This morning, single-payer advocate and public option supporter Rep. Anthony Weiner (D-NY) defended the merged Senate bill, arguing that it’s still worth passing. “It’s not that they got a bad bill on their hands, it’s a pretty good bill,” Weiner said. “I think that Howard Dean is wrong. And I don’t think we should let the perfect be the enemy of the good.”

Asked “what is it in this bill that’s going to lower costs and provide more choice” since Sen. Joe Lieberman (I-CT) insisted on stripping the bill of the public option and the Medicare buy-in provision, Weiner argued that covering more Americans would minimize the cost shift from the uninsured:

WEINER: No, that’s easy. I mean frankly, when you have 30 million people who are uninsured today going into hospital emergency rooms getting very expensive costs, passing along the burden. We in New York City pay $6 billion what could be in extra taxes for the uninsured. Theoretically, those people are going to be covered now, so they’re going to get better health care than they’re getting today.
O’DONNELL: How if there is no public option?
WEINER: I understand there is no public option but there are 30 million people who are going to be getting health insurance who don’t have it today. Those people are going to be getting more efficient less expensive care, not passing onto you and me higher costs. That’s a good thing. That’s an unvarnished good thing.

Watch it:

Weiner also encourage President Obama to travel to Nebraska to rally support for health care reform and appealed to the President to take a strong position in support of the public option and other progressive principles.

Since the disintegration of the public option/Medicare buy-in compromise, some progressives have joined ranks with conservative critics to argue against requiring Americans to purchase health insurance coverage. The turn-around is as extraordinary as it is reactionary. In their anger at Joe Lieberman and the failure of the public plan, progressives are inadvertently supporting a policy that would increase costs and jeopardizes crucial insurance regulations.

Consider the numbers. Last week, liberals defended an individual mandate since the merged Senate bill would have pushed 3 million Americans into the public option and 12 million into private insurance. This week, all 15 million Americans (roughly half of the expanded population) will be required to purchase private insurance. The three million difference is enough to torpedo this bill:

- KEITH OLBERMANN: “The mandate in this bill … must be stripped out,” Olbermann said. “It is above all else immoral and a betrayal of the people who elected you.”

- MARKOS MOULITSAS: Strip out the mandate, and the rest of the bill is palatable. It’s not reform, but it’s progress in the right direction. And you can still go back and tinker with it at a later time.

- DEMOCRACY FOR AMERICA: So, the bill doesn’t actually “cover” 30 million more Americans – instead it makes them criminals if they don’t buy insurance from the same companies that got us into this mess.

The math is really quite simple. The individual mandate creates incentives for otherwise healthy Americans to purchase insurance and may be the the only way to achieve affordable universal coverage. Without a mandate, only the sick who need health care would be motivated to purchase it. The pool of insured would be weighted with sick individuals, forcing the costs of the premium to escalate. According to a study by MIT economist Jonathan Gruber, “a plan without mandates, broadly resembling the Obama plan, would cover 23 million of those currently uninsured, at a taxpayer cost of $102 billion per year. An otherwise identical plan with mandates would cover 45 million of the uninsured — essentially everyone — at a taxpayer cost of $124 billion.” As Paul Krugman concludes, a plan without mandates would cost $4,400 per newly insured person, the plan with mandates only $2,700.

Since every person has at least some risk of experiencing a medical crisis, encouraging Americans to assume a collective responsibility for medical cost is a reasonable proposition. Its also essential for reforming health insurance markets. After all, demanding insurers accept every applicant without regard for pre-existing condition and charge every beneficiary a community rate is impossible if healthy people game the system and wait until they fall ill to purchase coverage. After all why would anyone spend their healthier years paying insurance premiums if the neighbor across the street can obtain the same coverage for the same rate on a need-it-now basis?

Unlike the public option, a strong individual mandate that’s structured to change behavior and encourage individuals to purchase coverage is the glue that maintains reform’s affordability and regulatory provisions. Strip it, and you might as well “kill the bill.”

Our guest blogger is Sonia Sekhar, a Special Assistant for Health Policy at American Progress Action Fund.

As Congress argues about health care reform, within sight of the Capitol, African American babies are dying at three times the rate of white babies born in the U.S. Nationwide, African-American women are 35% more likely to die of heart disease than white women, and 28 percent of Latinos report having little or no choice in where to seek care. Only 15 percent of whites report this difficulty.

People of color represent a third of the U.S. population, but more than half of the uninsured, leaving them particularly exposed to the vulnerabilities of our broken health care system. A report released today by the Center for American Progress by Dr. Lesley Russell highlights the health experience of racial and ethnic minorities in America and how pending health reform legislation take steps to address some of these issues.

The report explores the health care access, coverage, and quality that minorities tend to experience at lower levels than the white population, and how these factors are reflected in lower health outcomes.

The report highlights that:

- Racial and ethnic minorities tend to receive lower quality health care than non-minorities even when controlled for access-related factors such as insurance status and income.

- As many as one in five Spanish-speaking Americans report not seeking medical care because of language barriers.

- Half of Hispanics and more than a quarter of African Americans do not have a regular doctor, compared with only one-fifth of white Americans.

- African Americans and Latinos have been affected by the decrease in employer-sponsored insurance over the past eight years to a greater extent than whites and were less likely to have it to begin with.

Current bills in the House and Senate contain provisions to address racial and ethnic health care disparities, including:

- Provisions that attempt to realign payment incentives so that they are tied closely to outcomes rather than the quantity of services rendered. Shifting to a quality-based payment system will help improve the care that people of color experience.

