Editore"s Note
Tilting at Windmills

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December 20, 2007
By: Kevin Drum

1994 vs. 2008....Ezra Klein writes about the prospects for universal healthcare if a Democrat wins the presidency next year:

I'd like to believe, as Joe Klein does, that America's corporations will make this the year that they finally support universal health reform. But I wouldn't bet an extraordinary amount of money on the prospect. For instance: Though the NFIB [a small business lobby that was instrumental in defeating Bill Clinton's healthcare plan in 1994 –ed.] has been making conciliatory noises, and even talking with Ron Wyden on occasion, they still came out in ferocious opposition to Schwarzenegger's California reforms, which are not dissimilar to the models offered by the national Democrats....Any president walking into this counting on the support of the corporate community will get their lunch handed to them.

I agree. But that's boring, so instead I'm going to play devil's advocate. There really are a number of differences between 1994 and today that work in favor of getting business cooperation on a serious healthcare plan:

  • In 1994, the business community got sold on the idea that the HMO revolution might succeed in reining in healthcare costs, which meant there was no need for the feds to get involved. Obviously that didn't happen, and no one in the business community now believes that there's some quick fix on the horizon that will keep their healthcare liabilities from continuing to skyrocket. They're much more open to a government solution on this score than they were 14 years ago.

  • The Clinton plan included mandates on small businesses. The current crop of Democratic plans don't. When it comes to assuaging business concerns and producing healthcare plans they can live with, Democratic politicians have gotten much, much smarter over the past decade.

  • Public opinion has shifted too. The public was in favor of healthcare reform in 1994, but not overwhelmingly — and Harry & Louise were enough to turn them against the Clinton plan. Today, public opinion is far more strongly in favor of healthcare reform, and that's a tailwind that even conservative politicians have to respect.

Now, having said that, I think (a) public opinion still isn't where it needs to be, (b) the business community remains suspicious of big government healthcare plans for all the usual ideological reasons, and (c) movement conservatives haven't budged an inch on healthcare. They view it, probably rightly, as a stalking horse for resurgent liberalism, and will oppose it every bit as furiously as they did in 1994.

Still, there are differences. The climate today for healthcare reform really is more hospitable than it's been in a long time. It's not 1994 forever.

UPDATE: Ezra takes issue with my point about public opinion. I don't think polls adequately capture what's really going on with broad-but-shallow issues like healthcare, but it's still worthwhile to look at them as a baseline of sorts. And at least as far as the CBS/NYT polls can show us, discontent over the healthcare system is about the same today as it was in 1994.

Kevin Drum 2:06 PM Permalink | Trackbacks | Comments (33)

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The thing to watch for is whether the program consists of manditory health insurance, whereby everyone is required to buy insurance from insurance companies.

This is the type of program that will be pushed big time by the insurers because it means billions more going through their books. It's advantage goes entirely to the insurers, with little check on costs resulting from it.

But it will be presented as reform, when it is only guaranteeing a new stream of income for the insurers.

Don't be fooled by this type of program--it doesn't begin to address the real issue of insurance cost and the large percent of health care costs that are eaten up by the insurer.

Posted by: Neal on December 20, 2007 at 2:13 PM | PERMALINK

It's not 1994 forever.

Yes it is, as long as there is a living, breathing rightwing machine.

Posted by: Emily on December 20, 2007 at 2:15 PM | PERMALINK

Exactly what was wrong with the piece I posted?

Posted by: George Antrobus on December 20, 2007 at 2:26 PM | PERMALINK

Today, public opinion is far more strongly in favor of healthcare reform, and that's a tailwind that even conservative politicians have to respect.

Bullshit. Watch this.

[clears throat]





There, that was easy.

Posted by: Grand Moff Texan on December 20, 2007 at 2:28 PM | PERMALINK

Yes, it's going to take a lot of work to enlist corporate help, but it's do-able. Have to work first on the big guys who know it's coming eventually, especially the ones with a lot of employees, and then be ready to show the Chamber of Commerce types how and why specific kinds of social insurance that work best with universal participation is neither socialism nor the slippery slope. Warren Buffett and Bill Gates can be a huge help in the CEO suites. Certainly either Hillary or Obama will be able to engage them; I worry that Edwards may be painting himself too far into a theoretical corner to use them if he were to be elected. This is the process that Krugman isn't getting yet about how Obama operates. Hillary does, too, and that's why neither of them give us all the red meat we like. Krugman is too much of a New Yorker who feels most at home with confrontation.

