Health Care Reform Redux
by Geoff Johnson
Like many present-day lawmakers in the United States, the ancient Babylonian king Hammurabi gave at least some thought to the question of how to pay for health care. One section of the famous Code of Hammurabi detailed what the fall 2009 issue of Lapham’s Quarterly cheekily referred to as a “fee schedule” for doctors in the 18th century BCE. For successfully employing a “bronze lancet” to treat a severe wound, Babylonian doctors were entitled to a set remuneration. If the patient were a “gentleman” he was to pay ten shekels of silver. The son of a poor man would owe just five (thus fees were in part tied to one’s ability to pay), and a gentleman whose servant needed care was to pay the doctor two shekels (an early version of our present day employment-based health insurance system?). These latter provisions might strike us as almost modern, but the code took a more draconian stance when it came to dealing with medical malpractice. Doctors who killed or maimed a patient while operating did not end up in court facing a civil suit as they might today; they simply had their hands cut off.
Nearly four thousand years after Hammurabi’s laws were first carved into stone, physicians have considerably more to work with than bronze lancets when it comes to medical technology, but the United States has yet to figure out a decent way to ensure that everyone has access to medical care and a means to pay for it. The Patient Protection and Affordable Care Act recently passed by Congress and signed by President Barack Obama purports to be the beginning of a long-term solution to that problem, and it comes after a year-long fight that sucked nearly all of the oxygen out of mainstream political debate in this country.
The terms of the health care discussion, such as it was, were heavily circumscribed from the outset. While a single-payer system — some version of which has been adopted in basically every other fully industrialized nation — has polled extremely well in public opinion surveys for years, anything akin to “Medicare for all” was deemed “politically impossible” from the outset (the obvious reason being that it was anathema to the enormously profitable and powerful insurance industry and its political backers, generally went unspoken). During his major address to congress on health care last September, Obama “triangulated” in a highly cynical fashion when he likened single-payer to absurd conservative proposals that would end employer-based insurance and force individuals to buy insurance on their own, labeling both interesting but impractical ideas. Despite its popularity and the fact that a House single-payer bill has been co-sponsored by over ninety members of congress in recent years, the corporate media provided little reporting or commentary on this option.
While single-payer advocates were not even offered a seat at the negotiating table, major stakeholders in the current for-profit health care system were central players from the beginning as the Obama administration sought to avoid the ire of the insurance and pharmaceutical industries that had helped derail health care reform in 1993 – 94. America’s Health Insurance Plans (AHIP), the trade group of the health insurance industry, was in regular touch with the administration and promised to work for reform but sat on the fence for months before deciding to oppose the Democratic proposal. This decision angered the Obama administration and led to a war of words between the White House and the insurance industry. In the end, however, the two main demands of the industry (everyone would be required to buy health insurance, no government-run “public option” to compete with private insurance) were met by the legislation signed by the president.
Meanwhile, the pharmaceutical companies’ trade group PhRMA, led by former Republican congressman Billy Tauzin, struck a deal with the White House last summer under which Big Pharma would agree to $80 billion in cost-cutting measures in the years ahead. In exchange the White House promised that it would not seek to lower prescription drug prices, an issue on which Obama had campaigned in 2008. PhRMA eventually supported the reform legislation with an expensive ad campaign, even reviving the fictional couple “Harry and Louise” whose commercials had helped to derail the Clinton reform effort but who now argued that we could “get the job done this time.”
In the Senate, control of the legislation was initially handed over to the conservative Democrat from Montana, Max Baucus, who had received over $1.4 million in campaign contributions from the health and insurance sectors during the 2008 election cycle. Baucus and five other members of the Senate Finance Committee (including three Republicans) were tasked with working out a compromise bill. The GOP made the (rather obvious) calculation that it was not in their political interests to help Obama pass a massive, bipartisan makeover of health care and as such embarked on a course of staunch opposition while paying lip service to the idea that they were negotiating. Several months were lost in the process, and during the summer recess a popular backlash against the supposed government “takeover” of health care exploded on the political scene, with the half-term ex-governor of Alaska arguably driving the discussion more than the president. The backlash — which undoubtedly was given excessive attention by the media — consisted of a potent mix of genuine, grassroots, anti-government conservatism (and libertarianism) and corporate astroturfing led by former House Majority Leader Dick Armey’s group Freedom Works. The Obama administration was clearly caught off guard and never really regained control of the debate.
