(Not totally a local issue, but it involves a lot of local players, and continues on a subject that gets a lot of attention around here, so I thought I’d share.  Reprinted from my site.)

There’s something of a consensus that Netroots Nation didn’t offer enough adversarial panels and instead largely consisted of bloggers agreeing with one another.  But that’s not true.  I personally witnessed the most adversarial panel of the weekend, and it was spectacular, because finally, both factions of the debate about health care policy on the left were able to come together and understand the political contours of the brewing fight in the Congress.

over…

The panel was entitled “Time for Action: How the Netroots Can Lead on Healthcare Reform,” and was put together by Eve Gittleson, who blogs at Daily Kos under the moniker nyceve.  There’s a good liveblog of the panel here, but what you need to know is that Gittleson stacked the deck.  She had some great health care activists who are doing great work in different areas of the space: Giuseppe Del Priore, MD, MPH a New York cancer surgeon; Hilda Sarkisyan, whose daughter, Nataline, died after being denied a liver transplant by Cigna; Rocky Delgadillo, Los Angeles City Attorney, who is pursuing civil and criminal investigation into insurance practices; Geri Jenkins, RN a member of the Council of Presidents of the California Nurses Association/National Nurses Organizing Committee.  And then Ezra Klein, associate editor for The American Prospect and a health care policy guru, appeared at the end of the panel.  The aforementioned speakers were all powerful advocates.  Sarkysian, whose family HAD health insurance and still couldn’t get their daughter what she needed, said bluntly “This is not a good country anymore.”  Del Priore discussed the need for doctors and patients to handle questions of care and the need to arrest insurance executives for their crimes in denying coverage.  Rocky Delgadillo outlined the schemes, like rescission (even based on spousal applications), that insurers are engaging in to maximize profit at the expense of patient care.  He also mentioned how California regulators ignored a million-dollar fine to Blue Cross because they feared they would lose the case if it went to court, which is just unbelievable.  And Jenkins argued that the insurance industry will play no role in reforming health care, and we need to move immediately to a not-for-profit system.

Good points all.  And then Eve turned to Ezra:

Eve: Ezra, why does HCAN want to condemn Americans to this kind of system? I get confusing emails from Elizabeth Edwards and MoveOn talking about the atrocities of the insurance industry, then marginalizing the only viable solution. Can you explain this new Edwards HCAN initiative, the TV commercials, etc. . . What’s it all about? What are they trying to do? It seems there are three initiatives on the table–676, Wyden  and HCAN.  What’s wrong with Wyden and Edwards? And a follow-up…what can we realistically expect from President Obama?

I hope you don’t mind that I’m sand-bagging you. I love you, really, Ezra. I just don’t agree with you on this point.

This apparently startled Mr. Klein.  But for him to not know the position of Eve and the CNA and an activist like Hilda Sarkysian speaks a lot to his cloistered state in Washington.  Because I know all about this fight.  I made one positive comment about HCAN upon their launch and took massive amounts of crap for it.  I was called a defeatist and admonished for not being true to the cause.  My only point was that having an organization with $40 million dollars to spend on calling out health insurers on their garbage is going to be tremendously helpful to whatever reform we get through the Congress, and furthermore I didn’t see them having much of a place at the table in the policy debate.  In other words they were finally an organization concerned with moving public opinion and playing the health care debate out on political grounds rather than policy grounds.  And on the panel, Klein echoed the importance of politics over policy:

You can take a lot of approaches to health reform. You can emphasize policy, politics, principles, or some mix thereof. Judging from the panel, Health Care for All, and the California Nurses, could use a bit more politics in their approach. It was a panel about “health reform” — not care or policy, but “reform” — at a conference of engaged politicos that never mentioned the Senate, or votes, or the conditions required for presidential signature.

There was a lot of talk about “fighting” insurers and other special interests, but not much about what that fight will look like, or where it will take place, or who decides the winner. My argument, was that, for reformers, insurers aren’t the real enemy. Setting them up as the opponent actually gives them too much credit. Insurers are stupid, profit seeking beasts — the enemy is American politics, and in particular, the structural feature of the US Senate that have repeatedly killed health reform in the past. No matter what your policy preference, that’s where your organizing has to be focused, because that’s where the actual fight happens: In Congress. Not on panels, or on blogs, or among the Left. In the US Senate, where you have to get to 60, or at least figure out how to get rough Democratic unity for using budget reconciliation and then convince Kennedy and Carper to vote “aye” on the same bill.

This is basically the same argument Ezra makes continuously on his site, but it appeared to hit the audience like they never heard it before.  And considering that it’s largely the correct analysis, it was generally well-received, I thought.  I spoke later with Eve, who told me that she had a conversation with someone from HCAN and “they are not the enemy.”  What a concept – all elements of health care advocacy on the left working together, for a change, toward a common goal.

Now granted, this week they all had a big juicy target.  AHIP, the health insurance lobby, put together a fake grassroots front group called The Campaign for an American Solution.  Of course, that “solution” involves funneling more cash and customers to the same broken insurance system we have now.  Now, who was the very first group to coordinate a counter-attack on this front group on the first stop of their listening tour in Columbus, OH?  That’s right, HCAN

Well, that didn’t take long.

