a few years after the failure of the Clinton plan, the HMO revolution had achieved much of the cost reduction proposed in that plan. If voters take the promise that “nothing will change” too seriously, there is further risk of a backlash, because things will change.

A Caveat: Some things are just difficult! While some of the obstacles to reform can be given names and faces, probably the biggest barrier to a better health-care system is a bit more mundane: Reform is just inherently difficult. Implementation will take years and during that time, may be derailed by economic or political shifts. The quest to provide every American with decent health care will continue for years, if not decades, even if 2009 turns out to be the turning point in this long history.

Mark Schmitt is the executive editor of The American Prospect.

By Miles Mogulescu

posted: October 30, 2009 04:21 PM

The pygmy public option now being proposed in the House and Senate will not be a viable competitor to mandated private insurance.

• It will not put any meaningful pressure on private insurance companies to moderate their premiums.

• It will not have the market power to pay lower fees to doctors and hospitals than private insurance and will thus not be less expensive than private insurance.

• It will not even be available to most Americans.

• Since it will be unable to effectively compete with private insurance, it will end up with few, if any customers.

At this point, it really doesn’t matter whether or not a final health reform bill includes this type of public option in name only. The public option, as it’s now being proposed in the House and Senate, will have no meaningful impact. If Joe Lieberman or other corporate Democrats kill this meaningless public option, it will make no difference in the lives of most Americans. With or without a fraudulent public option, millions of Americans who will be required to buy insurance or pay a fine will see their premiums skyrocket as there will be no effective limits placed on how much private insurers can charge the customers whom the federal government will make buy their product.

The final nail in the public option’s coffin came when House Democrats (with no help from President Obama to twist Blue Dog arms) fell 10 or 12 votes short of including a requirement that the public option pay providers Medicare rates plus 5% and instead will be required to negotiate rates with each doctor and hospital in America. This all but guarantees that the public option will end up paying more to doctors, hospitals and drug companies than private insurance.

It’s like a brand new Mom and Pop store trying to compete with WalMart.

Here’s why, without a tie to Medicare rates, the public option will end up paying more to providers than private insurance: The largest private insurers in each market already have tens or hundreds of thousands of members. When they negotiate rates with providers, they get volume discounts of as much as 30%-40% off “retail rates,” just as WalMart gets volume discounts because of its market clout. (Because of its even greater bargaining power, Medicare often pays providers 15%-20% less than private insurance).

But without the ability to tie pricing to Medicare rates, the public option will have no ability to negotiate volume discounts. It will start out with no subscribers. It will then have to go to each hospital, doctor and drug company to negotiate rates. Without any subscribers at the outset, these providers will have no incentive to give volume discounts to the public option, which will end up paying more than large private insurers. This in turn will make the public option more expensive than private insurance.

As a result, it will sign up few subscribers. With few subscribers, it will be continue to be unable to negotiate volume discounts. Even if the public option were allowed to pay Medicare plus 5% rates, unless it already had a large number of subscribers in a particular market, providers would simply refuse to accept public option patients at these reduced rates, prefering to treat patients from higher-paying private insurers. So it’s a chicken and egg situation. Few subscribers will lead to higher costs. Higher costs will lead to few subscribers. This is a public option designed to fail.

As a result, when the Congressional Budget Office first evaluated the Senate negotiated-rate public option plan, the CBO concluded that it would end up with no subscribers. Perhaps with a little pressure from Congress, the CBO is now projecting that by 2019, approximately 6 million Americans would be enrolled in the negotiated-rate House public plan. The CBO also projects that “a public plan paying negotiated rates would…typically have premiums that are somewhat higher than the average premiums for private plans.”

The CBO notes that this public plan would attract a “less healthy pool of enrollees” than private plans. With a less healthy pool of enrolees who require more services than private plans, the cost of the public plan would continue to escalate beyond the cost of private insurance, further reducing the number of people who sign up, and further reducing its negotiating clout, leading to a vicious circle of increasing costs and unaffordability that would do little or nothing to put pressure on private insurers to lower their premiums.

