Kennedy Unveils Government-Run Health Care Bill

Health Care News (Heartland Institute), August 1, 2009
Sen. Edward Kennedy (D-MA) and the Senate Committee on Health, Education, Labor, and Pensions have unveiled the first of what is expected to be a series of health care reform bills released this year.

The Affordable Health Choices Act establishes federal and state-level taxpayer-subsidized health coverage for middle-income Americans while implementing an individual mandate, tightening regulations on insurance companies, and establishing a new government agency responsible for preventing Americans from going without health insurance.

Funding for the bill, and the amount of tax penalties authorized for failing to offer or carry health insurance, are details left up to the Department of Health and Human Services.

‘Laughable’ Idea

“The theory that government can run health care better than private enterprise would be laughable if it weren’t so dangerous,” said Georgia Senate Majority Leader Chip Rogers (R-Woodstock). “Once ‘free’ health care is made available, we will never be able to afford it, and sadly we’ll also never be able to get rid of it.”

John R. Graham, director of health policy studies at the Pacific Research Institute, says the plan is misconceived.

“If Kennedy really wanted to increase our choice of health plans,” Graham said, “he would put forward a bill to erase the tax prejudice favoring corporate-based versus individually purchased health insurance.”

“Moving from a third-party payment arrangement to an individual empowerment and responsibility system is the only hope for improving health care access and managing health care costs,” said Rogers.

Mandates Galore

Graham said, “Calling this bill the ‘Health Choices Act’ is as Orwellian as calling the bill to abolish secret ballots for union certification the ‘Employee Free Choice Act.’ This bill mandates that every American buy a health insurance policy designed by the government—specifically a new ‘Medical Advisory Council.’ However, just to make sure no lobbyist is left behind, the MAC’s decisions can be overruled by Congress.”

The bill provides for taxpayer-funded insurance subsidies for Americans with incomes up to five times the federal poverty level. “The share of the premiums for which beneficiaries are liable increases only at the rate of the Consumer Price Index, which has historically been lower than the rate of medical inflation,” said Graham.

When combined with the enlarged group of subsidy-eligible Americans, that means “the taxpayers’ liability for the share of premiums will increase every year,” Graham said.

“The bill also outlaws insurers from pricing risk, forcing them to accept all applicants at the same premium and imposing a government-run method of retrospective risk-adjustment to compensate insurers who enroll more expensive beneficiaries,” said Graham.

Unintended Consequences Loom

The bill also mandates providers’ acceptance of an “affordable access plan,” meaning the lowest-cost qualifying plan. “Any Medicare provider would have to accept an affordable access plan paying Medicare rates, which are well known to be below the cost of care,” said Graham. “So doctors will either drop Medicare patients to avoid this mandate, or quit practicing medicine.”

The bill subsidizes “gateways” to insurance benefits, to be operated by the states, and allows the hiring of “navigators” to help individuals and businesses negotiate the new, multilayered program.

“These bureaucratic gateways will be impossible for individuals or businesses to navigate on their own, [so] we’ll have to engage a government-sponsored navigator to do it for us,” said Graham.

Joe Emanuel ([email protected]) writes from Georgia.

For more information …

“The Affordable Health Choices Act”:

Nothing contained in this blog is to be construed as necessarily reflecting the views of the Pacific Research Institute or as an attempt to thwart or aid the passage of any legislation.

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