The Alan Katz Health Care Reform Blog

Health Care Reform From One Person's Perspective

President Obama Entering Health Care Reform Arena

Posted by Alan on July 13, 2009

President Barack Obama’s approach to health care reform has been a bit unusual. Many of his predecessors have taken the Moses approach to major legislation. They descend from the mountain top with legislation chiseled in stone, hand it to Congress and in their best imitation of Charlton Heston (Republicans) or Patrick Stewart (Democrats) instruct them to “Make It So!”

Sometimes the tactic works, other times, not so well. President Bill Clinton and First Lady Hillary Clinton were the last to take the long walk down from the summit. Upon telling Congress to enact their commandments as is they were told in no uncertain terms to take another hike. No Congressional committee even voted on their legislation.

President Obama approach to health care reform is less dramatic, but is likely to be more effective. He articulated three general principles for reform, identified some key elements he’d like to see, guaranteed that the phrase “everything is on the table” would be 2009’s most overused cliché, and told Congress to figure it out the details themselves. The payoff is on the horizon: in the next six weeks several Congressional committees are likely to not just vote on comprehensive health care reform, but actually pass draft legislation. This is historic.

It is also messy – as disorderly and trying as anything the FCC allows to be broadcast on public airwaves during the family hour. Lawmakers are busy building the case for their favorite provision, pundits are busy making clever pronouncements, organizations of all stripes are seeking to create the next “Harry & Louise” advertisement, and voters are consistently demanding all this activity produces something responsible.

Whether voters will get their wish is as yet unknown. There are some hopeful signs and I’m willing to make some broad (and pretty darn easy) predictions:

  • cost control will be a major part of any reforms
  • the public plan is likely to look nothing like the government-run plan proposed by then candidate Obama and more like a Sunkist (or some other non-profit, non-government cooperative).
  • paying for reform will come from a variety of sources, not all of them pleasant, but the price tag will be significantly less than the $1.5 trillion originally identified.
  • premiums will be subsidized to make coverage more affordable for millions of Americans
  • carriers will no longer be able to exclude applicants due to pre-existing conditions (this may qualify as the safest prediction around)

Of course there are some warning signs, too. Among the open issues of concern:

  • politicians of all stripes are convinced exchanges / purchasing pools / gateways or whatever term eventually emerges are the solution to all of the insurance industry’s ills – depending on how these are structured the only impact they may have is to crush innovation and eliminate brokers from the system (then again, they may not – the topic for an upcoming post)
  • while carriers will be required to sell coverage, consumers may not be required to purchase coverage, which will lead to skyrocketing premiums – New York and New Jersey take this lopsided approach and the average premium for individual coverage in those states are twice that of California’s.
  • what cost controls are put in place may prove inadequate – opposition to creating medical guidelines to tie costs to outcomes may not survive the political process

Whether any of these predictions become reality and how the open issues are resolved will depend in large part on the action Congress takes in the next few weeks. And that’s unknown. As I’ve written before, much of the draft legislation under consideration are better viewed as negotiating positions than representative of a likely final bill. There is an exception, however.

Senator Max Baucus, Chair of the Senate Finance Committee, has been hard at work with Senator Charles Grassley, the ranking Republican member of the committee, to fashion bi-partisan reform (and to be fair, their staffs have been working pretty darn hard, too). The fruits of their labor were to be made public at the end of last month, but it has yet to see the light of day. That’s about to change.

According to the Associated Press, President Obama made it clear during a White House meeting that he wants “health care legislation ready in the Finance Committee by week’s end.” Coupled with his statements while introducing his impressive nominee for U. S. Surgeon General, Dr. Regina Benjamin, it is becoming clear President Obama is about to personally engage in the health care reform sausage making process. “Don’t bet against us,” President Obama said. “We are going to make this happen.”

The President has tremendous political capital, especially with Democrats. If you’re running for election in 2010 you do not want to be branded a hindrance to this Administration, especially if you represent a marginal seat. For now, the conflict over health care reform is an intra-party battle, especially in the House of Representatives. House GOP members are basically spectators, carping from the sidelines. The real contest is being waged between liberal and moderate Democrats. That’s the price of a large majority, but it also means President Obama is well positioned to resolve the differences. And as his recent statements indicate, he’s willing to enter the arena and, merely by showing up, change the dynamics.

As President Obama proved during the election, when he says “Yes we can” it often means “Yes we will.”


4 Responses to “President Obama Entering Health Care Reform Arena”

  1. Andy said

    Many an administration has fallen into the deep abyss of health care reform, but none have had the political capital and forces that support the Obama administration. The recent 2009 proposal has probably the best chance to get approved that any in the recent past. The question is will health care reform in America work?

  2. Meg McComb said

    Big thumbs up on this blog Alan!

  3. uninsured and nervous said

    The only way we are ever going to get the health care plan we desperately need is if we can find a villain, someone the public can openly criticize. It’s the quickest way to move the argument from the abstract to a matter of morals, to make the public feel impassioned.

  4. Rick said

    Alan, just why would an exchange/purchasing pool/gateways eliminate brokers? The average small business is too busy to search gateways, then explain to its employees, and go through the entry online and upload this info. In addition would all companies be required to market through the exchange? Could you please explain?

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