A day after Politico reported the health insurance industry is launching a health care reform campaign next week, the progressive reformers are firing back.

Health Care for America Now announced Friday that it plans a news conference and a rally next week to counter the insurance industry’s Campaign for an American Solution, which launches in Columbus, Ohio, on Tuesday with a roundtable discussion among uninsured locals.

“They’re pretending that the health industry represents the American public, and we need to make it really clear to them and the public that all they represent are their own profits,” said Richard Kirsch, national campaign manager for Health Care Now.

Indeed they did attend the launch, and got to ask some tough questions, confronting the head of AHIP and asking her how an insurance industry group could possibly be objective in pushing for lower rates and higher quality coverage when they are concerned solely with the profit motive.  It got heated, and I’m glad they did.  And all of a sudden, Daou’s Triangle started closing.  Rep. Pete Stark came up with a great quote:

“America’s Health Insurance Plans’ new ‘Campaign for an American Solution’ rings as true as the tobacco industry’s efforts to end smoking. There is nothing grassroots about it. It is designed, financed, and coordinated through their Washington trade association with the singular goal of protecting their profits.

“I hope it is true that these companies intend to be a positive force in health reform efforts, but I tend to be cautious when the fox starts drawing up plans for a new henhouse.”

HCAN called up the hotline for the Campaign for an American Solution that they set up for the public to provide input… and they got an answering machine.  They’ve trickled this out one by one and pretty much ruined the launch of AHIP’s front group.  That’s REALLY important for the future of health care reform.  Because on the policy the views are far closer on the left than most people imagine.  Everyone knows that whatever system is ultimately put forward can be paid for in a far better manner than the current wasteful, inefficient system.  So expense should never be a deterrent, meaning we can build whatever system we choose and it is extremely likely to go revenue-neutral very quickly once we eliminate the shoddy budgeting of the current broken system.  We know that health insurers will not jeopardize their profit margins unless they’re forced to.  Once you recognize these two realities, the policy goals become fairly clear.  The political goals have to include attack dogs pushing back on the false memes of the right and the insurance industry, and pressuring the Senate to do the right thing.

Now Obama’s plan includes some better regulation toward insurers (including guaranteed issue and community rating) and a public option to compete with the private insurance market and take the step toward a sequential single-payer.  (His latest addition to the plan, a tax credit for small businesses who offer quality health care, is borrowed directly from the Clinton plan, raising hopes that eventually he’ll just borrow all of it, as he should).  Despite this being a fairly modest set of reforms, McCain and the right are going to denounce it as government-run “Hillarycare” anyway.  So it’s vital to have a broad coalition to give as good as they’ll get from the right and give the lawmakers backbone to push the policy forward.  Matt Stoller writes:

Coalitions are strange beasts, with multiple moving parts, but they are also the only way anything gets done.  A coalition has a core of organizers behind it, and a variety of groups out in front who each take different roles.  Some people can talk to Republicans, some people can talk to Democrats, some people threaten, some people cajole, some people talk to businesses, etc.  HCAN is driven by labor in the form of SEIU, the NEA, AFSCME, and United Food and Commercial Workers, as well as groups primarily funded by labor such as Americans United for Change and the Campaign for America’s Future.  It is also driven by direct mail and Foundation based organizations,  such as La Raza, Planned Parenthood, Center for American Progress Action Fund, Center for Community Change, and the National Women’s Law Center.

Stoller goes on to make the point that HCAN should broaden their mandate and make this a fight about general health, and I agree.  Going after convenience stores that sell fatty, sugar-laden food to kids sounds like it could be a part of their mandate.  The farm bill, the transportation bill (more mass transit and more livable, walkable cities means healthier lives), and others could be brought onto the field of battle.  But the larger point is that coalitions of this nature are built because they work.  And the benefit is that they give lawmakers breathing space to do their job and the spine to do it right.  This moment in health care demands that everyone understands the political spade work necessary to reach the desired outcome.  So out of the ashes of that contentious NN panel came something pretty special.  Groups across the center-left ideological spectrum working together to end the health care crisis in America and restore treatment as a basic human right.

This is the benign face of the industry that will undeniably get richer in a forced-market “universal” health care approach:

One of the state’s largest health insurers set goals and paid bonuses based in part on how many individual policyholders were dropped and how much money was saved.

Woodland Hills-based Health Net Inc. avoided paying $35.5 million in medical expenses by rescinding about 1,600 policies between 2000 and 2006. During that period, it paid its senior analyst in charge of cancellations more than $20,000 in bonuses based in part on her meeting or exceeding annual targets for revoking policies, documents disclosed Thursday showed.

The revelation that the health plan had cancellation goals and bonuses comes amid a storm of controversy over the industry-wide but long-hidden practice of rescinding coverage after expensive medical treatments have been authorized.

Cancellation GOALS.  That’s right.  One man’s catastrophic medical and financial situation is another man’s new boat.

