Panicky People Make Bad Decisions : Salvaging Health Reform after Scott Brown

Jeff goldsmith

The shocking surrender of Ted Kennedy’s Senate seat to an insurgent Republican state legislator, Scott Brown, has imperiled President Obama’s health reform initiative. The Massachusetts “massacre” has unleashed a tidal wave of second guessing from Democratic pundits. Obama, the left argues angrily, got what he deserved for trying to find a bipartisan solution to health reform, for abandoning the beloved “public option” and snuggling up to the corporations they wanted to punish. If only he’d remained pure to their ideals, Martha Coakley would be a Senator and he’d have a bill on his desk by the end of the week. General Custer could not have gotten worse advice.

It’s possible that the loss of Ted Kennedy’s Senate seat might end up saving both health reform and the Obama Presidency. The President seems to understand what happened in Massachusetts better than his more ideological brethren. Disarmingly, he argued the day after Brown’s victory that it was produced by the same popular anger as his own election, though it’s worth noting an important qualitative difference. The 2008 election coincided with a full blown market panic, which the President’s calm and policies helped quell; What he is now facing is much closer to voter despair, as the domestic economy digests a huge overhang of debt, and unemployment lingers above the toxic 10% level.

His focus on health reform through his first year shouldn’t have been a surprise. It was a pivotal theme of his campaign. Rather than postpone health reform until the economy recovered, Obama connected the two – that we couldn’t have an economic recovery without reforming healthcare- without successfully explaining the connection to voters. Apparently, the political types in the White House prevailed over the economic types in the President’s decision to press ahead.

His transition and White House staffs were drawn heavily from the Clinton White House staff, who were haunted by the Clintons’ failure to accomplish health reform. They resolved not to write the bill themselves as the Clintons had done, but to manage the Congressional process from behind the scenes. They chose a popular former Senate Majority Leader, Tom Daschle, to be the manager. This was a brilliant appointment, not only because of his credibility and relationships, but because he brought with him a sensible roadmap, outlined in his book, Critical: What We Can Do about the Health Care Crisis.

The decision to throw Daschle under the bus in early February after ethics concerned surfaced was in retrospect extremely costly. It not only cost the White House nearly four critical months as they searched for replacements, but it also untethered the Congressional relationship and handed the initiative to Congress, particularly the House of Representatives. The two people chosen to replace Daschle, while knowledgeable and capable, lacked the political relationships and gravitas to manage the Congressional relationship. It ended up politicizing the process by handing the reins to Rahm Emanuel, who had both relationships and domain knowledge, but neither the time nor the position to chair all the key meetings. The illness and death of Ted Kennedy also crucially deprived the process of a senior Congressional diplomat capable of helping broker a solution.

The larger strategic problem was the inherent asymmetry between those who benefit from health reform and the core constituencies of the Democratic party. Those core constituencies already have coverage: organized labor, the “elderly”, the poor, etc. Their main concern throughout the process was in not losing any of those benefits. On the other hand, the main beneficiaries of health reform- young people, widows, homeless people, immigrants, both legal and illegal, etc, -had neither the voice nor the resources to advocate on their own behalf.

Political calculation led the White House to engage the major health care stakeholders (hospital, physicians, health plans and pharmaceutical companies), limiting their liabilities in exchange for neutralizing their opposition to the process. As health reform unfolded, core elements of the Democratic base felt increasingly alienated by the inevitable compromises. Single payer types felt betrayed by the failure of the White House to fight for the “public option”. Hispanics were infuriated by the House bill’s provisions definitively denying coverage to illegals (6-8 million of the uninsured). Womens’ groups were enraged by the extension of abortion restrictions to private insurance purchased through the exchanges. The unions were infuriated by the proposed tax on “Cadillac” health plans


With each successive iteration, the bills grew fatter, less comprehensible and less lovable. As it stood on the brink of reconciliation, the legislation had grown into a gigantic, hairball with the throw weight of a cinder block, laden with special interest favors, pet projects and carve-outs of various kinds. Despite the spin from the White House, it also represented a nearly open-ended, if delayed, spending commitment, and abjectly failed to alter the health system’s fundamentally inflationary payment ground rules. As concerns about the bill grew, a frustrated Emanuel lashed out at the policy community, reminding them that his goal was to get a bill passed, not to garner the approval of the Brookings Institution or the Aspen Institute.

By the late fall, most of the core Democratic constituencies, the policy community and the commentariat all hated the legislation, while its intended beneficiaries were either terminally confused, or had tuned the process out, convinced that it wasn’t going to help them. The White House’s sense of urgency was well placed, because the longer the process stretched out, the more vulnerable it became to political brushfires like the loss of the Kennedy seat. It’s not like the Democrats are exactly helpless with 59 Senate votes and an eighty plus vote majority in the House. It’s rather that the year-long process has not only alienated the core of the President’s party, but also angered the public, which saw only a lot of “inside baseball” special deals and non-transparent policymaking.

Can progress on health reform be salvaged post Scott Brown? Absolutely, but at a price. One major problem will be finding a trash can large enough to stuff the two Houses’ grotesque bills into. Several red bags will be needed. Then, the political question will be: who can the President afford to piss off now?

The President yesterday indicated the possibility of scaling back from achieving quasi-universal coverage to accomplishing a few major goals with broad support: health insurance reforms, small business coverage subsidies, perhaps a modest Medicaid expansion and some cost containment measures (pilot projects, a Medicare Commission?). As we will discuss, these are not political “gimme’s” by any stretch.

