Administration Nixes The Class Act

[josejohn]

The Obama Administration on Friday backed away from what would have been the first government-run insurance program for long-term careThe New Old Age Blog: Administration Nixes The Class Act

 

[Lithium381]

welcome to AT

 

[Craig234]

Commentary:

The Untimely Death of Long-Term Health Insurance
by Robert Reich

The Administration’s decision to pull the plug on long-term health insurance in the new healthcare law (so-called Community Living Assistance Services and Support or, as it was known by healthcare insiders, CLASS) offers an important lesson.

As written, the law had three incompatible parts.

First, it required beneficiaries to receive at least $50 a day if they had a long-term illness or disability (to pay a caregiver or provide other forms of maintenance). That $50 was an absolute minimum. No flexibility on the downside.

Second, insurance premiums had to fully cover these costs. In budget-speak, the program was to be self-financing. Given the minimum benefit, that meant fairly hefty premiums.

Third, unlike the rest of the healthcare law, enrollment was to be voluntary. But given the fairly hefty premiums, the only people likely to sign up would know they’d need the benefit because they had or were prone to certain long-term illnesses or disabilities. Healthier people probably wouldn’t enroll.

Yet if the healthier didn’t enroll, the program would have to be financed entirely by the relatively unhealthy — which meant premiums would have to be even higher. So high, in fact, that even the relatively unhealthy wouldn’t be able to afford it.

End of story. End of program.

Why, oh why, didn’t the Obama administration make life easy for itself and for Americans by choosing the simplest and most efficient system for both primary and long-term health insurance — Medicare for all?

The lesson: If a public insurance system has minimum benefits and must pay for itself, it can’t be voluntary. Everyone has to sign up.

Or something else has to give — benefits have to be more flexible, or the program can’t be expected to pay for itself.

For example, Medicare and Social Security are mandatory. Everyone effectively signs up through their payrolls. Even so, questions arise about how flexible their benefits have to be if the programs must be self-financing.

So what does this mean for the remainder of the new healthcare law? Its fate hinges on the so-called individual mandate — the requirement that everyone, including younger and healthier people, participate (or pay a fine if they don’t).

Today’s decision to jettison long-term care offers clear evidence why that individual mandate is so necessary.

Unfortunately, the mandate isn’t popular — because it wasn’t modeled on Social Security or Medicare but based instead on private insurers who’ll want to maximize revenues. It’s also vulnerable to constitutional challenge, largely for the same reason. The Supreme Court will likely decide its fate this term.

It didn’t because it wanted to get Republican votes. It got almost none. And now the Republicans are enjoying the prospect of the law being dismembered piece by piece, starting today.

Box with commentary: Why, oh why, didn’t the Obama administration make life easy for itself and for Americans by choosing the simplest and most efficient system for both primary and long-term health insurance — Medicare for all?

 

[Hayabusa Rider]

Wait until the 2014 provisions kick in and the costs of insurance for younger citizens skyrocket. That will be interesting.

 

[PokerGuy]

This is one of the few correct decisions I've seen from this admin. This thing had no chance, it was screwed up like the beginning. Lets hope they realize the same is true for the entire obummercare package soon so we can start over and actually get something useful.

 

[jstern01]

Wait until the 2014 provisions kick in and the costs of insurance for younger citizens skyrocket. That will be interesting.

And you know this how? crystal ball, ouija board? There is no evidence to base the claim costs will skyrocket higher than they have over the past 10 - 15 years. Simple fact is insurance costs are going to continue to rise as long as the cost of covering uninsured and under insured is rolled into the cost of providing medical care.

 

[Fear No Evil]

Didn't this portion of the bill claim like 40% or 60% of the savings? (I forget the numbers thrown around).. I guess those numbers will magically work themselves out though.

 

[EagleKeeper]

And you know this how? crystal ball, ouija board? There is no evidence to base the claim costs will skyrocket higher than they have over the past 10 - 15 years. Simple fact is insurance costs are going to continue to rise as long as the cost of covering uninsured and under insured is rolled into the cost of providing medical care.

By what right does the government have to force my 30 yr old son to purchase medical insurance coverage that he feels is not needed?

Insurance rates are not going down for me just because he gets insured

 

[Hayabusa Rider]

And you know this how? crystal ball, ouija board? There is no evidence to base the claim costs will skyrocket higher than they have over the past 10 - 15 years. Simple fact is insurance costs are going to continue to rise as long as the cost of covering uninsured and under insured is rolled into the cost of providing medical care.

Because it's buried in the details. You will be subsidizing older and higher risk people but you must have known that right? You wanted it and you are going to have it. Congrats.

 

[Thump553]

By what right does the government have to force my 30 yr old son to purchase medical insurance coverage that he feels is not needed?

Insurance rates are not going down for me just because he gets insured

Actually getting the uninsured will help drive your rates down. Right now the unpaid medical expenses of the uninsured are spread out among the rest of us.

Plus you have the factor that medical expenses tend to be higher for the uninsured due to a lack of preventative care and overutilization of ER services.

So now I and the rest of the public are paying for your son. But I suppose that jives with your code of ethics (versus him being forced to carry his own weight).

