Wednesday, June 17, 2009

Health Care Reform: Cheers for Bernie Sanders Who Confronts the Elephant

A huge big cheer for Bernie Sanders for being the only Senator on the Senate Health Committee, perhaps the only Senator or only person in either the House or the Senate who has had the nerve to address the invisible elephant in this debate: the fact that health insurance companies have only one obligation and that is to be profitable.

He had the courage to point out that health insurance profits over the past several years have increased over 400%, that their executives make huge salaries (one ex-CEO left with over 1 billion dollars in stock options), and that they hire armies of administrators to deny coverage.

Sanders is the only member of this committee who has also asked the fundamental question: is health care a universal right? Because one can't honestly evaluate a reform package without deciding if you believe health care is a right or a privilege or just a nice option.

Check Sanders out on C-Span - about the 40 min. mark

p.s. Sherrod Brown, Sen. of Ohio, gave a speech on the floor that was an extension of his comments in the committee. He had the courage to address the competition issues raised by opponents of a public plan. He pretty much made the obvious observation (I'm paraphrasing from memory) that if the private insurance companies can't compete with a public plan maybe it is the fault of the insurance companies.

Not surprisingly, the health insurance lobby has launched a massive campaign to prevent inclusion of a public health insurance option with which they would have to compete.

I guess competition is a good thing, unless they are the ones who have to compete. If you have a public option, insurance companies--the President says repeatedly that the whole point of [Page: S6703]an option is that the public plan will compete with a private plan, which will keep the private plans more honest. We have done that with student loans. Fifteen years ago, the only game in town for students, by and large, if they wanted to borrow money for college, was to go to a local bank, or another service, which were all private and unregulated. President Clinton, in the mid-1990s, decided maybe we should have a direct government program so students could borrow directly from the Federal Government. Do you know what happened? The banks brought their interest rates down. The banks started to provide better service. The banks behaved better. That is analogous to what we will see with the public plan.

The conservatives in this body, who are major recipients of insurance company money for their campaigns, whose philosophies are always that business can do it better, the people who have aligned their political careers with the insurance industry all oppose the public option, the public plan. Why? It is simple. It is because insurance companies will have to cut down their administrative costs, maybe even pay lower salaries to their top executives. Maybe they will have to change their marketing practices, be less wasteful, and maybe they will behave a little better. In that case, the public option was competing with private banks, and everybody got better. A public health insurance option competing with the private insurance companies will make everybody get better. That is the whole point.

With private insurance competition, when it is just the insurance companies competing with each other, funny things tend to happen. We see huge salaries and, second, a huge bureaucracy in the insurance companies and, third, we see all kinds of marketing campaigns, and we see huge overhead and administrative costs--sometimes up to 35, 40 percent.

We also see that the term ``private insurance competition'' is often simply an oxymoron. In Ohio, the two largest insurance companies account for 58 percent of the market. I am not a lawyer, so I didn't take the antitrust course. I didn't go to law school. When you have two companies that have 58 percent of the market, that is not competition. In some Ohio cities--as I assume it is in the Presiding Officer's State of Illinois--the two largest insurance companies account for 89 percent of the market. That is not exactly healthy competition. If we bring in a public option and compete with these two companies, their rates would come down and salaries for top executives would come down. There would be no more multimillion-dollar salaries, and administrative costs would be cut. They would be leaner and meaner, a better insurance company as a result.

C=Span Source

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