Public Option

Thanks to Louise Norris for the heads up on this.

Over a year ago, the Washington State legislature passed (and Gov. Inslee signed) a bill to create, for the first time, a state-based Public Option healthcare plan for the individual market. As I noted at the time, there's a few important caveats which illustrate again just how difficult it is to make major overhauls to the healthcare system, even at the state level:

Last October I noted that the state of Colorado had released a report on the latest evolution of their impending State-based Public Option addition to their ACA exchange. At the time, the key specs included:

  • The "State Option" plans are supposed to be available via Connect for Health Colorado starting in 2022 (i.e., they'd enroll starting in November 2021)
  • They expected average premiums are expected to be around 9 - 18% lower than similar policies offered by other carriers
  • Hospitals would be reimbursed at rates ranging from 175 - 225% of Medicare rates

Here's where it got more interesting:

Yesterday, reporter and (pretty apparent) Bernie Sanders supporter Ryan Grim said the quiet part out loud in response to the news that the powerful Nevada Culinary Union isn't a fan of Medicare for All:

Hey @Culinary226, check in with your government affairs people. There are not 60 votes in the Senate to ban the private health insurance you got in your union negotiations, nor will there be after the election. You're gonna be okay.

— Ryan Grim (@ryangrim) February 12, 2020

Yes, apparently the new strategy to win over support from organizations which don't like one of the core tenets of your preferred candidate is to reassure them that there's absolutely zero chance of that tenet ever actually happening.

 

Not Joe Biden. Not Pete Buttigieg. Not Amy Klobuchar. Not Michael Bloomberg. Not Tom Steyer. Not Michael Bennet.

Nope. This is none other than Senator Bernie Sanders of Vermont from July 2009, issuing a strong and vigorous argument in favor of adding a Medicare-like Public Option to the U.S. healthcare system to offer a "level playing field" and "fair competition" with private insurance.

I've cued up the video to the relevant starting point, but if it starts at the beginning for some reason, scroll up to 4:55 in. It runs until around 6:13.

Here's the transcript of Bernie during the section in question:

“No one is talking about a government-run healthcare system. No, they’re not. What they’re talking about is a public option that will compete and give people the choice! The choice of whether they want a public plan or a private plan! Why are you afraid of that? If the private plans are so much better, people will go into the private plan. If the public plans are more cost effective, more reasonable, if people prefer a Medicare-type program they’ll go into that. Why are you afraid of the competition?

via the Washington Health Benefit Exchange:

Washington Health Benefit Exchange Issues Statement on Approval of Cascade Care Plan Designs

Washington Health Benefit Exchange (Exchange) board approved the design for Cascade Care plans today. Cascade Care plans are qualified health plans that have a standard health benefit design across health insurance carriers making it easier to understand and offer more value for Washington Healthplanfinder consumers.

Today, Pam MacEwan, CEO of the Washington Health Benefit Exchange, and Ron Sims, the Exchange’s Board Chair, issued the following statement regarding the approval of the designs as a step in implementing Senate Bill 5526 (Cascade Care):

 

Please watch this interview with Hillary Clinton. The whole thing is worth watching, but the portion about healthcare policy and the best route forward starts at around 9:20 in and runs less than 7 minutes, to 16:00 (It's supposed to be cued up to exactly 9:20 but you may have to scrub forward to get to it depending on your device).

Please take 6 minutes and 40 seconds out of your day to actually listen to the words which are coming out of her mouth.

UPDATE: Full, verbatim transcript by yours truly:

Andrew Ross Sorkin: “I want to talk to you a little bit about healthcare, because I know it’s an issue that you care about deeply and have thought a lot about.”

Hillary Clinton: “I have.”

Sorkin: “Because we seem to be in a very divided world, not just among two different parties, but even within the Democratic Party. Medicare for All versus a Public Option. You look at what Elizabeth Warren presented last week, and you think...what?”

I honestly haven't written or read much about this since I wrote about it in April, but the Colorado government is making good on its promise to put forward a serious Public Option proposal.

While Washington is technically the first state to create their own state-based Public Option, the reality is that while I do give them plenty of credit for getting the ball rolling (their PO is scheduled to go into effect starting in January 2021), what they're doing isn't quite what most people have in mind when they think of a PO.

Washington is essentially outsourcing administration of a healthcare plan to an existing carrier, with the state government negotiating the provider network and reimbursement rate levels...which have been set to 160% of Medicare rates. There's nothing wrong with this, and it's an important move forward...but it's only expected to shave perhaps 5-10% at most off of costs because any negotiated rate settings are partly cancelled out by the cost of the private carrier doing the administration.

I haven't written much about South Bend, Indiana Mayor and presidential candidate Pete Buttigieg. The biggest mention I've given him until now was back in March, when he stated that he's an advocate for a robust Medicare-like public option plan.