As Kip Sullivan, a long-time fighter of universal health care, has argued articulately, the devolution of the public option from a robust proposal projected to cover over 129 million Americans and lower insurance costs to a sham public option that will at best cover 6 million Americans in 10 years and have no impact on lowering insurance costs is a case of “bait and switch”.

The “public option” was initially proposed by Yale political scientist Jacob Hacker and Campaign for America’s Future leader Roger Hickey as a more politically “pragmatic” alternative to the long-time progressive goal of establishing universal single payer health care (as though insurance companies and their paid-for Congressional allies wouldn’t fight against a robust public option as hard as they would fight against Medicare for All).

Hacker and Hickey laid out 5 criteria that, they argued, were essential to the success of the public option.

1. The PO had to be pre-populated with tens of millions of people by shifting all or most uninsured people, as well as Medicaid and SCHIP enrollees, into the PO, so like Medicare, it would represent a huge pool of enrollees on day one.

2. Only enrollees in the PO, not in private insurance, would be eligible for government subsidies.

3. The PO and its subsidies would be available to all nonelderly Americans (not just the uninsured and employees of small businesses).

4. The PO would pay Medicare reimbursement rates.

5. The insurance industry had to offer the same minimum level of benefits that the PO offered.

If these criteria were met, the Lewin Group (a subsidiary of health insurance giant United Health) projected that the public option would enroll 129 million Americans, have overhead of 3%, pay hospitals 26% less and doctors 17% less than the private insurance industry, and have premiums 23% below the private insurance industry average.

That was the “bait.” Now came the “switch.” The puny public option proposals that are still on the table in the House and Senate meet only the 5th of the 5 criteria for an effective public option and eliminate the first 4 criteria. They are not pre-populated; subsidies go to both the public option and private insurance; large employers are barred from buying into the public option; and the public option is not allowed to use Medicare rates but must instead negotiate rates on a provider-by-provider basis.

The result is that instead of enrolling 129 million Americans and decreasing insurance premiums, the sham public option being proposed in the House and Senate will enroll between 0 and 6 million Americans and will cost more than private insurance.

It’s time that organizations which supported a “robust” public option tell their supporters the truth: that the public option in the House and Senate bills bears no relationship to the public option they have been fighting for. (Instead, the Health Care for American Now blog praises the public option in the House bill as “a strong competitor to private insurance, keeping prices down and attracting customers.”) Its time that “progressives” in Congress like Anthony Weiner, Alan Grayson, Jan Schakowsky, Raul Grijalva and Lynn Woolsey admit to their constituents that, with no help from President Obama, they’ve lost the battle for a “robust” public option. Media figures like Keith Obermann and Rachel Maddow, who’ve been vocally talking up the public option, should be reporting the truth about the pitiful public option that’s left on the table.

As it stands now, the sham public option in the House and Senate bills serves only one purpose. It gives political cover to progressives and liberals in the House and Senate to vote for mandates that will use the power of the federal government to force uninsured individuals to buy inferior and over-priced private insurance or be fined by the IRS by being able to say, “Well, at least the bill contains something called a public option,” even if it’s a public option in name only.

Better that Joe Lieberman’s filibuster threat forces Congress to drop this sham public option from the bill. At least, then, progressives and liberals will have to squarely face up to the implications of their vote and decide if this type of “health care reform” is really in the interests of the American people, or indeed, in the interests of the Democratic Party.

As the final bill takes shape, it’s going to be a close call whether this type of mandated “health insurance reform” with no price controls on premiums is better than no reform at all.

Read more at: http://www.huffingtonpost.com/miles-mogulescu/the-public-option-in-cong_b_340501.html

Obama’s Mistakes in Health Care Reform

By VICENTE NAVARRO

Let me start by saying that I have never been a fan of Barack Obama. Early on, I warned many on the left that his slogan, “Yes, we can,” could not be read as a commitment to the major change this country needs (see “Yes, We Can. Can We? The Next Failure of Health Reform”). Still, I actively supported him against John McCain and was very pleased when he became president – for many reasons, encompassing a broad range of feelings. One reason was that Obama is African-American, and the country needed to have a black president. Another was that his election seemed to signal the end of the Bush era.

