President Obama: Make Sure Families Can Afford the Insurance They Are Forced to Buy

When President Obama speaks before the Congress on Wednesday night, he will tell the nation in more specific detail what he wants to do to make the health care system work for everyone. 

He’d had better pledge to make sure good health insurance is affordable for all Americans – because he’s already made a deal to force all of us to buy insurance.  And if that insurance is not affordable, he could get a bill out of Congress, but there will be hell to pay later – not from “the left,” but from working Americans.

A good way for President Obama to start is to get clear about big deals he – and Democrats – have already made with the insurance industry.  All the pundits are talking about the bipartisan agreement that we should force the insurance companies to sell insurance to everyone who wants to buy it.  No more denying people coverage because of a preexisting condition or because they are too old, or dropping people from coverage if their conditions cost the insurance company too much money.  The pundits call this an easy and important reform to pass, because it is popular and the companies have already agreed to it.  

But the insurance companies think they’ve already gotten something big in return:  the federal government will require everyone in America to buy health insurance.  It’s called an “individual mandate.” Most of the pundits and policy wonks assume President Obama has already agreed to it, even though he steadfastly refused all through the presidential campaign – despite huge pressure from then-Sen. Hillary Clinton and many “experts” – to endorse requiring people to buy insurance. His argument at the time was that rather than use the power of  federal law to force people to buy insurance,  government should make sure that health insurance was so easily available – and affordable – that people would want to buy insurance for themselves and their families.  

Apparently, Obama is now willing to give the insurance companies what they wanted all along – a mandate that will force 47 million people who don’t have insurance (and everyone who loses their job or their employer-sponsored insurance) to quickly buy an insurance policy.  In exchange, the companies will allow Obama and the Congress to pass laws that try to stop their discriminatory sales practices. The policy wonks encouraged this deal, saying the companies can’t be expected to sell insurance to people only when they get sick.  But requiring all those millions of people to buy insurance will mean a massive windfall for the insurance companies.

What do Obama and the Democrats get?  They had better make sure the insurance industry sells decent insurance policies that are affordable for those millions of people who are going to be forced to buy them.  If that doesn’t happen, they could get a populist backlash that blows up in the Democrats' faces – after health reform is passed. 

OK, so Obama has done the “easy part” – agreeing to a windfall for the insurance companies.  How does he make sure people are happy with the quality and cost of the insurance they are going to be forced to buy? 

Well, that’s where the public option comes in – giving the private insurance companies price competition from a nonprofit insurance company that sells good insurance at affordable prices, and giving us all some transparent benchmark information about how cheaply a company can sell insurance with good, reliable health benefits.   

That’s also where the “insurance exchange” comes in – setting strong standards that assure buyers that they can count on the quality of benefits of insurance policies sold through the exchange by private insurance companies – and by one public insurance company.

That’s where the subsidies for poor and working class families come in – to assure they can afford insurance policies. 

Conservative calls to “cut back” health reform can backfire – on Obama.

These essential parts of reform – affordability, decent benefits, and the public option – are the very elements that would disappear if President Obama and the Democrats agree to the conservative calls to “cut back” on the overall scope and cost of the health reform we’ve been talking about. 

Cut back on affordability?  Some conservative lawmakers (including Democrats) want Obama to “cut back” the cost of his overall bill to a ten year cost of $700 billion dollars.  Most experts think that if you don’t spend at least $1.2 trillion over that decade-long period, you won’t be able to keep premiums and out-of-pocket costs affordable for most of the millions of people who will be forced to buy insurance. 

Cut back on the insurance exchange?  Other conservatives want Obama to “cut back” on the package of health benefits that private companies will be allowed to sell in the exchange.  What good are insurance policies that don’t cover the treatments people need when you get sick – or require that you pay expensive co-pays?

Cut back on the public option?  And as we have seen, other conservatives want to get rid of the public option.  They say we can trust the insurance companies (and the free market) to keep prices affordable. Don’t worry that most insurance markets are dominated by only one or two big companies, they argue. 

Now that the conservatives have managed to get Obama and the Dems to buy into the deal that will force millions of us to buy health insurance, they are demanding that Obama “compromise” by getting rid of all of the elements that Democrats have devised to make sure families can afford the insurance they will be required to buy. 

On Wednesday night, President Obama should explain the deal he’s already made – and then explain the deal he proposes to make with the American people to make sure we can all afford good, high-quality health care.