I am left with a lot of questions: If Senator Richard Burr does not see a path to passing an ObamaCare replacement this year, why make a splash with a proposal that is not a bill rather than simply scheduling hearings? If Richard Burr thinks that the Burr-Coburn-Hatch proposal from last year was unfairly rejected by his Republican colleagues and that they should take another look at it, why put Burr-Hatch-Upton forward as if it were brand-new–as if it were not a reboot of last year’s Burr-Coburn-Hatch? And why does Peter Sullivan of The Hill not tell his readers that BHU is a reboot of BCH–if, that is, he has the slightest desire at all to be in the trusted-information-intermediary business? And even if he doesn’t want to be in the trusted-information-intermediary business, why does it please Burr to have The Hill’s readers thinking that this is something that Burr has come up with in the last two months, rather than a line of approach that he has been thinking bout, tweaking, and trying to get right for years?

As far as legislative-process and coalition-assembly is concerned, this looks like Kabuki. More, it looks like Dingbat Kabuki–the motives of the performers seem, to me, to be incomprehensible. And I have worked in the U.S. Treasury. I have not just seen the sausage being made but actually done some sausage-making myself.

From The Hill:

If Peter Sullivan is going to write a story about the political maneuvering that is leading Burr to advance a proposal he regards as a feint, he should tell us the story of the political maneuvering that is leading Burr to advance a proposal he regards as a feint. If Peter Sullivan is going to write a story about options for health-care reform, he should tell us what the options for health care reform are. This is, it seems to me, to be neither…

Must- and Shall-Reads:

• Mark Thoma: “If the Fed is overly optimistic yet again… it could raise interest rates too soon… perhaps even create a stall…. Most… believe that the risks involved with raising rates too soon are much larger than the risks of patience…. Asymmetric risks… combined with the Fed’s tendency to be overly optimistic [make] the argument for a cautious, patient approach… stronger.”
• Frances Coppola: “The ECB is acting far beyond its mandate in seeking to influence negotiations between Eurozone member states regarding the terms and conditions under which member states lend to their distressed partners…”
• Megan McArdle: Your Right to Skip Shots Ends Where My Kid Begins

1. Teresa Nielsen Hayden: @tnielsenhayden: “If personal beliefs: were a valid basis for public-health-related behavior, there wouldn’t be a history of health & hygiene regs being laid down in legal codes around the world since law and writing were invented. They exist because personal preference doesn’t work. Typhoid Mary was sure she wasn’t causing typhoid outbreaks in households where she worked. 19th C. dairy farmers likewise knew that their unpasteurized milk wasn’t a problem. Every law prohibiting open sewers or toxic food adulterants is a monument to the existence of citizens who wouldn’t behave responsibly unless the law compelled them to do so.”

2. David Deming, Claudia Goldin, Lawrence F. Katz, and Noam Yuchtman: The Disruptive Potential of Online Learning: “What do we know about the performance of online education thus far?… The most basic question about online programs is whether they can actually reduce the cost of tertiary education…. Does the quality of education suffer when content is delivered online?… Two recent studies have found negative impacts of switching from in-person to online instruction on course final grades in an introductory economics class (Alpert et al. 2014, Joyce et al. 2014)…. For business job vacancies… employers strongly prefer applicants with degrees from (nonselective or selective) public institutions as opposed to applicants with degrees from for-profits. The biggest callback ‘penalty’ is imposed on the applicants with an online for-profit degree…. Online education… can succeed in cutting… costs…. But preliminary evidence suggests that–t least for the time being–the new technology comes at a cost of quality…”

3. Ann Marie Marciarille: Missouri State of Mind: Sutter Health vs. Blue Shield: War of the Gargantuas: “I like… increased health insurance literacy, price transparency, and the promotion of [consumer] competition in health care markets. But when I see consumers whipsawed as with the current War of the Gargantuas taking place in Northern California, I wonder if consumer activation alone will save us. In order to have been a savvy purchaser of health insurance… you would also have to have known something about the health insurance and health care services contracting world.  Can we reasonably expect consumers to master this, to ferret out what they really need to know?… Northern California employers have a fall open enrollment period…. Here’s what your employer (or exchange) surely didn’t tell health insurance shoppers… this past fall: 1. Blue Shield of California is a huge insurance company, with about three million covered lives in California.  2. Sutter Health is a huge health care provider with, for example, over 4300 licensed acute care beds in California. 3. They bargain fiercely right through and past the open enrollment deadline over the next year’s contract rates. 4. Even a behemoth such as Blue Shield… has, historically, been unable to bring Sutter to heel…. 5. Decisions… [may be] made after the close of your open enrollment period…. 6. The decision by a major provider to exit an established health plan after the close of the open enrollment period is apparently not deemed a qualifying life event allowing for special enrollment under Covered California…. So the chat boards are lighting up.  Can it be that a change in a health plan’s coverage options in a highly concentrated market  such as Sacramento or the East Bay is not a a trigger for special enrollment rights? You mean you didn’t know all this already? Watch out where Gargantua steps.”

