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Kowalko, Jaques, and Crane: Now retreating from HB 392?

This may be one of the shortest debates over a bill in General Assembly history, since the sponsors and main advocates are all effectively admitting that it is fatally flawed.

That wasn't so evident two days ago in the John Kowalko-Earl Jaques press release patting themselves on the back for having written a Single-payer health insurance bill for Delaware:

John Kowalko here:  HB 392 will solve
all of Delaware's health insurance
problems.  Trust me, I've run all the
numbers myself.
State Representatives John Kowalko (25thDistrict) and Earl Jaques (27th District) announced they have filed HB 392, legislation that will provide Health Care coverage to all Delaware residents.
The legislation will provide universal health care coverage access through a system that will reduce administrative costs by minimizing and centralizing the current system that requires multiple payment forms and consists of medical decisions being rendered by insurance company bureaucrats with no medical background.
Earl Jaques: this is a
responsible plan that
we have sweat blood
to bring you!
“Representative Jaques and I agreed that while some critics may allege that filing a bill this late in session is mere political rhetoric, the complexity and enormity of the challenge facing the uninsured and the soaring costs of health care demands a responsible plan be composed now. The fact that the Federal Health Reform mandates are imminent only adds a further sense of urgency to our responsibilities” said Kowalko.

Now Kowalko and Jaques were clear on the fact that they intended this to be seriously introduced, debated, and passed in the legislative sessions beginning in January 2013.  No problem with that,  but's let's take a look at the highlighted segments:

First, Kowalko-Jaques presented HB 392 as a legitimate, workable plan:  "legislation that will provide Health Care coverage to all Delaware residents," "the legislation will provide universal health care access."

Second, Kowalko-Jaques claimed credit for having created an original and workable plan:  "the challnege facing the uninsured and the soaring losts of health care demands a responsible plan be composed now."  By any reading of this press release, that "responsible plan" is HB 392, and that "responsible plan" was recently "composed" by Kowalko-Jaques.

Third, Kowalko-Jaques wanted this particular plan debated, discussed, and scrutinized.

This is evident as well in the obviously pre-planned statement by Mitch Crane (Democratic candidate for Insurance Commissioner):
I'm Mitch Crane and I support
HB 392 as the way to bring
single-payer insurance coverage
to all Delawareans.
Mitch Crane, the Democratic Party’s endorsed candidate for Insurance Commissioner, announced his support for House Bill 392, a bill to implement a single-payer healthcare system in Delaware. “Health care is a right, not a privilege. For the 125,000 Delawareans currently uninsured and thousands more underinsured, this bill will provide health insurance coverage for every Delawarean. As health insurance premiums rise at unsustainable rates, this bill will bend the cost curve by rooting out wasteful health insurance spending including lobbying expenses, advertising costs, and corporate profits."
The problem will all this, as I pointed out very quickly, is that HB 392 is NOT a new bill, but an almost verbatim recycling of SB 177, which John Kowalko co-sponsored in 2007, and which was written by Dr. Floyd McDowell much earlier.

This proved embarrassing enough for Kowalko and Jaques to start back-pedaling away from their original press conference statement, while making a few additional gaffs along the way.

They started by attempting to defend the math in the bill's funding mechanism.  Here's Jaques:
DoTheMath: Your comment that somebody ought to do a rough estimate on the math and then see what they think. Rep Kowalko and I did. We had both the Sec of Finance office and the Controller General’s office check the numbers. They took into account the size of employers across the state to determine who has to pay 4% and who would pay 9%. Then they used last year’s tax numbers to determine the 2.5% factor. Then we added in the money which will be included in the pot from various federal programs,i.e. medicare, etc. Guess What? The numbers in the bill work!!
Notice that even here, Representative Jaques has not yet admitted that the plan is over five years old.  You can read this comment (as you were intended to) as Kowalko and Jaques wrote the bill and then took it to responsible government agencies to check the numbers.  (Of course they don't release those numbers or the assumptions behind them, but trust them--it will work!!)

Except that this is--to put it bluntly--a bold-faced lie.

Read it carefully:  Jaques says that the Secretary of Finance and the Controller General's office were the ones "to determine who has to pay 4% and who would pay 9%."  They also say that "then they used last year's tax numbers to deterimine the 2.5% factor."

Not possible.  The Secretary of Finance and the Controller General could  not have  been the ones who determined the tax rates for this bill unless they did so in 2007--because the tax rates are exactly the same as appeared in the 2007 version of the bill.

