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Health Care Reform and Sausages

Jun 7, 2010 • Government, Regulation • 184 Views    No Comments

Now that we have a health care reform bill, I wondered about the next step. After a law is passed, how are the provisions implemented? A recent Washington Post article provided the answers.

The next step unfolds in government offices where staffers decide what each provision means and how it will be applied. With more than 2,000 pages of provisions, for health care reform, the decisions are countless and the logistics unfathomable. According to the Washington Post, government staffers are arriving earlier, staying later, and seeing White House officials oversee key timing and content decisions.

Immediately, $250 checks have to be sent to seniors because of Medicare’s drug benefit coverage gap, small businesses will receive a tax break in exchange for their employees’ insurance coverage, and insurers will have to let families keep adult children on their policies. The law prohibits an “unreasonable” premium increase but what is “unreasonable”? Because the law says that insurers have to spend premiums on improving members’ health, insurers have begun to reclassify activities as improving members’ health. Who determines their validity? Even agency names are being debated. Creators of OCIIO (The Office of Consumer Information and Insurance Oversight), for example, have to decide what to call themselves, “oh-sig-oh” or “C-C-I-I-O”. And this is only the beginning.

Reading the legislation (H.R.4872 and H.R. 3590), I recalled that Otto von Bismarck said, “Laws are like sausages. It is better not to see them being made.” And we should add, “and implemented”.

The Economic Lesson

Fiscal polcy can be defined as the activities of the President and the Congress that relate to spending, taxing, and borrowing. It sounds so concise and clear until we look at health care reform and see how complicated fiscal policy can be.

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