McDonnell Makes Good Call on Health Exchanges

McDonnell to dazed-and-confused federales: You wrote Obamacare, you implement it.

by James A. Bacon

Governor Bob McDonnell is totally justified in his decision to not set up a state-based health benefits exchange as called for by Obamacare, even if it means relinquishing a modicum of control over health care insurance to the federal government.

He laid out his thinking clearly in a press release issued late  yesterday:

For months, Virginia has asked the Obama administration to provide clear guidance and comprehensive answers to important questions that would determine major components and financial impacts to the Commonwealth should we decide to run our own exchange. Originally, I asked that we begin the planning process to potentially operate a state-based exchange for Virginia, primarily so we would be in control of this process. However, despite repeated requests for information, we have not had any clear direction or answers from Washington until recent days, and we cannot conclude, as we review those materials, that we would have the control and flexibility needed to efficiently and effectively run our own state exchange.

If Virginians are faced with running a costly, heavily regulated bureaucratic exchange without clear direction from Washington, then it is in the best interest of our taxpayers to let Washington manage an exchange at this time.

Inevitably, McDonnell will be attacked for pursuing a partisan, anti-Obamacare agenda. But he has steered clear of the kind of inflammatory rhetoric that I would engage in, were I in his shoes. Indeed, he has stressed that he is open to changing his mind should the feds reach a point where they can provide  clear direction.

Bacon’s bottom line: If the states are not required to set up their own exchanges, why should Virginia go along? Obama and his acolytes rammed a massive piece of legislation through Congress and the implementation has been fraught with more pitfalls and complexities than its architects imagined. Why should governors like McDonnell help bail out Obama, only to set themselves up for partisan criticism should they fail to deliver functioning health care exchanges under impossible circumstances?

One of the rhetorical tropes of Democrats is that Republicans make incompetent administrators, either out of moronic  ineptitude or ideological antipathy to government. Well, let the Dems show everyone how bloody smart they are. Guided by the immortal words of then-House Speaker Nancy Pelosi, “We have to pass the bill so that you can find out what is in it, away from the fog of controversy.”

Obama won re-election and, as he reminds Republicans, elections have consequences. One of those consequences is that he, not someone else, has to implement the hash of legislation he enacted in his first term. Let him figure out what’s in the law and how to make it work.

Republicans cannot content themselves, however, with being the party of “no.” There is one big thing they can do to advance the cause of health care reform in Virginia in the context of Obamacare — they can build upon earlier initiatives to create price and quality transparency in the Virginia health care marketplace. That means getting serious about putting actionable information into the hands of consumers — either directly, through the mechanism of the Virginia Health Information Foundation, or indirectly through the insurance companies.  Empowering consumers to make cost-quality tradeoffs when seeking health care services will do more to restrain cost increases and boost the quality of medical outcomes than all the bureaucratic edicts emanating from Washington.

30 Responses to McDonnell Makes Good Call on Health Exchanges

  1. re: “ramming” through legislation… Got any idea why the Bush Tax cuts are temporary?

    re: health care exchanges in Va.

    already a reality: check out healthcare.gov and key the “FIND Insurance” button and answer the questions and you’ll see a dozen or more offerings.

    anyone who does not have employer-provided insurance will be able to buy insurance from the exchanges.

    imagine what that means to people who would switch jobs or start out their own entrepreneurial efforts if health insurance was taken care of.

    Here’s what I think. I think companies that provide health insurance are afraid of ObamaCare because then their employees can switch jobs without fear of losing their insurance.

    From now on, workers are going to be looking for other things from prospective employers… good working conditions, good pay, etc but not insurance.

    this is the beginning of the end of employer-provided all-you-can-consume insurance that has supercharged our enormous health care costs.

    From now on, people will choose how much insurance they want/need and many will pick less expensive insurance with higher deductibles and co-pays – and more skin the in the game when getting care.

    I do not respect McDonnell’s position at all. He took a partisan position instead of looking out for Virginians – both those who need health insurance and can’t get it and the rest who have to pay for ER visits for those without insurance.