- Demonstration programs to promote access for Medicare beneficiaries with limited English proficiency by providing reimbursement for culturally and linguistically appropriate services.

- Incentives to encourage a range of needed health professionals to work in primary care settings, in public health services, and in areas of workforce shortage.

- Improved data reporting and collection in an effort to better evaluate programs and develop targeted strategies for addressing racial and ethnic health care disparities.

The Institute of Medicine cites expanding coverage—key aspects of both the House and Senate bills —as the most critical factor in addressing health disparities because it gets everyone in the system, and helps ensure access to prevention services, early diagnosis and treatment. Many of the broader reforms in the bill will also help improve access to care for minorities.

However, the report makes it clear that while the bills are a good start to closing the gap on health care disparities, more must be done if policy makers hope to elevate the nation’s “medical apartheid” to a top policy priority rather than treating the problem through a collection of small-scale, uncoordinated initiatives funded for a few years and then forgotten.

Health care disparities generate a significant human and economic cost that is borne directly by the individuals involved and indirectly by all Americans. As minorities become an increasing percentage of the population—Census estimates project them to be the majority by 2042—their health status will increasingly define the nation’s health and drive health care spending.

Responding to Howard Dean’s argument that Democrats should “kill” the Senate health bill, John Podesta made the case that the merged Senate legislation goes a long way towards achieving universal coverage and ending abusive insurer practices. “I am keenly aware of the real alternative to the bills now before us: millions more Americans without health care and billions more for health care spending as the same challenges President Clinton tried to resolve continue to metastasize unchecked,” Podesta writes before listing 10 reasons why the bill is still worth passing even without a public option or a Medicare buy-in provision.

Indeed, the loss of the public plan and Medicare buy-in undermines, to some degree, the effectiveness of the Senate bill, but it does not substantially harm the core of the proposal. The merged Senate bill may be without its flashiest provision, but on the whole, the legislation is an improvement over earlier drafts. Consider the Finance Committee’s proposal. It lacked a public option, but also included weaker affordability standards, individual mandate provisions, and insurance regulations:

Moreover, while the debate on the Senate floor has been far from constructive, Senators did attach an important amendment offered by Sen. Mark Pryor (D-AK) to improve the exchanges and adopted Sen. Barbra’s Mukulski’s (D-MD) amendment to ensure that women can access critical cancer screenings and preventive services at no cost sharing.

The Hill’s Jeffrey Young is reporting that in light of the Democrats’ decision to drop the public option and the Medicare buy-in provision from the Senate health bill, SEIU is backing away from their support of the legislation:

The SEIU had planned to participate in a Capitol Hill press conference along with the AARP, the liberal advocacy group Families USA, Consumers Union and the American Cancer Society Action Network. As recently as Tuesday morning, the organizations distributed an advisory to the news media that included the SEIU. But the move by Senate Majority Leader Harry Reid (D-Nev.) to excise provisions of the healthcare reform bill to create a government-run public option health insurance program and to allow people between 55 and 64 years old to buy into Medicare gave the labor union pause, spokeswoman Lori Lodes said.

This explanation is a bit hokey. Initially, the public option would only be available to individuals, small businesses and the self-employed. Union members would presumably remain in their generous employer-sponsored plans — far from the public option or any other health insurance program offered in the exchange. Thus, their reaction to the latest developments is either just a misunderstanding of the policy — which I highly doubt — or a back door way of opposing the 40% excise tax on so-called Cadillac health care plans. The indexing of the excise tax may be problematic, but overall the the excise tax would exempt most union members from the fee, help slow the rate of health care cost and reduce the deficit.

I’ll leave that policy debate for another day and simply point out that the so-called compromise debacle has provided progressive critics of health care reform with cover to register their discontent with other parts of the Senate health care bill. The reality is, most progressives rated the chances of a public option passing the senate as highly unlikely at best. Sen. Reid’s decision to include an opt-out extended the public option dream, if only briefly, but it didn’t change the fundamental political reality. Without converting conservative Democratic senators to the progressive cause, the policy was still a no-go.

For this reason, among others (including the plan’s narrow reach), the heart of health care reform was never about the public plan. The real game was in improving affordability standards, enhancing the exchanges, and figuring out the payment reform. At this juncture, to pretend that health care reform is synonymous with the public plan is a bit opportunistic and disingenuous.

Moments ago, Sen. Bernie Sanders (I-VT) announced that he is prepared to vote against the Senate health care bill in light of the recent decision to strip the public option and the Medicare buy-in provision from the legislation. Appearing on Fox Business’ Cavuto, Sanders said “I’m struggling with this, but as of this point, I’m not voting for the bill.”

Sanders is the only member of the Democratic caucus to publicly oppose the Senate legislation and it’s unclear if he would vote for cloture but oppose the final bill. Still, Sanders’ objections raise new doubts about whether Reid has the votes to file cloture on the bill tomorrow and pass it before Christmas:

I’m struggling with this. As of this point, I’m not voting for the bill…I’m going to do my best to make this bill a better bill, a bill that I can vote for, but I’ve indicated both to the White House and the Democratic leadership that my vote is not secure at this point. And here is the reason. When the public option was withdrawn, because of Lieberman’s action, what I worry about is how do you control escalating health care costs?

