Source: Informed Comment

Distinguished economist Michael Hudson writes that by “conquering the brains of a country by shaping how people think, you can twist their view into ‘unreality economics’ and make them think you are there to help them and not to take money out of them, then you’ve got them hooked.” This is how Big Insurance and Big Pharma maintain control of U.S. health insurance. Our system is privatized, financialized and unregulated so that private, big insurance companies can make money.

President Biden and many Democrats have spent their careers defending the financial sector, including big insurance and big pharma, whose policy is also to maintain and further privatize basic health care financing and infrastructure. Economist Hudson further notes that, “Biden’s long political career has been right-wing. He’s the senator from Delaware, the country’s most pro-corporate state—which is why most U.S. corporations are incorporated there. As such, he represents the banking and credit-card industry. He sponsored the regressive bankruptcy “reform” written and put into his hands by the credit-card companies. As a budget hawk, he’s rejected Modern Monetary Theory (MMT), and also “Medicare for all” as if it is too expensive for the government to afford—thereby making the private sector afford to pay 18% of US GDP for health-insurance monopolies, far more than any other country. That means blocking governments from providing basic services at cost or on a subsidized basis—education, health care/health insurance, roads and communications. Privatized and financialized economies are high-cost.”

BIDEN’S BAND-AID

Although health insurance affordability for the majority of US citizens remains a very large problem, Pres. Biden’s disappointing health insurance plan shifts many more dollars into private, Wall Street/ insurance industry hands. Biden’s American Rescue Plan (ARP), a $1.9 trillion stimulus package increases government subsidies to health insurers for covering recently laid-off workers and those who purchase their own coverage. The ARP spends $34 billion expanding the Affordable Care Act subsidies for two years. The changes would make upper-middle-income Americans newly eligible for financial help to buy plans on the Obamacare marketplaces, and would increase the subsidies already going to lower-income enrollees. The stimulus package also subsidizes private health insurance premiums for newly unemployed workers. The legislation that the House passed would cover 85 percent of COBRA premiums through September.

Since ‘Obamacare’, the Affordable Care Act (ACA), was enacted in March, 2010, Big Insurance has lobbied Congress hard to ensure that most non-elderly Americans become compulsory customers of the private insurance industry and approve taxpayer financing of massive subsidies for that industry. The private insurance industry is very happy that with ACA, Americans are forced to purchase the product of their private industry plus give huge tax-financed subsidies to their industry in the amount of a half-trillion dollars per decade.

EIGHT REASONS M4A-2021 IS BEST

When compared to the newly proposed Medicare for All Act-2021 (HR 1976) , Biden’s plan is disappointing and at best a band-aid approach. We need a system that is truly universal—everybody in, nobody out. Biden’s proposal will add more participants to the current program, but still leave millions out.

1). Health insurance coverage should be stable and permanent throughout life. Biden’s proposed fixes would be temporary, many expiring in two years. With history as a guide, it’s likely that legislators would develop ‘reform fatigue’ in this session and fail to follow up with more permanent measures. M4A-2021 would be a single program—permanent throughout life.

2). Employer-sponsored insurance can create problems such as job lock, which many conservatives and progressives believe should be terminated. Biden would perpetuate it since it involves less government involvement—predominantly private spending with a tax benefit. M4A-2021 would end employer-sponsored insurance, and, for most, M4A-2021 would be better.

3). Medicaid carries the stigma of being a welfare program which results in legislative underfunding and neglect. Biden would attempt to expand Medicaid in those states that have underutilized it. M4A-2021 would fully terminate the Medicaid program and move everyone into a universal, comprehensive and equitable program.

4). We need a program that is affordable for each individual and for society as a whole. Biden’s plan will add significantly more spending to the program while leaving it still unaffordable for too many individuals. M4A-2021 would achieve all goals of financing reform without significantly increasing spending.

5). Patients should have free choice of their professionals and health care institutions. Biden would continue health plans with restrictive networks that take away free choice. M4A-2021 allows choices within the entire health care system.

6). The privatization of public programs such as Medicare through Medicare Advantage and Medicaid through private managed care programs have proven to provide poor value for the taxpayer (obscured by cherry picking and lemon dropping) and should be eliminated. Biden would continue these programs, whereas M4A-2021 would eliminate them.

7). Fragmentation results in dysfunctional financing of health care. Biden would perpetuate fragmentation whereas M4A -2021would bring an end to it.

8). Biden’s proposals would add more administrative burden along with the costs they entail. M4A-2021 is specifically designed to greatly reduce this burden and its associated costs; health insurance industry profiteering is ended.

SUMMARY

Although the” American Rescue Plan Act of 2021”is a positive and much needed $1.9 trillion economic recovery bill, it is regrettably a massive gift to the profiteering health insurance industry. President Biden, along with Democrats in Congress, chose the most expensive method of expanding health insurance care via the Affordable Care Act (ACA), giving more taxpayer funds to private insurers by paying higher prices for a health care financing system heavily dependent on private insurers.

The major reason private insurers are more expensive is due to profiteering and administrative costs. Those extra taxpayer funds going to private insurers include costs such as advertising/ marketing of their plans, costs of contracting for restrictive provider networks, administering prior authorization requirements, complex systems of processing claims including denial of benefits, simple administrative costs of operating large corporate entities, and distributing generous profits to their executives and passive Wall Street investors.

Increased costs to taxpayers are are not just for more health care, but are a gift to the most expensive and inefficient health insurance financing system on earth. Very worrisome is the fact that the administration is presenting this as if it were a gift from the government to patients. Government money provided by the taxpayers is hidden from view since a large portion of taxes we pay are disassociated from health insurance/care spending.

The new Medicare for All Act-2021(HR 1976) now filed in Congress, would much better fill our health care financing needs without wasting hundreds of billions of dollars on superfluous administrative costs and end immense profiteering by private insurers and big pharma. The USA is a country where health insurance for medical and mental health care is a function of socio-economic status. Everyone knows that this inhumane system should have been corrected long ago. Please tell your legislators that the very best way to cope with the vast dangers of COVID-19 and other health problems is to immediately enact “The Medicare for All Act-2021, H.R. 1976”.

F. Douglas Stephenson , LCSW, is a retired psychotherapist and former instructor of social work in the University of Florida Department of Psychiatry. He is a member of Physicians for a National Health Program.

---