This loss of control was perhaps nowhere more evident than in the discussion of the public option, a fairly limited and inadequate reform which would have been available only to a small percentage of the population (and only if they wanted it), but which was quickly spoken of by the right as though it were culled from the pages of Mein Kampf. Many of Obama’s supporters on the left, meanwhile, came to view the public option as the holy grail of reform, taking little notice of the fact that it was never described with any real specificity and could well have proved a failure if implemented and significantly set back the cause of single-payer to which most progressives are committed. Adding to the confusion, mainstream media outlets generally represented the proposed public option as unpopular despite the fact that surveys routinely showed that more than 50 percent of the country supported it. Obama obligingly mouthed his support for the public option to avoid angering his liberal base more than necessary, but it seems likely he abandoned the idea of including it in the legislation early on, perhaps as part of a quid pro quo with industry groups.
Scott Brown’s surprise victory in the January special election to fill the late Teddy Kennedy’s Senate seat seemed to kill the possibility of reform, but ultimately the Democratic leadership — fully recognizing that failure to finish any legislation would have been politically disastrous — was able to craft a route to passage based in large measure on the original, moderate Senate bill reported out of Baucus’s finance committee. Liberals cheered, hailing the bill as the greatest domestic policy achievement since Medicare and Medicaid, while many conservatives suggested that the bill was essentially the beginning of the end of freedom in the United States
In reality it’s extremely difficult to say what the effects of reform will be on public policy and on American politics in the long run. In terms of what the policy will actually do there are several issues at play. Measures which will significantly expand the number of people who have access to Medicaid, allow young people to stay on their parents’ plans until age twenty-six, and end discrimination based on pre-existing conditions (among others) are unambiguously beneficial assuming they are actually implemented as advertised. Despite threats of repeal if and when the Republicans retake the government, and forthcoming constitutional challenges by conservative attorney generals in a dozen or so states, it seems extremely unlikely that the law will be taken off the books by Congress or the courts, and as such a number of provisions will likely begin to have a demonstrably positive effect even before the 2012 election.
More threatening to the future of the legislation will be business efforts to fight its implementation through legal channels while also fighting a continued public relations war via advertising. According to the Wall Street Journal, the US Chamber of Commerce is planning on spending $50 million attacking health care reform and attempting “to unseat vulnerable Democrats who voted for it.” The Chamber also plans to take legal action if and when they disagree with implementation of the law. Critics have remarked that the legislation is full of loopholes, and much of the uncertainty about the law going forward stems from the fact that the meaning of some of the key provisions will likely be decided in the courts. We’ve already seen a preview of this lawyerly strategy when the insurance industry briefly tried to argue (perhaps correctly) that the law did not actually require them to provide coverage to children with preexisting conditions this year, as had been assumed. The industry quickly backed down from that argument after an outcry, but it’s a safe assumption that high-priced corporate attorneys will be looking for any legal loopholes that, for example, allow insurance companies to cover individuals poorly or not at all.
In spite of industry concerns, the conventional wisdom is that most health care companies will benefit from the new law. The New York Times reported on April 9 that the legislation will likely prove to be a boon for health care stocks, as companies like CVS Caremark and Quest Diagnostics are expected to profit handsomely from increased prescription drug sales and medical tests respectively. Insurance companies may face more difficulties once they have to cover people with pre-existing conditions at which point, as one health analyst told the Times, we’ll have to see if “they price these things so that they can avoid losing money” (that seems likely!). Despite their earlier opposition, AHIP has now, according to Time magazine, signed on in support to make “sure the new law succeeds beyond most expectations,” though AHIP and its health care industry members no doubt define “success” differently than do many of the supporters and intended beneficiaries of the bill.