  2. Ditto Larry,
    McDonnell punts but what the hell, he’s gone in a year.

  3. The costs of covering more people will greatly exceed the costs of ER visits. Nothing the federal government touches ever costs less.

  4. I do not think so. The view that people do not get health care if they do not have coverage is myopic.

    When people get sick, they go get medical care and it’s usually more expensive than if they were getting regular and preventive care – and someone pays for it and this is one reason why our health care costs are twice as high as other countries who cover everyone.

    we’re living in denial.

  5. re: “we will pay more”.

    so.. we’ll even INCREASE beyond the twice as much per capita that all other industrialized countries pay AND cover ALL of their people?

    Why does this have an Alice-in-Wonderland “feel” to it?

    Every other industrialized country in the world has universal health care and pays 1/2 what we do – but if we try to do that our costs will go even higher than double?????

    It’s almost like as a country we are stupid – but we have “good reasons” why.

    ;-)

  6. Larry, from what I have read, many countries that have “universal” coverage either have crappy government programs or allow people to buy high deductible, catastrophic coverage policies. With Obamacare, costs will rise and many people with employer-based insurance will lose it.

  7. @TMT – did you know you can buy a wide range of policies from ObamaCare including high deductible catastrophic?

    In all those other countries – the universal care is the baseline. You are free to buy more if you want to.

    The savings accrue from people getting regular, preventative care – rather than late-state, expensive care paid for by others.

  8. Larry, if health care reform was going to save money, how come so many health care providers agreed to support it? Not out of benevolence. They saw and still see more money. What precedent do I have to believe something Uncle Sam touches saves money?

  9. TMT – did ALL providers support it? My recollection is there was opposition from a number of providers.

    Most Doctors tend to be GOP and most of the ones I know opposed it.

    And over and over we heard that Medicare and MedicAid and ObamaCare will not provide adequate payment and doctors may stop accepting it.

    The health insurance companies support it because they’ll sell more insurance.

    I’ve heard a lot of stuff – pro and con from providers.. myself.

  10. One thing that is kind of funny here is that Bacon is often heard to say that we need to “experiment” …with things like health care and education and ObamaCare certainly would qualify as an “experiment” in most people’s books – but people are opposed to this kind of “experiment” even as they don’t know any better how it will work or not than any other experiment.

    A few years back Singapore of all places decided to implement universal health care via individual mandate (a hefty payroll tax higher than ours) and govt rules for health care including mandatory disclosure of costs for procedures and the ability of people to “shop” around for their care.

    Singapore now has among the highest life expectancy and infant mortality stats at the same time they have among the lowest costs – about 6% of GDP while we are pushing almost 3 times that rate and our people have no clue what costs are much less able to shop around.

    If you go to healthcare.gov – you will see that people can easily compare plans and costs and choose from a wide variety that vary from high deductible catastrophic to comprehensive family policies.

    while you are there you will also see – that despite the propaganda that says ObamaCare is socialism that the cost of the insurance DOES depend on your lifestyle habits, obesity, etc with the primary difference being that you cannot be denied and insurance is offered to you by more than one company and you can compare.

    Although one of the options is MedicAid and local clinics, the majority of options are non-govt, private company plans.

    I would urge everyone to go to healthcare.gov and give it a test drive.

    I liken it to the Federal Employees health care plans – FEHB… works similarly with an array of choices and the ability to compare them.

    Will Congress be forced to drop FEHB and use ObamaCare? I see conflicting reports. anyone know for sure?

  11. It will be entirely new. If Virginia doesn’t want to have its own exchange from the get-go, that’s ok. If it all works, and it will eventually, Virginia will come on board. This is change, and I think most everyone agrees that change to our health system is necessary, but someone has to step out front to start the change – throughout our history, it has been the federal government.

  12. Larry, I misspoke. I meant to say virtually all of the insurance companies supported Obamacare. They did so because they expected to see more, not less, health care dollars being spent. Again, name something the feds touch that costs less than before.

