I wrote a bit skeptically about yesterday’s White House health care event. In a broad sense, even if the administration did move the ball forward, it was a small advancement through the legislative minefield comprehensive health reform will no doubt prove to be.
But could the event, in and of itself, have actually been a setback? When the health care fight kicks off on the Hill, one of the major points of friction will be the issue of a public insurance option. Commercial health care interests oppose it. Republicans oppose it. Several Democrats oppose a serious version of it. But, in the minds of reformers, it’s a crucial element of real progress. Without a public option–an affordable health care plan, run and subsidized by the government–insurers and other interests will have little incentive to cut costs and waste such that private plans will be affordable to all consumers.
Yesterday, those interests came together and pledged to shave 1.5 percent a year off the approximately six percent a year annual growth in health care costs. That’s not unsubstantial–if they really follow through they’ll save people about $2 trillion over the next 10 years. (More accurately, if they follow through, health care costs will grow by $2 trillion less than they would have in absence of any reforms.)
But there are a few problems.
- Even if the proposed reforms are as cost-effective as promised, they aren’t proposed reforms at all, but rather the promise of proposed reforms.
- Even if they were concrete–and they supposedly will be in the next couple weeks–they wouldn’t be binding in any way. They’re voluntary. They’re not part of any law.
- Even if they were turned into binding legislation, the groups that proposed them still oppose a public option–the biggest cost saver of all. To paraphrase Paul Krugman noted, what most people call “cost savings” they call “lost profits.” And there’s every reason to believe they’ll use these gestures as, at least, a bargaining chip against a public option.
Earlier today, I spoke with Roger Hickey, co-director of Campaign for America’s Future, who laid out the pros and cons of yesterday’s event quite clearly from the perspective of reformers (or, at least, reformers who support the approach President Obama has outlined).
“Obama is right to say it’s better to have these interests, these commercial health care interests, in the tent than outside the tent,” Hickey said. “It’s very good that they sense that Obama is winning, that there will be health care reform, and that they’re not opposing any progress altogether.”
That, he says, is a big change from 1994, when the Clinton approach went down in flames.
But, as I noted above, Hickey says “the plan they put forward is not really a plan. It’s an aspiration. It’s a voluntary resolution. And it’s correct to be skeptical of that kind of voluntary action.”
“I’m under no illusions,” Hickey says. “These guys are saying we’re making sacrifices [so] you don’t have to do a public insurance plan.” But, he adds, if their goal was to take the public option off the table, they didn’t succeed. “They didn’t want to say that publicly with the President standing there because the President is still committed to the public insurance option. If that was the goal of their public relations effort, they failed.”
One fear, though, is that, by committing themselves to saving trillions of dollars, they’ll turn around and say they were stabbed in the back if the bills set to come out of the Finance and Health, Education, Labor, and Pensions (HELP) Committees contain a public option.
There are a couple political ways to address that threat. In the coming days and weeks, activists will lobby key players to suggest that the coming legislation leave out what’s known as an individual mandate–a provision requiring people who aren’t provided with health care to buy it. That’s sort of the Holy Grail for insurers. They want it. Some say that, in the context of other reforms on the table, they need it to survive. And the idea is that if it’s not included in the draft legislation, it can be added later…as long as insurers don’t wage war against the public option.
We’ll know soon enough how successful those efforts are. As for Hickey, he has a rhetorical response. “We’re going to be saying that it’s good that they’re acknowledging that savings are possible. And the best way to accomplish that is a public plan.”