4. Noah Smith: What We Talk About When We Talk About the Middle Class: “The problem, as Vox’s Ezra Klein recently wrote, is that the middle class is almost impossible to define. The obvious stumbling block is the variation in local living costs: ‘[T]he amount of money needed to feel middle class varies sharply across the country. Making $50,000 leaves you struggling in Manhattan and wealthy in Detroit…. But… is living in New York City a necessity, or is it a luxury good, much like buying a fancy car or a huge house?’… Middle class is more of a state of mind… means a feeling of being in a similar economic situation to the people around you, combined with a sense of overall optimism and security…. That’s why inequality kills the idea of a middle class, even if it improves people’s standard of living overall. When everyone makes $50,000 a year, it’s easy to tell that you’re middle class. If half of those people suddenly start making $150,000 a year, it’s no longer so easy. For the half of people still making $50,000, nothing has changed in terms of their absolute material standard of living…. But now they might think to themselves, ‘Have I failed in some way?… The idea of the middle class is dead. There is no going back in our lifetimes. We need to find a new way of thinking about broadly shared prosperity.”

5. Gregory Clark: Social Mobility Barely Exists, But Let’s Not Give Up on Equality: “We live surrounded by inequality…. The Conservative reaction, personified by David Cameron, is to promote social mobility and meritocracy. History shows… that social mobility rates are immutable, [thus] it is better to reduce the gains people make from having high status, and the penalties from low status. The Swedish model of compressed inequality is a realistic option, the American dream of rapid mobility an illusion…. An illustration of the power of lineage even in modern England comes even from the first names children receive at birth. Naming your daughter Jade means she has one hundredth the chance of attending Oxford as a girl whose parents chose for her Eleanor. Similarly for Bradley versus Peter. Is this just the survival of sclerotic olde England, where the dead hand of the past exercises an especially powerful grip? No…. Why is social mobility so resistant to change? The reason is the strong transmission within families of the attributes that lead to social success… policy can do no more than nibble at the fringes of status persistence. Marriage is highly assortative…. Create labour market institutions that compress wages and salaries…. Structure educational systems to narrow the social rewards to those at the top…. We cannot change the winners in the social lottery, but we can change the value of their prizes.”

6. Emily Bell: Social Networks and Journalists: “Journalism needs a lot more journalists who are technically proficient, and the new gods, the platform companies, social networks and search engines, need to hire a lot more technologists who are proficient in news. Because at the moment we have a situation which is not working for either of us… we need to work together, because we are now part of one continuous global information loop…”

Should Be Aware of:

• Cory Doctorow: “After sending Roger Vanderklok for… asking to file a complaint, Philadelphia… TSA supervisor Charles Kieser… lied… in court… fabricated an aggressive confrontation and a bomb threat, neither of which are in evidence on the CCTV footage or in the police report. His victim was help incommunicado in jail, panicking his wife who had no idea where he’d gone. Kieser gets to keep his job.”
• Tim Stafford: The best way to win an argument
• Volunteer of the Month: Michael DeLong

1. Richard Mayhew (2014): Reinventing the wheel: “Following up on my post this morning on the financing of the P-CARE proposal there is a significant change as the Republicans proposing this bill realize that they are proposing a massively expensive and disruptive tax hike that will impact middle class and upper middle class voters. Sen. Coburn’s office issued a “clarification” this morning: ‘Institute a modest cap on the exclusion for the most generous high-cost plans; specifically, cap it at 65 percent of the average market price for an expensive high-option plan.’ Hey numbnuts, there is already a 40% excise tax scheduled to go into effect for the most expensive plans. It is called the Cadillac tax and your f—ing campaign committees have been running against it for four years now. Why re-invent the wheel?”

