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Valentine’s Day Surprise: Senate Democrats Blast Obamacare Implementation

By Phil Galewitz

February 14th, 2013, 1:15 PM

Senate Democrats on Thursday showed little love to the Obama administration for how it is implementing the federal health law.

Testifying before the powerful Senate Finance Committee, the administration’s top regulator on new health exchanges encountered criticism from several Democrats who helped push through the 2010 federal health overhaul — among them Chairman Max Baucus of Montana and Sens. Ron Wyden of Oregon, Bill Nelson of Florida and Maria Cantwell of Washington.

Baucus questioned how well the online health insurance marketplaces would interact with what he called “archaic” computer systems at Social Security and the Internal Revenue Service.

Cantwell criticized the administration for failing to meet a 2014 deadline to start a so-called Basic Health Program—an optional program that would allow states to offer a cheaper alternative to the individual health policies sold in new online marketplaces to lower-income people. “You are overwhelmed by the details and technology, I get that point. … It seems as if the agency is taking pages out of the law,” she said. Washington state, which has a program similar to this, was hoping to have the federal Basic Health Program running next year when its program expires.

Cantwell also questioned whether the administration was delaying the Basic Health Program until 2015 as a way to increase the number of people who buy policies in the online markets.  That prompted a quick denial from Gary Cohen, deputy administrator and director of the Center for Consumer Information and Insurance Oversight.  Cohen said the agency was working with states to come up with alternatives in the interim.

Nelson, meanwhile, faulted the administration for cutting funding for new consumer-owned insurance co-operatives that supporters said could help provide more affordable policies.

The fiscal cliff deal, approved by Congress on New Year’s Day, eliminated most of the more than $1.4 billion in remaining funding for the program.  Nearly $2 billion in funding had already been awarded to co-ops in 24 states, but those in other states, including Florida, were shut out.

“The people of Florida are going to suffer,” he told Cohen. “I want someone to be held accountable for this.”

Cohen said he didn’t know why the White House had agreed to cut the funding as part of the deficit deal.

Finally, Wyden pressed Cohen to help find ways to resolve a glitch in the law which may result in the denial of federal assistance to millions of Americans of modest means who could be priced out of family health coverage at work. He referred to the Internal Revenue Service ruling last month that workers cannot get federal tax credits to help them purchase coverage in health insurance marketplaces, unless the cost of the individual’s coverage through their workplace exceeds 9.5 percent of the worker’s household income. The ruling ignores the fact that the cost of family coverage would be much higher.

“We’ve got millions of people – working-class, middle-class people – who are going to be pushed into a regulatory health coverage no man’s land,” Wyden said. “They are unable to afford the family coverage through their employer and ineligible for the subsidy that could be used by dependents on the exchange.”

Cohen said he would respond to Wyden in writing next month with ideas about how states could help such workers.

Cohen also told the committee that every state will have a new online insurance marketplace operating by Oct. 1 with coverage effective in January 2014—regardless of whether the markets are run by the state, the federal government or a partnership of the two.

The administration has given conditional approval to 17 states and the District of Columbia to run the marketplaces. But it is unclear whether all those states will be ready. Idaho, for example, has yet to hire an information technology vendor to set up its website. In January, CMS gave Idaho until Feb. 15 to have a vendor in place to get final approval. State officials say that deadline has been extended.

States have until Friday to apply to run an exchange in partnership with the federal government. Health insurers start submitting premiums and benefits to the federal exchange March 28 and the federal government hopes to approve them this summer.

17 Responses to “Valentine’s Day Surprise: Senate Democrats Blast Obamacare Implementation”

  1. Richard Austin says:

    Yet another reason obamacare is making health insurance l less affordable and harder to get.

  2. CHL says:

    Looks like dems finally got around to reading the law.

  3. Yet another reason we need to simplify and unify under a single payer national health care plan, expanded Medicare for all. The public option would have been an inroad to universal coverage if the GOP had let it stand, and would have solved problems like this, but we will end up just enriching ins co’s, phrm co’s, and lawyers with this complicated mess. Please check out my book, The Other End of the Stethoscope The Physicians’ Perspective on the Health Care Crisis. It explains why 40% doctors say they plan to quit medicine or retire in the next 1-3 yrs. and suggests a trifold solution: Basic National Health Care, National Malpractice/Complications Fund run and supportedby MDs, and freedom for patients to choose their MDs.

  4. ECF says:

    The problem with “Medicare for All” is that “Medicare for Just the Aged and Disabled” isn’t working particularly well. The program is basically insolvent, and according to the government’s own auditors lost about $45 billion to fraud in 2010…about four times the aggregate profits of the 10 largest insurers in America. When you put the government in charge of the money, and it has no particular incentive to be efficient with it, you get what we’ve got with Medicare…half a trillion dollars flying out of federal coffers annually to just about anyone bold enough to ask for a share of it.

  5. Lennie says:

    I think someone in the Obama administration once said, you never want to let a serious crisis go to waste. Dems blasting Dems? Do you find that shocking? Frankly, they just want to manufacture another crisis so that they can speed up the migration to an eventual universal single-payer healthcare system. In case you didn’t know, Obamacare is just a start. It’s not the solution. it’s just a baby step toward universal single-payer government controlled healthcare. Face the facts folks, the free market is no place to deal with life and death decisions. If a private insurance company has to choose between their profit margin or whether you will live or die, the choice is clear in all cases. They will choose to protect their profit margin 100 percent of the time. That is why we need to eliminate the private insurers. The private insurers have one motive. To be profitable. They have no vested interest in keeping you healthy. NONE! ZERO!