Watch it:

“How do you give competition to the private insurance companies who are raising rates, premium rates outrageously every year, who’s only function in life is to make as much money as they can?’ Sanders asked. “What a strong Medicare-type public option would do is at least provide competition and prevent, I believe these large increases in rates.”

Earlier today, Republicans filibustered Sanders’ single payer amendment by asking clerk to read all 767 pages. After 2.5 hours, Sanders reluctantly withdrew his amendment.

Our guest blogger is John Podesta, President and CEO of the Center for American Progress Action Fund.

Since Joe Lieberman demanded stripping the public option and Medicare buy-in provisions from the merged Senate bill, some strong progressives like Howard Dean have argued that without a public option or a Medicare buy-in provision, the bill is a giveaway to private insurers and should be killed. Other progressive leaders like Senators Jay Rockefeller, Tom Harkin and Sherrod Brown believe that the bill represents the best chance for passing health care reform in the foreseeable future. “I’m going to vote for it,” Brown told reporters. “I can’t imagine I wouldn’t. I mean there’s too much at stake.”

Change of the magnitude envisioned by health care reformers does not come easily. There have been many frustrations and there will be more. But, as a senior White House staffer with a ringside seat for the slow death of comprehensive care in 1994, I am keenly aware of the real alternative to the bills now before us: millions more Americans without health care and billions more for health care spending as the same challenges President Clinton tried to resolve continue to metastasize unchecked.

So while I have great respect for Governor Dean, and we have worked together to provide the strongest health care reform bill for the American people, I come down on the side of the Senate passing the bill.

Here’s why:

The Senate health care bill is not without its problems. But if enacted, it would represent the most significant public reform of our health care system that Congress has passed in the 40 plus years I have worked in politics. The bill will give health care coverage to a record 31 million Americans who are currently uninsured, lay a foundation that will begin to lower costs for millions of families, and provide all Americans with the access to adequate and dependable coverage when they need it most.

All of us are anxious to see the final language from the Senate. And a final bill must ensure that the subsidies provided are sufficient to make insurance truly affordable for working families. But based on what we know, here are my top ten reasons for why progressives should support the Senate passing the bill:

1. Largest Expansion Of Coverage Since Medicare’s Creation: Thirty-one million previously uninsured Americans will have insurance.

2. Low/Middle Income Americans Will Not Go Without Coverage: For low-income Americans struggling near the poverty line, the bill represents the largest single expansion of Medicaid since its inception. Combined with subsidies for middle income families, the bill’s provisions will ensure that working class Americans will no longer go without basic health care coverage.

3. Insurance Companies Will Never Be Able to Drop or Deny You Coverage Because You Are Sick: Insurers can no longer deny coverage because of a pre-existing condition. They can’t rescind coverage or impose lifetime or annual limits on care. Significantly, the bill also ends insurer discrimination against women — who currently pay as much as 48% more for coverage than men — and gives them access preventive services with no cost sharing.

4. Lowers Premiums For Families: The Senate bill could lower premiums for the overall population by 8.4%. For the subsidized population, premiums would decrease even more dramatically. According to the CBO, “the amount that subsidized enrollees would pay for non-group coverage would be roughly 56 percent to 59 percent lower, on average than the nongroup premiums charged under current law.”

5. Invests in Keeping People Healthy: The bill creates a Prevention and Public Health Fund to expand and sustain funding for public prevention programs that prevent disease and promote wellness.

6. Insurers Can’t Offer Subprime Health Care: Insurers operating in the individual and small group markets will no longer sell subprime policies that deny coverage when illness strikes and you need it most. Everyone will be offered an essential benefits package of comprehensive benefits.

7. Helps Businesses Afford Coverage: Small employers can take advantage of large risk pools by purchasing coverage through the bill’s state-based exchanges. Employers with no more than 25 employees would receive a tax credit to help them provide coverage to their employees. The bill also establishes a temporary reinsurance program for employers providing coverage to retirees over the age of 55 who are not eligible for Medicare.

8. Improves Medicare: The bill eliminates the waste and fraud in the Medicare system, gets rid of the special subsidy to private insurers participating in Medicare Advantage and extends the life of the Medicare trust fund by 9 years. It also closes the doughnut hole that affected 3.4 million seniors enrolled in Medicare Part D in 2008.

9. Reduces The Deficit: Not only would the bill expand coverage to 30 million Americans without adding to the nation debt, it would also reduce the deficit by up to $409 billion over 10 years.

10. Reduces National Health Spending: A CAP-Commonwealth Fund analysis concludes the bill could reduce overall spending by close to $683 billion over 10 years – with the potential to save families $2,500. Even the most conservative government estimates conclude that the bill would reduce national health care expenditures by at least 0.3% by 2019.

Our guest blogger is Judy Feder, a Senior Fellow at the Center for American Progress Action Fund.

Yesterday, PolitiFact gave a “false” rating to Sen. Harkin’s claim that “today and every day, an estimated 14,000 Americans will lose their health insurance coverage.” The statistic cited by Sen. Harkin comes from a report we released in February showing that the job market turmoil at the end of 2008 and beginning of 2009 led to 14,000 people losing their health care coverage a day. Our report employed a method – based on an Urban Institute analysis co-authored by health economists John Holahan and A. Bowen Garret – of extrapolating insurance losses from the rise in unemployment rates.

In July, PolitiFact took a look at our report and found it to be “mostly true,” with the caveat that the rate could actually be higher than 14,000. In its latest report, PolitiFact ran the numbers on its own, and found the rate of daily losses to be lower (between 7,524 and 7,784).

