Daily Pulse: Dissecting the Baucus Bill

Yesterday, a long and pathetic spectacle came to an end. Sen. Max Baucus (D-Mont) released the first draft of the Senate Finance Committee’s health care bill.

After months of fruitless negotiation in search of elusive bipartisanship, Baucus delivered a bill with no Republican support. You’d scarcely know it to read the bill. As Tim Fernholtz observes on TAPPED, the Baucus bill looks like a retread of the Republican alternative [2] to Clinton’s health care plan.

Sure enough, the Baucus bill is a boon to the insurance industry. The government would force people to buy more of the same expensive, crappy private insurance that necessitated reform in the first place. Instead of driving down costs through competition with a public option, Baucus wants the government subsidies to help people buy bad insurance they can’t afford. That’s not the free market. In capitalism, if your product is too expensive, people don’t buy it. Under Baucusism, the government forces you to buy insurance and kicks in some money to help you afford it.

As expected, the bill contains no public option. Instead, the bill calls for 50 state insurance co-ops to bargain for better rates—but the bill hobbles the co-ops [3] by restricting their enrollment and bargaining power. If the goal is to drive down prices, you want the biggest possible co-op to drive the hardest possible bargain. So, anything that keeps co-ops smaller or restricts their ability to negotiate undermines the exercise. Which proves once again that the Baucus and the Blue Dogs only care about holding down costs when the money is coming out of the pockets of the big business contributors.

Individuals must have insurance, but employers are under no obligation [4] to offer it. Companies would pay a fee if they did offer insurance and workers and the workers ended up getting public subsidies instead, but not the full cost of the subsidy. So, the taxpayers would be subsidizing employers who won’t do right by their employees.

The Baucus bill throws down the gauntlet on organized labor by calling for a 35% tax on high-quality health insurance plans. The tax could raise $200 billion, but as McJoan [5]explains at AlterNet, it’s a giant middle class tax hike that hits union workers the hardest.

Luckily, nothing is set in stone. This is just the first draft of one of the Senate bills. The Baucus bill will have to be combined with the much more liberal bill passed by what was then Sen. Ted Kennedy’s (D-Mass) Health Education Labor and Pensions Committee. Senate Majority Leader Harry Reid is already signalling that the final bill will look very different by the time the full senate is called to vote on it.

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