Facing the Abyss – H.R. 3200 and healthcare reform

By Dr. William Harvey, M.D.
America’s Right

It took the Continental Congress 5 years (1776-1781) to develop the Articles of Confederation governing the relationship between the states; after 6 years the Congress convened the Federal Convention (today known as the Constitutional Convention) ostensibly to propose amendments to the Articles of Confederation. The Constitutional Convention took 6 months to do its work, but the entire process of developing the Constitution, from the Annapolis Convention to the seating of the first Congress under the Constitution, took almost 3 years (1787-1791). The Founding Fathers knew that critical decisions, nation-altering decisions, deserve full public deliberation and care before being enacted.


Three similar approaches to healthcare legislation, two from the Senate Democrats and one from the House Democrats, were made public last week. President Obama announced publicly he’d like to have final healthcare reform legislation on his desk for signature before the August Congressional recess. As a nation, we’ve had the financial stimulus and the bailout bills rammed through Congress before anyone had a chance to read or evaluate them. Will we do the same with the most critical piece of legislation that has come before the Congress in at least 60 years, if not longer?

In the Senate, the Committee on Health, Education, Labor and Pensions (appropriately abbreviated “HELP”)developed their bill under Senator Baucus. This bill is as yet unnumbered but is titled “America’s Affordable Health Choices Act of 2009”. I can’t find the Senate version of the bill in either THOMAS, the official Congressional website for pending legislation, or in Govtrack.us, but it is posted on the Senate HELP Committee’s website in its submitted form, the committee mark-up (Ref. 5), and the Chairman’s mark-up form (Ref. 6).

Once the Senate HELP reported its bill out to the Senate, the basic bill (now identified as H.R. 3200) was introduced by Rep. John Dingell on July14 and ultimately referred to four other House Committees. It was reviewed and reported out of the House Energy and Commerce Committee to the full House on July 17. The vote was 26-22 along mostly party lines. (The full committee has 37 Democrat and 22 Republican members).

In short, both the House and the Senate have similar bills before each chamber, ready for debate and voting. Let’s look at the contents of H.R. 3200 to see the operational details of the Democrats’ healthcare plan.

H.R. 3200 is a svelte 1017 pages. The basic strategy is to leave the current multiple-provider / multiple-payor, employer-driven, insurance-based system intact but improve the system “by building on what works in today’s health care system, while repairing the aspects that are broken.” In fact, the bill, if passed in its current form, will, in a few short years, irretrievably destroy the current private healthcare system by removing the competitiveness of the private payer system and by creating a new generation of healthcare workers trained to believe that a government-run, government-financed system is the only choice.

The bill is organized as follows:

Division A (“Affordable Healthcare Choices”) establishes standards for health benefit plans (Title 1), defining the services that must be offered and ensuring access. Title 2 creates the Health Insurance Exchanges (also called gateways), defines the public health insurance option, and establishes subsidies for lower-income households. Title 3 requires employers to provide and individuals to obtain health insurance. Title 4 modifies the IRS code to establish penalties for companies and individuals who fail to comply. This Division essentially redefines the American healthcare system from both the individual and employer perspectives.

The Congressional Budget Office, in its formal review of the introduced version of this bill, indicated that (Refs. 1, 2):

Collectively, those provisions [of the bill] would yield a significant increase in the number of Americans with health insurance. By 2019, CBO and the staff of JCT estimate, the number of nonelderly people without health insurance would be reduced by about 37 million, leaving about 17 million nonelderly residents uninsured (nearly half of whom would be unauthorized immigrants). In total, CBO estimates that enacting those provisions would raise deficits by $1,042 billion over the 2010-2019 period.

Because of certain projected “revenue provisions” (like $583 bn in increased taxes on individuals and employers) and other “savings”, the net budget deficit in the CBO projections is smaller, on the order of $239 bn. This plan certainly does not meet the President’s goal of being revenue neutral.