If the White House did not want to let go of the goal of universal coverage , it could take a big political risk by advocating passage of Wyden Bennett (S 334, the Healthy Americans Act), the only health reform proposal with bipartisan sponsorship. S334, which CBO scored as deficit neutral in its first full year of implementation, would create a national, consumer choice market for health insurance supported by federal vouchers. It would also fold Medicaid into a national voucher program for private coverage, permanently ending a fiscally explosive welfare program (and bringing US health policy in line with that of most European countries, who do not separate low income people from the rest of the covered population).

However, Wyden Bennett severs the tie of health coverage to employment, and is thus anathema to the labor unions. The unions have played a major, if unscripted, role in shaping the administration’s policies. Preserving public sector union jobs (in higher education and healthcare) consumed a major fraction of the unpopular American Relief and Recovery Act, at the expense of infrastructure spending, green energy and a host of other job creating programs. The unions also shaped the auto industry bailout and were rewarded with majority ownership of Chrysler. Is achieving universal coverage at the price of alienating his union supporters worth the price? That’s a question that only the President can answer.

If Wyden Bennett is too big a stretch, even the partial reforms the President is considering would carry political costs. For example, imposing “patient protection” measures like restricting pre-existing condition exclusions or lifetime benefit caps, or cutting Medicare Advantage payments without the healing balm of millions of new customers will definitely alienate the health plans. (The Democratic base as well as many Blue Dogs and moderate Republicans will cheer lustily. . . )

Hospitals, doctors and pharmaceutical firms will step up their opposition to a Medicare Commission, or to future restraints on Medicare payment increases, absent the prospect of millions of new customers. A split with the medical industrial complex is inevitable. As things were going, however, this was going to happen shortly after health reform was enacted, when the White House turned its attention to deficit reduction.

Other measures could bring major reductions in uninsured people with very little cost. If you don’t require community rating, covering millions of people in their teens and twenties could be accomplished for $60 a month, with affordable subsidies for lower incomes. At low enough rates, many parents would voluntarily cover their kids. Doubling community health center funding would cost only about $2 billion a year, extending the healthcare safety net. Voluntary Medicare buy-in could cover a lot of the 11 million uninsured boomers with modest subsidies for the lower income folk (an trial balloon shot down in October by the hospital industry and their buddy, Joe Lieberman).

The crucial thing is that the President must rigorously limit what’s in the bill to things that directly reduce the uninsured population with as little collateral fiddling as possible, or which create immediate, tangible benefits for people than can be explained in, at most, two PowerPoint slides, and do it in about 300 pages of legislation. As the bills in Congress metastasized into the present monstrosities, these tangible benefits were either postponed five years or became largely unexplainable, squandering the President’s formidable capacity to persuade. A major reason why I voted for Obama was that because I thought he’d be a good teacher- a calm, reasonable person who could explain to us in English how we stood to benefit from a reformed health system.

To overcome the obstacles that lie in his path, he’s going to have to shed the arrogant misreading of the 2008 election as somehow “transformational” -a call for government to “rescue us”. His election, like the 2006 Congressional election that preceded it, was a “throw the bums out” election. Most of the “bums on the bubble” are now members of his own party, will have controlled Congress for four long years. And if the Democrats cannot defend Ted Kennedy’s seat, how many of their seats are really safe in 2010 or 2012? Unlike Clinton, Obama does not seem driven by the compulsive drive to have everyone love him. Some cold calculations about who you can afford to piss off is the key to making the right choices.

Spread the love

61 replies »

  1. Vikram C – I don’t think I can quite summarize the state of the industry on publishing cost or quality results. Anthem has been putting out market-specific (ranges of) costs by provider for several years, for a limited set of procedures. Aetna similarly has done provider-specific costs for many outpatient procedures in many markets, again going back several years. Many smaller or more regionally based health plans are doing similar things.
    Nate – There are vendors such as Healthgrades or WebMD that have a business aggregating & publishing provider data, primarily with hospital data and based on either Medicare data or (for states that collect the data) all payer data, and that health plans display on their websites. That’s fairly common for the major Blues and commercial plans. Info on physicians is hardest to come by and least likely to be published (aside from directory-type info), both because it isn’t commonly collected and there are not widely agreed-upon measures for quality.
    The theory behind these is that consumers will act more prudently when they know in advance more of the cost & quality data, especially in an era of higher deductibles. Obviously, if someone is having a heart attack they can’t comparison shop, but if someone is going to get a more elective procedure or something with a longer time horizon, then one hopes that consumers would care. The danger of attitudes that “more expensive is higher quality” is a very valid concern.
    Health care is very complex and the data are poor, but it’s very paternalistic to say consumers can’t understand and shouldn’t have the data. Consumers are hungry for more & better info on health care, as evidenced bny the popularity & growth of health sites.

  2. spend a couple minutes on google you will find them. The PPOs will be harder as that happened back in late 80s early 90s so PPOs stopped.
    “Patients commonly share opinions of doctors on online review sites like AngiesList.com. The reviews help to keep doctors honest and on their toes, according to patients. But a handful of doctors call the ratings unfair and they’re fighting back by requiring patients to sign contracts that bar them from commenting on their care. Patients say these contracts – usually known as “Mutual Privacy Agreements” – violate free-speech rights. Hear from all sides about a topic that’s generating buzz nationwide. ”

  3. Nate- where exactly was Angie’s list or Aetna sued for rating providers? As I see Angie’s list members were sued but not related to health care issue.
    Same goes for PPO. Which insure got sued for star remarks for provider?
    Please provide links.

