Friday, January 22, 2010

Will President Obama salvage his centerpiece? Four Choices for the Health Care Situation

ABC News
January 20, 2010
George Stephanopoulos' Exclusive Interview with President Obama

President Obama: I would advise that we try to move quickly to coalesce
around those elements of the package that people agree on. We know that we
need insurance reform, that the health insurance companies are taking
advantage of people. We know that we have to have some form of cost
containment because if we don't, then our budgets are going to blow up and
we know that small businesses are going to need help so that they can
provide health insurance to their families. Those are the core, some of the
core elements of, to this bill.


President Obama: If you ask the American people about health care, one of
the things that drives them crazy is insurance companies denying people
coverage because of preexisting conditions. Well, it turns out that if you
don't -- if you don't make sure that everybody has health insurance, then
you can't eliminate insurance companies -- you can't stop insurance
companies from discriminating against people because of preexisting
conditions. Well, if you're going to give everybody health insurance, you've
got to make sure it's affordable. So it turns out that a lot of these things
are interconnected.

Comment: It looks like there are four choices: 1) walk away and accept the
status quo, 2) use alternative political maneuvers to move the bill through
Congress, 3) attempt to salvage at least a portion of the less
controversial components of the current proposal, or 4) start over. Let's
look at these.

1) Walk away

Far too many individuals and businesses are no longer capable of paying the
very high costs of our health care system. The existing spending controls in
government and in the marketplace show no evidence of ameliorating the
excessive growth of our total national health expenditures. The status quo
is unacceptable. On this everyone agrees, so we cannot walk away.

2) Move the bill through Congress anyway

The strategy that has been advanced to pass the bill relatively intact would
be to have the House approve the Senate version, and then make corrections
in a budget reconciliation process. We can forget this approach since the
bill managers' head count in the House has come up far short of the votes
needed. Also, cramming the bill through before Sen. Kirk is replaced by
Scott Brown has been rejected by President Obama and other Democratic
leaders. But the overriding reason why this bill will not clear Congress
intact is that a majority of Americans are very displeased with it - that
includes all conservatives, most liberals, and a majority of moderates.
Sometimes we question the collective wisdom of Congress, but they're not
that dense.

3) Salvage a portion of the legislation

Crafting a health care financing system and integrating it with the health
care delivery system creates a dysfunctional system if it is done piecemeal.
That's what we've been doing over the past century, and it's obvious where
that has led. As President Obama said, "it turns out that a lot of these
things are interconnected."

President Obama and some members of Congress would still like to salvage the
centerpiece of this legislation - making health insurance markets work for
us. They would like to do that without including the policies that offended
so many in Massachusetts and throughout the nation - new taxes, and an
individual mandate to purchase private insurance. If there is no mandate
then there is less need for the taxes that would be required to pay for the
private insurance subsidies. Of course, without a mandate, many more will be
left uninsured, but that seems to be the price that many members of Congress
are willing to pay simply to pass something that looks like reform.

President Obama shows that he understands the greatest difficulty with
reforming the private insurance market as a stand-alone process. The insurer
abuses that he wants to eliminate were there for a reason. They are designed
to reduce the amount of health care that the insurers fund. Once the
insurers are required to cover all risks, insurance premiums increase. With
no mandate, many of the healthy will decide they cannot afford the higher
premiums and will remain uninsured. The adverse selection that would result
could send our entire private insurance industry into a death spiral of
skyrocketing premiums.

Obviously, as we've been saying all along, the centerpiece based on private
insurance plans is inherently a dysfunctional model that can never achieve
efficiency, equity, universality, and affordability for all of us.

That said, there are some measures in this legislation that could be
salvaged and enacted on an emergency basis until we finish the task of
delivering a just health care system for all. As prime examples, we should
move immediately to expand Community Health Centers and to reinforce our
primary care infrastructure. We should also recover the overpayments to the
Medicare Advantage plans that are wasted on excess administration and
investor profits. There are many other beneficial measures that could be
enacted without requiring that they be part of an omnibus bill.

4) Start over

The policy work has already been done. We know what we need - an improved
Medicare for all national health program. President Obama and most of the
Democrats in Congress know that as well.

Even the conservatives certainly understand that it would work for all of us
and that, once enacted, it would be in place forever because of its
popularity. Since they can't oppose it based on its sound policies, they
simply oppose it based on their ideological opposition to social solidarity.
That is perhaps the saddest reality in this whole debate

Don McCanne
Quote of the Day

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