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The Moral Case Against the Baucus Bill

In his spare time, Max Baucus likes to socialize with high-priced lobbyists and their CEO clients at pricey resorts. The CEOs who attend Baucus functions get to go hiking and fly fishing with the Senator. It must be nice to be able to attend exclusive resorts, and unwind while ensuring that your future seven and eight figure salaries will be untouched by the government. All those fly fishing trips with the Senator paid off today, as Baucus delivered an "absolute gift" to the insurance industry.

Baucus, of course, is crowing about his "successful" negotiations" with people like Senator Chuck "I’m No Nail" Grassley:

"This is a unique moment in history where we can finally reach an objective so many of us have sought for so long," said Baucus, of Montana. "The Finance Committee has carefully worked through the details of health care reform to ensure this package works for patients, for health care providers and for our economy."

If Baucus bill passes, millions of Americans will face a 13 percent tax hike in order to line the pockets of Baucus’ insurance CEO buddies.

Since Senator Baucus shut progressives out of his negotiations, I will take the opportunity to explain my concerns, as a progressive. I have no problems with an individual mandate…as long as that mandate comes with strict restrictions on insurance industry profit and insurance industry executive compensation.

The current system, despite Baucus claims to the contrary, would be largely untouched by the Baucus bill. The problem with that is that the current system creates incentives for bad practices. Insurers try to please Wall Street by lowering their medical loss ratio. In layman’s terms, that means insurance companies try to increase their stock price by denying cancer patients and abuse victims the medical care that they need in order to live healthy lives.

Wall Street, which can never accept modest profits, then pushes insurers for more. The result is that they cut their sickest patients; it’s a large part of the reason why 1/3rd of all chronically ill Americans are uninsured. The insurance companies reward the employees who increase their profit margins by denying the sick medical care with glowing performance evaluations and five-figure bonuses.

The patient–the person who should be the focal point of the medical system–gets shafted in the process. Uninsured, and effectively uninsured, patients receive less care, and tend to develop severe complications, which can cost the system over 50 times what good up-front medicine would cost. By the time a patient’s family has finished fighting with insurance bureaucrats, it is often too late to save a person’s life. Meanwhile health insurance CEOs, the titans of industry who are ultimately responsible for such a horrid system, become billionaires.

In every other industrialized country, a decision has been made to take the profit out of the insurance delivery system. These countries have realized that allowing people to become rich off of paying medical claims ultimately creates perverse incentives.

This isn’t to say that people who process claims shouldn’t be entitled to a decent living. They do perform an important service to society. They should be able to live a comfortable life. But in a morally just health care system, nobody should be able to become obscenely wealthy off of denying a cancer patient access to life-saving medical care.

This isn’t to say that competition is a bad thing. As T.R. Reid points out in his book "The Healing of America," other countries see non-profit insurers successfully compete with each other. Small variances in pay based on a plan’s success in attracting members can be an incentive to provide quality service to the plans policyholders.

And that gets to the fundamental problem with the current American health care system, insurers see their real customers as Wall Street Financiers, not policyholders. The result is that middle America is being trapped in a never-ending cycle of increased premiums and denied claims. The original purpose of insurance companies was to provide a quality service (spreading risk among many members of society, and processing claims) to many members of many communities. The current purpose of insurance companies is to provide a quality service (increasing stock dividends) to a few members of a very narrow community (Wall Street).

That is why, as a progressive, a strong public option is a non-negotiable item. Allowing the public to choose a not-for-profit, government-administered plan would take power away from Wall Street tycoons and put it back into the hands of ordinary Americans.

Over the past 28 years, as conservative trickle down economics as reigned supreme in Washington, income inequality has widened to truly disturbing levels. The result is that average Americans have less to spend while wealthier Americans are stockpiling money. This ultimately leads to declines in consumer spending, subsequent job losses, and the insurance horror stories touched on above. That is why, as a progressive, taxing the wealthy in order to pay for health care reform is a non-negotiable item.

As a progressive I believe we should use this opportunity to affirm the principle that every human life is valuable. I believe that any health care reform should live up to a basic commitment found in many sacred texts–that anyone, no matter how rich or poor, should be able to access the dignity of quality medical care; that no one–no matter how rich or poor–should be forced to endure the pain of illness because they cannot afford to see a doctor.

I believe that Chairman Baucus has failed to produce a bill which lives up to the moral obligations of our time. Call your Senator. Tell them to stand with Jay Rockefeller, and with the millions of Americans who want a health care reform bill which benefits the middle class, not a health care reform bill which would line the pockets of greedy CEOs.

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