  13. well your last sentence is a challenge to rebut!

    but the problem with health care of which 50% is govt-funded and 50% is private funded is that if we do nothing – it continues to go up because basically we’re paying for whatever services the providers can figure out how to write diagnostic codes that will get past the gate keepers.

    You keep acting like we’re saving money and ObamaCare is going to cost us more.

    We’re losing money and the intent of ObamaCare is to bend the cost curve.

    It might or might not but it’s at least an attempt which if it fails will result is more changes until we start to see some results.

    as opposed to doing nothing, staying frozen in place and letting costs keep going up.

    I think ObamaCare COULD have been a LOT BETTER but we had unrelenting opposition with empty promises of REPLACE once it was declared unconstitutional and/or Obama was kicked out.

    That strategy was a failure 3 different ways and now we go forward, good, bad, or ugly.

    that’s what happens when you oppose something and offer no competitive alternative.

    people who supported that approach bear some responsibility for where we are right now.

  14. Gee Larry, Mexico has universal healthcare – and I have many reasons to NOT be impressed with their level of healthcare. Ditto many other countries that have ‘universal’ healthcare.

  15. Hey Larry, I tried out healthcare.gov, OMG, that’s suppose to be good??? I was honest and the BEST they came up with was $1700 a month for my wife and me (and we basically rank fairly healthy). And that was with some rather (to me) healthy deductables. Let’s compare that to the health insurance that I presently have with my employer which (including disability insurance) runs me $400 a month and my deductables are very low. Oh yeah, if this is what we have to look forward to – the future looks bleak.

  16. $1700 a month? seriously?

    Must be something different between Va and Texas.

    but you pay $400 tax free and how much does your employer kick in?

    we need to compare apples to apples here but I’ve heard the 1700 a month before and would like to know more about your specifics if you’d be comfortable providing… I’d like to see for myself.

  17. Oh and I DID go through the numbers for a family of 4 and did not get anywhere near to 1800.00.. it was more like 700 as I recall.

  18. Accurate – in Virginia for a family of 4 I got 46 choices
    and the least expensive was $337.09 and the most expensive
    was 2,464.00 . how many choice and high/low did you get?

    This seems to me to be better. If you could take the money from
    your employer-provided – I bet you could tailor a plan better to your needs and probably save money to boot.

    better than that – if you changed jobs, you keep your insurance and you bargain at your new job for increased salary and 401(K) benefits.

    • As I recall, I was given four choices and the $1700 choice was the cheapest and that was just for me and my wife. Right now, I’m pretty happy with my healthcare, although last year and this year they’ve introduced some rather nonsensical flim-flam where we are suppose to either read some junk about (your choice) sleep, exercise, diet … OR … have a chit-chat with some bimbo on the other end of the line and listen to her spout that you should stay on the meds that your doctor has prescribed … OR … get a flu shot … OR – something that they deem okay and if you don’t do it they tack an extra $35 a month to our premium. It’s just another stupid game, I play it, it has no effect, I already know and do all this falderall. Worse part is that in 6 years I will qualify for Medicare, and I’m not looking forward to that cattle call, especially the way Obama has screwed that pooch. The good news, I hopefully will die within the next 10 years (cause I want to) and I can leave this mess behind.

  19. @Accurate – the cheapest per month is not the default sort. You have to do the sort to get the cheapest per month.

    only 4 choices and I got 46. I avoided answering any question about special needs or pre-existing conditions. I just put in mom, dad and 2 kids and checked the ” We have trouble finding affordable insurance” button.

    The cheapest ones that I got were essentially catastrophic with high deductibles which I doubt would be providing all the “junk” you are
    seeing so in that regard you’d have more choice as to what you want and don’t want.

    What do you think about the idea of the insurance being portable?

    If you could get insurance from the exchange at similar cost to what you pay now – wouldn’t that be better for you if you changed jobs?