The public health insurance “option” in Title 2 is perhaps the most worrisome aspect of the first division of this bill. In a New York Times editorial, Mankiw (Reference 4) examines how such an option would quickly drive pricing to the point where only the public option would remain. Many articles have mistakenly referred to this option as creating a government monopoly, but in fact, it would create a monopsony. A monopoly is a market situation where one seller has multiple buyers and can drive prices up; a monopsony is a market situation where one buyer has multiple sellers and can drive prices down.

Imagine a taxpayer-subsidized public option, which starts with the single largest patient pool (all Medicare, Medicaid, S-Chip, Defense Department and Department of Veterans’ Affairs beneficiaries and dependents; approaching 50% of the U.S. population). How hard would it be for such a behemoth to “negotiate” major discounts from all stakeholders in healthcare and then price undercut all private payors and other suppliers? Employers would clearly turn to such an option to reduce their (now government-mandated) healthcare expenses, and in a short period of time there would be only one plan: the public option. Government should not be in the business of competing with the private marketplace under any circumstances, but certainly not while subsidized with taxpayer funds.

Division B modifies Medicare, Medicaid and S-CHIP to align and operate more smoothly in the new healthcare landscape. It provides consistency of services in rural areas, establishes quality standards, and impacts the education of medical trainees within Medicare, although, as we’ll see in a moment, the entire medical educational system will be revamped eventually, under the direction of the Federal government.

Division C continues the Public Health aspects started in the American Recovery and Reinvestment Act of 2009 (“The Stimulus Bill”). Here, a complete revamping of the Primary Care, Nursing and Public Health workforces is implemented. As in the UK and other countries with a government-run healthcare system the government will take over the training of most healthcare workers in the US through a series of scholarship, loan or other support programs which will require either a period of National Service (Public Health Workforce Corps, section 3401) or some method for loan repayment (section 340N). These programs will include training for diversity (section 2241) as well as “cultural and linguistic competency training for health care professionals (section 2251). Section 2301 expands the prevention and wellness research initially authorized in (you guessed it!) the Stimulus Bill. Section 2002 creates a protected “slush fund”, under the title Public Health Investment Fund, starting with $5 bn in annual funding in fiscal 2010 and growing to $12.7 bn annually in fiscal 2017. This fund is to be used to carry out “activities under designated public health provisions”. These funds “shall not be taken into account for purposes of any budget enforcement procedures… of the Balanced Budget and Emergency Deficit Control Act and budget resolutions for fiscal years during which appropriations are made from the Fund”, meaning they are “off the books” for deficit reporting and reduction.

Here again, the Federal Government is stepping well beyond any passive role as a provider of financial support for medical education to provide staffing for the nation’s need. Instead, during a long period of public service to repay loans, the nation’s healthcare workers are being given non-medical, political indoctrination on what the proper social and societal views should be towards the provision of healthcare in a free-market based constitutional republic. If this bill is left in its current form, within one generation, there will be no way to modify any aspect of this approach to healthcare; both the private payer infrastructure and the required workforce will be utterly destroyed.

Perhaps most insidious is the last provision of Division C of this bill. I’ll simply quote it in full:

Subtitle E—States Failing To Adhere to Certain Employment Obligations
SEC. 2541. LIMITATION ON FEDERAL FUNDS.
A State is eligible for Federal funds under the provisions of the Public Health Service Act (42 U.S.C. 201 et seq.) only if the State—
(1) agrees to be subject in its capacity as an employer to each obligation under division A of this Act and the amendments made by such division applicable to persons in their capacity as an employer;
and
(2) assures that all political subdivisions in the State will do the same.

In short, the Federal government here demands that in order to have medical staff and receive funding for health care facilities and other resources each state must impose on itself and on its local governments all the obligations the Federal government is placing on employers. Any semblance of the original relationship intended by the Founding Fathers between the powers of the Federal government and the states is utterly lacking. This is the clear imposition of the will of the Federal government on the states.

Every American is impacted by healthcare reform. Not sometime in the future but immediately. This bill will change your care, your taxes and the nature of your relationship to your doctor (or your next doctor, if many physicians elect to retire early once they sense the direction of this change). More importantly, it will be an irreversible step in the relationship of the Federal government, the states, and the people. Read the parts of this bill that worry you … and contact your Congressional representatives. Senator Enzi has certainly provided his thoughts (Ref. 3) and polls are beginning to show the American people are not as dazzled by President Obama’s rhetoric as they were in January. Let your Congressmen (and women) know how you feel. Politically there is nothing more important than this bill right now. Let’s not let the “dog days of summer” allow something this critical to just sneak by. Nothing less than the future of America is at stake.

