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Why ‘Ryancare’ Is Far More Hostile To States Rights Than ‘Obamacare’

Yesterday, House Budget Committee Chair Paul Ryan (R-WI) predicted that the Supreme Court will embrace the meritless claim that the Affordable Care Act violates states rights and “knock down the individual mandate.” Yet, if there is one person who shouldn’t be hiding behind states rights arguments, it is Paul Ryan. The truth is that Ryan’s infamous health plan does far more than simply phase out Medicare, it outright declares war on the states’ ability to protect their citizens from insurance company abuses.

One of the centerpieces of Ryan’s plan is an element from the McCain/Palin presidential campaign’s plan that supposedly allows Americans to “purchase health insurance across state lines”:

Currently, individuals and families can purchase health insurance only in the States in which they live, because insurance companies are prohibited from selling polices outside their respective States. Thus the consumer is prevented from purchasing coverage from another State that might offer more suitable, or more affordable, coverage. [...]

Allowing consumers to shop across State lines will balance State regulation of health insurance. Individuals no longer will have to pay for health benefits mandated by their home States that they do not need; they will be able to choose policies from States whose mandates better fit their personal circumstances. States will then have an incentive to balance their insurance mandates against costs to remain competitive with other States.

This sure sounds great! Why shouldn’t you be able to buy a plan from an Arizona insurance company if you happen to live in Ohio? The truth, however, is that the McCain/Palin/Ryan plan’s promise to let people “shop across State lines” is nothing more than a code for completely immunizing the insurance industry from state laws that protect consumers.

As Sen. McCain explained during his failed campaign, the McCain/Palin/Ryan plan is modeled after the process banks used to systematically dismantle state laws protecting consumers from excessive interest rates. Once upon a time, banks were governed by something known as “usury laws,” state laws which prohibited lenders from charging excessive interest to homeowners and other borrowers. In 1978, however, the Supreme Court held that banks are only required to follow the usury laws of the state where they are “located,” effectively immunizing banks from the interest rate caps in each of the other 49 states.

The result was a race to the bottom where states competed to enact the least protective usury laws in order to coax the banking industry into relocating within their borders. Eventually, South Dakota “won” this race by repealing its usury laws altogether, and Citibank rewarded South Dakota by moving its lending offices to that state. The rest of the industry soon followed suit, immunizing itself from interest rate caps altogether by locating in places like South Dakota.

So the effect of this chain of events was to completely neutralize states’ ability to regulate interest rates — hardly the kind of states rights result that 10th Amendment absolutists pine for. And the McCain/Palin/Ryan plan would impose the banking model’s approach to state regulation on health insurance regulation. If the Ryan is successful in enacting this plan, a short list of laws that would effectively cease to exist includes:

  • Women’s Health: 49 states and the District of Columbia require health plans to cover reconstructive surgery after breast cancer, mammograms, and maternity stays;
  • Fair Appeals: 44 states and the District of Columbia allow patients to appeal denials of coverage to an external review board;
  • Preexisting Conditions: 38 states and the District of Columbia restrict how far into the past a insurance company can “look-back” to determine whether a patient is disqualified because of a preexisting condition;
  • Healthy Children: 31 states require health plans to cover well child care.

In other words, Ryan’s preeminence as the right’s leading health policymaker does nothing more than prove that they couldn’t care less about states rights and the 10th Amendment. They’re just happen to pretend to care in order to undermine President Obama’s signature accomplishment.

Report: 40 Percent Of Medicare Spending On Tests Is ‘Medically Unnecessary’

In case you weren’t convinced that the government is spending millions of dollars on health care that does nothing to improve outcomes, this stat may change your mind: an investigation conducted by iWatch finds that “40 percent of Medicare spending on common preventive screenings [is] regarded as medically unnecessary.” Beneficiaries are receiving these tests “more frequently than medically recommended or at times when they cannot gain any proven medical benefit, extracting an enormous financial toll on the nation’s health care system.” This is because “doctors disregard scientific guidelines out of ignorance, fear of malpractice suits or for financial gain, as patients inundated by medical advertising clamor for extra tests.” The Affordable Care Act tries to tackle this waste by changing the incentives that lead to unnecessary care, funding tort reform demonstration projects, and investing in comparative effectiveness research to weed out ineffective treatments.

NEWS FLASH

Brewer Defends Accepting Millions Of Dollars In Federal Grants From The Health Law She Opposes | Arizona Governor Jan Brewer (R) is defending her decision to accept $29.8 million in federal funding to establish a health insurance exchange from the Affordable Care Act. Brewer opposes the law and is part of a lawsuit challenging its constitutionality, but claimed that she had to apply for the funds in order to prepare the state in case the Supreme Court upholds the constitutionality of the law. “I believe that Arizona would be far better off to engage in a health exchange that we operate to fit our particular kind of delivery of services,” said Brewer. “I don’t believe that one particular type of exchange is going to bode well for 50 different states. It’s incomprehensible. I do hope we win in court, but Arizona is going to be prepared and ready to go and we want to be in charge.”

