Give the Villain his Check

President Obama and his fellow Democrats kicked off their newest campaign to vilify insurance companies in the final attempt to pull off their extremely unpopular healthcare-whathaveyou.

The Republicans, meanwhile, stood on the curb to point out that those very same insurance companies would get huge checks from the government if health reform is enacted. Wha? No way!

“(Health Insurers) will keep on doing this for as long as they can get away with it. This is no secret,” the president said. “They're telling their investors this – ‘We are in the money. We are going to keep on making big profits even though a lot of folks are going to be put under hardship,’” the President told supporters at a rally in Pennsylvania.

HHS Secretary Kathleen Sebelius, meanwhile, wrote to insurance company executives demanding that they justify premium hikes.

Neither bothered to note that the Senate health reform bill, which is the basis for Democrats' last chance at comprehensive reform, would give the insurance companies millions of new customers required by law to buy health insurance. It would also require insurers to cover everyone, regardless of age, gender or pre-existing condition.

To pay for the new insurance requirements the government would give to people money to buy insurance - $336 billion over the next ten years. That money, ultimately, would have to go to... insurance companies. Not individuals. But the folks they're vilifying in public, and handing checks to behind their backs.

Folks without employer-sponsored insurance who make too much money to qualify for Medicaid and less than about $88,000 for a family of four, would get tax credits to help them buy insurance on the open market. But the payment of the tax credits would be made directly to insurance companies. See page 37 here of the Senate Finance Committee's exhaustive explanation.

Now, remember when candidate Obama criticized a proposal by Sen. John McCain because it would send government help for people to buy insurance directly to insurance companies? Yeah. And when Hillary had the exact same plan? Yeah. This is that same plan.

“But the new tax credit [For Health Insurance] he’s proposing? That wouldn’t go to You. It would go directly to your Insurance Company – Not Your bank account," said Candidate Obama in October.

And yet that’s exactly what Democrats' proposal would do and why so many would prefer public insurance option to compete with the private market. Supporting the Senate bill will be tough for many liberal Democrats in the House.

To the Republicans’ (and Obama’s on the campaign trail) point about the payments going directly to insurance companies, remember that people with employer-sponsored insurance or current federal medical benefits do not usually get a separate check to buy insurance either. They pay premiums directly to the insurance company and so does their employer. The Senate proposal would create a similar relationship between people who don't have employer-based insurance and the government.

So why do Insurance companies, if they're set to receive more than $330 billion in government subsidies to insure people without insurance now oppose the Senate bill?

"Health plans proposed more than a year ago robust insurance market reforms and new consumer protections to guarantee coverage for pre-existing conditions. Much more needs to be done in the current legislation to address the skyrocketing cost of medical care, which is making health care coverage unaffordable for working families and small businesses," said Robert Zirkelbach, a spokesman from America's Health Insurance Plans, in a statement today.

He argued that health insurers should not be targeted by the President and their profits are lower by margin than other sectors in the health industry. But the President needs a villain, and you can't make Doctors and Nurses be the bad guys - that just doesn't work. And you need to find pond scum that polls worse than Nancy Pelosi and Harry Reed - which, on last count, I think Used Car Salesmen were polling at a 2 to 1 favorable rating over Congress - so Insurance Companies it is.

"For every dollar spent on health care in America, less than one penny goes towards health plan profits. The focus needs to be on the other 99 cents," he said.

Why not more sensible solutions - like HSA Accounts for everyone? Too complicated and Bush tried that. So, no way a sensible solution is going to be coming around the track anytime soon.