When I challenged Representative Jaques on how old the analysis was Representative Kowalko answered, leading off with a stunning admission that he had previously introduced this bill with no fiscal studies at all to support it:
There was no study involving Sec. of Finance and Controller Generals office done on SB 177.
He follows up with a repeat of the mantra that he and Jaques had taken the language of the bill to two financial offices in the state to determine the funding figures:
Rep. Jaques and I felt that the first and most difficult order of business was to see what amount of revenue would be accumulated by HB 392 and what amount of money was being spent to provide Health Care to Delawareans. Nothing was contrived or hastily arrived at and the revenue neutrality of the proposal is represented by the recently calculated facts. The analysis is NOT old and is very current and Rep. Jaques and I delayed this filing to ensure that there would be NO artificial optimism or pessimism in the calculations and projections. 
So if the analysis was "NOT old and is very current," how does Representative Kowalko explain the fact that exactly the same funding mechanism and percentages that worked for 2007 (when there was less unemployment, fewer uninsured, no Affordable Care Act to change the rules, a burgeoning economy, and a State budget that was easily balanced because revenues were constantly going up, were just coincidentally the funding percentages that the State Secretary of Finance and Controller General recommended today?

Answer:  he didn't explain it.  Instead, he followed two tried-and-true political strategies for times when you've been caught making it up as you go:

First:  he told me,
I would suggest that you spend more than a few hours thinking about it to try to verify your pessimistic reasoning so that Rep. Jaques and I can seriously consider any legitimate concerns you may have. If you’ll read the press release you’ll see that we intend to seriously and responsibly take into account each suggestion, criticism, critique and “fact based” challenge to the numbers we (and others) have spent an awful lot of time accumulating and verifying.
John Kowalko, again:  Did I forget to
mention this bill is over five years old
and that when I first introduced it I did
not run the numbers, but now they
magically work.  Only "inbreds" would
question me!!
This is utter horsecrap.  The bill is FIVE YEARS OLD.  I've had plenty of time to read it, Representative Kowalko.  In fact, I've probably spent more time working with it than you have, considering that you didn't actually change anything substantive in it from the original version.

Then, he attacked another critic, Will McVay, in fairly scatalogical terms, as possibly being
. . .  one of those inbreds that names all their children the same . . . 
This was enough for both Representative Jaques and candidate Crane to start backpedaling like crazy.

All of a sudden, Jaques acknowledged that this was not an original bill:
Rep Kowalko and myself questioned the numbers contained in Dr. McDowell’s bill. We wanted to know if they were real or just pulled out of the air. So we took the numbers and asked both the Secretary of Finance and the Controller General to run the numbers.
Interesting note:  see above that Representative Kowalko had no such compunctions about the financing when he co-sponsored this bill in 2007.

"Run the numbers" is such a wonderfully elastic phrase.  Hidden away in there are all the assumptions that you used--cost of health care now versus health care under HB 392.  Later in the conversation, Representative Jaques would challenge me to run the numbers myself:
Steve, you claim to be such an expert – the numbers are in the bill – so you work it out. Can you disprove our numbers or not? Waiting to hear from you!!! 
Nice try--but there are no numbers in the bill, Representative Jaques.  There is not a single number that tells us what you project the total coverage (including dental, eye care, etc.) for an average citizen of Delaware will be under the McDowell Plan.  Lacking that, and the assumptions behind it, there is no possible way to do the calculation.

But that doesn't matter, because Jaques didn't even wait an hour before he started walking back his own claims about the bill--or even the whole idea of a universal single-payer plan:
Earl Jaques, here again:
well, maybe we won't
actually use these
numbers and maybe
we will exempt some of
my constituents from the
definition of "universal"
'cause they don't like it
and they vote.
Now will those be the percentages when the bill gets introduced next year? I don’t know – we will have to see what comes out of the public meetings and what changes will be made to the bill. I expect there will be several. I have already heard back from many senior citizens who want to keep their present healthcare, which was provided to them by their company at retirement. They would like single payer to just be one of several options that a person could chose. I think this idea warrants discussion.
So now Jaques doesn't know what the percentage will be--even though he supposedly had it nailed down.

And now Jaques is supportive of the idea that there might be exemptions for people from what this bill requires, despite the language in the bill (that he supposedly help craft) that would make that . . . illegal!?