Essential Health Benefits Will Cost More Than Bare Bones Insurance Plans…And That’s A Good Thing

Last night, the Institute of Medicine (IOM) released its recommendations to the Department of Health and Human Services for defining essential health benefits — the standard benefits insurers will have to offer beginning in 2014. As Sarah Kliff explains, the institute had to balance “affordability against comprehensiveness,” find a way to please patient advocacy groups who “want to ensure that the benefit package is comprehensive, providing robust coverage for a wide array of medical conditions,” and industry groups who “worry that a sweeping benefit package could prove unaffordable.” Ultimately, IOM didn’t provide HHS with specifics, but offered a framework that erred on the side of affordability: it recommended that HHS model the package on the more modest benefits offered by small businesses to ensure that everyone can access the basic plan and that the central purpose of the Affordable Care Act is realized.

But Republicans — who have offered to deregulate the insurance industry almost entirely — are already speaking out against the recommendation. Sen. Mike Enzi (R-WY) offered this condemnation:

Small businesses can’t sustain these increases, especially when combined with the increases that will inevitably result from the more expensive essential health benefits packages mandated by the new law,” said Senator Enzi. “Employers need flexibility when determining what type of health insurance to provide their employees, so they can afford to continue offering coverage. Too many small businesses are already running the numbers and deciding they can’t afford to make payroll and pay for health care. The number of small businesses offering coverage decreased 11 percent this year, and rigid benefit packages will make this even worse.” [...]

“It is simple math that as more mandated benefits are included, the higher the costs will be,” Senator Enzi said. “As more regulations are published and more requirements are enacted, premiums will continue to increase which will likely lead to more small employers dropping coverage.

The purpose of the essential benefit rules, however, isn’t to burden businesses or individuals with new costs or unnecessary and unproven benefits, but to establish a floor of basic coverage that will allow companies to compete on cost rather than quality and guarantee that the most vulnerable parts of the population have access to the basic care they need. Beneficiaries will determine how much they pay for their benefits — insurers will offer bronze, silver, gold or platinum plans that will cover a certain percentage of the cost — but all new policies will provide comprehensive coverage and preventive care that is essential to maintaining good health. That’s a far cry from the deregulated markets that Republicans are proposing — in which insurers sell subprime policies that beneficiaries can never count on if they actually fall ill. That kind of coverage may be cheaper, but it’s also worthless for maintaining health and treating major disease.

Yglesias

Affordable Care Act Denialism

One strange phenomenon in contemporary American life is what I call “Affordable Care Act denialism” in which someone will simply refuse to acknowledge that the most significant bill of the 111th Congress existed, passed, and contains provisions that do things. For example, Matt Bai complains that “Either we’re being told that centralized, 20th-century systems can never be changed to accommodate more individual flexibility (like say, decoupling health care from employment), or we’re being told that all federal programs are wasteful and that every American should basically fend for himself.”

That’s shameful! An appropriate policy remedy might be to set up health insurance exchanges in which people will be able to choose from themselves one out of several health insurance plans offered by different providers. Needless to say, in order to avoid adverse selection problems you’d need a regulation forcing participation in the exchanges. You’d also need to provide subsidies to make purchase affordable to people with modest incomes. To avoid needlessly disrupting people’s lives, you’d want to transition away from the employer-based system into the exchange-based one gradually. And to raise some of the necessary funds, you might launch a phased rollback of the current tax subsidy for employer-provided health insurance. All this and more was done by the last Congress amidst a widely publicized and highly contentious debate.

NEWS FLASH

House Committee cuts funding for U.N. organization that prevents women’s deaths, HIV | The House Foreign Affairs Committee voted to deny $50 million to the U.N. Population Fund, an organization that provides reproductive health care to more than 1 million poor women and children worldwide. That money would help prevent 7,000 maternal and newborn deaths, provide surgeries to 10,000 women, and provide contraception to 1 million couples in developing countries. Republicans slashed the spending, citing disapproval of the UN and UNPF’s affiliation with China and its one-child policy. Chief of the Washington UNFPA office Sarah Craven countered GOP arguments, telling the Huffington Post, “not one dime” goes to China’s abortion policy. UNPF is a victim of the “global gag rule”, which prohibits any U.S. funding to foreign organizations that provide abortion services.

-Rebecca Leber

NEWS FLASH

Boehner Jokes Women Have Abortions Out Of Convenience | House Speaker John Boehner (R-OH) joked that women decide to have abortions because they find their pregnancies inconvenient, during his address at the Values Voter Summit this morning. “Like I told you, I have 11 brothers and sisters, my mother had us one at a time,” Boehner said. “I’m sure it wasn’t convenient for her. But I’m glad they’re all here.” Watch it:

Bachmann Introduces Federal Health Mandates To Govern Abortions

With her poll numbers down after the entrance of Rick Perry into the GOP presidential race, Rep. Michele Bachmann (R-MN) is shifting her campaign message from a focus on the economy to the social issues that first launched her political career. In multiple town halls in Iowa this week, Bachmann reminded supporters that “as much as this election will be about jobs,” “we can’t forget the undergirding of our nation and those are the values, the principles that we stand for.” She urged voters not to “settle” on a candidate who lacks a track record of defending traditional social issues and reviewed her own accomplishments — from championing a constitutional amendment against same-sex marriage as a state senator in Minnesota to advocating anti-abortion legislation in Congress.