    • Hey, I’ll even try again, however I did scroll down and while I didn’t look at all four choices, choices 2 and 3 were higher than choice 1, so I just assumed. I will even check into my city insurance and see if I can’t figure out how much the city is kicking in. I forget if I answered that I have insurance or if I answered I was having difficulty finding it. I don’t remember it asking me of any medical conditions, if it did I told it that we (my wife and I) didn’t have any. I’ll try again, just to humor you, but remember, it’s from Obama, so you know it sucks.

      As for the insurance being portable. If I was younger and wanted to/was worried about other jobs, I could see it as a plus. However, since I’m older and will be here pretty much until I die (and will soon be forced onto Medicare) it’s not a selling point to me. In fact as a young man (oh, so many years ago), with the exception of one bad spell of unemployment, all my jobs from age 18 on, did have some form/degree of health insurance. During the ‘bad spell’ there was no way I could afford anything, heck affording asprin was difficult to budget for.

  20. re: ” but remember, it’s from Obama, so you know it sucks.”

    oh would it feel so good for you to have to eat those words!

    ;-)

    re: I’ll be here until I die…

    Geeze, Accurate.. it wasn’t that long along that you switched jobs, no?

    besides don’t you feel the slightest bit of guilt working for government? is that somewhat antithetical to your usual anti-govt persona?

    but seriously – only 4 choices and the cheapest was 1800?

    WOW! big difference from Virginia AND Virginia is NOT participating and I thought Texas as not either.

    I wonder what the difference is.

    Can you run a standard 4-person family through the Texas Exchanges since you are humoring me anyhow?

    • “oh would it feel so good for you to have to eat those words!”

      Larry, he’s the WORST president EVER, I’m not worried.

      Yes, Texas too is not participating, but I’ll give the scenario that you’ve asked for.

      Wasn’t that long since I switched jobs … time flys, even hard for me to believe that this May it will be 5 years.

      Guilt working for the government? No, as I’ve explained before, I work for the airport and the airport here is funded by passenger fees, fees to airlines to land and use our gates and FAA money. Quite different than the typical ‘government’ employee.

      Thanks for the chat. Hope you (and everyone on this board) have an absolutely fabulous Christmas.

    • GOOD LORD Larry –
      You are impressed by this website? Really??? What a screwed up mess. So I’m going to run your scenario. I choose family and Texas. Next comes are you losing insurance from a job, you’ve applied but were rejected or I need health insurance for some other reason. Since I didn’t have instructions from you, I chose losing health insurance from work. Then comes the dumbest question of all, how old is the family member needing insurance. Note, no matter which reason I choose for looking for the insurance, once I’ve picked family this stupid choice comes up – excuse me, I just told you I had a family, uh, typically means more than one person and typically means people under 18. But no, in typical stupid government style, I am asked this single question in which they break down the age groups, under 18, 19 – 25, 26 – 64, 65 and older. So I click 18 and under and the next question is medical conditions, I don’t click any, then is it difficult to afford insurance and I click yes. Now I’m presented with choices like COBRA, spouses insurance, continued coverage for kids under age 26, I settle on Health insurance plans for individuals and families.

      FINALLY, the ‘here are your choices’ screen shows up. I sort lowest premiums to highest. Blue cross comes in with a monthly premium of $581 with $3,000 individual deductible and $9,000 family deductible if I stay in the network and $10,000 individual and $30,000 family deductible if I go outside the network. And you think this is a good deal?

      First the premium ain’t cheap. Second the deductibles would knock me out of the ball park. Heck, since I couldn’t pay that, I’ll just go uninsured, use the ER when I have to and let them chase me for the money, cause I ain’t got it.

      Yeah, you’re boy Obama has really come up with a winner with this one. Larry, face it, Obama was, is and always will be a hack, nothing more and nothing less. A man with an ego the size of the world, who always believes that HE is the smartest man in the room.

      I will try to get how much my employer is contributing to my health insurance soon.

