Nate Silver: A trigger with teeth?

[BzaDem]

http://www.fivethirtyeight.com/2009/09/trigger-with-teeth.html

"And what, pray tell, might those conditions be? The most obvious is that a trigger couldn't be overly tolerant of further growth in health insurance premiums. For instance, suppose that the trigger were triggered if the average cost of health care for a represenative cohort of adults rose by more than inflation + 0.5 percent over the next five years. Health insurance premiums, according to an estimate by the Commonwealth Fund, are expected to increase at an annual rate of about 5.5 percent over the next dozen years, whereas inflation typically runs at between 2 and 3 percent. If premiums were to grow at 3 percent per year instead, that would save the typcial family about $5,000 per year by 2020. This is not trivial.

But secondly, the insurance companies would need to have real reason to fear the trigger. And that means having a public option that, if it were triggered, would be able to negotiate at Medicare rates, or perhaps Medicare rates plus a small premium of 5 to 10 percent. This is how the public option was originally envisioned -- but the provision appears to have been stripped from the version of the House bill passed by the Energy and Commerce Committee, which arguably represents about the maximal bill that a sufficient number of Blue Dogs would be willing to accept.

Indeed, if the public option were "softened" by having to negotiate at prevailing private-industry rates, and particularly also if it had to offer premiums at prevailing private-industry rates, it is not clear how much good it would do. It would just be another plan in a market of increasingly undifferentiated plans. Perhaps it would be able to generate some savings in terms of administrative and advertising costs -- although if premiums were indexed to private-industry norms, this would result in a profit for the government (not necessarily a bad thing; it would reduce the debt) rather than having any direct impact on health care costs for families.

In other words, given a choice between a "robust" public option that would be subject to a trigger, and a non-robust public option that would be prevented from leveraging much of its negotiating power but would be in place from Day One, the former would probably be the better choice for Democrats -- particularly as the mere specter of a robust public option could have a lot of deterrent value for the private insurers. Of course, this is an artificial choice: progressives want a public option that is both robust and immediate. But it's not clear that they have the votes for one."

[AzDar]

1. A trigger would be disastrous. People are dying while this bullshit is being bandied about.

Where's my fucking CHANGE?

[BzaDem]

6. Your "CHANGE" died when it failed to get enough congressmen elected to support it.

The death of a robust public option occured on November 4th, 2008. That was the date that determined we would not have a majority of progressives in either house of Congress. I don't know why this is so hard for some people to understand.

[ProSense]

2. Sorry, this is lame

In other words, given a choice between a "robust" public option that would be subject to a trigger, and a non-robust public option that would be prevented from leveraging much of its negotiating power but would be in place from Day One, the former would probably be the better choice for Democrats -- particularly as the mere specter of a robust public option could have a lot of deterrent value for the private insurers. Of course, this is an artificial choice: progressives want a public option that is both robust and immediate. But it's not clear that they have the votes for one.

We don't have the votes so we should settle for a weak public option? With 12 more Senators agreeing to vote for the HELP bill (support is not at 49) since this debate started and Obama pushing for a public option, why should we settle for a weak public option?

Reconciliation is still on the table.

[BzaDem]

4. Your vision of a strong public option wouldn't even pass the house.

In fact, it would have died in committee. Henry Waxman changed the public option from offering medicare rates to offering negotiated rates. He did this because there were enough Blue Dogs to kill the bill in committee, even before it went to the house floor.

[ProSense]

5. I accept the public option in the four existing bills, which have tremendous support.

The House will pass a bill with the public option intact.

[BzaDem]

7. You are simply factually incorrect about the public option in the house.

Only two bills in the house have the "robust" public option. That's because there weren't enough blue dogs on those two committees to kill it. But on the Energy and Commerce committee in the house, the public option was changed to not be as robust (i.e. negotiated rates instead of Medicare rates). That is simply what happened.

The blue dogs made it clear that the Energy and Commerce weakened public option was the MOST they would be willing to support. That was before the August recess. I doubt now they would be willing to vote for a bill wiht a public option at all. But they certainly won't be willing to vote for a public option with Medicare rates (they weren't even willing to do that before the August recess and were perfectly happy to let it die in committee that way).

Given that there are 52 blue dogs and we can only lose 40 seats in the House to pass the bill, the other versions of the bills are really irrelevant.

[ProSense]

8. Well, I guess you have a better handle on the situation than

Pelosi

"Given that there are 52 blue dogs...."

Given that there are 60 Democrats in the progressive caucus and some blue dogs already supporting the plan, the other blue dogs aren't needed.

[phleshdef]

12. Correct me if I'm wrong, but doesn't the option in existing bills take 5 years to implement anyway?

The only thing I don't like about the trigger is that it doesn't go 100% to mandate a public option, its conditional. But aside from that, I don't really see the difference the effect would have.

[Pirate Smile]

3. This is why the conference will be key. Either the House gets to add strong teeth to a trigger or

the Senate would get to water down a House Public Option. Nate makes a good argument that adding strong teeth to a trigger could be preferable. It could also make it easier for the ConservaDems and Blue Dogs to vote for it. I would hope they could also add additional, tougher regulations on the Insurance Co's if the trigger is kept in.

[DrToast]

9. Without a public option, insurance companies could just deny claims to meet the goals

People would have nowhere else to turn.

[Pirate Smile]

10. kick

[jeanpalmer]

11. If they won't vote for a robust public option now

why would they vote for one to be triggered 5 years from now? I assume the opponents oppose the public option based on "principle." Why would they sacrifice their principles 5 years out?

A public option that pays at prevailing private industry rates does not reduce premiums. So why bother with it? A public option that pays at Medicare rates +5% reduces premiums by 5% and a public option that pays at Medicare rates +10% does not reduce premiums. So why bother with either of those? The ability to pay just at Medicare rates has been stripped from the House Bill.

Using the $5000 savings in 2020 figure as a base, the average family now pays $11,965 a year in insurance premiums. By 2014, when the proposed trigger would kick in, it would be paying $15,638 assuming premium increases of 5.5% a year. A robust public option at that time would reduce their premiums 10% to $14,074 a year. Is allowing a 5-year rape healthcare reform?