In political terms, the health care debate has energized both the new Tea Party Movement and the Democratic base. Given the moderate if not conservative nature of the reform — which, as Clinton administration Labor Secretary Robert Reich has pointed out, is similar in certain respects to proposals made by Richard Nixon — it says a great deal about politics in the age of Obama that many liberals are now mobilizing around what they see as an enormous policy success while the Tea Party and the GOP are mobilizing to roll back the rising tide of fascism, or something. Regardless, for the next few years if not beyond we shouldn’t be surprised to see continued, intense grassroots energy directed at health care reform from both the right and liberal-left.
To what ends that energy will be directed is arguably a more difficult question. Perhaps in part because of the fierce intensity of the debate, many pundits speak and write as though the current battle lines for the health care debate will persist indefinitely. However, if history is any guide when it comes to major social legislation, that likely will not be the case. When the Social Security Act was passed in 1935, it was not particularly popular with FDR’s labor base (which was largely indifferent to the very idea of social insurance) nor with the Republican opposition (some of whom made reference to a threat to “the integrity of our institutions” and warned of “the lash of the dictator”). The act held to the racial and gender strictures of its time and excluded the majority of African Americans and women from the old-age insurance portion of the plan (the NAACP actually testified against the bill). Over time, however, Social Security became more inclusive, and was not only accepted by the next Republican president, Dwight Eisenhower, but was expanded significantly by his administration, and labor unions and other progressive groups would come to defend Social Security as the bulwark of the (admittedly limited) American welfare state.
The story with Medicare is somewhat similar in terms of shifting politics. In the early 1960s, future Republican standard bearer Ronald Reagan railed against Medicare on behalf of the American Medical Association and argued that it was a stepping stone to socialism. He had changed his tune, however, by the time of the 1980 election when incumbent Jimmy Carter tried unsuccessfully to make an issue of his past statements in opposition to the by-then-popular program. George W. Bush and a Republican congress added an outlandishly expensive prescription drug benefit to Medicare in 2003, and in August of last year Republican National Committee chairman Michael Steele argued in a Washington Post op-ed that “we need to protect Medicare…” Many progressives of the mid-1960s viewed Medicare and Medicaid as poor substitutes for their real goal of a national health insurance plan, but now “Medicare for all” is the rallying cry for many on the left.
A consideration of even the most basic variables demonstrates how difficult it is to predict the future politics of Obamacare. While the legislation is not in fact a government takeover of health care, it is perceived that way by many (on both sides of the debate). Will this perception continue to hold in the future? How popular will the reform be in five to ten years, and which aspects will be popular and which less so? If many view the program as successful (or as a failure), will it be because of a belief that the government took a larger role in the health care system, or because they left the private system largely as is, merely tweaking around the edges? If health care costs continue to go up, as is likely, will that be blamed on the federal government, the states, the insurance companies, or some combination thereof? We cannot know the answers to these questions at this point, but it’s entirely possible that liberals will be lamenting the failure of reform ten years from now while conservatives will have decided it wasn’t so bad. Or not.
For those of us on the left, it’s impossible to be happy with the Patient Protection and Affordable Care Act or the way the process unfolded, though one can hardly be surprised by the outcome. The legislation seems to have further entrenched the role of for-profit insurance in the health care system which, in the long run, will inevitably continue to drive up costs as corporate profits are prioritized over people. The industry bought political access and helped write the bill to significantly suit its own interests, and single-payer advocates had no real opportunity to articulate the case for a European or Canadian style system in the course of a lengthy national health care debate the likes of which may not come again for many years.
On the other hand, the new law does seem to codify (at least in theory) the principle that access to affordable health care is a right, not a privilege, of all Americans. This legislation will almost certainly not deliver on that promise, and a decade or two from now it’s quite likely that Congress and a new president will be discussing health care all over again as costs spiral wildly out of control. At that point, having perhaps internalized the notion that everyone deserves to have coverage, even more Americans (and more legislators) might be open to the idea that a single-payer system is most efficient at containing costs while still providing everyone with access to care. Even if we get to that point eventually — a very big if — drug and health insurance companies will rake in a whole lot of shekels in the meantime, and tens of thousands will die because they could not afford to pay the man or woman with the bronze lancet that could have saved their life.
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