While the methodology we used in February (and which PolitiFact now uses in their own analysis) offered the best approach for assessing the state of health insurance losses at the time, newer, more precise data are now available – and those data show that more than 15,000 people have lost their health insurance per day in 2009.

Specifically, we now know the extent to which enrollment is dropping among the nation’s biggest private insurers in 2009, based on the Kaiser Family Foundation’s analysis of the SEC filings of the six largest publicly-held insurance companies. Based on those filings, Kaiser estimated that in the first three quarters of 2009, 4.2 million people have lost their private insurance – an average of 15,385 people per day.

These data, and the conclusions they generate, are more accurate both because they are a more direct measurement of insurance losses, and because they are not subject to the month-to-month volatility of the unemployment rate.

Based on these reasons, we enthusiastically stand by both our conclusions and the point that Sen. Harkin and others have been using them to make: that the rate at which Americans are losing their health insurance coverage is profoundly alarming, and clearly demonstrates the urgent need for reform.

Sen. Joe Liberman (I-CT) told reporters this afternoon that as long as “there are no other attempts” to bring the public option or the Medicare buy-in back into the health care bill, “I’m getting towards that position where I can say what I wanted to say all along, that I’m ready to vote for health care reform.” But as Lieberman was getting in, Sen. Ben Nelson (D-NE) got out. “I’m not on the bill,” said Nelson, who spoke with Obama earlier Tuesday. “I have spoken with the president and he knows they are not wrapped up today. I think everybody understands they are not wrapped up today and that impression will not be given.”

In trying to discern some of Nelson’s reasons for potentially opposing the measure, my colleague and DC Progressive blogger Emma Sandoe put together this very useful table of amendments that have gone to a vote on the senate floor. Nelson has voted with the Republicans 9 different times:

- Co-sponsored a failed measure to deny women who receive subsidies the right to purchase abortion coverage.

- Voted to send the bill back to the Senate Finance Committee to remove the Medicare and Medicare Advantage adjustments.

- Voted to eliminate the CLASS Act.

In fact, the only time Nelson voted with the Democrats was on an Ensign amendment that would have limited the contingency pay for plaintiff attorneys representing victims in malpractice cases.

Later this evening, the Senate will vote on two different drug re-importation amendments and two amendments concerning the tax provisions in the Senate bill. Nelson is expected to vote for Sen. Mike Crapo’s (R-ID) motion to commit the bill back to the Senate Finance Committee and remove tax increase for Americans earning under $250,000. Nelson has previously supported drug reimportation.

Matt Yglesias points out that the health care deal in the Senate is far from signed sealed and delivered. Sen. Ben Nelson (D-NE), a key Senate moderate whose vote Reid is actively courting, left yesterday’s session early, “telling reporters he remained undecided.” Nelson has serious doubts about the bill’s abortion provisions and the long-term care insurance program known as the CLASS Act. It’s also unlikely that Sen. Joe Lieberman (I-CT) — who has also opposed the CLASS Act — gave Reid a firm commitment to voting for cloture on the bill.

Since Republicans seem “united” against voting for health care reform, Reid will have to address the lingering concerns of his Democratic caucus if he hopes to pass a bill before Christmas, a goal that would require him to file cloture no later than Thursday.

Below are some of the the remaining ‘points of tension’ within the Democratic caucus:

- ABORTION: Democrats and two Republicans tabled Nelson’s Stupak-like abortion amendment. In an effort to please the Senator, Reid suggested that he would be open to strengthening the existing abortion provisions. But the Senators have yet to agree on a compromise that would satisfy both parties.

- CLASS ACT: Nelson and Lieberman view the CLASS ACT as an unfunded liability that could cost the government money over the long term. Both senators are also being pressured by the long-term-care insurance lobby to oppose the legislation. Ditching the long-term care insurance provision could prove difficult however, since the program’s revenues account for more than half of the Senate bills’ deficit reduction in the first 10 years.

- MEDICARE CUTS: Nelson voted several times to strip the Medicare cuts out of the Senate bill. It’s unclear how serious Nelson is about these Medicare changes, since his votes may have been orchestrated to send a message to Democrats.

- COMPARATIVE EFFECTIVENESS RESEARCH: While Nelson hasn’t spoken out about comparative effectiveness research during this debate, in February he teamed up with Sen. Susan Collins (R-ME) to remove CER funding from the stimulus legislation

- OPM TRIGGER: Press reports have indicated that the public option compromise would trigger a public option in the event that non profits did not join the Office of Personnel Management’s (OPM) network of nonprofits. Lieberman has opposed any kind of trigger and it’s unclear if this provision is still part of the compromise.

A rumor from the RPM report suggests that the Senate will vote on the bill on the morning of December 23 and begin a two-week conference on December 26th. The House and Senate could vote on the conference report in mid to late January.

Last night, when the Democrats gave in to Sen. Joe Lieberman’s (I-CT) demands and dropped the Medicare buy-in proposal, they also abandoned any hope of pursing Plan C (or T) and incorporating a triggered public option into the Senate bill.

