Obama Introduces White House Health Care Plan - Health Insurance Stocks Rally

While I was watching Toyota’s CEO being grilled by Congress in front of the TV cameras, I was amazed at how angry and inhospitable the Congress members were. Here were our elected representatives making as public a showing as possible that they were concerned about the health and safety of American citizens. They were exercising their sworn duty to protect us from all foreign enemies. And Mr. Toyoda was now the enemy du jour. Yes Toyota had brought this problem on itself and as a result of their not acting quickly enough there are reported to be as many as 34 deaths due to sudden acceleration problems. Now 34 deaths is intolerable and tragic for each and every one of their families. But wouldn’t it also be nice to see our elected representatives equally as exorcised over the 18,000 Americans who die each year of preventable causes because they do not have health care coverage?

But all is well in Muddville. While this sham was proceeding for the cameras, President Obama was getting ready for his “bi-partisan” health care summit. Prior to convening this summit, the President released his own health care reform proposal. It appears that this new proposal is truly bi-partisan. It is a plan that Republicans should love, but cannot do so publicly. All they needed to do was keep saying no to every reasonable proposal, until the White House capitulated and proposed a watered down health care bill that serves first to protect the health insurance industry and only secondly the public. So in the new Washington, bi-partisanship is a Democratic President proposing a plan that is ideologically Republican, providing the Republicans the cover they need to go on opposing the bill making their play for the extreme elements such as the Tea Baggers.

If the health care reform plan introduced this week by President Obama was supposed to reform the health care industry and protect consumers, it seems that somebody forgot to tell the health insurance companies. On the same day that the President revealed his so-called health care overhaul, stocks in two of the largest health insurance providers increased. Humana, Inc. saw its stock prices rise 5.5% and the United Health Group, Inc. saw their stocks increase 3.5%. On the heels of the President’s announcement, the Morgan Stanley Healthcare Payor Index of health insurers increased by 1.6%. Well, at least somebody is happy about the President’s newest iteration of health care reform.

The core of the President’s plan would require all Americans to purchase health insurance, creating an even larger market for private insurers. The plan tries to make this mandate that will force Americans to purchase health insurance from corporate insurers more palatable by claiming that “you will be able to shop among private insurance plans that will be sold in the insurance exchange – a marketplace where you can choose what is right for you.” Actually, the majority of Americans have spoken and decided what is right for them – a public option. In fact there is no mention of a pubic option. Instead the pubic is given the option to choose amongst private insurers – I thought we had that already and that is the root of the problem. Without a public option there is no true competition. A Republican dream, massive government subsidies of private corporations.

Yes there are some good provisions in the bill, but they are long overdue and barely take a step in the direction of fairness and equity. Actually by my count there are two provisions that will go a long way to helping people, and both could have been proposed and passed without the divisiveness that we have had to endure. These are doing away with annual and lifetime limits and pre-existing conditions and closing the so-called Medicare doughnut hole. But even these miniscule improvements are mired down in appeasing the insurance companies and the opposition, the prohibition against pre-existing conditions and lifting the annual and lifetime caps does not go into effect until 2014, and closing the doughnut hole does not go into effect until 2020. If these provisions are designed to correct current injustices, why delay their implementation, other than appeasement?

As way of explanation, the “doughnut hole” refers to Medicare Part D prescription drug coverage. After a Medicare beneficiary reaches the annual limit for prescription drugs they are financially responsible until their prescription drug costs reach the “catastrophic level.” The way it works is that the first $295 spent satisfies the deductible for the year, then from $295 up to $2,700 spent on prescription drugs Medicare covers 75% of the cost. If annual costs for prescription drugs are higher than $2,700, the elderly person must spend an additional $4,350 out of pocket before reaching the catastrophic level. At that point, Medicare will cover 95% of all additional drug costs. This doughnut hole, or gap in coverage, forces millions of retired folks to choose between which medications they will take or to underdose by taking less than the prescribed amount. If we know this is a burden for millions of retired older Americans, why wait ten years to correct it?

Which is the question we all should be asking our President and elected representatives, if we know the system is broken and is not serving us as it should, why then don't we provide the fix that is truly needed? Why tinker around the edges and settle for the slightest incremental change? Mr. Obama, you were elected by an overwhelming margin, partly because you promised Hope and Change. Without change we lose hope, and that is what is happening. Once this sham health care reform is passed, health care will e off the public agenda for decades. Now is the time to get it done. We need bold action, not weak reforms based on some fanciful notion of the possibility of bi-partisanship. Where is the Barack Obama that was elected? Where is the Barack Obama that promised Hope and Change, we need that guy back.