Senate Finance Plan--Is It Good Value?

On October 8, the Congressional Budget Office released its preliminary assessment of the impact on the federal budget of the Senate Finance Committee’s America’s Healthy Future Act. The much touted CBO score concluded that the proposal ultimately would reduce federal budget deficits by $81 billion over the ten year period beginning 2010. The CBO anticipates this deficit reduction even while expanding insurance coverage to 29 million people. Pundits have rejoiced in the CBO’s report and proclaimed the America’s Healthy Future Act as the model for reform.


The question is, does this so called, health reform scheme represent good value for us, the American people?

For one thing, this Act still leaves 25 million Americans uninsured. But, the CBO estimates that about one third of these uninsured are “unauthorized” immigrants, and they don’t count. After all, we don’t want to reward those illegals with health insurance. So you see, it’s not as bad as it sounds.

Furthermore, the Act’s rating ratio for older adults allows insurers in a health insurance exchange to charge older people premiums that are four times the amount the premium charged to the youngest insureds for the same coverage. This would likely make the insurance unaffordable for folks ages 55 to 64, many of whom would not qualify for a premium subsidy, if the Urban Institute’s analysis is correct. Where does this leave the large Baby Boomer generation?

Then there’s expansion of the number of people that could be covered by Medicaid, a program that, at least here in Illinois, grossly underpays (or doesn’t pay) medical providers. And the federal government would end up paying a much greater share than they now pay of the cost of Medicaid and the Children’s Health Insurance Program. States pay the balance of the cost of those public programs, with the poorest states getting bigger subsidies than better off states.

And just yesterday, the health insurance lobby, represented by the America’s Health Insurance Plans, released a report prepared by PriceWaterhouseCoopers claiming that the Senate Finance Committee plan would cost the typical family $4,000 more in premiums than projected by 2019..

Finally, the reform provisions would not take effect until 2013, by which time……You can fill in the blank. Your guess is as good as mine.