After Lieberman announced his opposition to the Medicare buy-in on Sunday, some progressives began quietly nudging Reid to ditch Lieberman (who also opposes the trigger proposal) and save the public option by collaborating with Sen. Olympia Snowe (R-ME), the only Senate Republican to vote for health care reform and a possible 60th vote. Snowe, after all, remained open to supporting a trigger proposal and winning her support could have tainted the effort with bipartisanship. But courting Snowe would have undermined the Democrats’ self-imposed holiday deadline, delaying a vote on health care reform until the new year with no certain prospect of securing anything genuinely worthwhile and no guarantee that other issues or senators wouldn’t derail reform. “It isn’t enough to say let’s get it done and not worry about the specifics that are in the legislation,” Snowe has said. “The more they try to, you know, sort of drive this process in an unrealistic time frame, you know, the more reluctant I become. … I don’t think we should be concerned by this artificial timetable. There’s always January.”

Snowe’s rhetoric didn’t reassure nervous Democrats or the White House, which remained focused on scoring a major legislative and political victory before the State of the Union and turning the corner to focus on jobs and the economy in the new year. Health care reform had hijacked the agenda, and as popular support for the Senate bill declined, Democrats believed it was better to pass something quickly than run the risk of not passing anything at all.

From a policy stand point, the White House may be right. The reality is, a robust Medicare-like public plan that uses the Medicare infrastructure to achieve administrative efficiencies and delivery system reforms is now a distant memory. Snowe described the plan as plans. Up to 50 different independent semi-private/public state-based non profit plans that would have lacked the market power or leverage to lower prices or change the way care is delivered. Had they been triggered — assuming the trigger was designed correctly — the plans would have been subject to today’s controversies. Opponents would have claimed that “factors other than health plans’ inability to manage spending caused the lack of affordability”; in the 21 states where conservatives are now leading campaigns to exempt the state from health care reform, the triggered plan would have been dead on arrival.

Lieberman may be gloating today, but given the politics of the public plan, it’s unclear that Democrats would have been better off if he wasn’t.

Moments ago, Democratic Senators told reporters that the caucus yielded to Sen. Joe Lieberman’s (I-CT) demands and dropped the Medicare buy-in provision from the Senate health care bill, leaving only a network of nonprofits to stand in for the public health insurance option. While Senators stressed that a final decision would be made tomorrow, after the Democratic caucus meets with President Obama, most agreed that the fate of the Medicare buy-in was all but certain.

“The general consensus was that we shouldn’t make the perfect the enemy of the good and if we’re going to get all the insurance reforms accomplished and a number of other things [and] dropping the Medicare expansion was necessary, well then that’s what should be done and it appeared that would be necessary to get the 60 votes,” Sen. Evan Bayh (D-IN) told the Hill. “At some point you have to switch from the sentiment, the emotion of the words, to the facts,” said Sen. Jay Rockefeller (D-WV). “And then you’ve got to decide if I didn’t get what I want, in the form that I wanted it, am I willing to cashier 31 million Americans? I want a bill.”

CNN confirmed these reports:

When Democratic leaders initially announced the compromise last week, progressives claimed that the Office of Personnel Management’s (OPM) network of nonprofits would do little to increase competition or lower health care costs. Public option ‘godfather’ Jacob Hacker argued that “because Blue Cross and Blue Shield (BCBS) is the most likely national non-profit to take advantage of this new opening, and because the Blues dominate most states, the plan perversely amounts to trying to increase competition and choice by encouraging Blue Cross and Blue Shield to compete against, you guessed it, Blue Cross and Blue Shield,” Hacker wrote, asking “That’s competition?”

Now, with the public option dead (and the OPM proposal ineffective), Democrats should demand a list of policies in its stead. These proposals should seek to accomplish the goals of a public plan (competition, cost savings, transparency and accountability) through regulatory means and ensure that health reform does not reward private insurers with millions of new customers.

Among the options are proposals to strengthen the Medicare Commission (now known as IMAC) to focus on a more systematic approach and target more providers, allow all state-based exchanges to act as prudent purchasers and select only the most efficient insurers, work to strengthen the consumer protections in the bill or bolster the mechanisms that oversee insurer compliance with the new regulations. Lawmakers should also consider including more dynamic regulatory authority that would allow the Secretary of Health and Human Services to prevent insurers from designing new ways of excluding sicker beneficiaries and give the agency the authority new insurer abuses.

This afternoon, Sen. Al Franken (D-MN) openly challenged Sen. John Thune (R-SD)’s claim that the Senate health care bill does not offer benefits until 2014. “We are entitled to our own opinions; we are not entitled to our own facts,” Franken declared. “I stand here day after day after day and hear my colleagues, my good friends from the other side, say things that are not based on fact.”

The Senate health care bill spends $10 billion between 2011 and 2014 on interim benefits. Franken explained that the bill offers immediate insurance reforms for Americans purchasing coverage in the individual market and closes the donut hole in Medicare Part D.

“Senator Thune did say that none of the benefits started next year, but he just, I guess, hasn’t read the bill,” Farnken said. “I do find that many of my colleagues who I’m very friendly with, haven’t read the bill and are not very familiar with it.”

Watch a compilation:

The exchanges don’t open open until 2014, but the Senate health bill immediately prohibits insurers from rescinding coverage or imposing life-time or annual limits. Americans who are denied coverage because of a pre-existing condition could participate in a national high-risk pool program and young Americans can stay on their parents’ policies until they turn 26. Under the Medicare buy-in compromise, Americans between 55 and 64 would also be able to enroll in the Medicare program on day one.

Franken may have overstated his case, however. While the bill offers some substantial immediate benefits, the bulk of reform does not kick in until 2014, once the exchanges are established.