      • Oops, I read it wrong. The 3,000 and 9,000 numbers were in network, out of pocket limit. The 10,000 and 30,000 numbers were annual deductible. I went to the most expensive and got $2804 per month premiums with 3,000 and 6,000 out of pocket, in network limit and $250 and $500 annual deductible. Not a bad policy but the premiums suck rocks.

        Sorry Larry, paint me a VERY unimpressed.

        Just for giggles, I changed it to just the wife and me and it looked like the same batch of loser plans. Lowest monthly premium (with all the high limits and deductibles) was $465 and the highest was $2254, again with the same low deductibles (cause you’re paying through the nose for the insurance).

        To finish this experiment I picked (for just the wife and me) a plan with $600 premiums. Hey, once you met your annual deductible they covered a lot, but not addiction and not mental health issues (I need the mental health from having discussions with democrats – my head hurts ALOT after listening to them). Sorry Larry, this is NOT the solution, not the panacea, not much of anything to our healthcare problem in this country. And no, I dislike one payer even more, one payer is the worst of the post office and the DMV all rolled into one. Short of having a limb missing (that you are carrying with you) or blood spurting from a cut, the answer is “The doctor will see you in 2 to 8 weeks”. No Larry, this thing is just a really, really, bad joke (sort of like Obama is).

        • Accurate, I ran a Texas scenario with Mom, Dad, two kids that need affordable insurance and I got about 3 dozen choices that ranged from about $300 a month to very expensive plans and they are ALL private plans – not govt plans AND they are PORTABLE AND you can switch insurance to get more/better or less if that’s all you can afford. You CAN CHOOSE, you don’t have to take what your employer offers and nothing else.

          It may not “impress” you but surely you must admit this opens up a lot more choices and options certainly for people who are less fortunate than you. Some people do not have employer-provided insurance or simply cannot afford what is offered or they work in situations as contractors and/or changing employers and this gives them options they did not have before.

          you have to admit that this is better for some people than what they have right now.

          I’ve never seen the opponents seriously offer any real alternative. It seems almost petty for folks who have employer-provide insurance to resent the ability of those who can’t or won’t et it – some reasonable option to get it.

          • Oh, yeah I didn’t mention how many choices I had. Yes there were about 40, I stated the high and the low. However, with the amount of the deductibles the only place they would help would be a major issue (heart attack, stroke, other things like that), and again, I’d never have the amount to pay the deductible so again, the insurance was almost useless.

            Better than what some folks have now? Really? If you’re earning minimum wage, or even $10 up to $15 an hour a $300 a month premium would be hard to meet. In addition, meeting the deductible would be pretty much impossible. Is it a better option? Again, compared to what that person would owe after a heart attack without insurance, yes, they are in a better place, but they will still be way underwater owing $3000. Larry, Obama’s plan sucks.

          • Accurate one of the problems with Health Care costs is said to be all inclusive/everything is covered plans and that the way to inject more consumer discretion into pricing – and they say – there should be plans that cover basic care and screenings – and catastrophic and these are some of those choices.

            and yes it’s better than some folks have it now because if they cannot afford it, they will get a subsidy to be able to visit a doctor regularly, screened for diseases that can be caught quicker and cheaper and treated instead of not getting treating, having the disease progress to the crisis level and go to the ER for free care – which is passed on to you and I.

            It’s better and more options for more people to have some minimal level of care where they did not have any before.

            You and others have been hard-nosed opponents without even really knowing how the plans were work. They were calling them govt socialist care with “death panels”, etc, etc when every one of the plans is a private company – there is no govt doctors or clinics and there are no more “death panels” than with your own insurance company that could also turn you down if they felt the costs were too high.

            The opponents have been nothing but – opponents – never really offering a viable competitive alternative approach.

            ya’ll spent all your energy in opposition and nothing for a positive approach – both for health care and Obama and the American people saw that you offered nothing – just opposition and gridlock – and they rejected it.

            Now people who needed health care and could not get it, can get it – not as much as they want or need and not without quite a few warts to be sure but way, way more than anything the opposition offered.

            Merry Christmas!

  21. You too Accurate.

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