Today, however, "Mayor Pete," as he's come to be known, rolled out his official healthcare overhaul plan, and sure enough, it centers on...a robust Medicare-like public option. He calls it "Medicare for All Who Want It":

BECAUSE HEALTH CARE IS A HUMAN RIGHT, GUARANTEE UNIVERSAL COVERAGE THROUGH MEDICARE FOR ALL WHO WANT IT.

The Medicare for All Who Want It public alternative will help America reach universal coverage by providing an affordable insurance option to the currently uninsured. The public alternative will provide the same essential health benefits as those currently available on the marketplaces and ensure that everyone has access to high-quality, comprehensive coverage.

Politically, it's generally better to underpromise and overdeliver. Unfortunately, when it comes to the actual legislative process it's usually the other way around.

Case in point: Connecticut.

It was just twelve days ago that Connecticut Governor Ned Lamont rolled out his proposed ACA improvement policy package, which included a bunch of key elements including the ballyhooed "Connecticut Option"...a Public Option which would have opened up the existing state employee healthcare plan to anyone on the individual or small group markets.

The full suite was supposed to include nine major provisions:

This actually happened back in March but I missed it at the time:

Lawmaker proposes Medicaid buy-in and individual mandate for Oregonians

Representative Andrea Salinas, the new Chair of the House Health Care Committee, recently filed a bill that aims to establish a Medicaid buy-in option for Oregon residents. The bill, HB 2009, would also establish a “shared responsibility penalty,” or an individual mandate for Oregonians.

HB 2009 would essentially allow individuals who do not qualify for Medicaid, or for premium tax credits under the Affordable Care Act, to enroll in CCOs by paying premiums to cover their health services.

(Note: "CCOs" = "Coordinated Care Organizations", which I believe is how Oregon designates their Medicaid program.)

Welp. That didn't take long...just a week ago, Connecticut Governor Ned Lamont announced that he and the state legislative leaders had put together a robust package of impressive healthcare reform bills, including:

  • expanding subsidies to at least some of those eanring more than 400% of the Federal Poverty Level (like California is in the process of doing)
  • expanding Medicaid up to 170% FPL (it used to be 201% FPL but was dropped down to 155% a couple of years ago)
  • reinstating the ACA's individual mandate penalty (similar to what Massachusetts, New Jersey and DC have done and what California is in the process of doing)
  • implementing a state-level reinsurance program (as over a half-dozen states, including several GOP-controlled ones, have done)

Last October, shortly before the midterm election, Democratic gubernatorial nominee Ned Lamont of Connecticut announced that if elected, he'd push hard for a robust reinsurance program along the lines of other states which have successfully implemented reinsurance 1332 waivers under the ACA:

HARTFORD, CT — Democratic gubernatorial candidate Ned Lamont has much lower expectations for what he’s going to be able to do to improve the health of Connecticut residents than one might expect from a Democratic candidate this year.

Sounds like Lamont would not push for CT to reinstate the ACA individual mandate penalty:

...Does he believe everyone in Connecticut has to purchase health insurance now that it’s not mandated by the federal government?

A couple of weeks ago I wrote an extensive piece laying out what seemed, at first glance, to be a bona fide state-level Public Option bill quietly working its way through the Washington State legislature:

Democrats in Olympia push through governor’s 'green' agenda and public healthcare coverage bills

...Another key item on the governor’s agenda is the so-called “public option” socialized health care coverage measure, SB 5526. This bill would create subsidized state-funded public health plans managed by regulated insurance companies. It would require the State Insurance Commissioner and the Health Care Authority to set up the socialized plans by 2021.

,,,These plans would be available through the state’s health care exchange to all residents, but the state would pay subsidies to individuals with incomes of up to five times the poverty level. Premiums would be limited to no more than ten percent of adjusted gross income, and payments to doctors and other health care providers would be restricted to Medicare-level limits.

via the Lexington Herald-Leader:

Colorado's Senate advanced another piece of Democratic Gov. Jared Polis' health care agenda on Tuesday by tentatively endorsing a study on creating a state-run health insurance option.

The bill would direct state agencies to recommend a plan that would compete with existing private insurance plans and those offered on Colorado's health care exchange. Another Senate vote sends the study bill to the governor. It's already cleared the House on a bipartisan 46-17 vote.

On the surface, this sounds pretty much like the state-level Public Option bill which has quietly been rushed through the Washington State legislature over the past few weeks. Unlike the Washington bill, however, it looks like the Colorado legislature is covering a few more bases...particularly funding:

Back in January, 2nd-term Washington Governor and Democratic Presidential candidate Jay Inslee jumped fully onboard the Public Option train:

Inslee proposes ‘public option’ health-insurance plan for Washington

The proposal, which Inslee said is the first step toward universal health care, is geared in part to help stabilize the exchange, which has wrestled with double-digit premium increases and attempts by Republicans in Congress and President Donald Trump to dismantle the Affordable Care Act.

...The proposal would have the state Health Care Authority contract with at least one health-insurance carrier to offer qualified health coverage on the Washington Health Benefit Exchange, according to a summary of the proposal.

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