Two Health Care Must-Reads

Jonathan Cohn on why the threat of reconciliation changes the political calculus of health care reform so significantly. (Hint: reconciliation is targeted NOT at Republicans, but at.....that's right, the Democrats.) 

Sometimes, it seems like the Wyden-Bennett health care plan, which would turn Medicaid and sCHIP into wrap-arounds and institute state-based purchasing pools, is the odd duck out in Congress. It has 14 cosponsors... but no support among those who are writing what will end up being the legislation that gets to the President's desk.  The respected Lewin Group has figured out a way to combine Wyden-Bennett with the principles outlined by Senate Finance Committee chairman Max Baucus. 

The Lewin proposal would include a mandate for insurance, would force employers to turn health benefits into wages (and change the tax system accordingly), would include a subsidy for the purchase of insurance for people living below the poverty level times four (400%), exchange-like mechanisms that cross state boundaries, an initial  "pay or play" requirement for employers and a variety of new regulations on existing health insurance plans. Medicaid would be responsible for protecting poor people up to 100% of the poverty level. There'd be a new government-run plan, too. 

Baucus's public plan would (or could be) big enough to compete with the insurance company plans, driving the prices down and spurring competition.  Lewin's analyst, John Sheils,  notes that "both proposals envision a major role for employers in a reformed health care system," but that each proposal would lead to at least some loss of employer provided health insurance." The group has previously estimated that most Americans would drop their insurance and buy into the public plan; the report doesn't quite say it, but I know Baucus, in crafting his bill now, is playing with the idea of creating a public plan that would somehow hover above the market for a while...giving the market a chance to meet the challenge before true competition begins.