But, the most important reason was that I saw him as a decent man, surrounded by some good people who could promote change from the center and open up some possibilities for progress, giving the left a chance to influence the administration’s policies. Well, after just over seven months of the Obama White House, I have no reason to doubt that he is a decent man, but I am dismayed by the bad judgment he has shown in the choice of some of his staff and advisors. I really doubt that he is going to be able to make the changes we need. As I said, I never had great expectations about him and his policies, but even the lowest of my expectations have not been met.

Some among the many skeptics on the left might add, “What did you expect?” Well, at least I expected Obama to show the same degree of astuteness that he and his team had shown during the campaign. He seemed to be a brilliant strategist, and his election proves this. But my greatest disappointment is the strategies he is now following in his proposals for health care reform – they could not be worse. I am really concerned that the fiasco of this reform may make Obama a one-term president.

Error number One

One of the two major objectives for health care reform, as emphasized by Obama, is the need to reduce medical care costs. The notion that “the economy cannot afford a medical care system so costly, with the annual increases of medical care running wild” has been repeated over and over – only the tone varies, depending on the audience. An element of this argument is Obama’s emphasis on eliminating the federal deficit. He stresses that most of the government deficit is due to the outrageous growth in costs in federal health programs. Thus, a crucial part of the message he is transmitting is the health care reform objective of reducing costs.

This message, as it reaches the average citizen, seems like a threat to achieve cost reductions by cutting existing benefits. This perception is particularly accentuated among elderly people – which is not unreasonable, given that the president indicates that the funds needed to provide health benefits coverage to the 48 million currently uncovered will come partially from existing programs, such as Medicare, with savings supposedly achieved by increasing efficiency.

To the average citizen (who has developed an enormous skepticism about the political process), this call for savings by increasing efficiency sounds like a code for cutting benefits. Not surprisingly, then, one sector of the population most skeptical about health care reform is seniors – the beneficiaries of Medicare. The comment that “government should keep its hands off my Medicare,” as heard at some of the town hall meetings, is not as paradoxical or ridiculous as the liberal media paint it. It makes a lot of sense. An increasing number of elderly people feel that the uninsured are going to be insured at the expense of seniors’ benefits.

Error Number Two

The second major objective of health care reform as presented by Obama is to provide health benefits coverage for the uncovered: the 48 million people who don’t have any form of health benefits coverage. This is an important and urgently needed intervention. The U.S. cannot claim to be a civilized nation and a defender of human rights around the world unless this major human and moral problem at home is resolved once and for all. But, however important, this is not the largest problem we have in the health care sector. The most widespread problem is not being uninsured but underinsured: the majority of people in the U.S. – 168 million, to be precise – are underinsured. And many (32 per cent) are not even aware of this until they need their health insurance coverage.

This undercoverage is an enormous human, social, and economic problem. Among people who are terminally ill, 42 per cent worry about how they or their family will pay for medical care. And most of these people are insured – but their insurance does not cover all of their conditions and necessary interventions. Co-payments, deductibles, and other extra expenses – besides the insurance premiums – can amount to 10 per cent or even higher proportion of disposable income.

During the presidential campaign, both Obama and Hillary Clinton, in discussing the need for health care reform, made frequent reference to heart-breaking stories – cases in which families and individuals suffer under our current system of medical care. But none of the proposals that the Obama administration is ready to support would address most of these cases. It will be an embarrassing and uncomfortable moment during the 2012 presidential campaign if someone asks candidate Obama about what has happened to some of the people whose stories he told in the 2008 campaign.

Error Number Three

Obama plans to cover the uninsured by increasing taxes on the rich (a very popular measure, as shown in all polls) and by transferring funds saved through increased efficiencies in existing programs, including Medicare (an unpopular measure, for the reasons I’ve mentioned). We see here the same problems we’ve seen with other programs targeted to specific, small sectors of the population, such as the poor. Programs that are not universal (i.e., do not benefit everyone) are intrinsically unpopular.