  6. Gary Hemminger says:

    If private insurance is the problem, then we need to get rid of car insurance, home insurance, flood insurance, earthquake insurance and all insurance.

  7. Steve Massey says:

    This is the US, not some small monocultural European state with a realtively competent government. A universal single payer plan would be a guaranteed disaster of even greater magnitude than the ACA. I don’t think you guys realise how incompetent and corrupt the USG really is.

  8. Laka says:

    Maybe it might have been a good idea to read it before passing it.

  9. Homple says:

    As Obamacare goosesteps toward its inevitable disaster, the generals who ordered the march begin blaming the soldiers trying to follow their orders.

  10. Jack says:

    “The private insurers have one motive. To be profitable. They have no vested interest in keeping you healthy. NONE! ZERO!”- Lenny, and others who make the point in favor of a single-payer.

    The private insurers make more money if you are healthy my friend. They lose money when you get unhealthy and start racking up medical bills.

  11. Mark Time says:

    Please keep in mind that the WTO’s General Agreement on Trade in Services has a trap for unwary countries that open their insurance markets to overseas vendors, in our case that would happen by our allowing insurers to sell across state lines.

    (Something the EU has been asking for for decades)

    The GATS Article XXI gives multinational companies an entitlement to stay in a market forever once they have invested in developing it.

    This could make future single payer impossible,

    We will need real single payer (which is not an “option” – it must be the only payer to save money as we need it to) because Americans cannot afford health insurance, and this is all smoke and mirrors to hide that.

    Read these papers for more on this problem:

    http://www.citizen.org/documents/PresidentialWTOreport.pdf

    also more generally:

    http://www.citizen.org/documents/PC_Gats_Backgrounder_05-05.pdf

    http://www.citizen.org/documents/GATS-financial-dereg.pdf

    also from Canada – about the GATS conflict with public healthcare issue

    http://www.policyalternatives.ca/sites/default/files/uploads/publications/National_Office_Pubs/facing_facts.pdf

    http://www.policyalternatives.ca/sites/default/files/uploads/publications/National_Office_Pubs/putting_health_first.pdf

    Please watch out for a potential trap in the WTO’s GATS investor-state provisions (Article XXI) which could kick in to trap the US into bad health care choices forever if we sell insurance across state lines. This could happen inadvertently! (But it is probably intentional on the part of some people, which is creepy)

    *For an example of how that would work, look at the recent Antigua-USA dispute over online gambling, which we lost.*

    Please do not ignore this issue These free trade agreements are the unseen hand poisoning US healthcare policies!

  12. Harry says:

    Ask any person employed in the insurance industry and they will tell you that their industry strives to lower risk by increasing the risk pool. The more payers that participate, the lower the premiums are per payer. Healthcare insurance in no different. The Heritage Foundation understood this simple concept and so they suggested that healthcare reform should include mandated insurance. Mitt Romney understood the concept of mandates and so he enacted Romneycare which includes mandated insurance for all residents of Massachusetts. Obamacare is a virtual carbon copy of Romneycare in terms of mandated insurance. That’s just the way it is! The bigger the risk pool, the lower the cost. Most intelligent people understand this very simple concept. This concept is so simple that even a kindergarten student could understand it. So what is it about Republicans that they don’t understand this very simple concept?

  13. Steve says:

    Jack,

    You make a very good point, however…

    If we gradually eliminate the middleman, namely the private insurers, wouldn’t that free up more and more money to dedicate specifically toward actual medical care and not toward unnecessary administration costs? I guess my real question is, what value do private insurers actual provide except to act as an unnecessary, yet expensive, middleman? Will we need such and expensive middleman especially after the state exchanges open for business on January 1st, 2014? In Massachusetts, under Romneycare, the state exchange acts as the navigator to find a healthcare policy that is specifically designed for the applicant. The Massachusetts exchange is doing what the insurance broker did in the past. More and more, private insurers are becoming increasingly irrelevant. It seems to me that we are moving, little by little, to a future where universal single-payer healthcare will be inevitable. Don’t you agree?

  14. George says:

    I cannot speak for pubs but I doubt that they have any problem understanding about economies of scale that exist from single payer. However, they wouldn’t be much different from dems if they were in favor of yet another wasteful government monopoly…especially when death panels are involved. Just look at the magnitude of waste and fraud rampant in Medicare and Medicaid. And think about the political temptation of saving money through neglect of the aged.

  15. wendy says:

    Death panels? Are you joking? Are we still stuck on death panels? Let me guess, you are a Republican, right? Let me guess, Chuck Grassley is your hero, right? Don’t you ever get tired of repeating and repeating and repeating the same old worn out talking points? It’s so played! Dude, you really need to pick another tune on that Jule box!

  16. Steve says:

    Wendy,

    Did you mean “juke box”?

    Please give us Republicans a little bit of credit. We may be conservative and most of us are cheapskates and are still using double-edge safety razors, but we are more advanced than playing tunes on a juke box. We have at least graduated to using a 6 track cassette recorder. Give us a break, we aren’t that austere, are we?

  17. mandy says:

    Steve,

    Austere is not the word I would use.

    Scrooge would be the word I would use. Yet, when you look back at the Bush 43 programs, two unfunded tax cuts for the very wealthy, two unfunded wars (Iraq and Afghanistan) and a totally unfunded Medicare Part D program, One could assume that the Republican Party could be described a hypocritical with regard to fiscal policies. Americans have very short memories, don’t we?

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