All of which resulted in Mitch Crane seeing the handwriting on the wall and backpedaling away from a bill that he proves he had never read completely through in the first place:
Mitch Crane again:  I've changed
my mind, and now I am not even sure
that Single-payer will work in Delaware,
and I don't actually want to see this
bill enacted as written.  Elect me!!
Besides, I haven't actually read
this stinking, anti-abortion rights
turd of a bill, so please don't hold
me responsible!!!!
The purpose of filing HB 392 is not to get it passed in this Session, or even to see it enacted as written. 

There are changes I would like to see in this bill. For one I believe the Insurance Commissioner’s office needs to be involved.

My position has been that I do not know if a state the size of Delaware can enact a successful single payer program. Vermont has enacted a modified program and is awaiting waivers from the federal government to go forth. If Vermont’s program goes live and if it works, then Delaware can learn from it.

 Let me count the doublespeak ways here:

1.  He doesn't expect it "enacted as writtten"?  Compare that to his original statement above that "this bill" would answer all of Delaware's health insurance issues.

2.  He'd like a role for the Insurance Commissioner?  Proof that Mr. Crane did not read HB 392 all the way through before he endorsed it, because the bill provides the Insurance Commissioner sweeping new powers of enforcement:

§1622. Insurance Reforms.

Insurers regulated by the Delaware Insurance Department are prohibited from charging premiums to eligible participants for coverage of services already covered by the Health Security Authority. The State Insurance Commissioner shall adopt, amend, alter, repeal and enforce all such rules and regulations and orders as may be necessary to implement this section.

3.  After originally saying, "
this bill will provide health insurance coverage for every Delawarean," Mr. Crane nows says, "I do not know if a state the size of Delaware can enact a successful single payer program."  No flip-flop there, huh?

4. Mr. Crane then refers us to the Vermont single-payer plan, which has been passed but not enacted, and cannot be enacted until either 2014 (with a Federal waiver) or 2017 (without)..  This would appear ("If Vermont's program goes live and if it works, then Delaware can learn from it") to be Mr. Crane's escape hatch from this bill--let's not be first, let's wait 2-5 years and see what happens in Vermont.

If you want one last conclusive piece of evidence that neither Representative Kowalko, Representative Jaques, nor Mr. Crane ever actually read the whole bill carefully and considered its implications, there's this:

All three of these gentlemen, I believe, are in favor of abortion rights.  Yet this bill, as written, codifies into law the premise that life begins at conception:
The General Assembly finds and declares that enacting a single payer, non-government run Delaware Health Security Act will guarantee comprehensive, quality health care coverage for all Delawareans from the moment of conception until one's last breath is taken. 
Great job, guys.  You just proposed the most blatant "right to life" legislation that could ostensibly be used to curtail abortion rights that any "Pro-Lifer" could ever want in their wet dreams.

There is no way in hell these individuals intentionally proposed a piece of anti-abortion legislation, and yet the reference to life beginning at conception is included in the bill not once, but twice.

Conclusion:  they didn't carefully read their own damn bill.

That's simply irresponsible, shoddy law-making.  It is one thing to propose a bill knowing that you will have to make changes going through the process.

This is quite another:  Representatives Kowalko and Jaques have proposed a bill that even they could not in good conscience vote for in its current form, and then proceeded to demonize anybody who pointed out this self-obvious fact.

And Mr. Crane, who presents himself as the responsible alternative to the incumbent Democratic Insurance Commissioner, has--in one day--both supported the idea of single-payer health insurance in the Delaware and then admitted he didn't know if it would work, AND supported a bill that by his own admission he proves he has never read all the way through.

You know, I complimented the Democrats for endorsing Mr. Crane because Karen Weldin Stewart had been such a disaster as Insurance Commissioner.  If this is an example of how Mr. Crane does his due diligence on matters before him, I take it back.

He is not an acceptable representative of Delaware citizens' best interests if this is how he works.

Sources:  all quotes from these gentlemen used in this post can be found here.

The current language of HB 392 is here, and the comparable language for SB 177 is here.


NCSDad said…
Why anyone in Dover would do business with Mr. Kowalko is beyond me. When he is not fronting for big donors he seems to be rushing around trying to catch up with the latest bandwagon.
Anonymous said…
It amazes me that these folks can put forth legislation and endorse without even reading it. It is really time to change who we send to Dover. Thank goodness there is another candidate for insurance commissioner. Paul Gallagher actually knows and understands insurance. Check out his web site:

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