Fighting for Our Health
Even if everyone can agree that we should pay for care that actually works, changing the way medicine is practiced is no easy matter. This can partly be achieved by investing in health information technology and research into what treatments work best, so that doctors have the tools to make better decisions. (The stimulus package provided additional funding to move in this direction.) Drug and medical device manufacturers won't like this, because it means they will have to demonstrate that newer, more expensive products outperform older, cheaper ones. Since doctors and hospitals consume more than 50 percent of healthcare dollars, we are going to have to make difficult changes to the way they are paid if we really want to make better use of our health spending. Today providers are reimbursed by the volume of services they give to patients, not whether their treatments are making their patients better. They are not going to be happy if they think changing this will cut their paychecks, and they can rally support from patients by scaring them with threats of "government rationing."
This is one area in which the public plan is most helpful. A government-run health insurance plan will have the ability to aggressively restructure how providers are paid. If it operates more efficiently, private insurers will be forced to trim costs in order to compete. In the absence of a public plan, however, a more complicated alternative might be to drive a change in reimbursements through the largest existing federal program, Medicare, while using regulation to guarantee coverage to hard-to-insure patients in private plans.
Though it is theoretically possible to expand coverage just by reallocating existing healthcare dollars, engineering such a reallocation would be so disruptive that many believe it is politically impossible. (This is largely what the Clinton plan tried to do, and we know how that went.) Instead, a plan like the one outlined by the Obama administration combines some cost-saving measures with a call to raise additional revenue. This new spending would cover the upfront costs of making the system more efficient and subsidize coverage for the uninsured and those whose coverage does not fully meet their needs.
Raising revenue is always a major challenge, as the president was reminded when even some Democratic Congressional committee chairs balked at his budget proposal to raise money by capping the tax deductions of the wealthiest Americans. Some, like Senate Finance Committee chair Max Baucus, would prefer to impose a tax on the healthcare benefits employers now give employees tax-free. But large businesses, which offer insurance at a far higher rate than small ones, hate this idea, and unions also oppose it, because they regard these benefits as hard-won wages. Unions like the idea of paying for health insurance by mandating that businesses offer benefits or contribute to a government fund to help employees buy insurance on their own. But Dan Danner, president of the NFIB, the small-business group, calls an employer mandate a "lightning rod" that would trigger his group's opposition. AHIP, which has been working closely with NFIB, is officially agnostic on an employer mandate but heavily favors requiring everyone to have coverage (as Massachusetts has done), a proposition that works only if premiums are adequately subsidized to make coverage truly affordable.
HCAN has no easy task in cutting through this thicket of interests, Representative Stark warns: "There are a lot of guerrillas in that jungle."
Surveying a meeting of these guerrillas--I mean, stakeholders--at the White House healthcare reform summit, Senator Ted Kennedy expressed hope that a new spirit of cooperation will make possible the reforms that have eluded him for forty years. Pledges of cooperation were made that day not only by AHIP but also PhRMA, the NFIB and the Chamber of Commerce. "It'd be hard to think of those interests being together and...demonstrating the kind of commitment as we have today," Kennedy told the gathering. "This time we will not fail."
Kennedy's office has been arranging confidential meetings of these groups for months to try to reach a compromise package. But the AFL-CIO's Shea, who attended the White House summit and whose organization is participating in the Kennedy discussion group, thinks such an approach will lead to the death of healthcare reform by a thousand cuts: "Having gone through a number of these processes fifteen years ago, we think this is bullshit. There is no way to get agreement that way."
That is why HCAN was rallying in front of AHIP's Ritz-Carlton policy forum just a few days later. The path to reform, Shea says, is not bipartisan compromise but the same one that led to Medicare and the Civil Rights Act: for the president to use his electoral mandate to press for the big change that's needed, and for a better-organized, better-funded progressive coalition to help force Congress to pay for it.