 

[michal1980]

as a younger person I was going to sign up for this because it sounded like a great deal.

Kind of like medicare. pay little now, get a whole lot later.

 

[woolfe9999]

http://forums.anandtech.com/showthread.php?t=2198713

 

[woolfe9999]

Wait until the 2014 provisions kick in and the costs of insurance for younger citizens skyrocket. That will be interesting.

If it isn't fixed by 2014.

http://azstarnet.com/news/national/...cle_74e5ebbe-5222-5d0b-a646-4716aee18413.html

 

[Ausm]

as a younger person I was going to sign up for this because it sounded like a great deal.

Kind of like medicare. pay little now, get a whole lot later.

Not if your side get's it's way

Oh if Medicare gives you a "whole lot later" then why does practically everyone I know carry a supplement then?

 

[FDF12389]

Actually getting the uninsured will help drive your rates down. Right now the unpaid medical expenses of the uninsured are spread out among the rest of us.

Not so fast, {Redacted} cents out of every dollar I give the hospital goes to administrative costs. Hospitals are forced to staff huge bureaucracies to reconcile and litigate claims from insurance companies. Forcing more people into the system will perpetuate this clusterfuck even faster.

It's not a solution, its a distraction.

 

[Throckmorton]

Not so fast, eighty five cents out of every dollar I give the hospital goes to administrative costs. Hospitals are forced to staff huge bureaucracies to reconcile and litigate claims from insurance companies. Forcing more people into the system will perpetuate this clusterfuck even faster.

It's not a solution, its a distraction.

Enough with the tort reform crap. Texas has tort reform already and their costs aren't any lower.

 

[EagleKeeper]

Actually getting the uninsured will help drive your rates down. Right now the unpaid medical expenses of the uninsured are spread out among the rest of us.

Plus you have the factor that medical expenses tend to be higher for the uninsured due to a lack of preventative care and overutilization of ER services.

So now I and the rest of the public are paying for your son. But I suppose that jives with your code of ethics (versus him being forced to carry his own weight).

He has his own little contract with the local MD/UR clinic that is presently keeping him healthy for a lot less than an insurance coverage would be.

Granted that if he has to go into the hospital for anything; it will come out of his PLANNED health care account.

$50/month and $20/visit.

Prescriptions are normally available at the local pharmacy for $4. Has not needed them.

Those numbers are less than what the government wants him to pay.
And I have little faith that the government will get my medical coverage payments any lower

 

[JSt0rm]

Not so fast, eighty five cents out of every dollar I give the hospital goes to administrative costs. Hospitals are forced to staff huge bureaucracies to reconcile and litigate claims from insurance companies. Forcing more people into the system will perpetuate this clusterfuck even faster.

It's not a solution, its a distraction.

Source for this 85 cents of every dollar goes to admin?

 

[umbrella39]

welcome back to AT

Corrected.

 

[PokerGuy]

And you know this how? crystal ball, ouija board?

Simple logic and math. If you remove the ability to exclude pre-existing conditions and you mandate coverage for things that are not currently covered, the premiums have to skyrocket. There's simply no way around it.

 

[woolfe9999]

Enough with the tort reform crap. Texas has tort reform already and their costs aren't any lower.

California has had it since the 1970's and our costs aren't lower either.

 

[shira]

Not so fast, eighty five cents out of every dollar I give the hospital goes to administrative costs. Hospitals are forced to staff huge bureaucracies to reconcile and litigate claims from insurance companies. Forcing more people into the system will perpetuate this clusterfuck even faster.

It's not a solution, its a distraction.

Please provide us with a link to a reputable source that documents this assertion that 85% of hospitals' income is for administrative expenses. Your claim is outrageous on its face, and it's even more telling that you think it's credible.

 

[Hayabusa Rider]

If it isn't fixed by 2014.

http://azstarnet.com/news/national/...cle_74e5ebbe-5222-5d0b-a646-4716aee18413.html

That's a separate issue. Hey, it looks like I'm going to benefit from all this come retirement. I won't have to work in the system, I may have medicaid, and if not my premiums will be lower because those younger than myself will have to pay a portion of them. Then the younger guys can complain how the older generation is raping them when in this case they themselves wanted it that way. It's perfect justice. Don't ask, don't tell in a new context when it comes to health care legislation.

 

[woolfe9999]

That's a separate issue. Hey, it looks like I'm going to benefit from all this come retirement. I won't have to work in the system, I may have medicaid, and if not my premiums will be lower because those younger than myself will have to pay a portion of them. Then the younger guys can complain how the older generation is raping them when in this case they themselves wanted it that way. It's perfect justice. Don't ask, don't tell in a new context when it comes to health care legislation.

Separate issue from what? What was your original point?

 

[michal1980]

Not if your side get's it's way

Oh if Medicare gives you a "whole lot later" then why does practically everyone I know carry a supplement then?

I never stated a side.

http://blog.american.com/2009/08/have-seniors-really-paid-for-their-medicare-benefits/

To answer your question: Because even if you get more from the system then you paid in, it still might not be enough.