David Frum's Slippery Slope

People who are knowledgeable about the world's various national healthcare plans are aware that private insurance plays a significant role in any number of them. Even in Canada, the land from which Frum emigrated, people use supplemental insurance policies - often provided by their employers - to supplement Medicare. And yet....

The Dems are willing to accept that the plan won’t be offered in all states. They are willing to allow private insurance to coexist alongside the government-plan for many years to come. They are willing for the government-plan to retain many features of private insurance – premiums will be based on the allowed risk factors, not on “ability to pay.” They know that all those concessions will gradually erode. The key thing: establish the government-run plan now. Drive private insurers out of the market gradually. Shift only slowly from insurance-like finance to tax finance.

What is it that Frum sees as so special - so especially bad - about the U.S. health insurance system that if the government gets so much as a toe in the door everybody in the nation will recognize the superiority of a national plan and press their legislators to expand the program to allow them to enroll?

Next, he breaks out the crack pipe, arguing that Obama could have easily passed a modest healthcare bill:

“I continue to support the public option personally and will work for it to be established later. For now, my priorities are (1) insurance reform, to outlaw the practices that most offend Americans, and (2) to create exchanges like those created by Gov. Romney in Massachusetts so that individuals and small businesses can buy insurance at the same favorable prices paid by large employers. We’re going to have an individual mandate to buy insurance – and subsidies to help those who can’t. We’re going to shift regulation of health insurance from the states to the federal government, so that we can write a single, predictable set of rules, rather than 50 different rules that allow lobbyists in places like New Jersey to push insurance prices up and up and up.”

Republicans could never have said no to that. He would have pushed his program through in a week.

Okay, let's set aside for the moment the fact that numerous high-ranking Republicans have announced that they want to defeat health reform to hurt President Obama. Let's look instead at what the Republicans call a health reform bill. Let's look first for the biggest of the insurance company "practices that most offend Americans" - denying coverage to people with preexisting conditions, and revoking people's policies when they get sick. Their "plan" creates "high risk pools" but doesn't require that insurance companies insure the sick. For revocation, they offer a nebulous, undefined third party review process.¹ Will the review process be an insurance industry rubber stamp? My cynical side says that if it were intended to be anything but, Boehner would have included some specifics.

The Republicans claim, "The GOP plan prohibits an insurer from canceling a policy unless a person commits fraud or conceals material facts about a health condition." Which is great, except that those are the exact grounds insurance companies assert even when they wrongfully terminate people's health insurance coverage. The Republicans think that the termination letters insurers send out say, "We've decided you cost too much, so we're walking away from our legally binding contract of insurance"?

The Republicans also include their standard "race to the bottom" proposal for "buying insurance across state lines". That's the opposite of Frum's notion of a national set of regulations. As I've previously noted,

There is, of course, no reason that insurance companies cannot enter additional states, offering plans in those states, right now. The impediment is that to set up health coverage you need to create a network of participating doctors, clinics and hospitals who accept your plan.

The Republican proposal isn't about an out-of-state insurer writing new plans in your state - it's about insurers from your state relocating to the states with the least regulation so that they can strip away benefits required by your state's laws and work out of states with minimal regulatory oversight. What does the CBO have to say about the GOP proposal?

By 2019, CBO and JCT estimate, the number of nonelderly people without health insurance would be reduced by about 3 million relative to current law, leaving about 52 million nonelderly residents uninsured. The share of legal nonelderly residents with insurance coverage in 2019 would be about 83 percent, roughly in line with the current share.

Further, "in the large group market, which represents nearly 80 percent of total private premiums, the amendment would lower average insurance premiums in 2016 by zero to 3 percent compared with amounts under current law, according to CBO's estimates." Wow. Almost nobody gets insured, and the cost savings are at best near zero. Did Frum fail to notice that Boehner's bill has no mandate? That it bears no resemblance to Frum's dream bill?

I mean, seriously, if the Republicans could back a sensible set of reforms and pass them within a week, why haven't they written up the Frum Bill (or something similar) instead of Boehner's bill, seemingly designed to reform next to nothing? Further, contrary to Frum's suggestion, Obama has effectively said that he'll sign any healthcare reform bill that gets through Congress, even if it doesn't include a public option. The Republicans can still write up that Frum bill that could supposedly pass in a week - why are they instead declaring a "holy war" against healthcare reform?

Frum appears to live in an alternate universe where he's still a prominent member of the Republican Party. Instead he's shouting from a soapbox, "The Republicans truly are reasonable - and if given a chance they'll agree with me" even as he's been marginalized and excluded. Yet he still hasn't quite embraced honest debate, such that he might gain credibility with anybody else.