This is of course nothing new.  It’s standard practice for most insurers.  When you get sick and put in a claim to actually use your health insurance, your file is immediately sent to the cancellation department and people review it for the slightest rationale to dump your coverage.

Now, market reforms like guaranteed issue, which would mandate that insurance companies cover anyone who wants health insurance regardless of pre-existing condition, would stop this practice.  California’s latest iteration of a health reform bill includes this policy.  But let’s not be so naive that insurers will not find other ways to stop paying their claims, and use the spectre of “affordability” to do so:

Insurers maintain that cancellations are necessary to root out fraud and keep premiums affordable. Individual coverage is issued to only the healthiest applicants, who must disclose preexisting conditions […]

The documents show that in 2002, the company’s goal for Barbara Fowler, Health Net’s senior analyst in charge of rescission reviews, was 15 cancellations a month. She exceeded that, rescinding 275 policies that year — a monthly average of 22.9.

More recently, her goals were expressed in financial terms. Her supervisor described 2003 as a “banner year” for Fowler because the company avoided about “$6 million in unnecessary health care expenses” through her rescission of 301 policies — one more than her performance goal.

In 2005, her goal was to save Health Net at least $6.5 million. Through nearly 300 rescissions, Fowler ended up saving an estimated $7 million, prompting her supervisor to write: “Barbara’s successful execution of her job responsibilities have been vital to the profitability” of individual and family policies.

Let’s not claim that “but in the future, this will be illegal” and clap our hands in self-congratulation.  This is ALREADY illegal in the state of California.  You can’t tie bonuses to claims reviews.  But they did it nontheless.

So when you make deals with a for-profit health insurance industry, don’t be surprised if they ever so slightly go back on them.

So out of the “magic fax” in Sacramento where all bills without authors are created comes new “legislative language” on a compromise health care proposal, language that nobody has claimed as their own and that everyone is disavowing, but which looks mysteriously like the Governor’s handiwork.  You can take a look at this language yourself here.

We are disappointed that we seem to back to square one with something very similar to the Governor’s January proposal, with only a few of our comments and concerns raised over the course of the year addressed. While we would have preferred having the Governor’s language much earlier in the year, we do appreciate having the language to seriously respond and react to–if that is what it takes to move the conversation forward.

It’s like when you work really hard on a document, but then the computer crashed, and you have to reboot and start again. It’s frustrating, but the goal doesn’t change.

over…

This could have played out over the regular session if the governor would have distributed this and negotiated at that time.  But as he jets off to China, this gets dropped in everyone’s lap – and look what’s in there:

• The elimination of quarterly complaint and greivance reporting for HMOs, which seems to remove an important oversight over insurers.

• The apparent increase in the permissible premium, for those making 150-200%FPL (federal poverty level), at a level that is still too high–5%, which does not include out-of-pocket costs.

• The lack of any standards for out-of-pocket costs in the subsidized pool. Given that one can drive the cost of a premium down by raising deductibles and cost-sharing, the limit of premiums provides small comfort.

• An exemption from the minimum level of coverage for any and all employer plans. The draft still has, as a placeholder, an unacceptable $5,000 deductible (and $10,000 out-of-pocket max) plan as a minimum level of coverage under the individual mandate… but that even that low minimum does not apply to individuals who take up employer-based coverage, meaning they could have coverage with very skimpy benefits, or no out-of-pocket maximum.

• A weak definition of the minimum Medical Loss Ratio (the amount spent on patient care rather than administration and profit), so that it applies to an insurers’ entire portfolio of business, meaning this rule would no longer provide assurance that any specific product is of good actuarial value. A limit that was product-by-product, or even market-by-market, would be more helpful to consumers.

• The Healthy Action benefit seems to be less than advertised as well, since it only requires an insurer to offer such a product, but does not include smoking cessation or obesity programs as a mandated benefit. With no requirement, the policy seems more likely to be a way for insurers to identify risk, rather than a viable new benefit for consumers. If this is truly a priority, it needs to be a mandated benefit.

• And most concerning, the guaranteed issue protections in the individual market seem hollow with the new details. Only a few high-deductible, low-benefit products will be guaranteed issue to begin with–so those with “pre-existing conditions” will only have access to the coverage in the market that is least suited to them. There would be little assurance that we would ever get to a second phase of having the full market guaranteed issue. Insurers will be able to use benefit design, marketing, and pricing to avoid those California customers that have health risks and needs. In particular, we believe older Californians will simply be priced out of the individual market, and the guaranteed access an illusion.

I can live with an individual mandate if it included guaranteed issue and significant cost controls, in addition to a baseline of coverage for the insured and a cap on prices.  But this proposal seeks to eliminate practically all of those checks on the insurance companies while maintaining the individual mandate.  This is nothing but a license to print money for the insurers.

Since nobody will claim this document, it’s hard to know whether or not this is the result of any negotiation or if it’s the Governor’s response to AB8.  Therefore, it’s hard to know whether or not the end result will be something in the middle, or something pretty close to this orphan document.  If the latter is the case, health reform should be torpedoed in the special session without delay.  These terms are unacceptable.