This is why antipoverty programs are unpopular. People feel that they are paying, through taxation, for programs that do not benefit them. Compassion is not, and never has been, a successful motivation for public policy. Solidarity is. You support others with the understanding that they will support you when you need it most. The long history of social policy, in the U.S. and elsewhere, shows that universality is a better way to get popular support for a program than means-testing for programs targeted to specific vulnerable groups. The limited popularity of the welfare state in the U.S. is precisely due to the fact that most programs are not universal but means-tested.

The history of social policy shows that the best way to resolve poverty is not by developing antipoverty programs, but by developing universal programs to which all people are entitled – for example, job and incomes programs. In the same way, the problem of noncoverage by health insurance will not be resolved without resolving the problem of undercoverage, because both result from the same failing: the absence of government power to ensure universal rights. There is no health care system in the world (including the fashionable Swiss model) that provides universal health benefits coverage without the government intervening, using its muscle to control prices and practices.

The various proposals being put forward by the Obama administration are simply tinkering with, not resolving, the problem. You can call this government role “single-payer” or whatever, but our experience in the U.S. has already shown (what other countries have known and practiced for decades) that without government intervention, all the measures now being proposed by this administration will be handsome bailouts for the medical-insurance-pharmaceutical complex.

Error Number Four

I can understand that Obama does not want to advocate single-payer. But he has made a huge tactical mistake in excluding it as an option for study and consideration. He needs single-payer to be among the options under discussion. And he needs single-payer to make his own proposal “respectable.” (Keep in mind how Martin Luther King became the civil rights figure promoted by the establishment because, in the background, there was a Malcolm X threatening the establishment.) This was a major mistake made by Bill Clinton in 1993.

When Clinton gave up on single-payer, his own proposal became the “left” proposal (unbelievable as that may seem) and was dead on arrival in Congress. The historical function of the left in this country has been to make the center “respectable.” If there is no left alternative, the Obama proposals will become the “left” proposal, and this will severely limit whatever reform he will finally be able to get.

But there’s another reason that Obama has erred in excluding single-payer. He has antagonized the left of his own party that supports single-payer, without which he cannot be reelected in 2012. He cannot win only with the left, of course, but he certainly cannot win without the mobilization of the left. His victory in 2008 is evidence of this. And today, the left is angry at him.

It is a surprise to me, but Obama is going to pay the same price Clinton paid in 1994. Clinton antagonized the left by putting deficit reduction (under pressure from Wall Street) at the top of his policies and supporting NAFTA against the wishes of the AFL-CIO and the majority of Democrats. The Gingrich Republican Revolution of 1994 was due to a demobilization of the left. The Republicans got the same (I repeat the same) number of votes in the 1994 congressional election that they got in 1990 (the previous non-presidential election year). Large sectors of the grassroots of the Democratic Party that voted Democratic in 1990 stayed home in 1994. Something similar could happen in 2010 and in 2012. We could see a strong mobilization of the right and a very demoralized left. We are already seeing this. Why aren’t those on the left out in force at the town hall meetings on health care reform? Because the option they want – single-payer – has already been excluded from the debate by a president they fought to get elected.

This is my concern. The alternative to Obama is Sarah Palin or someone like her. Palin has a lot of support among the people who mobilized to support John McCain. And the ridicule heaped on her by the liberal media (which is despised by large sectors of the working class of this country) helps her, or her like, enormously. I am afraid we may have, in the near future, friendly fascism. And I do not use the term lightly. I grew up under fascism, in Franco’s Spain, and if nothing else, I recognize fascism when I see it. And we are seeing a growing fascism with a working-class base in the U.S.

This is why we cannot afford to see Obama fail. But his staff and advisors are doing a remarkable job to achieve this. Ideologues such as chief-of-staff Rahm Emanuel (who, when a congressman, was the most highly funded by Wall Street) and his brother, Ezekiel Emanuel (who did indeed write that old people should have a lower priority for health care spending) are leading the country along a wrong path.

I don’t doubt that President Obama, a decent man, wants to provide universal health care to all citizens of this country. But his judgment in developing his strategy to reach that goal is profoundly flawed, and, as mentioned above, it may cost him the presidency – an outcome that would be extremely negative for the country. He should have called for a major mobilization against the medical-industrial complex, to ensure that everyone has the same benefits that their representatives in Congress have, broadening and improving Medicare for all. The emphasis of his strategy should have been on improving health benefits coverage for everyone, including those who are currently uncovered. And to achieve this goal – which the majority of the population supports – he should have stressed the need for government to ensure that this extension of benefits to everyone will occur.