REFERENCES
1. CBO to Rep. J Dingell, letter dated July 17. Preliminary analysis of HR 3200.
2. CBO, Director’s Blog: Preliminary Analysis of the House Democrats’ Health Reform Proposal.
3. Enzi: HELP Democrats’ Bill a Prescription for Failure. Press Release; July 15, 2009 (pdf)
4. Mankiw, N. Gregory: The Pitfalls of the Public Option. NY Times; June 28, 2009
5. Senate HELP Committee: Markup of H.R. 3200 (“America’s Affordable Health Choices Act of 2009’’).
6. Senate HELP Committee: Chairman’s Markup of H.R. 3200 (“America’s Affordable Health Choices Act of 2009’)’. (pdf)
7. Singer, Peter: Why We Must Ration Health Care. NY Times Magazine, July 19, 2009

—————
William Harvey is a physician with extensive experience in drug research and development. He began as an academic researcher but has been a pharmaceutical executive in the global development arena for almost two decades. His current position involves the strategic use of comparative effectiveness research to speed drug development and to educate healthcare stakeholders: government, payors, prescribers, and patients. He lives in the greater Philadelphia area.

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Comments

  1. Gail B says:

    Dr. Harvey, I agree with your statement that good legislation takes careful thought and planning.

    Obama/Soetoro has talked out of both sides of his mouth, lied, promised, misled, and betrayed us to the point that I don't believe anything he has to say and do not want anything he has to offer.

    SC Senator Jim DeMint, Rep. Lynn Westmoreland (3rd GA), Rep. Tom Price (6th GA), or Rep. Walter B. Jones (3rd NC) could sponsor the SAME proposed legislation and I would be all for it because I trust them. They have shown themselves to be trustworthy. Obama/Soetoro has failed so miserably in that respect that I wouldn't believe him if he said he was an American citizen!

    Thank you for another great piece, and thank you for all the work you did in researching it. (Now I'll get back to it to digest it.)

  2. Anonymous says:

    OK, so now we have a medical doctor talking about the Constitution. Does this mean that the Patriots who have been sounding the alarm (for the past year!) were in the slightest bit warrented?

    http://www.popmodal.com/video/3037/Citizen-Grand-Jury

    Pixel Patriot

  3. Anonymous says:

    Good read.

    I'd like to ask Dr. Harvey for his thoughts on an individual U.S. citizen (me, for example) procuring health insurance in another country or even international health insurance (IHI) if this bill and related measures do pass.

    In early middle age and with hypertension that has led to two small strokes already, I am not willing to surrender my well-being over to these power-hungry scoundrels just yet. Any thoughts would be appreciated.

    JV

  4. Gail B says:

    Just received a news alert that the Senate is not going to vote on this until after the Aug. 8 break.

  5. Anonymous says:

    hi bloggres¡
    by no means i am going to support the boy at wh, but the present american health care is an obscenity, is an indecence, people study medicine just to turn filthy rich, the patients are not well taken care of,specially the old ones what happen jeff ´s relative in poland could very well happen in the states, when is thru ins. co. there is an abuse and misuse of exp. tests, adm. of medications etc, and much more
    the health system needs an urgent "treatment"

  6. Gail B says:

    Thanks, Sally.

    Am forwarding your comment (came in email to my computer) to my conservative friends email group.
    ———————————
    Robert, how is moving coming along? I know life is hectic right now (the toilet tissue is in the bottom of the carton), but thank you for the time you give us, too.

  7. Anonymous says:

    Email Cambridge Police Commissioner Robert Haas at
    http://www.cambridgema.gov/cpd/c…cfm? email_id=37
    In support of Sergeant James Crowley and tell him he doesn't need to apologize for doing his job.

    Sally

  8. Gail B says:

    We have a problem, folks, and it runs deep.

