Drops in a Bucket that Make a Difference

I met someone last night who received a $25 check from their health insurance company. What? They received a check from their insurance company? Come on, Spandan. Surely, you mean they had to write them a check. No, no. I know what I said. Thanks to the... you know, terrible horrible no good very bad health reform law the president signed, health insurance companies will be refunding their customers as much as $1.3 billion this year.
Altogether, insurance companies will pay out between $1.1 billion and $1.3 billion this year, and had set aside reserves to cover the rebates. Companies such as Aetna (NYS: AET) , Cigna (NYS: CI) , Coventry Health Care (NYS: CVH) , UnitedHealth (NYS: UNH) , and Wellpoint (NYS: WLP) will be sending out rebates to employers and customers who purchase their own insurance.
Much of the reaction of the political media about this news, though, is a big yawn. It's a drop in a bucket, they say. After all, per customer, it's not that much cash. The average for those receiving rebates will be $151 per household. Besides, it's a small chunk of the total revenue that the health insurance companies take in. And our news media certainly doesn't want to give it any attention, given the law's requirement might have a real effect of cutting down on the ad spending insurance companies make on these media channels' networks. Can't have that.

What's really going on here is this: Thanks to the health reform law's rule that says insurance companies must spend at least 80-85% of their premium dollars on providing health care rather than on CEO salaries or advertising or other administrative expenses, insurance companies aren't only going to be paying it out, they are already adjusting premiums so they don't have to do this again next year. And of course, these rebates will come with a letter informing their recipients that it's courtesy of Obamacare. Wonder if the people who tried to stop reform (from either side of politics) will refuse to cash their checks.

Let's address the question. Is it a drop in a bucket? It most certainly is. What our media - and our pundits - will refuse to recognize though, you add up enough drops and you suddenly have a whole bucket of water. If anyone thinks a $151 check in this economy isn't something a family can use, I cordially invite them to get out of their gated communities. That's money right in time for back-to-school shopping. Think that might give a little boost to consumer spending? I think so. It could be the difference for family meals for a whole week. But it isn't just the $1.3 billion that these checks will add up to. One of the biggest criticisms - interestingly enough, this came mostly from the Left - of the Affordable Care Act is that it is too incremental, too many drops in a bucket rather than one big shock to the system. Drops in a bucket add up.

Let me list some things here, that if taken individually, would all be drops in a bucket, though some bigger than others (okay, some could be considered kind of a big splash in the bucket):
  • Requiring insurance companies to stop discriminating on the basis of pre-existing conditions or anything else (other than smoking habit and age, and then at a definitive formula).
  • Letting young people up to the age of 26 stay on their parents' health insurance plan.
  • Requiring insurance companies cover preventive care without a copay, even if the copay would "only" be $25.
  • Outlawing the practice of insurance companies dropping you when you get sick.
  • Outlawing yearly and lifetime benefit caps.
  • Providing money for training medical professionals - doctors, nurses, and other caregivers.
  • Saving money by incentivizing a switch to electronic medical records.
  • Giving small businesses up to a 35% credit for providing health insurance for their employees.
  • Expanding community clinics so that people without insurance can get a checkup.
  • Setting up pre-existing condition insurance pools to hold over till the exchanges begin operating in 2014.
  • Giving states the flexibility to demonstrate that they can use alternative means to insure at least as many people at least as inexpensively.
  • Requiring insurance companies to justify big rate increases.
  • Making hospitals and providers take a rate cut in exchange for a guarantee of less uncompensated care (through the mandate as well as the Medicaid expansion).
  • Expanding Medicaid to all low income Americans.
  • Setting up one-stop-shops called insurance exchanges.
  • Ensuring that the exchanges enable the dissemination of information that the average person can understand rather than insurance company mumbo jumbo.
  • Giving refundable tax credits in the exchanges for people to buy insurance - with the caveat that the more income one has, the less subsidy one gets.
  • Closing the prescription medication "donut hole" under Medicare.
  • Requiring large employers to either cover their employees or pay into a fund.
  • Ensuring that those who can afford to but choose not to buy insurance pay a fine so that when they show up in the emergency room, responsible citizens aren't forced to bear that cost.
  • Providing incentives to move us from a pay-per-service system to a quality-of-care model for paying providers so that our system focuses on quality of care rather than number of tests.
  • Bringing sorely needed mental health parity to our health insurance system.
  • Requiring insurance companies to spend 80-85% of premium dollars on actually providing health care.
I could go on. And on. And on some more. Any one of these reforms - while some are certainly leaps compared to others that seem to be small steps - by itself probably wouldn't have been a major change, or would have been dwarfed by the ability of insurance companies to gut or get around it by using other loopholes. Worse yet, some of these reforms without the others (for example, guaranteed issue and community rating without individual as well as large employer responsibility provisions or vice versa) could have made our system worse. One could argue that each of these reforms is a drop in a bucket. Now put them together. They add up to a whole big bucket of change. These are drops in a bucket that make a difference.

The lesson here isn't just about health care. It is about change. Change is about drops in a bucket. Change is about drops in a bucket that make a difference. When you volunteer at a food bank or a care organization, by yourself, you're only putting a drop in a bucket. But together, volunteers make a world of difference. When you decide to bike one day a week to work, you're only putting a drop in the bucket of solving climate change. But if enough people do it, and if we can add enough fuel efficient vehicles to that, and a great public transit system, and maybe even find ways to reduce industrial pollution, those little drops fill up that bucket pretty fast. When you make one phone call for civic action, or even 10, you are creating nothing more than a drop in a bucket. Have enough people do it and suddenly you have created a campaign that is taking the wold by surprise.

That is the nature of change. Before there was a Martin Luther King, Jr. - and even after there was an MLK - there were people who fought battles in their own lives, changing one mind at a time. Before there was a President who endorsed marriage equality, there were millions of us who spoke to our neighbors, our friends, our coworkers and sometimes in the most difficult of ways to our families about equality. Before we took a 40-hour workweek and overtime pay for granted, millions of working people gave it their all to stand up for the rights of everyone. No change just happens. For change to work, and for change to last each of us has to be an agent of change. Each of us have to start thinking about drops in a bucket that make a difference. Relatively smaller things, put together, can make - and have made - huge differences in human history.

It is for this reason that health care reform was a history-making moment. It didn't shock the system. It created change. It created lots of big and small drops in a bucket and changed the contents of that bucket. It culminated the struggle of a century to make health care a basic right for all human beings in the richest nation on the planet. It did so not by emptying the bucket but with drops in that bucket that is making a world of difference.