This morning, Ezra Klein pointed out that Sen. Joe Lieberman’s (I-CT) opposition to health care reform will kill the bill and the thousands of Americans who will go uninsured because of it. Klein’s post may have been simply “pointing out that Lieberman’s actions have consequences,” but it elicited a sharp response from Washington Post editor Charles Lane. “Klein essentially accuses Lieberman of mass murder because he disagrees with him on a policy issue about which there is considerable debate among people of good will across the political spectrum,” Lane wrote:

This is disgusting, and pretty illogical, too. Klein brandishes a study by the Urban Institute showing that the lack of health insurance contributed to the deaths of 137,000 people between 2000 and 2006. But last time I checked, Joe Lieberman does not oppose insuring everyone. Indeed, he is on record favoring “legislation that expands access to the millions who do not have coverage, improves quality and lowers costs while not impeding our economic recovery or increasing the debt.” He simply opposes the public option, as well as Harry Reid’s last-minute improvisation on Medicare. Klein’s outburst only makes sense if you assume that there is one conceivable way to expand health insurance coverage, and that Harry Reid has discovered it.

Matt Yglesias points out that “stark moralistic language….makes people very uncomfortable. Lieberman’s people are squirming at the accusation that he bought his Medicare concessions by threatening to kill people. Lame Washington Post editors are squealing.” True, but I would argue that Americans are far less comfortable with arguing that the status quo and insurance market deregulation kills people and far more comfortable believing the government death panels will euthanize grandma.

Compare, for instance, reactions to Sen. Chuck Grassley’s (R-IA) ‘pull the plug’ remarks with the fire storm that brewed over Rep. Alan Grayson’s (D-FL) argument that Republican health care reforms would result in more deaths. Grayson was asked to bow at the alter of Rep. John Beohner (R-OH) while pundits tried to ‘debate’ the merits of end-of-life counseling provisions. Why are Grassley’s claims given more credibility than Grayson’s indictment of the status quo and GOP insurer-friendly health care proposals?

One argument fits a neat and familiar narrative that goes back to the days of Medicare. The other suggests that some combination of government inaction and corporate malfeasance are at least partly responsible for a great number of needless American deaths. Only the latter argument has the benefit of being true, but it’s also the one that’s venomously smeared.

A compromise provision in the Senate health care bill that requires insurers to rebate beneficiaries if they fail to spend 90% of premium dollars on medical care could add new costs to the federal government, limiting health reform’s deficit reductions. Sen. Jay Rockefeller (D-WV) inserted the new medical loss ration (MLR) requirement (for insurers participating in the small or individual group markets) during the Gang of 10 public option negotiations, but a new directive from the Congressional Budget Office (CBO) may force Majority Leader Harry Reid (D-NV) to abandon the provision and could further undermine the now defunct compromise.

The CBO’s “harsh assessment” concluded that the 90% MLR requirement — which insurers would only have to maintain until 2014 — “would devastate the industry“:

A proposal to require health insurers to provide rebates to their enrollees to the extent that their medical loss ratios are less than 90 percent would effectively force insurers to achieve a high medical loss ratio. Combining this requirement with the other provisions of the PPACA would greatly restrict flexibility related to the sale and purchase of health insurance. In CBO’s view, this further expansion of the federal government’s role in the health insurance market would make such insurance an essentially governmental program, so that all payments related to health insurance policies should be recorded as cash flows in the federal budget.

The question of whether certain purchases of private health insurance “should be treated as part of the federal budget” is not insignificant. During President Clinton’s push to pass comprehensive health care reform, the CBO decided that “payments to and from the ‘health alliances’ should be included in the accounts of the federal government.” The decision artificially increased the bill’s score, dooming its chances in Congress.

Rockefeller argues that insurers that receive government subsidies should be required to spend those dollars on health care, not administrative overhead or profit. The 90% ratio replaced an existing provision that required insurers to maintain a medical loss ratio of 85%.

In an effort to quantify savings that the Congressional Budget Office and the Office of the Actuary at the Center for Medicare and Medicaid Services (CMS) refuse to score, the administration’s Council of Economic Advisers released a new report today which finds that the health care legislation moving through Congress would reduce health care spending by 1 “percentage point over an extended horizon.” “This increase in the growth rate of GDP resulting from slowing the growth rate of health care costs translates into substantial increases in the median family income,” the report concludes.

“There is a lot of uncertainty,” Christina Romer, chairwoman of the Council of Economic Advisers, admitted on a conference call with reporters. But “the CBO scores for various things, especially for delivery reforms, turn out to be low compared to what actually happened.” “When you do these reforms in a unified comprehensive way…putting them all together you can actually have important synergies.” “Just based on the CBO scores, on the analysis that is out there, we feel comfortable saying that it will slow growth by 1 percentage point.” Romer also pushed back against conservative critics who cited the recent CMS report to argue that national health spending would increase under reform:

[There is a]difference between level effect and growth rate effect…expanding coverage to 30 million, will up the level of health care spending initially. You can’t increase coverage and pay less…I do think we need to acknowledge that the level spending rises initially…But we are talking about what happens over the longer haul… so the important thing is that we think it will slow the growth rate of cost by 1 percentage point per year and that’s based a lot on the CBO score…what happens at the end of the budget window and then what they’re projecting going out further…”

“Yes, in the short run you do spend more to insure a larger number of people,” Romer reiterated. But “the more fundamental issue is about the trajectory we are on. The people on the house floor who say that the status quo is better or can even be sustainable, have not looked at the numbers.” Currently, the United States spends 18% of its Gross Domestic Product (GDP) on health care, and is expected to spend nearly 34 percent of GDP on health care by 2040.