    To begin with, the contemporary liberal Democrats are pushing things at us at an alarming rate. WHY? To avoid giving the congressmen time to read proposed legislation to learn what is in the bills.

    This so-called president is after control–period. He has illegally gained control of the banks and auto industry, has illegally fired and replaced CEOs. He wants Cap and Tax passed to control energy. He has control of our food and water coming up. And, he desperately wants the healthcare passed. What's so important about the healthcare? (This is where it gets really ugly.)

    Remember when someone expressed the concern of the government coming between the patient and his doctor, and Obama said that would not happen? That was a lie.

    The government wants to control the type of healthcare that it considers best. WHY? We have the best health care in the world already!

    (You are going to be mad.) If universal healthcare is passed after Congress returns from the summer break, the government will have control over our lives, what we eat, our lifestyle, whether we smoke or drink, and so on.

    Remember when he led us to believe that he was going to fundamentally change America? Well, the change he was campaigning for is not the change he led us to believe he wanted. He has something entirely different in mind.

    Think about the enormous numbers of jobs being lost and have already been lost just since Obama took office and the worsening of the economy. Health insurance coverage and benefits are not portable if you lose your job. The stimulus was not meant to stimulate the economy but to deepen the recession, to cause job losses. Add to that the number of people who do not have health insurance. Now there is a substantial number of people who want/need government's healthcare! But they're thinking they will receive the same thing they had. WILL NOT HAPPEN!

    A bureaucrat will decide what the government doctor will do for you. Seniors will receive no healthcare. There will be long lines because of the shortage of doctors. Switzerland (I think it is) has a successful national healthcare plan, but they do not have anything near the population that the US has. One of Jeff's writers did a piece on it.

    There will be long lines and poor coverage. Oh–seniors will be required to undergo a mental exam every five years, every year if in a nursing home. Who will give these exams? Not psychiatrists! An enormous number of people will be hired by the government to give the examinations. Will a quota be required, as there was when ACORN fraudulently registered my "dead aunt and her dead dog" to vote?

    Will there be a number of mentally incompetents to be eliminated in order to cut costs?

    This Obama regime is DANGEROUS, folks, and we need to pay attention to what they are doing and what they CAN do with each bill.

    The initial healthcare bill could look rosy at first, but there's nothing to keep a Czar from radically changing it.

    Get on the horn to your congressmen, write a letter to your newspaper, send emails, do what you can to fight this ugly monster! Our lives and the lives of our grandchildren — if we are allowed to have any — DEPEND upon it!

    I heard Rush Limbaugh last night talking with Greta Van Susteren. It clicked when he mentioned that health insurance is lost when a job is lost. He is right on target.

    Now you understand the real purpose of the stimulus bill that cost so many jobs.

    We cannot allow any government-controlled healthcare legislation to pass.

  9. TWO WORDS, NANCY PELOSI says:

    Wow, Gail, you said it so thoroughly and elegantly. You sum up my take on it, "We're screwed".

  10. Anonymous says:

    This is a video that you must watch if you have any love for this country. I am forwarding it to everyone I know and am posting it where I can. The man that made this video is a true patriot with an important message. Please take a few minutes and watch this video. You will be glad that you did.

    http://www.youtube.com/watch?v=jeYscnFpEyA

  11. Jackie Smith says:

    Gail—-He has illegally gained control of the White House too….you left that one out!!! If the courts don't settle the "natural born" clause soon…..I believe there may have to be a Revolution in the streets and demand that Congress and our Judicial system do their jobs!!!

  12. Anonymous says:

    ENZI and BARRASO… my two Senators from the Great State of Wyoming. Woot!

  13. Anonymous says:

    Anonymous 6:05…

    Obviously you are a troll! And you know NOT what you are talking about!

    My husband is an excellent and compassionate vascular surgeon. He did NOT go into this profession to become "filthy rich"! He would have never made it through the grueling training and countless sleepless nights for 10 years AFTER COLLEGE if he was not motivated by his desire to help people. He treats patients whether they have insurance or not! He only operates on those that truly need it. (And we are NOT "filthy rich"!)