  4. “A more efficient way to compare providers would be independent publication of outcomes.”
    That would punish providers willing to take on difficult or complex cases because it would affect their aggregate rating. Outcomes don’t tell the whole story, especially in healthcare, like how sick was the patient when they came in for the procedure. How many variables to you want to include.

  5. Margalit, make a deal liberals call off the attorney’s and I’ll give you everything you asked for. It’s not fair to blame insurers for not doing what the courts have told them they can’t.
    Patient rating has gotten the aggregator sued. Angie’s List, Aetna and a couple others did it, not tried but it was actually done, and they got sued.
    Marking providers with a star is an implicit suggestion to see those providers and when one of those providers performs malpratice the PPO/insurer is also sued for suggesting them. Giving those stars based on cost would be guaranteed loser under our current tort system.
    A more efficient way to compare providers would be independent publication of outcomes. Why have 10,000 insurers each republishing the same info when you can have 4-5 aggregators publish it? The information would also be considerably more trusted comming from an independent third party then from the insurer.
    Insurers should publish what they pay per procedure but it is the responsibility of the provider to publish what they charge.
    I don’t think the public, especially the left, has any clue how bad government has restrained innovation in insurance.
    Rein in your attorneys and I would gladly do everything on your list.
    “I would love to sum it up and compare to premiums collected.”
    You can do this on yahoo or any finance site now. THis info has been esily available for 50 years, not by provider but summed up it is. Payments to premium is loss ration and not only published for every company with stock but every insurance department I am aware of collects and publishs it as well.

  6. “Popular convention is most expensive is best”
    Yes, they say you get what you pay for, so if insurance is paying either the high or low price I’ll take the high price. Look people can’t even pick a good mechanic, contractor, or investment “professional”, do you think they have enough insider insight to pick a good doc – when failing even once can be a big hurt. My wife is a nurse and we still have trouble assessing medical professionals. No one can read a few “ratings” and get any idea as to how that doc/hospital will function for THEM, only constant assessment and use will give anyone any idea and comfort as to outcomes.

  7. Kim- What is the current status of procedure specific cost information and quality information? I just never found it on any my insurance websites. And what exactly are they to achieving by putting price on websites? Popular convention is most expensive is best and it just might increase the total claims bill.

  8. Margalit – several insurers (including but not limited to Wellpoint and Aetna) have been putting out provider and/or procedure-specific cost information for several years now, with an even longer history of quality information (especially for hospitals, where there is better data). Wellpoint even partners with Zagat’s on consumer ratings. Not all procedures/providers and not perfect by any means, but making progress.

  9. Nate, if you seriously want people to actually do comparison shopping then this is what they will need:
    An insurer website where you can search by service/procedure and get a list of providers with appropriate contractual prices that the insurer actually pays. Also on that page, there should be outcomes information (i.e. 1000 CABG 75% dead in a month, or something like that). patients rating would also be nice to have.
    Consumers should be able to sort by quality, by price and by distance from home.
    Insurers could mark some of the cheaper providers with a star, meaning that if consumers select that provider, there is a rebate, or copay waved, or whatever.
    Will insurers agree to do that? If yes, show me! If not, then don’t expect consumers to have any ability to help contain costs and let’s stop talking about “healthy competition”.
    There should be public disclosure for what insurers are paying each provider, per unit and total per year. I would love to sum it up and compare to premiums collected.

  10. Medical outcomes are readily available for every major hospital. US News uses it to Rank them every year. CMS uses it, and some insurers use the data as well.
    If your insurance pays 100K in claims when they could have paid only 75K that is likly to have an adverse effect on your rates. If your insurer offered to waive your deductible and co-pays that would be even more incentive.
    You seem to be arguing that consumers knowingly waste money, that would seem to fortail a failure of any public plan since they exercise no control over utilization. Medicare has proven rationing by reimbursement rate doesn’t work. Paying less for proper care and wasteful care is not more efficient then paying well for proper care and not incurring wasteful care.
    seeing as how a very small amount of total care is spent on emergency care its a non squater question.

  11. Dave Brown- Very good comments. However let me just point out a few things.
    Unit cost per procedure may be high but a better strategy is to shift utilization to lower cost procedures and lower overall utilization. As an example choosing Chiro over back surgery. Fran just referred to 3K pages of HC bill. The thing that has to be understood is that if the requirements are complex and multi-faceted the solution will be complex as well. All regulations are there for a reason. Removing a regulation is easy but what do you do with those societal requirements around safety, fairness etc?
    Now the beauty of lowering utilization or severity thereof is that vested interests cannot oppose it easily. That battle is in the minds of the people. It is not imposed on anyone. We may not be able to reduce per unit cost except that of drugs so easily, however that ain’t our goal. Our goal is reducing total national spend. Once it is proved that expensive isn’t necessarily better, hopefully some procedures’ price will automatically go down. Demand-price elasticity can be established only when there is willingness to try alternatives.

    Talking about nearly 3,000 pages, with supplementals.
    That’s insane. No one but a JD/PhD with six months of 18×7 work could figure it out, with any sense of authority.
    It has failed because it is too complicated for 99.99% of the population.
    U.S. Sen. Snowe suggests starting over. Yup.

