I’ve already said my share on what Obama did not say in his State of the Union address. But it’s also worthwhile to take a look at what he did say, which policy provisions in health-care reform made the cut for the speech and which ones did not. It’s not a particularly daunting task─Obama only spent 452 words on health care last night, about 6 percent of his 70-minute speech—so, after getting a bit of a nudge reading the Columbia Journalism Review this morning, here’s my run down on the four main policy provisions that Obama highlighted and what the Senate bill would do about them:
Obama said: “The approach we've taken would protect every American from the worst practices of the insurance industry.”
Senate bill says: Insurers cannot deny coverage based on a preexisting condition; everyone can buy. Insurers would also be seriously limited in their ability to “rate” customers, a common practice in the industry where older, riskier patients pay more. The Senate bill would limit age rating to a 3:1 ratio (i.e. an older customer could only be charged three times more than their younger counterpart), rating for smokers would be limited at 1.5:1 and rating gender rating would be completely eliminated.
Obama said: “It would give small businesses and uninsured Americans a chance to purchase affordable health care in a competitive market.”
Senate bill says: States will have health-care "exchanges" where insurers who want to sell have to play by the government’s rules. Among the requirements: insurers selling on the exchange have to offer affordable coverage (if the exchanges were set up this year, for example, insurers would have to offer at least one plan that costs just under $1,000 per month to insure a whole family). Businesses can buy on this exchange.
Obama said: “Our approach would preserve the right of Americans who have insurance to keep their doctor and their plan.”
Senate bill says: This isn’t necessarily a plank laid out in the Senate legislation, but the general idea is that everyone who already gets insurance through their employers will continue to do so.
Obama said: “It would reduce costs and premiums for millions of families and businesses.”
Senate bill says: Any family of four earning up to $88,2000 gets discounts (or, for the policy wonks, advanced, refundable credits) to buy their health insurance (more on these subsidies here). Not many changes for big businesses that already provide insurance. Small businesses will get a whole bunch of tax credits if they offer insurance and will be able to buy those cheaper plans I mentioned earlier.
(Should note here that, while Obama is accurate in saying that health-care reform would reduce premiums for millions of Americans, the CBO report found that for about 13 million Americans buying individual policies, premiums will increase. Why? Because insurers will no longer deny coverage based on preexisting conditions and therefore have a less healthy pool of subscribers. More health-care costs for insurers translate into higher premiums.)
What should we take away from Obama’s 452-word Cliff Notes on the 2,074 page bill? He’s all about selling Americans on health insurance reform as affordable. Notice he makes no mention of the individual mandate—the fact that all Americans will have to buy insurance—which could easily be interpreted as (and for some Americans will be) yet another financial burden. Nor does he mention the price tag ($871 billion) for this program, as he does for his jobs and clean energy initiatives. In a way, Obama’s take on health care was similar to his take on bankers. Insurers didn’t get quite as bad of a rap, but Obama set up a bad guy / good guy dichotomy: here are some greedy corporations, they’ve been taking your money and I am here to fix it.