    The bureaucracy and inefficiency of practicing medicine are a DIRECT RESULT of a LITIGIOUS SOCIETY.

    His patients LOVE him, and he takes the time to pray with and for them before they go to the operating room.

    If you look at the part of the healthcare system that is broken, it is MEDICARE…a government program! Talk about waste and fraud into the billions! Do your research!!!

    The government is NOT responsible for your healthcare…YOU are!

    Insurance should not be obtained through employers. It should be up to the individual, highly customizable, and portable.

    Most healthy people would do well with catastrophic insurance plus a medical savings plan.

    Others with chronic conditions could choose a more extensive plan.

    And those that cannot TRULY afford to pay for healthcare (assuming they have not prioritized spending on cell phones, satellite TV, and a nice car first) could be treated in a system that is more state or locally based.

    We have a local charitable clinic that is completely privately funded, where the working poor receive almost free care that is exceptional and compassionate. The treating doctors receive NO fees for their services and completely donate their time and skills. (Now isn't THAT greedy of those evil docs?)

    My father was also a surgeon (in the old days), and if he knew that a patient couldn't pay, he did it for free.

    If Americans were more involved and responsible for securing and paying for some form of care, they would be much more inclined to practice preventative care and make healthy lifestyle choices. When the large percentage of care is paid for by a blanket plan, their is little incentive to make healthy choices…they simply know that it doesn't matter what they eat or do…modern medical technology will be there to save them.

    What you MUST understand is that, under a socialized system, people will NOT receive the most advanced, cutting edge care or medicines, b/c the government won't pay for it. The best drugs for certain types of cancers are simply not available in Britian, as the government "can't afford them".

    You need to do some serious research, and if you want to live in a country with a socialized system, then there are several options from which to choose! I'm sure they would love to have you!

    Lisa in TX

  14. Gail B says:

    Anonymous July 23 at 6:05 p.m.

    People do not study medicine to get rich. The cost of malpractice insurance prevents that!

    I used to work for a (Cuban) surgeon who once lamented, "I only make 98 thousand dollar this year! How am I going to pay my bills? I need more tax deductions." (I suggested that he give me a raise.) His reply was, "Oh, I cannot do that! If I give you the money, _I_ cannot spend it!" I told him to stay out of the tobacco shop.

  15. vcw39 says:

    We also need to get rid of all the politicians who did not do their jobs when they should have and made sure Sotero/Obama was qualified to be elected.

  16. Anonymous says:

    Just heard a sound byte…

    The great o'Bama (he is Irish, yes?) spent more time picking his dog!

  17. A BRIDGE TOO FAR says:

    Actually that dog was forced onto him by a Kennedy, just like this healthcare nightmare.

  18. NEXT TOUR AT 2:00 says:

    I'd rather see the White House while on a tour of it, than sit to have a beer with someone who called me stupid.

  19. LEST WE FORGET says:

    On the night of July 18, 1969, Kennedy was on Martha's Vineyard's Chappaquiddick Island at a party for the "Boiler Room Girls", a group of young women who had worked on his brother Robert's presidential campaign the year before.[43] Leaving the party, Kennedy was driving a 1967 Oldsmobile Delmont 88 with one of the women, 28-year-old Mary Jo Kopechne, as his passenger, when Kennedy drove off Dike Bridge into Poucha Pond between Chappaquiddick Island and Cape Poge barrier beach. Kennedy escaped the overturned vehicle and swam to safety, but Kopechne died in the car. Kennedy left the scene and did not call authorities until after Kopechne's body was discovered the following day.

  20. Anonymous says:

    I worry that this is another ploy to destroy capitalism in this nation. I went to http://www.cpusa.org and pulled an article called "Program of the Communist Party USA" and it clearly states their plan to destroy capitalism in this nation and blame it on EVERYTHING. They say in page 52 of the article for them to succeed the Party must be
    1. A party of the working class, part of the c lass but its most ADVANCED SEGMENT (Government in other words)
    2. A party of SOCIALISM
    3. based on MARXISM-LENINISM
    4. engaged in protetarian internationalism (UN IN CONTROL I IMAGINE)
    5. organized on the principle of democratic centralism (GOVERNMENT IN CONTROL OF EVERYTHING)

    It scares the sap out of me for I don't want socialism, Marxism nor communism to take over in this nation.

