Tags: haa | healthcare | obama

Healthy Americans Act Makes Sense for All

Monday, 28 Sep 2009 10:56 AM

By Lanny Davis

  Comment  |
   Contact  |
  Print   |
    A   A  
  Copy Shortlink

Last week I described the political riddle of a national healthcare proposal, called the Healthy Americans Act (HAA), which mandates universal healthcare insurance for all Americans, pleasing liberals; which empowers individual choices and private market competition, which pleases conservatives; and which fundamentally restructures our healthcare system substantially to reduce costs, which pleases liberals and conservatives.

And it is the only plan among all that has breathtakingly broad bipartisan support. Senate co-sponsors range from Democrats Ron Wyden of Oregon and Debbie Stabenow of Michigan to Republicans Bob Bennett of Utah and Lamar Alexander of Tennessee, the No. 3 in the party's Senate leadership. In the House, co-sponsors ranging from Democrats Anna Eshoo of California, a close ally of House Speaker Nancy Pelosi, and Rep. Jim Cooper of Tennessee to Republicans Mike Castle of Delaware and Jo Ann Emerson of Missouri.

This week, as promised, I will explain briefly how this bill works to achieve these goals. And next week I will explain how this act will be paid for — according to the Congressional Budget Office, producing a revenue-neutral result in the first two years and then a surplus thereafter. That remarkable conclusion was confirmed in a May 2008 letter signed by then CBO-Director Peter Orszag, now President Barack Obama's Office of Management and Budget.

The HAA achieves the liberal goal of 100 percent coverage by requiring all Americans and eligible residents to purchase insurance on a public state-administered exchange. Every such exchange must offer, at a minimum, the same Blue Cross plan available to all federal employees and members of Congress (called the Federal Employees Health Benefit Plan or "FEHBP") or its "actuarial equivalent."

Those workers whose employers provide them with health insurance (estimated by CBO to number about 150 million) would receive an immediate salary increase — probably their biggest ever in a single year. But they would be required to use the extra cash and given the choice of either (a) purchasing an insurance policy among many listed on the exchange, including the FEHBP-type plan, or if they wish, (b) continuing to be covered under their employer's policy, with the premiums deducted from their paychecks.

Each worker would get a standard deduction each year (or, in the

House version, a smaller tax credit), meaning virtually all the extra salary for health insurance would not result in any additional income tax liability. Employers would also get to deduct the cash payments to the workers.

For the rest of the uninsured, the HAA would provide sufficient cash equivalents from the standard tax deduction (and/or tax credit) for them to afford at least the basic plan available on the state public exchange.

And for the poor at the poverty level ($11,000 per year or less), the

government would provide a 100 percent subsidy to purchase the same

or similar policy. Reduced subsidies would be available on a sliding scale up to 400 percent of the poverty level, i.e., individuals earning up to approximately $43,000 per year and families earning up to $88,000 per year would receive some cash subsidy.

Thus, under the HAA, there would no need further for Medicaid and SCHIP. Here's a revolutionary concept for my fellow liberals: Poor people would be treated like everyone else. In other words, the HAA if enacted would be the death knell of the current dual system of healthcare, where those with private insurance too often get better medical care than those poor people under Medicaid or poor children

under SCHIP, who are too often rejected by private medicine and forced into public clinics and public hospital emergency rooms.

Now under the HAA, the second goal can be achieved that conservatives should love — the unleashing of the power of the private market and competition to keep private insurers sensitive to premium pricing, benefits, and treatment of their customers, rather than a government takeover and mandates.

If under the HAA system private insurance companies don't sharpen their pencils and chase consumers for business on the state exchanges, they will lose out — or go out of business. And to repeat the baseline concept of the HAA: At a minimum private insurers will be chasing the relatively lower premiums and satisfactory benefits under a Blue Cross FEHBP-type program currently available to all federal employees, from janitors to members of Congress.

For those who demand a "public option," one hopes they can get past what seems at times like a robotic mantra and do what Obama has asked them to do — consider supporting a surrogate that achieves the same objective of keeping private insurance companies honest through vigorous competition.

Blue Cross' FEHBP would arguably perform that function under HAA. Its premiums are affordable, since the base of people in the plan is so large. The Blue Cross FEHBP is regulated, requiring that all will be covered, regardless of pre-existing conditions. And, a little known fact: Most state Blue Cross companies enjoy significant federal tax subsidies, estimated to be over $1 billion in a special earmark from the federal treasury.

Affordability, regulation, strict requirements for universal and guaranteed coverage for all who wish to be insured, taxpayer subsidies: sure seems like it walks, talks, looks, and achieves the competitive benefits of a pure government-run "public option" plan.

The fact is, no other Democratic plan in the Senate or House achieves the HAA's two core objectives: both universal coverage and free choice for all — including poor people being treated the same as rich people.

For example, according to the Congressional Budget Office, the three-committee-approved House bill, H.R. 3200, is estimated to leave out about 9 million non-elderly citizens and legal residents (not counting undocumented aliens), several million of whom are the poor who don't know how to take advantage of Medicaid. Under the HAA, poor people can more easily be brought into the system, since they would be automatically enrolled and receive their wholly subsidized health insurance whenever they have any contact with the government, such as applying for Social Security, a driver's license, or car registration.

And no Democratic proposal offers everybody the choice of purchasing a better policy on a public exchange than they have from their employers — indeed, being able to pocket in cash the difference, if any, between what the employer was paying vs. the price on the state public exchange.

In short, under the current Democratic committee plans, very few people could take advantage of a purely public option even if there was one. As Wyden recently wrote:

"The problem with these [Democratic] bills, however, is that they would not make the exchanges available to all Americans. Only very small companies and those individuals who can't get insurance outside the exchange — 25 million people — would be allowed to shop there. . . . This would leave more than 200 million Americans with no more options, private or public, than they have today."

Next week I will explain how HAA also manages to be the only proposal that is immediately deficit-neutral and then, two years later, begins producing a revenue surplus.

Lanny J. Davis, a Washington lawyer and former special counsel to President Bill Clinton, served as a member of President George W. Bush's Privacy and Civil Liberties Oversight Board. He is the author of "Scandal: How 'Gotcha' Politics is Destroying America."

© 2014 Newsmax. All rights reserved.

  Comment  |
   Contact  |
  Print   |
  Copy Shortlink
Around the Web
Join the Newsmax Community
Please review Community Guidelines before posting a comment.
>> Register to share your comments with the community.
>> Login if you are already a member.
blog comments powered by Disqus
 
Email:
Country
Zip Code:
Privacy: We never share your email.
 
Follow Newsmax
Like us
on Facebook
Follow us
on Twitter
Add us
on Google Plus
Around the Web
Top Stories
You May Also Like

Clinton, Warren, Remain United

Monday, 15 Dec 2014 11:45 AM

As a supporter of Hillary Clinton for president if she runs, I don't mind the efforts of some Democrats to urge Sen. Eli . . .

Why I am Ready for Hillary

Thursday, 11 Dec 2014 10:12 AM

Last week, on Dec. 4, I helped organize a Ready for Hillary fundraiser in Montgomery County, Md., in the immediate subur . . .

Ferguson - a Call for Effective Policing Tactics

Thursday, 04 Dec 2014 09:42 AM

No matter how effective the communications skills of the key players in the Michael Brown tragedy, bitterness and anger  . . .

Most Commented

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

 
NEWSMAX.COM
America's News Page
©  Newsmax Media, Inc.
All Rights Reserved