Max Baucus Releases a Damn Good Plan

Ok, first critique (0.00 / 0)

"The responsibility for all Americans to obtain coverage would be enforced possibly through the U.S. tax system..."

Baucus intends to use the IRS to enforce a mandate to hold a certificate of health care coverage. The corollary here, of course is that everybody must file a tax return to comply or receive a subsidy, and that fines for noncompliance will be levied against your taxes.

Along with this IRS dictatorship, is the granting of tax credits to subsidize those who can't afford to purchase a policy, for those who don't receive a policy through their work, and who don't qualify for a public assistance program like Medicaid or Medicare,

Of course, if you have a tax offset, say for things like owing the federal government money for back taxes or defaulted student loans, then all a tax credit will do is go straight towards the offset.

I've said many times before that the problem with any plan that wants to utilize the IRS's dictatorial role in using taxes to force compliance and issue tax credits will fail with a large constituency of people. This was a major critique of Hillary Clinton's health care plan in relation to Obama's.

People living on the margins (and have tax offsets--millions of Americans), who make too much too qualify for Medicaid, yet not enough to purchase a plan through Baucus' proposed "Exchange" without a subsidy (read "tax credit") will both be unable to get insurance through the tax credit's diversion to the tax offset and will be penalized for not having the coverage.

This is the essential stink test that Baucus' plan will have to pass, and I see nothing in his proposal that alleviates these concerns. Low income people will suffer under this sort of dictatorial relationship with health care reform through IRS mandated forced filings, enforcement actions, and fines levied against your taxes.

"Every individual would receive a certificate of coverage from their insurer to demonstrate that they are meeting their responsibility.

Enforcement of a responsibility to have health care through the tax system has advantages. The biggest advantage is that most Americans already have contact with the IRS through the annual filing of a tax return. Monitoring health insurance coverage through the tax code would take advantage of this existing relationship. One issue to be addressed, however, is how to deal with individuals who do not file a tax return due to their low tax liability. If a premium subsidy for health care was administered through the tax code, the non-filer issue would be significantly decreased because a number of current non-filers would voluntarily file in order to get the assistance."

"In order to make health coverage affordable for all Americans, refundable tax credits would be available to individuals and families with incomes at or below four times the Federal poverty level. These tax subsidies would be available to individuals and families who purchased coverage through the Health Insurance Exchange."

---

by: JC @ Wed Nov 12, 2008 at 13:17:30 PM CST

So what's the alternative? (0.00 / 0)

I'm not asking that in a patronizing tone -- honestly wondering what we should be pushing for. Mandates have to exist in some fashion. That's less because of very low-income folks (where a mandate should take the form of auto-enrollment) and more because of folks of moderate and high-income who may choose not to insure but who end up putting demands on the health care system.

The only way the economics works is to have everyone buy in. So how do we make sure that everyone buys in?

---

by: Matt Singer @ Fri Nov 14, 2008 at 14:17:52 PM CST

[ Parent ]

I'm only going to write this once. (0.00 / 0)

And if anyone tries to tie me to it in the future, I will disavow this comment, and then hunt them down in their sleep.

If I'da known that Max would do this, I would have voted for him.  This is the closest the man has come in 30 years to a political master stroke, and to actual leadership.  This is a good plan, and JC's reservations not withstanding, I think it's a plan that can work.  Regardless of how icky tax-based coercion is, it works, especially with those who need the tax breaks to make the bottom line (employers).

But I'm not a policy wonk, so I'll let others hash that stuff out. What I am truly impressed by is this.  Timing.  Max has obviously worked this plan out for quite some time.  He released it a) before the incoming President could release a plan of his own, b) while the opposition is disoriented and leaderless, c) when the opposition will be gun-shy of offering resistance simply because they haven't a clue where the political winds are blowing (and won't until 2012), and d)  when it would most secure Max's political legacy.  Even the insurance industry will be ... circumspect .. in taking on this plan because resistance could mean a loss of control and a huge loss of revenue.  To Max I say, well done, sir.

Unlike watching the Clinton plan get debated in 2003 (PAINFUL!), this is gonna be a hoot.  I know that President elect Obama probably won't comment on this for some time, or even until after January 20th.  I don't think the Current Occupant will comment on it at all.  Politically speaking, this is as close to shooting fish in a barrel as it gets.

---

by: Wulfgar @ Wed Nov 12, 2008 at 17:53:30 PM CST

I have to commend Max too, for sticking his neck out on this one. (0.00 / 0)

Notice I don't go down the single payer critique, nor do I lambast the general tenet of the plan. I do think that this could be the icing on Baucus' and Kennedy's careers.

I just happen to think that unless some details get worked out on how to implement universal healthcare reform concerning the use of tax credits, that there is going to be a class of vulnerable people (both economically and healthcare-wise) who are going to suffer.

You can't have "universal" healthcare with a mandate when some x millions of people won't benefit due to IRS involvement.

The issues of tax credits and tax offsets needs to be dealt with up front.  

---

by: JC @ Wed Nov 12, 2008 at 18:57:47 PM CST

[ Parent ]

How're the corporate puppeteers going to come out under (0.00 / 0)

Max (me too!) Baucus's plan?

---

by: jed @ Wed Nov 12, 2008 at 19:02:26 PM CST