  21. Anonymous says:

    1946-1981
    Each percentile gained in Income-Wealth almost evenly on a percentage basis.A picket Fence.

    Step ladder distribution started by Reagan.
    Climaxed by Bush.

    1980=600B budget(spending)and 1000B of Debt
    2009=4000B (spending)and 11,000B of debt

    20 years of three conservative presidents
    18 years of Conservative Senate
    12 years of Conservative House
    6 years of Total Conservtive control

    1920's Deja vu

    Housing Crash
    Rich Man Gambling Casino Wall Street crash
    Recession Crash
    1% have 21% of personal individual wealth
    10% have 71%
    Since 1973 workers gained no "real" increase in hourly pay

    2 unnecessary wars

    20 years=23M net new jobs
    12 years=33M net new jobs(carter + clinton)

    20 years of disaster for America.

  22. Anonymous says:

    USA RANKED 37th ON HEALTH CARE BY WORLD HEALTH FORUM

    Vet adm. is ranked as BEST in world.

    Cannot be it is total government controlled.

    Medicare–do not like it send in your card

    Social Security-Send in your card.

    Stay off OUR Interstate Highways
    Stay out of OUR Public Schools
    Stay out of OUR Veteran Hospitals
    Stop drinking OUR clean water
    Stop drinking OUR clean air
    Stay out of OUR Public Universities

    Why do people in other nations consider themselves happier than OURS

    why why

  23. TANNER VOTES NO (FOR NOW) says:

    Dear xxxxxxxx:

    Thank you for contacting our office to share your concerns over the health care reform proposals being discussed in the Congress. I have heard from many Tennesseans on this issue. There are those, like you, who are opposed to the current bills, and others who support them.

    Let me reiterate my belief that reform of our country's health care system is needed but I think we should proceed thoughtfully and responsibly. My Blue Dogs colleagues and I have successfully delayed any possible vote on reform legislation until sometime in September so we can all have time to thoroughly review all proposals.

    While the quality of our medical care continues to be very good in the United States, the system through which we finance care is far from perfect. Inefficiencies, waste, and ineffective payment incentives increase the costs and fail to reward high quality care. The ever increasing costs of American medical care means fewer can afford health insurance and this contributes to the continuing increase in costs. Since 2000, premiums have more than doubled. The United States now spends twice as much per capita on health care than almost any other industrialized nation with poorer health outcomes.

    There are many good provisions being discussed, such as no exclusion for a pre-existing condition, quality incentives, administrative simplification, coordinated care and maintaining the employer based system. However, I also continue to have concerns about the testimony of the non-partisan Congressional Budget Office Director Doug Elmendorf where he indicated that the health reform bills that have been introduced in the House and Senate will not reduce health care costs, which is critical to the success of any reform effort. Because of these concerns and others, I voted against the current legislation during consideration in the Ways and Means Committee.

    The problems facing the Congress with health care reform are complicated and there are many challenges. Everyone agrees that the overall goals of health reform should be containing costs, ensuring consumer choice, increasing access, and maintaining our high standard of quality care. However, not everyone agrees on how to achieve those goals. I will continue to work hard to try to achieve positive solutions that will help to produce a better and more cost efficient system for all Americans.

    Please continue to contact me on issues of concern to you in the future.
    Sincerely,
    John Tanner, M.C.

  24. Anonymous says:

    Oh! give us all a brake what happened to the trust ?
    I'd would like to see if any of you
    congress Men/Women would consider
    taking the lesser treatment plan
    for your selfs and family's .
    Why couldn't the american people
    hear what was said on that day of having beer, did we honestly think
    that having a beer was going to patch any thing up if any thing it leaves us the people wondering who
    is deciving who .
    I worked and paid my taxes and started a company with no help from
    the Goverment .
    When my legs started to give out
    I gave my accounts to another family who had a child home yet .
    Thanks for the space here

  25. Katie says:

    Nothing like winning a hand of poker! Thanks for the blog…

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