Here's how it would work: The Healthy Americans Act of 2007 would begin by dissolving all employer-based insurance. Instead, it would mandate that every employer who had covered his employees in 2006 convert the total they spent on insurance into salary increases creating, in one day, the single largest pay raise America has ever seen. Now, why would employers go along with that? Well, legislatively they'd have to, but, as Len Nichols explained to me, they'll also want to: Health costs are accelerating, every year costs 10 or so percent more than they ear before. By freezing the total at what employers paid in 2006, Wyden's plan would exempt them from 2007's increase.
Meanwhile, an individual mandate would be implemented, forcing every American to purchase one of the options offered by their state's newly formed Health Help Agency (HHA). The HHA's will have a menu of private insurance plans, all of which must provide coverage equal to or better than the Blue Cross Blue Shield Standard Plan used by Congress. All plans will be community rated by the state, meaning an end to adverse selection and preexisting condition problems. The only acceptable variables for price will be geography, family size, and smoking status. Subsidies will be offered up to 400 percent of the poverty line, will full coverage provided to those below 100 percent. Employers will contribute through a set equation related to business size and yearly profits. There's quite a bit more, but that's the basic outline.
This makes good sense to me not only on a policy level, but on a political level as well. This is what I want Democrats to be talking about, workable policy solutions on a problem that is a) real and in need of addressing, b) moves the political debate into a place where Democrats can control the agenda. I want them to be in the governing business, not just picking a fight with the Bushies. (Although I want them to do that too)
In the past, the insurers killed the effort as a threat to their business model, which is basically stick the other guy with the bill. Has the climate changed enough for them to believe that gravy train might be coming to an end? There is an upside for them here. Everyone will have insurance of some kind, the pool of potential customers would consequently expand, and could concievably increase profits without having to chase people around in collections.
The problems I foresee are for Health Care providers who have built their business model around the employers. What mechanisms would or could be put in place for them to want to support this without threatening their business model. I think most of those could compete in this new market, but the devil will be in the details.
Wow, those hippies sure are eager...