Health reform explained on the back of a napkin…

I highly recommend going through all of these slides as well as reading the commentary. You’ll find that here on the Back of the Napkin Blog.

Here are the gems:

“It’s not "health care” reform at all; it’s insurance reform.“

"Private insurance has miserably failed in its one value-added task: it has not managed to keep premiums down for members. If insurance can’t manage costs, then why does it exist?”

“On the contrary, as the rest of the American economy has tanked, the private insurance industry has done exceptionally well. While the government bails out GM (that’s failing in large part due to health care costs), the top three insurers averaged profits of $2,400,000,000.00 each for 2008.”

“Aside from insurance, is anyone else being asked to reform? A little, but nothing that government can legislate.”

“In the end, whatever reform package is adopted, it will all be paid for by me. If I’m employed and/or have coverage, I’m the only player putting money into the system.”

“Where will my money go? Depending on the decisions made by government in the next month, there are three possibilities: 1) Into the profits of private insurer shareholders2) Into funding new non-profit insurance co-ops and exchanges3) Into funding a new government insurance plan that by law cannot make a profit. (It really is that simple.)”

“There are 3 new models on the table. The first option changes nothing substantial except demands that private insurers cover all citizens.”

The second option adds insurance “co-ops” (or exchanges) on top of the current system and legislates that all citizens must have insurance from one or the other. (No fundamental changes are demanded of the existing private insurers. These co-ops offer non-profit pools of insurance that citizens may choose to pay into instead of paying private insurers.“

"The third option adds a government-managed insurance option to the existing system and makes health insurance mandatory for all citizens. The government option can’t make a profit by law. It does not replace today’s insurers but adds another option for people who chose not to pay a private insurer but legally are still required to have insurance.”

“Of all options, the private insurers see the first as being the least threatening, so have gone to extraordinary lengths to demonize Options 2 and 3. Town hall meeting participants have picked up on several misconceptions and are out-shouting participants who want to open the debate to all options.”

“All of them mandate universal coverage for all Americans; the difference is the degree of government-backed coverage they provide.”

“So what do these 3 options really mean for me?”

“If I am presently employed and covered, I will pay more for insurance under all proposed plans.”

“At this point in the debate, the actual additional costs are unknown. What is known – what we can try to influence – is how the money will be taken from our pockets. Will we pay higher premiums to private insurers, lose our existing health care tax benefit, or pay more direct taxes?”

“An additional aspect of the various plans we need to be aware of is whether our employer continues to pay our insurance premiums on our behalf to a carrier they select (called "Defined Contribution” in the secret code of the insurance industry), or do they pay us in health care vouchers that we can spend on any insurance program (called “Defined Benefit”). The difference means an additional $250 Billion in revenues collected annually by the government to cover health care with no impact on our compensation and employer costs.“

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