  13. Brown ran and said things in a generic Republican campaign circa ’02 or ’04 only he stayed away from social issues as much as possible (e.g., gun control, Gay marriage, abortion) and played up his populist and Independent image which is utter nonsense. The day he was swore in comments from several prominent Republicans in Congress including McConnell himself.
    What is going to be interesting is to see where Brown falls on a couple of issues that upcoming right away including Bernanke’s reappointment & financial reform. Politics can make for odd-fellows and Bernanke’s reappointment is no exception. Included in the ‘Nos” so far are Sanders, DeMint, and Boxer. You couldn’t have 3 more different politicians with different beliefs/constituencies.

  14. From the WSJ article:
    “but he stressed that he opposes high spending wherever it comes from.”
    We’ll see if he’s for high cutting as well.
    Interesting, do you think he would have voted to bail out the economy or voted to let it go into free fall? What made America great? Free unregulated markets that lead to collapse? Free enterprize that wants bailouts and preservation of bonuses with tax payer money? Manufacturing that’s allowed (free markets) to seek the lowest foreign labor/environmental/regulation costs and have the taxpayer subsidize the job transfers? Job creation by having the government give tax handouts and tax cuts to create jobs that only exist because of subsidies? Wait, I didn’t think Republicans thought the government could “create” jobs, I thought that was for private enterprize to do. But how many jobs has private enterprize created during this recent meltdown, which by the way was caused by deregulated/unregulated markets? Isn’t Scott Brown sounding like an old style Republican (politician) and not a pickup driv’n, status quo busting, work boot wear’n, populist?
    Most of the problems in this country cannot be solved without pain and in 60 days, but nobody wants the pain, they just want other peoples taxes to solve THEIR problem.

  15. Peggy Noonan had an absolutely hysterical commentary on the failure of the two parties in the Friday WSJ. Instead of warring mafia families, she compared them to two warring street gangs- the Nuts and the Creep. Guess who’s who?
    Read and weep: ttp://online.wsj.com/article/SB10001424052748703699204575017503811443526.html?mod=WSJ_hp_mostpop_read

  16. Actually, he expects to make a good buck from HCR. Something to do with medical information technology systems.

  17. “and had equal results”
    How would you know, after you died? Could you get a refund? And would you care if your insurance was paying anyway? And just where and when would you make that decision, in the ER or intensive care?

  18. If they posted 100K for heart by pass and the hospital across town posted 75K and had equal results then people would be more likly to go to the cheaper hospital. This would force 100K to lower their price which in turn would pressure 75K to further lower theirs.

  19. ” Why do they use retail clinics? They know the prices!”
    No, they can afford the prices. Healthcare cost drivers are not minute clinics, they’re hospital care, drugs, chronic disease care, and end of life. Do you think posting $100,000 for heart by-pass surgery will make it more affordable?
    “they are just not as efficient as the private sector”
    Like the private sector we have now driving healthcare costs?
    “the risk selection practices of the insurers, while somewhat rational, don’t operate in the public interest.”
    Would that be the “more efficient” private sector insurers? If you’re going to force insurers to accept all comers then you’re going to have to force all comers to have insurance – and you can’t do that unless insurance is affordable to everyone. If you want affordable insurance you’ll have to regulate prices and use.

  20. I may be late to the party today…would anyone care to hear a centrist Rep view with practical suggestions?
    First, a few observations of our state of affairs today:
    1–Our biggest current cost problem is unit cost — per George Halvorson, CEO of Kaiser and a Dem. Our unit costs for every type of care is between 2x and 6x the global average. Caused by — over regulation, litigation, government cost shifting to name a few…that, and pervavsive fraud and greed FROM ALL SECTORS, not just insurers.
    2 — supply and demand is an economic law, which Dem politicos and wonks often forget. It’s not optional. It’s a law. The unworkable side effects of today’s proposals are obvious to anyone who’s had 1 1/2 semesters of college-level econ. Pay attention, single payer advocates!
    3– Access to affordable care is just as or more important than insurance reform. If prices are transparent, they will come down. The public will be reassured. Why do they use retail clinics? They know the prices!
    4–the pending legislation barely addresses the access/cost problems, which then have tsunami-like effects on the rest of the system. The current proposals just happen to be the first ones to make it down the line — it doesn’t make them the best ones. Ready, fire, aim!
    5 — Governments don’t belong in the administration business — they are just not as efficient as the private sector
    6– the risk selection practices of the insurers, while somewhat rational, don’t operate in the public interest.
    I don’t regard the system as irretrievably broken, rather it is evolving at very different paces. At the risk of sounding overly simplistic, please consider the merits of the following incremental steps:
    1- We can improve cost effective access with community health centers (as noted above). They can be cost-effectively manufactured with prefab techniques and technology in mind. That should create jobs and capacity to ease unit cost pressures.
    2- Regulations in place today should be re-examined for their applicability to today’s medical economy (and tomorrow’s!). How about dusting off the idea of a bipartisan commission that addresses excess regs like excess military capacity? Remove the excess layers of compacted and conflicting regulation which would have to help un-stifle innovation in new process and products. Perhaps even unlock the tangled FDA approval bureaucracy. Net effect — it should create jobs.
    3- Similar to FAIR plan for homeowners insurance (risk transfer), assigned risk auto coverage and terrorist reinsurance — the government’s funding role should be to backstop the existing insurance system — in exchange for underwriting reform. A meaningful mandate may be necessary at the individual state level. (I’m considering the federal mandate unconstitutional for purposes of this discussion — considering the inherent delays in resolving this question from inevitable legal challenges). Tie the economic backstop to state mandates and underwriting reform.
    4–liberalize state medical licensure to expand the use of primary physician extenders and free up that capacity for real health-improvement — with bonuses for clinically proven population health gains.
    5-Tie expedited reimbursement from existing government insurance programs to automated standards for adequate data collection/analysis and adherence to evidence-based medicine (where it exists). Just slow down the payment processing cycle for the paper-based luddites. They’ll get the point and get with the automation game.
    These don’t pretend to hit all the issues or even the details, but I hope it’s a constructive start.
    BTW, had a chance to meet Dick Gephardt the other day. He liked my bipartisan regulation removal idea. I even told him I was a Rep.
    Ready, aim, fire!

