My first take on House Health Reform Bill

Ok, okay, so I've gotten through only the first 225 pages of the bill. (Read the 1,990-pages of the House "Affordable Care for America Act" yourself, if you think I should be faster!) I like this bill better than the Senate Finance concoction, but some things are worrisome.

The Good:

1. HIE Membership: All firms would eventually be allowed to enroll their employees through the health insurance exchange (HIE), thus encouraging over time a big pool of enrollees in this new system of competitive health care plans.
2. HIE Administration The HIE would be national in scope (though States may opt out), so the pool of enrollees would be large (very good) and the administrative expertise to set up and regulate the exchange would be centralized. (That's efficient.)
3. Premium Cost Structure within HIE: The range of premiums would be limited to a ratio of 2 to 1, so older people (the 50=64 crowd) wouldn't have to pay exhorbitant premiums.
4. The Public Option - participation: The public option (PO) will not require physicians to participate as a condition for them to participate in Medicare. That is, physician participation in the PO is largely unlinked from participation in Medicare. (This is very important in keeping the whole system from slipping into a single-payer Medicare program for all.
5. PO Payment rates to physicians: Physician payment rates under the PO would be negotiated but couldn't be more than the average rates paid by the private plans in the exchange. (Also can't be less Medicare rates.) So, if the PO administrator wanted to use the Medicare rates as the basis for participation, that would discourage doctors from participating, and the PO would become a bare bones plan in the sense that the availability of doctors to PO enrollees would be somewhat limited. (This would probably vary by area of the country.) You get what you pay for. Maybe quality for those people who choose the PO won't suffer. Who knows? What's quality in health care anyway? (If you think you know, you're wrong..Nobody knows, least of all myself.)
6. Participation of "Other Providers" in PO: The PO administrator would "negotiate" a rate at least as high as Medicare's DRG rates, and perhaps higher. The only practical "negotiation" on the part of the PO is to specify a multiple (say, 1.05) of the Medicare DRG rate. That higher-than-Medicare rate would mollify hospitals and other non-physician providers in the short run, and they would probably choose to participate, given the high fixed costs of hospital operation (volume is the name of the game for hospitals.) Now, this is good news, bad news, in my view, because other insurers may not have the market clout to demand that hospitals pay on a DRG basis, even one that's higher than the Medicare DRG rate. But, maybe insurers SHOULD play hardball with hospitals, and it is possible that this would encourage hospitals to take the lead in developing integrated systems of care (with doctors) that provide their own insurance offerings to people in their regions. That way, hospitals and physicians could share in cost-savings from delivering care more effectively and efficiently. In any case, hospitals' and other providers' ability to refuse to participate in the public option is an important safeguard for competition.

Worrisome things (other than cost, which I think we should pay for through a dedicated gasoline tax that brings prices at the pump to $4.00,..but that's another story and is so far beyond the fringe that I won't continue with it) will come in my next post, if I can ever slog through more pages of this bill.