NOW Action Bulletin
Baucus Bill is Profit-Driven Insurance Industry Dream
Your voice is urgently required!
The long-awaited Senate Finance Committee health care reform bill unveiled this week has many deficient and undesirable provisions and it must be opposed. First and most important, the legislation does NOT contain a public option — and, as a result, there is no effective mechanism to stimulate competition and control escalating health care costs. There is no mandate for employers to provide health insurance. Everyone will be required to get their own costly insurance and, failing that, they will be assessed a stiff penalty. Essentially, the same factors that have caused health care costs to rise at four times the rate of wages are left in place. This is not reform!
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For those reasons and many other burdensome and costly features (detailed in the Background section), as well as ideology-driven restrictions on women’s reproductive health care, the Senate Finance Committee bill must be stopped. Send a message to your senators right away to oppose this legislation.
In an attempt to write a bipartisan health care reform bill, Sen. Max Baucus (D-Mont.), chair of the Senate Finance Committee, has produced a bill that fails to effectively solve problems in our dysfunctional health care system and is unlikely to overcome strident right-wing opposition, anyway. The Baucus bill would require everyone to buy insurance, thus handing over 30 million new customers to profit-driven insurance companies. It would fail to bring health care costs under control, allow insurers to increase costs as we age, and tax high-cost insurance plans (over $8,000 for individuals and $21,000 for families — this would include plans that are higher cost because of chronic or severe illness, as older persons often have). Instead of authorizing a public option, the bill advances the flawed approach of health care co-operatives — which have shown little success in controlling rising costs.
In brief, the bill fails to make insurance truly affordable for low- and moderate-income families; it fails to assure broad access to a full range of reproductive health services for women (that’s discrimination, clear and outrageous); it fails to provide equal access to insurance coverage for “legal” immigrants; it allows insurance companies to charge older persons five times as much as younger persons; and it imposes a mandate that everyone buy health insurance and imposes stiff penalties if they don’t, while requiring premium payments higher than either the Senate HELP Committee bill or the House bill (H.R. 3200).
In every respect, it looks as though insurance companies wrote the bill themselves, as there is no employer mandate to provide health insurance, and it can be reasonably speculated that many companies may be dropping their group plans and leaving everything up to their unfortunate employees. Under this bill, a costly burden would be placed on individuals and families. For instance, a family of three with an annual income of $55,000 would be expected to pay $7,100 a year for insurance premiums — more than either of the other major reform bills would allow. And that doesn’t even cover out-of-pocket expenses for co-pays and deductibles.
Tax subsidies would be available for low-income and modest-income persons, but eligibility is more restrictive than in other reform bills, and the subsidies are less generous. Businesses with more than 50 employees would have to reimburse the government for some or all of the cost of the subsidies provided to employees who buy insurance on their own. This approach provides an incentive to businesses not to hire poor or disadvantaged workers, and the tax on higher-cost plans will discourage the hiring and retention of older or less healthy employees. There are many other intended and unintended bad outcomes that can be expected if this legislation is adopted.
The legislation would expand Medicaid to cover millions more uninsured low-income persons, with an additional cost of $287 billion over 10 years. Whether financially-challenged state budgets can pay the required match for the Medicaid expansion is a serious question. The subsidies to low- and moderate-income individuals and families amount to $463 billion over 10 years, and tax credits for small businesses to help them buy insurance would total $24 billion.
Keep in mind that your tax dollars would pay for all the subsidies flowing to those same profit-driven insurance companies that have denied as many as one in five doctor-prescribed services, excluded cancer and other critically-ill patients when they most needed help, and paid huge executive salaries. The 20 to 30 percent private insurance administrative costs, which are a significant part of our country’s comparably higher health care expenditures, would continue.
The Baucus bill will not result in universal coverage: the Congressional Budget office estimates that as many as 25 million persons will be left out. Of that number, about a third will be immigrants. Excluding undocumented immigrants and making legal immigrants wait and show documentation for health care services is bad public health policy.
The Congressional Budget Office estimates the price tag for the Baucus plan at $774 billion over 10 years. The lower cost is achieved because projected income from the unfortunate tax on the higher cost plans is used to offset costs. Additionally, Medicare costs will be squeezed to wring out more revenue to pay for this insurance industry subsidy plan. There are other sleights-of-hand in the legislation that make unrealistic assumptions about how these costs will be covered. We cannot let Democrats be pressured into supporting the Baucus bill because it supposedly has a lighter fiscal impact.
Take action by writing to your senators NOW!