   <– This is as much a question this year with this year’s Patient CARE proposal as it was last year with last year’s Patient CARE proposal.

2. W.E.B. Du Bois (1953): On Stalin &lt:– Given the context of discrimination and Jim Crow in W.E.B. Du Bois’s era, attachment to the only political party to make racial equality a goal that it tried to live every day is understandable, but he really should have known better than this by 1953.

3. Joel Gillin: Pope Francis Declares Oscar Romero a Martyr: “Pope Francis has declared Salvadoran Archbishop Oscar Romero, who was murdered while celebrating Mass in 1980, a martyr…. The U.S. embassy had evidence that Roberto D’Aubuisson, an anti-Communist former army major whom Reaganites considered a Cold War ally, was behind the killing…”

4. Patrick Clark: Welcome to SubTropolis: The Business Complex Buried Under Kansas City: “Welcome to SubTropolis: The Massive Business Complex Buried Under Kansas City
   More than 1,000 people spend their workdays in SubTropolis, an industrial park housed in an excavated mine the size of 140 football fields…”

The interaction of health-care regulation and antitrust policy is perhaps the most fraught area in the fight over how to build a system to control our health care costs. And not just individuals but the government has an enormous stake in this game–through exchange subsidies, and through all the other programs in which reimbursement rates are in any way influenced by what is customary and appropriate in the private marketplace:

Noah Smith argues that inequality has a direct effect on utility functions and societal well-being–not via the envy/spite channel, but through a yardstick channel by which an unequal society is one in which people feel insecure:

I think, yet again, that this New York Times story on the Burr-Hatch-Upton ObamaCare replacement proposal would have been much better if it had been assigned to David Leonhard’s The Upshot rather than to the New York Times’s national news desk. The indispensable link that should be in Robert Pear’s story but isn’t is here. And it should have been compared to last year’s equivalent

Robert Pear’s article:

Robert Pear does not provide a link to any piece of paper about the plan, not even to Burr, Hatch, and Upton’s own op-ed.

Over at the Washington Post’s Wonkblog, Jason Millman writes, much more usefully, that:

The GOP plan outlined by congressional aides Wednesday is similar to one that the senators offered last year, which the GOP never united around… no actual timetable yet for… writ[ing] a bill or hold[ing] hearings…

Indeed. Last year’s plan and this year’s plan are the same, save for three moderate substantive differences. Comparing:

• the two-pager for last year’s Patient CARE Burr-Coburn-Hatch proposal at http://www.hatch.senate.gov/public/_cache/files/95dd4672-5012-4ae0-99b2-6b2d450df6d4/The%20Patient%20CARE%20Act%20-%20Summary.pdf
• the two-pager for this year’s Patient CARE Burr-Coburn-Upton proposal at http://energycommerce.house.gov/sites/republicans.energycommerce.house.gov/files/114/20150205-PCARE-Act-Two-Pager.pdf

reveals that:

• This year, the regulation of malpractice insurance is no longer left to the states.
• This year, the plan no longer promises to “blunt the worse” of ObamaCare’s Medicare cuts
• This year Cadillac Tax replacement is
  • no longer a modest cap of the employer-sponsored insurance tax break that begins at 65% of the cost of the current average high-option plan;
  • rather a generous exclusion from taxation of $12,000/year for an individual and $30,000 for a family.

Otherwise the documents are, substantively, the same.

There are a number of rhetorical changes from last year’s document:

• The subtitle of the document has been changed from “A Legislative Proposal” to “Lower Costs, More Choices”.
• In the first paragraph: “patient-centered” has been changed to “patient-focused”; “patients and taxpayers” has been changed to “patients, families, small businesses, and taxpayers”.
• A footnote has been deleted. The deleted footnote is: “We believe it was unfair and wrong that Obamacare effectively treated Medicare as a piggybank to pay for new programs. Certainly, Medicare is in dire need of structural reforms that will put the program on a sustainable path and prevent its insolvency. That’s why we each have supported a range of proposals that would help shore up Medicare’s financing. We believe these reforms should be adopted–as soon as possible–as part of blunting the worst of Obamacare’s cuts to providers and plans. Over the longer-term, we believe that broader changes to Medicare should be addressed in the context of larger bipartisan Medicare reforms that not only put Medicare on a sustainable path, but modernize the Medicare benefit for seniors.”
• The change of “patient-centered” to “patient-focused” appears to have been made throughout.
• In the second paragraph, “common-sense patient protections” has been changed to “patient protections”; “mandates which drive up health-care costs” has been changed to “mandates”.
• In the bullets below the second paragraph:
  • “NO ONE can be denied coverage” has been changed to “no one can be denied coverage”;
  • “‘continuous coverage protection’ that rewards individuals moving from one health market to another” has been changed to “‘continuous coverage protection’ for individuals moving from one health plan to another”.
  • An added sentence: “An individual could not be medically underwritten, denied health coverage, or be forced to pay a higher premium solely because of a pre- existing condition if they were continuously enrolled in a health plan without a significant break in coverage.”
• In the third paragraph: “Empowering Small Business and Individuals” has been changed to “Empowering Small Businesses and Individuals”.
• In the bullets below the third paragraph:
  • “States would be allowed to use” has been changed to “States could elect”;
  • “auto-enrollment to design sustainable insurance” has been changed to “auto-enroll into insurance plans”;
  • “tax credits for individuals who have a health tax credit” has been changed to “individual’s tax credit”;
  • “high-risk pools will help patients who are otherwise without health insurance” has been changed to “high-risk pools could help patients”;
  • “balancing the cost impact” has been changed to “reducing premiums”.
• In paragraph four: a typo–“patients'” where it should not be possessive–has been corrected; “long-term care insurance and COBRA” has been changed to “COBRA”; “on bipartisan proposals of the past” has been changed to “upon bipartisan proposals”.
• In paragraph five: “The Patient CARE Act envisions adopting or incentivizing states to adopt a range of solutions to tackle the problem of junk lawsuits and defensive medicine” has been changed to “The Patient CARE Act adopts common-sense reforms to tackle the problem of junk lawsuits and defensive medicine”.
• Paragraph six has been deleted, rewritten, and replaced:
  • The old: “While recognizing the role of the employer sponsored system in our health care system, it is also important to address the unfair tax treatment of individuals and families who do not receive the same tax preference as those with employer-sponsored health insurance. This proposal repeals the employer mandate in Obamacare, a major reason for employers dropping coverage, and leaves the employer deduction untouched. To help lower the cost of health coverage, the Patient CARE Act reduces a distortion in the tax code—the unlimited exclusion from a worker’s taxes of employer- provided health coverage. This proposal institutes a modest cap on the exclusion for the most generous high-cost plans; specifically, a cap at 65 percent of the average market price for a high-option plan. The cap would be indexed to grow at an annual rate of CPI +1.”
  • The new: “We recognize that employer-sponsored insurance is an important feature of our health care system that provides coverage to nearly 150 million Americans, so we scrap the job-killing employer mandate and preserve the employer deduction. However, the open-ended tax preference encourages higher costs and increased spending. Our proposal maintains the employer deduction, so employers continue to have incentive to provide quality coverage to their employees. At the same time, we institute a cap on the exclusion for employees’ health coverage valued at a generous $12,000 for an individual and $30,000 for a family and index it at CPI+1 for perpetuity. Unlike the punitive Cadillac Plan Tax in current law which imposes an onerous excise tax of 40 percent on cost of coverage of health plans that exceed the annual limit, our proposal treats every additional dollar after the generous threshold at the individual’s tax rate–a more balanced approach for middle class Americans.”

UPDATE:
In email, Harold Pollack summarizes the provisions he knows of. The expansion of Medicaid is reversed, the individual and employer mandates to acquire and provide coverage dropped, and:

• Subsides would go up to 300% of FPL [rather than 400%]… [adversely effecting] middle-class people even more.
• Their own version of the Cadillac tax [on high-cost health plans]….
• Ban on lifetime and annual insurance payment caps remains.
• Young adult provision [for their remaining on their parents’ insurance] kept, but states could opt-out.
• HIPAA-type back-door individual mandate for those with continuous coverage, “a one-time open enrollment period in which individuals would be able to purchase coverage regardless of their health status or pre-existing conditions.”
• lock-granted Medicaid,
• Letting age gap to to 5:1 [rather than 3:1]
• Various taxes in ACA repealed or reduced.

Another observer writes:

A non-shocking CBO score… [would] be because of cuts to Medicad–not the expansion, but cuts on pre-ACA Medicaid. Overall, just eyeballing it, it looks like 1/5 tax increase on the middle class, 4/5 benefit cuts for the poor, in exchange for no guarantee of health coverage at all…