  21. Peter, no matter what you do, there will never be government completely devoid of undue influence of special interests, mostly moneyed interests. This was true from the first Washington administration to the current one. Since we are dealing with humans as opposed to angels, the constant tug of war between corruption and the interest of the people is an inherent part of Republican Democracy.
    What we need is to have legislation that encourages more men/women of integrity to be elected to Congress, and try to preserve the elusive balance between people and corporations.
    I’m not sure that experience is that important. Most representatives have no previous knowledge in the various fields that are debated on the floor and health care is a great example. That’s what staff is for.
    Experience on the other hand can lead to more than just rampant corruption. Loss of passion and complacency, particularly when viewed as another day at the office is not a good thing either.
    Boards, commissions and other political appointments are made by elected officials. Patronage is part of the game and the idealist Jefferson found this issue to be most daunting and unpleasant. My assumption is that people with integrity will make a better effort to appoint other people with integrity.
    I’m not looking for perfection and I’m not looking for a particular ideology to take hold. I’m just looking for an acceptable level of decency.

  22. “The folks in Washington are completely disconnected from their communities and their personal interests are no longer aligned with the interests of those that sent them there.”
    Then why do their constituents (at least the ones who vote) keep sending them back? You know experience counts, and to fully understand complex issues and why things work the way they do you need experience – and I don’t mean experience taking corporate checks. Usually when people talk about term limits they mean the other guy’s candidate. The other aspect to this is much of DC power brokering is done by people appointed to boards, commissions and departments. You’ll find many of those people are industry insiders whose company helped elect congressmen or worked for the party. There is so much $$$ back scratching in DC that no amount of term limits is going to solve anything, it’ll just be a baton passing relay race.

  23. Yes, Peter, even the guy that I like and is effective. In order to represent your constituency well, you have to be part of it. The folks in Washington are completely disconnected from their communities and their personal interests are no longer aligned with the interests of those that sent them there. If you know that elected office is temporary and there are no long term benefits associated, you are more likely to view it as real public service instead of a lucrative career choice.
    And, yes, the money thing needs to be fixed too.

  24. does discipline involve any pain or enhanced techniques or purley verbal?
    Margalit would you set that per position or 8 years of elected office so people don’t go their entire life living off the public dole? Politicians are to detached becuase most have never had to work like your average american. Public service should be something you do for a short time between jobs or at the end of a career not a lifetime career.

  25. “Eight years should be all anybody gets in any elected position. Life appointments do not sit well with this Constitution.”
    Margalit, even with the guy you like and who is effective? Look, elections are supposed to determine term limits, but we all know that the corporate money system gives huge advantage to incumbents. Fix the money thing and you’ll fix DC incumbents.
    “The country was designed to be governed by each state, not by the feds.”
    The United Balkan States of America, yea that’ll work.

  26. Nate – we need to talk about your participation on this forum. We’ve had a number of complaints about the tone of your comments. Please email me to discuss. My contact is John at thehealthcareblog.com. If I don’t hear from you, your posting privileges will be revoked.

  27. Peter,
    The country was designed to be governed by each state, not by the feds. Can you say “state’s rights”?

  28. Peter, there is more to governing than health care. I wouldn’t want to see the Israeli multi party system here. Every tiny special interest can keep the entire country hostage. It is most frustrating.
    I somehow don’t think the number of parties is the issue. It’s those “safe” seats that bother me. Constitutional Convention indeed. Eight years should be all anybody gets in any elected position. Life appointments do not sit well with this Constitution.
    And by the way, Jeff, I don’t know where exactly Obama tried to govern from the left. This left-right division is great for inflaming the masses, but are things really being driven by ideology in DC?

  29. “With a bunch of parties, you really do end up like Italy or Israel, with coalition governments, vote buying on a grand scale and paralysis.”
    Come on Jeff, really, worse than we have! Italy and Israel both have universal government run healthcare, so how bad can it be. Canada has four federal parties, one even a Quebec separtist party for christ’s sake that has been the main opposition party and still the country is more governable than U.S. and it also has universal single-pay healthcare.

  30. Medicare is not a model for any future public option. It is fiscally insolvent and politically swayed to buy votes from beneficiaries. Only today the Medicare beneficiary better be getting plan B out. Medicare will be cut. This healthcare bill was all about political cover for just that, cutting Medicare.