“What sounds like a small number is enormous when you look over time the effects that that has. So even though we will up the level of spending in the short run,” the 1 percentage reduction in growth after 5 or 10 years, “has a dramatic impact on where we are relative to otherwise we would have been.”

Romer also echoed yesterday’s floor speech by Sen. Sheldon Whitehouse (D-RI) who argued that policy makers will have to implement a range of policies to reduce growth. That’s the “importance of the Medicare advisory board,” Romer said. It’s “an institutional structure that keeps those ideas coming. We know this will be an evolving process…some will be dramatically good, others won’t work as well.” Romer also credited the 40% excise tax on high-cost plans and delivery reforms like bundling and Accountable Care Organizations for slowing the rate of growth.

Just days after signaling that he would not oppose a Medicare buy-in, Sen. Joe Lieberman (I-CT) announced yesterday that he would vote against the health care bill if it included the measure. Appearing on Face the Nation, Lieberman told host Bob Schieffer that he did not know “exactly what’s in it” but pledged to oppose the Medicare buy in “because it has some of the same infirmities that the public option did”:

LIEBERMAN: But I will tell you that on one part of it the so-called Medicare buy-in, the opposition to it has been growing as the week has gone on. And– and though I don’t know exactly what’s in it, from what I hear I certainly would have a hard time voting for it because it has some of the same infirmities that the public option did. It– it will add taxpayer cost. It will add to the deficit. It’s unnecessary. [...]

SCHIEFFER: So you can’t vote for the bill right–

LIEBERMAN: Yeah– [...]

LIEBERMAN: You got to take out the Medicare buy-in. You got to forget about the public option. You probably have to take out the CLASS Act, which was a whole new entitlement program that will in– in future years put us further into deficit. And you got to adopt some of the cost containment provisions that will strengthen cost containment that all of us favor….So it’s time to get reasonable.

Watch it:

Lieberman’s opposition leaves Senate Majority Leader Harry Reid (D-NV) with a set of difficult, if not unfortunate choices, that could very well doom any hopes of passing the Senate health care bill before Christmas. Insiders suggest that if Reid does not file all three cloture votes — one on the manager’s amendment, one on the bill substitute, and one on the final bill — by Thursday, he will not have enough time to pass the bill before or on December 23 or 24th.

Reid’s best hope is for a positive CBO score that would win over Sen. Olympia Snowe (R-ME) or bring Lieberman back to the negotiating table. Reid could try to pass the health care bill through reconciliation (which he has taken off the table), broker another compromise that satisfies Lieberman’s concerns or abandon the public option and the CLASS Act altogether. Ditching the long-term care insurance provision could prove difficult however, since the program’s revenues account for more than half of the Senate bills’ deficit reduction in the first 10 years.

Alternatively, Reid could ditch Lieberman and offer a triggered public option that could win the support of Snowe. But that would only further delay the process. “It isn’t enough to say let’s get it done and not worry about the specifics that are in the legislation,” Snowe has said. “The more they try to, you know, sort of drive this process in an unrealistic time frame, you know, the more reluctant I become. … I don’t think we should be concerned by this artificial timetable. There’s always January.”

Of course, if Lieberman was truly interested in voting for health care reform he would offer substitute policies that could achieve the goals of the public option — increased competition, lower costs, and care quality. Lieberman could offer to strengthen the Medicare Commission (now known as IMAC), allow all state-based exchanges to act as prudent purchasers and select only the most efficient insurers, work to strengthen the consumer protections in the bill or bolster the mechanisms that oversee insurer compliance with the new regulations.

But it’s unlikely that Lieberman will offer Democrats a real compromise. He has no real plan. In fact, his initial uncertainty about the Medicare buy-in may be the result of his absence from the original negotiations (Sen. Tom Carper (D-DE) sat in for Lieberman during those talks). He is not very interested in health care reform, but at least he’s with us on the war.

Politico is reporting that the Business Roundtable — a group of large businesses that have been fairly supportive of the health care reform — is pressing the administration to adopt greater cost containment measures. The group is threatening to publicly criticize the effort if the legislation is not improved. “We are going to be much louder and much more insistent on improving” the legislation, Roundtable President John Castellani told Politico in an interview on Friday.

Some of the concerns outlined below by Castellani would actually improve on the existing legislation and are already being addressed by a package of amendments offered by 10 Democratic Senate freshmen. Here is what the Roundtable wants:

- Access to data collected by the Centers for Medicare and Medicaid Services that can be used to identify cost-effective treatments, efficient hospitals and best performing physicians, which could help businesses develop more efficient and effective private insurance packages for their employees.

- An expansion of the authority of the proposed Independent Medicare Advisory Board so that it can search for cost savings in all health care sectors . The current legislation exempts some groups from scrutiny, including hospitals. In addition, the board [now called IMAB] should be charged to search for efficiency measures in the private sector that can replicated in the Medicare system.

- An acceleration and expansion of pilot programs aimed at changing the way Medicare reimburses doctors and hospitals by providing bundled payments to cover patient testing and consultations rather than paying for each service delivered, which critics say leads to unnecessary treatment.

- An exemption for self-insuring employers from a tax imposed on all insurance providers. The levy emerged at the 11th hour in the Senate deliberations.