That he has not chosen this strategy touches on the essence of U.S. democracy. The enormous power of the insurance and pharmaceutical industries corrupts the nature of our democracy and shapes the frontiers of what is possible in the U.S. Given this reality, it seems to me that the role of the left is to initiate a program of social political agitation and rebellion (I applaud the health professionals who disrupted the meetings of the Senate Finance Committee), following the tactics of the Civil Rights and anti-Vietnam War movements of the 1960s and 1970s. It is wrong to expect and hope that the Obama administration will change. Without pressure and agitation, not much will be done.

Vicente Navarro, M.D., Ph.D., professor of Health Policy at The Johns Hopkins University and editor-in-chief of the International Journal of Health Services. The opinions expressed here are those of the author and do not necessarily reflect the views of the institutions with which he is affiliated. Dr Navarro can be reached at vnavarro@jhsph.edu

La Propuesta de  Reforma de Salud  beneficiará a los pacientes que no hablan inglés. 

Uno de los aspectos más importantes al cuidar de pacientes es obtener una historia médica detallada. El plan de tratamiento también debe ser explicado cuidadosamente en una manera que sea comprensible para el paciente. Sin embargo, algunos grupos argumentan que estos importantes principios de cuidado médico no aplican a los pacientes que no hablan inglés. Ellos proponen que personas que no hablan inglés reciban un cuidado médico de inferior calidad para que aprendan inglés. Sin embargo, la discriminación de pacientes que no hablan inglés es ilegal en este país. Adicionalmente, organizaciones acreditadoras requieren que hospitales y aseguradoras de salud hagan esfuerzos para proveer servicios a personas que no hablan inglés. Como resultado, algunos sistemas de salud han tomado  pasos para acomodar a estos pacientes. Un ejemplo es el derecho a servicios de traducción incluido en la “Declaración de Derechos” de muchos hospitales.  Las reglas son flexibles y solo aplican a centros de salud donde una proporción importante de pacientes no habla inglés. Una manera de proveer estos servicios es a través de traductores profesionales, pero existen otras opciones. Por ejemplo, si más de la mitad de los pacientes hablan español, podría ser más eficiente tener proveedores de salud que hablen ese idioma. En clínicas donde se hablan múltiples idiomas, tener acceso a traductores vía telefónica a un bajo costo podría ser una alternativa. 

La propuesta de reforma de salud contempla la realización de un estudio que identifique estrategias para proveer servicios lingüísticamente apropiados para pacientes ancianos que no hablan inglés.  Este estudio representaría un componente critico de la reforma, pues nos permitiría comprender métodos eficientes para proveer cuidados de salud de alta calidad a poblaciones étnicamente diversas. Otro componente importante de la reforma es imponer multas a los aseguradoras de salud que no provean servicios de traducción a beneficiarios de Medicare con conocimiento limitado de inglés, de acuerdo a lo descrito en la ley. En la actualidad, las leyes no establecen penalizaciones para las instituciones que violan estas leyes anti-discriminatorias. Por este motivo, algunos hospitales y aseguradoras de salud todavía no ofrecen estos servicios. La imposición de multas a aseguradoras podría incentivar el cumplimiento de la ley.  

La mayoría de las personas que no hablan inglés en este país son trabajadores honestos que contribuyen a nuestra sociedad y economía. Algunos grupos sostienen que permitir que estas personas reciban cuidados de salud de calidad inferior o inclusive permitir que sufran o mueran rinde un servicio a los intereses nacionales. Quisiera recordarles que los principios de solidaridad y equidad de nuestros Padres Fundadores dieron origen a un país que lucho por unirse y por crear oportunidades para todos. Pensar que separarnos de estos principios nos traerá un futuro mejor es una falacia. 
 