  31. A LINE IN THE SAND – From jacksmith – WorkingClass
    My Fellow Americans and People Of The World
    The Public Option http://tinyurl.com/yfftf76
    God Bless You My Fellow Human Beings
    jacksmith – Working Class

  32. If neither party can govern when given control both of the White House and Congress, that does raise some questions about why we have only two parties.
    The parties’ Congressional wings have come to resemble warring mafia families fighting over trillions of dollars in spoils. The gravitational pull of those parties is what is really crippling our government. With campaign finance reform, those mafia tendencies will be markedly strengthened because there will be even more money to fight over, and fight with.
    It’s actually worse. Both parties’ nominating processes have become captives of their respective outer wings. Obama became President only because he outflanked Hillary Clinton on the left. McCain failed to become President largely because he was forced to cowtow to the right wing and feed them a salty confection called Sarah Palin. An innovative VP nomination (like a moderate Democrat) could probably have accomplished the unthinkable.
    Even though Obama has attempted to govern as a moderate, he has been dragged left by the House leadership (the “safe seat” Democrats), and ended up alienating independent voters and the moderates in his own party. When you run on a platform of “change” (one might say “Duh!”- Bush wasn’t on the ballot), lots of people, especially the wack-a-doodles, can hallucinate that you’re their guy. . . Now he will try to govern as a populist, and discover that the independents won’t come back (and if he tries hard enough, he might even re-ignite the panic).
    With a bunch of parties, you really do end up like Italy or Israel, with coalition governments, vote buying on a grand scale and paralysis. The alternative solution, one which produces actual change (welfare reform, eg.), is to make absolutely sure that control over the White House and Congress is split between the two parties, forcing them to compromise, or they cannot even fund the government. Constitutional Convention, anyone?

  33. “Obama was to throw the “bums” out. He did not.
    He hired them to run key positions on health care reform and more..”
    Propensity, I think you’re correct on the sentiment but how was he to throw them out, the “bums” were elected by US. He would have had to go outside DC to appoint key people, hardly possible (if legal) if he wanted any cooperation from the politicians who would be needed to eventually pass the bill.
    “Lobbyists and trade associations are writing policy for the US Government,”
    Just as they did in the Bush Regime, but until the American people can disconnect politics from money (everyones money) we will continue to be frustrated at policies and behavior from DC. But Americans still cling to the myth that privately funded elections equate to freedom and publically funded elections equate to socialism and a waste of tax dollars. Think about the fact that most of a congressman’s two year term is spent dialing for dollars not studying the issues or even reading the bills.

  34. He has some interesting conspiracy theories. I think he’s posted some of them here.

  35. Prometheus sounds like an illegal alien to me, I got some thoughts on where he can park his communal ways

  36. Many explanations abound and yours is articulate and effete. Try something simple that gets to the base feelings. The people saw the hypocrisy.
    He hired them to run key positions on health care reform and more, eg the Health Care Reform Czar, former Board Member of an HIT vendor. What does the HHS Secretary know about health? Lobbyists and trade associations are writing policy for the US Government, especially in the HIT venue, eg HIMSS. Obama was advised by the CEO of an HIT vendor.
    His team still can not connect the dots by making simple telephone calls to protect the airline passengers, who themselves are inconvenience by useless screening, from terrorists.
    Oh, these are just a few of the good reasons why people who voted for him are angry and would vote for a former nude model.

  37. Come on, Nate, you can be a little more gracious in victory.
    Must be a terrible shock to Prometheus, having descended from the heights to light mankind the way to a more caring, sharing, communal future, to be told to stick his torch where the sun doesn’t shine.

  38. Am I the only one viewing these elections as referendums that the voters, as an effective majority, are not interested in the party of power, but just do not have access to an alternative from Democrats or Republicans to put someone in office to represent them and be accountable and responsible?
    How long do we ride this ridiculous pendulum of voting Democrat, then Republican, then back to Democrat, then again Republican, until we cumulatively scream “is there another choice we can turn to that is viable and realistic!?”
    Hey, America, let’s start by voting out ALL INCUMBENTS of more than 12 years of office, irregardless of party affiliation, to show both of these arrogant parties that tenure is a detriment. Maybe, at least, they might try to look for fresh, invested minds that could give their respective party some legitimate interest to voters. Or, allow a third, hell, maybe even a fourth party to get some traction and give voters real choice, and to give Obama’s false assertion, true hope to the process we call democracy that runs this country.
    Ever see the Steve Martin character in early Saturday Night Live skits, York the …, when he goes into a mini rant at the end of the skit sounding aware that the status quo must change, only to end with a resounding “NAH”? That’s how this comment should end, because we don’t have people both in office and voting for them to enact true, caring change.
    Health care reform that is really realistic? Is EVERYONE in this country ready to make a sacrifice?

  39. “Yes you’re right, but the basic problem is that we’re now an ungovernable nation.”
    Well if you thought we were before the Supreme Court’s unlimited corporate money = free speech decision you haven’t seen anything yet. Just try to take any steps to rein in costs or reduce tax subsidized healthcare and Corporate America will have a well funded election attack ad for that. If you thought this bill was industry friendly wait til you see the next one. There will be NO reform that does not pass corporate muster. The game has changed.

  40. Well said. Sometimes how you go about enacted reform is just as important as the reform itself. The process of bringing the bill from inception to near fruition is a template for how an administration should not handle legislation.

  41. Good summary, Jeff. However I must take issue with positioning the health reform bill as beneficial to “young people, widows, homeless people, immigrants, both legal and illegal, etc,”.
    Honestly I really don’t think that the issues are limited “uninsured, un-insurable and indigent” and most of the PR damage to the bill was done exactly by positioning it this way.
    I would say that the “core constituencies” of both parties are affected by the runaway costs of health care, probably more than they realize. I am not a proponent of scare tactics ala death panels, but the Democrats failed to drill this message home and the majority became a disinterested party. It is way too late to change that now.
    Sort of eerie, but in very different ways the current failure to enact reform is due to the same thing as the Clinton debacle – failure to communicate.