“As president I want you to know I’ll fight for life and for marriage, because we can have a president who believes in the power of prayer,” Bachmann says in a new video, “a president who is steadfast on the values of life, of marriage, and faith and with your support for my candidacy for the president of the United States, this will be the year conservatives don’t have to settle.” Yesterday, Bachmann went even further, announcing that she would sponsor The Heartbeat Informed Consent Act, “a bill in Congress that seemed aimed directly at evangelical voters.” The measure would require all abortion providers “make the heartbeat of the unborn child visible and audible to its mother as part of her informed consent.” From Bachmann’s statement:

“A pregnant woman who enters an abortion clinic is faced with a decision that will forever change two lives. That’s why she must have the very best information with which to make that decision. The ‘Heartbeat Informed Consent Act,’ that I introduced today, would require that abortion providers make the unborn child’s heartbeat visible through ultrasound, describe the cardiac activity, and make the baby’s heartbeat audible, if the child is old enough for it to be detectable.

“A study by Focus on the Family found that when women who were undecided about having an abortion were shown an ultrasound image of the baby, 78% chose life. An unborn baby’s heartbeat can be detected as early as five weeks after conception and ultrasound technology is an amazing medical advance that provides a window for a pregnant woman to see her unborn child. My legislation will not only enable this technology to be better used to protect life, but also to ensure that a woman who is considering abortion is finally able to give full and informed consent.”

Bachmann’s support for federally-mandated ultrasounds undermines her strong opposition to government requirements in health care. Her bill would institute an onerous bureaucratic regulation that inserts the government into medical decision making and creates another level of unnecessary federal regulation. As the Guttmacher Institute explains, every state already “requires that a patient consent before undergoing medical treatment” and provides adequate and appropriate information about the procedure. Bachmann is seeking even greater federal intervention and is relying on government regulations to talk women out of undergoing a medical procedure — a decision that is best left to the woman and her doctor. Six states currently mandate “that an abortion provider perform an ultrasound on each woman seeking an abortion, and require the provider to offer the woman the opportunity to view the image.”

Bachmann’s new-found emphasis on social issues is not without risk, the Associated Press notes. “[P]revious candidates boosted by Iowa’s evangelical voters have failed to capitalize on that success once the campaign left the state” and voters seem especially uninterested in the message in 2012. A recent ABC News/Washington Post poll found that just 3 percent of Republican respondents said social issues were the most important issue affecting their vote.

Morning CheckUp: October 7, 2011

Republican senators raise concerns over contraception: Sens. Orrin Hatch (R-UT), Mike Johanns (R-NE), and 26 of their Senate colleagues “have written to Health and Human Services Secretary Kathleen Sebelius to press her on the constitutional concerns associated with the Department of Health and Human Services (HHS) implementation of the Institute of Medicine’s (IOM) recommendations for preventive health services mandates.” The senators are taking issue with “the lack of due consideration given by [Sebelius] and your Department to the adverse impact that IOM’s recommendations would have on our core constitutional value of religious liberty.” [Insurance News]

Rep. Johnson offers bill to slow ACA implementation: Rep. Sam Johnson (R-TX), has introduced legislation to “freeze the implementation of the health reform law, to establish a commission to evaluate its impact on the delivery of health care to current Medicare recipients, job creation, current health insurance coverage, participation in State exchanges, and the Federal deficit.” [Insurance News]

IOM’s essential benefits report focuses on affordability: The Institute of Medecine released a 297-page report laying out criteria and methods the Department of Health and Human Services should use in developing the essential benefits package that will be offered by insurance companies in the new exchanges. One of the outside experts asked by the panel to review the report said in an interview that its emphasis on affordability could mean less robust benefits. [Kaiser Health News]

Recommends establishing a premium target: Defining a premium target became a “central tenet” of the committee because, the committee concluded, if cost is not taken into account, the essential health-benefits package will become increasingly unaffordable for both individuals and small businesses. If that happens, the overriding purpose of the Patient Protection and Affordable Care Act—enabling people to buy insurance—will not be achieved. [Modern Healthcare]

Community health centers feeling the pinch: “The budget deal between the White House and Republicans cut $600 million, or half the regular 2011 appropriation for the health centers. To lessen the pain, the administration filled in for those missing dollars with money slated to staff and build new centers. As a result, the expansion dollars for this year became much more limited.” [Kaiser Health News]

Paul Ryan predicts health reform will cause death spiral: Paul Ryan said on Thursday he expects the Supreme Court to strike down the individual mandate and said that the law will send health care costs into a “death spiral” as a result. [CBS News]

Maternity care to be covered in California: Gov. Jerry Brown signed legislation ensuring maternity services are covered by health insurers and that new mothers can no longer lose their health insurance as a result of taking maternity leave. [The Hill]

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