Olveen Carrasquillo, MD, MPH

Vice-Presidente, Latinos por un Seguro Medico Nacional

Chief, Division of General Internal Medicine

University of Miami, Miller School of Medicine

Ana Palacio, MD, MPH

Assistant Professor of Medicine 

Health care reform

Everyone will suffer if illegal immigrants aren’t covered in reform, some caregivers say

Florida, home to a million undocumented immigrants, pays big to take care of those who can’t get insurance, including those here illegally. If health care reform leaves out the undocumented, we’ll still be paying, caregivers warn.

By William E. Gibson

South Florida Sun Sentinel

6:15 PM EDT, September 25, 2009

WASHINGTON

Excluding undocumented immigrants from health care reform could jeopardize everyone’s health and perpetuate a costly gap in insurance coverage, medical experts warned this week.

Much of the point of health care legislation in Congress is to cover all Americans to protect the public health and ease the high cost of treating uninsured patients in emergency rooms. Some health leaders worry that leaving the undocumented out of a newly created health care system would impair attempts to prevent the spread of infectious disease, such as tuberculosis or swine flu, and continue the growing burden on public hospitals.

The gap in coverage is especially big in Florida, home to a million undocumented residents.

The warnings come while the Senate Finance Committee is drafting a bill designed to prevent illegal immigrants from tapping into new health care marketplaces, known as exchanges, where individuals and small businesses could shop for insurance.

The committee, which will resume its work next week, is expected to produce a bill that would require consumers to show proof of citizenship or legal status when joining these exchanges. The bill also would prevent the undocumented from getting tax breaks designed to make insurance affordable. And it would force newly arrived legal immigrants to wait five years before joining exchanges or getting tax breaks.

Some health leaders in Florida fear these exclusions and restrictions would undermine the advantages of reform.

“If I’m standing next to someone who has tuberculosis and who is uninsured, it doesn’t protect me if they aren’t treated,” said Fernando Trevino, dean of the School of Public Health at Florida International University. “To the degree that someone is not getting care, they are more likely to spread infectious diseases to the rest of the population.”

He and other public-health experts also say any bill that leaves a big gap in coverage would miss an opportunity to lower costs by providing preventive care to everyone.

“People forget that we already provide inefficient and expensive care to undocumented residents,” said Dr. Olveen Carrasquillo, chief of general internal medicine at the University of Miami medical school. “They come into emergency rooms with advanced stages of an illness. Often they have medical conditions that are very expensive to treat but could have been prevented with primary care.”

Restrictions on the undocumented, if approved by Congress, would apply to new benefits provided by the reform legislation. The exclusion would not block immigrants from buying insurance on the private market outside these exchanges.

Florida Sen. Bill Nelson, a Democrat on the Finance Committee, supports exclusion of the undocumented.

“Nelson’s bottom-line position is that a health care bill should not provide benefits to folks here illegally,” said spokesman Dan McLaughlin. “In fact, he supports tough verification.”

These measures stem from a determination to prevent explosive immigration issues from derailing an overhaul of the health care system. President Barack Obama tried to assure Congress in a nationally televised speech this month that “the reforms I’m proposing would not apply to those who are here illegally.”

The remark sparked an outcry from conservatives — most immediately from Rep. Joe Wilson, R-S.C., who shouted, “You lie!” during Obama’s Sept. 9 health care address to Congress. Wilson and many other Republicans say the reforms being considered would allow illegal residents to sneak into the health care system at taxpayer expense.

The undocumented have access to health care. By law, hospitals and other providers are required to treat all patients who need emergency care.

Public clinics in South Florida and elsewhere do not ask patients about their immigration status. They also give vaccinations for such things as swine flu without demanding documents.

But some public-health leaders are concerned that the heated rhetoric and exclusions coming out of Washington will further discourage immigrants and some U.S. citizens. They say some residents who don’t speak English or meet the profile of a typical American — even those here legally — are reluctant to show up at public facilities for fear of harassment or deportation.

“By not covering them, we are choosing the worst for them and the worst for the rest of us in terms of financial cost,” Carrasquillo said. “We end up paying for it.”

William E. Gibson can be reached at wgibson@SunSentinel.com or 202-824-8256.