  42. There are still a few things in the bill that are admirable and actually make sense (e.g., impose and make organizations actually actually stick to a defined HIPAA transaction standard instead of leaving it open-ended) but the bill became a convoluted mess over time as money and back-rooming dealing were increasingly needed to buy-off various health care constituencies and politicians.
    Usually I take what Pat Buchanan has to stay with a grain of salt but it is a usually a twist off the same old tired formula (Anglo-Saxon Protestant greatness) but he had a very good point that the elderly White Americans became frightened about the Medicare cuts (rightly or wrongly) and that white Americans who still have solid coverage through their employer didn’t see what was in it for them.
    It was this demographic (especially White Americans males from 35-64) that Obama and the Democrats have done well nationally in the ’06 and ’08 elections to make large in-roads where they got supposedly clobbered in the recent elections including the Christie/Corzine race in NJ and the most recent Brown/Coakley race in MA according to the limited exit polling data.
    What is pretty clear now is that Obama and the Democrats in the House clearly overreached and misread what a majority of the electorate especially seniors in Medicare and Americans with coverage wanted. It isn’t so much that they were concerned about the deficit (both parties are lying through their teeth about that issue) but it really came down to a matter of “I like the status quo enough and what is in this bill for me.”
    It is going to be very interesting to see now what direction the wind blows as the Democrats likely try to stave off what might turn out to be one of the bigger midelection year disasters in US history.

  43. Good point on HIPPA, Nate. After 20 years in nursing, I see a decline in the protection of personal health information, rather than increased protection. If you need an example of this and you’re not currently working in a healthcare facility, simply go shopping at your local Walgreens. Lurk around the contact lens solution aisle for a few hours and note how many conversations you will overhear at the pharmacy window between patients and pharmacy staff about the type of medications they are taking and what it treats, etc. This is usually done after the patient’s name is called over the loudspeaker throughout the entire store. Ironic that an entire industry has sprung up of handsomely paid HIPPA Compliance Officers, HIPPA IT Specialists, and HIPPA Consultants, and the only thing HIPPA has really prevented is letting medical professionals collaborate easily in the care of a patient, as well as preventing doctors and nurses from informing appropriate concerned loved ones about a patient’s status!

  44. I have to side with Matthew’s remark that the nation is ungovernable in health care, and since government must have an active role to enable good health markets, our nation will also remain void of well functioning markets for health insurance and health care. The economic fundamentals of the industry–asymmetric information among players and highly skewed health risks for starters–require a government role to ensure a rational and level playing field for industry participants. Thus, the tea-party style, knee-jerk reaction to a major government role, while well embedded in popular, modern American political thought, knocks out a critical foundation for any rational reform, whether the reform direction be market-incentive or single-payer based.
    Jeff, you blame the Congressional leadership, but it’s a cheap shot. Certainly the proposals you appear to support could never have made it far politically: Too many entrenched interest groups would have rallied to undermine them. Further, whatever the reform proposal, Republicans had too much to gain by shooting it down. Since it was too easy to malinform our easily misled and fearful public, Republican votes were never in play.
    I’m amazed by so many people’s assertion that having a couple thousand pages means the bill must be bad. We’re talking about a sixth of our economy, and a sixth that is arguably more complex than most. Would you really have preferred giving each percent of the economy a limit of 17 pages each to guide fundamental legislative reform for that subsector? From a practical perspective, the only way such sketchy legislation could be implemented is if federal bureaucrats were handed wide-open mandates to guide not just the details, but major policy decisions also. That might fly in Europe, but not in our politics where government mistrust prevails.

  45. Heidi is the first person I have ever seen on here that realizes the waste in compliance. Congress learned nothing from COBRA passed in 86 and the tens of billions in wasted compliance and lawsuits. They followed that up with HIPAA which was also poorly written and cost billions in lawsuits and compliance waste. Some of these ideas are fine and beneficial to the system it’s the way the politicians run away once the vote is done, they don’t care how it is implemented or even if it works, they passed the bill and move on to the next political point scoring bill.
    Archon41 it needs pointed out that Americans are willing to “take a hit” for the indigent and uninsurable it is called Medicaid. They are not willing to “take a hit” for those that are able to buy insurance but choose not to. Nothing in the proposed bill helps the people the left claims need further assistance. Instead it penalizes, taxes, and restrains the honest hard working people that are already “taking a hit”. Apparently Obama and Reid don’t think the middle class has been “hit” enough.

  46. Jeff, good analysis of what went wrong. But I think it’s completely politically unrealistic to think that Congress can pivot to a different bill and pass it any time soon, particularly with total Republican opposition. You move the pieces around and you have to navigate all the treacherous political shoals all over again. Please explain how that is politically doable for Obama and the Dems. Why not take the admittedly imperfect Senate bill and improve it over time? Otherwise we’re nowhere for another generation.

  47. Jeff, another great observation on the tactical miss-steps of the whole debate: The house bill was terrifying. If the Senate bill had been at the center of the debate last summer, I’ll betcha we’d have law today.
    By the way, being a believer in markets doesn’t necessarily preclude sympathy for the uninsured, un-insurable and indigent. If universal access is the will of most Americans, then fine, community-rate the whole damn country, divide the total cost of annual expenditures by the population, call that ‘the national premium’ then let beneficiaries purchase care howsoever they choose.
    Use whatever mechanisms we like to allocate payment of that premium according to means.
    But we can’t have that debate, because we don’t trust markets. Instead we gravitate toward manipulation of both the supply and demand side of the equation.