- An adjustment or bridge that would ease the cost squeeze caused by the timing of new fees and insurance reforms and the onset of new customers.

The ‘freshmen package’ package strengthens Medicare’s ability to weed out system inefficiencies and strongly encourages the private sector to follow suit. The amendments require HHS to modernize Medicare’s data systems so they can be used by providers better coordinate care. Medicare will also be allowed to implement pay-for-performance for more providers – including hospices, ambulatory surgical centers, psychiatric hospitals and others – by 2018, and adopt greater payment flexibility for accountable care organizations.

The amendments also broaden the scope of the Independent Medicare Advisory Board (IMAB) by pushing the board to consider total health system spending and make system-wide recommendations to ensure that cuts in Medicare don’t result in cost shifts to other parts of the health system.

Like the latest CMS report, which criticized the Senate bill for not doing enough to control the growth in health care spending, the Roundtable’s “threats” should be treated as opportunities to improve the bill. Again, their concerns are valid. They should be addressed.

Rather than complain about the Senate bill’s insufficient cost containment measures, ‘moderate’ lawmakers should use this opportunity to insert even more stringent cost-control mechanisms into the final bill. Take on the providers by giving IMAB the authority to recommend payment adjustments to doctors and hospitals — after all, the health industry has already admitted to inefficiencies and pledged to reduce the growth rate in annual health spending by 1.5 percentage points a year over the next 10 years. Allow IMAB to hold them to that pledge.

Progressives are criticizing Majority Leader Harry Reid (D-NV) for including language in the merged Senate bill that would allow insurers “to place annual limits on the dollar value of medical care, as long as those limits are not “‘unreasonable’.” While it’s unclear how or why the language made its way into the final legislation, Reid’s explanation is not too convincing:

Hill sources explain that this was inserted because CBO said premiums would “go through the roof” if insurers couldn’t cap benefits. The official quote from Jim Manley, Harry Reid’s spokesperson, says much the same thing. “We are concerned that banning all annual limits, regardless of whether services are voluntary, could lead to higher premiums,” he explained. “We continue to work with experts on how best to accomplish our goals of preventing insurance companies from imposing arbitrary coverage limits while providing the premium relief American families need and deserve.”

This doesn’t make too much sense, particularly because the House bill managed to avoid use “unreasonable” language without causing premiums to soar. To be fair, the House limits unnecessary care by using “medical management” in another section of the bill. The Senate bill was likely trying to get at the same thing, but did so in the broadest terms possible. Compare:

The House bill deploys the far narrower “medical management” language on page 109. “Nothing in this Act shall be construed to prohibit a group health plan or health insurance issuer from using medical management practices so long as such management practices are based on valid medical evidence and are relevant to the patient whose medical treatment is under review.”

The Reid language goes beyond this narrow provision and should be changed. Encouraging plans to manage unneeded care is one thing, allowing them to establish so-called ‘reasonable’ limits is another.

Only a small number of lawmakers are familiar with the intimate details of the compromise and most Democratic senators have “shied away from explaining or defending their Medicare proposal, on the ground that it was being analyzed by the budget office.” But in in the last few days, key moderate lawmakers have expressed newfound skepticism about the plan.

While arguments about Medicare underpaying providers and cost shifts to Americans in private coverage are largely overstated, concerns about the viability of the buy-in are certainly valid. For the Medicare buy-in to work as intended, policy makers must ensure that it doesn’t becoming a dumping ground for the sickest Americans.

Here is what we know so far:

- The new Medicare option would be available only to individuals, not to families.

- People 55 to 64 would receive the same benefits as people in the traditional Medicare program.

- Medicare premiums for people under 65 would differ from those paid by people 65 and older, and the two parts of the program would be financed separately.

That last one is key. Democrats are pulling the rug from under the “you’re adding more people onto a sinking ship” crowd, but they’re not solving the fundamental problem of the program only attracting the sickest individuals.

Currently, the majority of adults between 55 to 64 are enrolled in employer sponsored coverage, but 13% are uninsured. That 13% is “more than twice as likely to be in fair or poor health than those with private, non-group coverage” and more than half of that 13% “have incomes below 200 percent of the federal poverty level (about $29,000 for a family of two in 2008).” They are sicker and they are poorer and if the Medicare buy-in is unsubsidized between 2011 and 2014, the overwhelming majority won’t be able to afford it. Only the sickest Americans would be willing to pay for Medicare buy-in, transforming it into just another small high-risk pool for older people.

A 2002 analysis of a different Medicare buy-in proposal concluded that without subsidies, the number of uninsured adults ages 55 to 64 would decline from about 10 percent to 9 percent. But, “if Medicare buy-in premiums were subsidized, with more generous subsidizes provided to those with low incomes, the share of uninsured adults ages 55 to 64 would decline by nearly half, from 10 percent to 6 percent.” The impact of the subsidy would actually decrease “as income per eligible person decreased and lower-income people would need a larger subsidy to induce them to enroll.” “In effect, subsidies may be necessary to encourage healthier people and those with low incomes to enroll in a Medicare buy-in.”

In other words, in order to avoid a situation where the buy-in attracts a small number of very sick people between 2011 and 2014, policy makers will have to consider subsidizing the program (or some other way of lowering premiums like not charging administrative fees or freezing premiums from year.) The Senate bill has about $150 billion dedicated to deficit reduction and it could dedicate some of that money for extra subsidies, but that may not be enough to provide any real affordability assistance. If they want to make this work, they’ll have to lower the cost of the program.