  48. In the interests of space, I neglected to point out the damage done by the House Bill back early this summer, which was a pure form, command and control, statist health reform vision. Pelosi, Waxman and Stark put their stake in the ground so far to the left that it not only set off all the old alarm bells about “government controlled healthcare”, but trapped moderate Democrats of both houses, who would have preferred some balance of state controls and market solutions. It also trapped the President, because it narrowed his options for creating something more realistic in the Senate, and resulted in an unbridgeable gap between the two houses. See my “Wild Pitch” blog for comments on the problem created by the House bill.
    The biggest problem with the legislation now apparently dead was that it was fiscally irresponsible, and made promises we could not fairly keep without destroying the dollar and ultimately driving up interest rates. If we could make a down payment on universal coverage by covering 12-15 million people now, it would be a huge victory. We simply did not have the resources to achieve universal coverage without a full-on political bloodbath, or else lying to the voters about the actual costs.
    Not Haiti, Matthew, but certainly possibly Argentina or Italy. I don’t think systemic collapse is in the cards either, nor should we be covertly rooting for it. If health reform fails completely, there is a great political “opportunity” to attack the healthcare industry, and to put it on a diet. That’s one reason why the industry attempted to “play ball” with the administration and stayed at the table throughout this process. It cannot fairly be blamed if health reform completely collapses. The real fault lies with incompetent Congressional leadership and a White House misreading of the national mood.

  49. A pity, really, that more Americans aren’t willing to “take a hit” to fund susidies for the indigent and uninsurable, but it is what it is. It doesn’t help, you know, that the primary beneficiaries of HRC, in its present modality, are Obama enthusiasts.
    You say that “community health center funding” might be increased a hundred fold for $100 billion a year? Why wouldn’t that be a worthy goal? Oh. I see. That wouldn’t create “equality of access.” Just doesn’t have enough humanitarian uplift. But would it rend the fabric of the moral universe to aim for something short of “equality of access”? And, if the spirit of reasonable compromise has fallen upon you, you might at least pay lip service to conservative preoccupations with “tort reform” and “defensive medicine.” A bitter pill, I know, but it is what it is.

  50. Brandon,
    re-read your post aloud, and report back if you hear any State Of The Union – calibre soundbites in all that enthusiastic talk of algorithmagically empowered creative energies stimulating the creative juices of consumer-friendly risk capital bases.
    If this is about voter mistrust, your VC jargon just bought you a ticket on the ‘you’re also to blame’ train.

  51. As a post mortem of the tactics that culminated in the death of HC reform ’09, I agree with Jeff’s assessment, especially the lessons perhaps mis-learned from ClintonCare complicated by Daschle’s departure.
    But does that analysis miss the bigger picture? Maybe it is wishful thinking but I would certainly like to think the MA result was partially driven by opposition to the creation/expansion of more federal power over the economic lives of Americans. I am happy to accept that the MA voters were not passing judgment on their own HC system, which they do seem to like. Rather, I think, they were passing judgment on the creation of a new federal behemoth with the prospect of uncontrollable growth and minimal accountability. (eg SS and Medicare) If I allow myself even more optimism, I might squint my eyes and make out the dim outlines of our old and mostly forgotten faith in market-based economic solutions for besetting social challenges. My greatest dismay over this entire debate has been over the utter absence of any prominent defenders of market based approaches to improving the cost/quality/access algorithm. We should be empowering the creative energies and risk capital base that has sustained the U.S. as the world’s innovator, rather than attempting to emulate… France.
    So tactically: sure, fine-tune away! But strategically, preserve wide avenues of opportunity for the most capable and well trained consumers the world has ever sired to drive and shape innovation and delivery of life’s ultimate consumable.

  52. Jeff Goldsmith’s analysis is right on target.
    The President would be wise to heed Jeff Goldsmith’s advice of limiting legislation to at most 300 pages, with key points that can be explained in two PowerPoint slides. (Personally, I think it needs to be under 100 pages in order to not create more problems than it solves). It has been my concern that, should this massive piece of legislation pass, it would require an entire (legal) industry just to interpret the bill to providers and to monitor and audit compliance. While that might be a great economic stimulus, creating new jobs for lawyers and consultants, it would take healthcare dollars away from the provision of direct care and channel it into another layer of bureaucracy.

  53. Jeff. Yes you’re right, but the basic problem is that we’re now an ungovernable nation. And the systemic problems in health care will lead to collapse of the system, even though that collapse will be more of an erosion than a Lehman Bros type implosion slower because of the reduction in consumer spending on health care you wrote about in Health Affairs.
    But all the minor reforms you wrote about (with the possible exception of the Medicare Commission) are of the deckchairs on the Titanic variety. So whether we get them or nothing (which is my bet) it doesn’t alter the overall picture.
    On the other hand I infer from your comments on Facebook that even when we get to total collapse, we won’t do the rational thing and put in austere single payer–but just let it happen!
    So the future is not 1940 Britain, it’s Haiti!

  54. Good analysis, although I am sure everyone will weigh in with their own ideas about what should or should not be done about this bill. I think Obama is at a critical point in his Presidency right now, though – either he makes that cold calculation, on several other issues as well as health – or he risks being seen as a powerless puppet.

Leave a Reply