Posted by: urban legend on December 20, 2007 at 2:36 PM | PERMALINK

But to clarify, he is OUR New Yorker, and we love him for it.

Posted by: urbanlegend on December 20, 2007 at 2:38 PM | PERMALINK

True healthcare reform would be to do it the way most other industrialized nations do it. The industry isn't going to to support that. No way. So don't kid yourself.

Posted by: bob on December 20, 2007 at 2:46 PM | PERMALINK

Good points, Kevin. I agree with you.

Posted by: Mike K on December 20, 2007 at 2:48 PM | PERMALINK

Any plan that would require small businesses to provide, supplement, or otherwise pay into a universal care system is doomed.

Universal care can be as simple as opening up Medicare as option for everyone. Allow it to become a new choice in cafeteria plans. Accessibility and lower cost should attract a sufficiently large risk pool to allow discounts for those who can't afford it.

Posted by: kis on December 20, 2007 at 2:49 PM | PERMALINK

One thing to remember is that it is going to take 60 votes in the senate to pass any kind of health care reform. This is an almost insurmountable obstacle and unless the democrats become more capable in sheparding legislation through the process, it is going to be incredibly difficult to pass.

Posted by: Duffer on December 20, 2007 at 2:50 PM | PERMALINK

The industry isn't going to to support that.

By industry, do you mean the health insurance industry? Or everyone else?

I suspect we are close to the point were GM, IBM, WalMart, and the other large employers will be sufficiently behind the idea of universal care. Its too big a line item on the balance sheet to ignore, and growing too quickly...

So its a matter of who will collectively lobby with more $$$ - insurers or everyone else?

Posted by: kis on December 20, 2007 at 2:54 PM | PERMALINK

I think that we can still neutralize big business on health care--but the window of opportunity is closing. More and more business is providing less and less healthcare to their employees. The business lobby against healthcare will only grow stronger with time.

Posted by: Joe S. on December 20, 2007 at 2:59 PM | PERMALINK

Kevin, another point:

When corporations based in one state know that their competitors in other states will face the same regulation - that will make a big difference.

The time will come when they'll get behind a federal solution.

Posted by: Jack Boot on December 20, 2007 at 3:03 PM | PERMALINK

Joe S - don't you see? if they drop coverage to lower and lower levels, or altogether - that is GREAT - that ensures gov't HC. Sure there will be pain in the meantime, but when is this ever not the case?

Really, corps do want to get out of the HC business. They just don't see the roadmap yet. They are motivated not by taking people's care away, but by not having regulations impair profits.

The time will come when they'll see it this way. Wait and see. It may be years, though.

Posted by: Jack Boot on December 20, 2007 at 3:06 PM | PERMALINK

The Clinton plan included mandates on small businesses. The current crop of Democratic plans don't.

Well, they're certainly not being very clear about that. I keep waiting - in vain - for a strong message that one of them fully intends to de-couple health insurance from employment.

Posted by: Brautigan on December 20, 2007 at 3:54 PM | PERMALINK

I pray you are right, Kevin. If you are, early retirement here I come!!!!

Posted by: The Conservative Deflator on December 20, 2007 at 4:06 PM | PERMALINK

The first step the congress should make - now - is to revoke the top shelf health care that all congressmen, senators, and other cabinet officials enjoy and reassign them health plans that reflect the average coverage by average American citizens, by which I mean various HMOs, government health insurance, and a large chunk of congressmen, senators, etc. who will have ABSOLUTELY ZERO HEALTH CARE WHATSOEVER. It shouldn't be entirely random - they should make sure the law operates like HMOs and drop congressmen with pre-existing conditions, high risk factors (including age).

And the law should stipulate that the congressmen cannot seek their own private health care. They just have to live with whatever their employers (the people) give them (including no insurance), just like the rest of us.

Let's see how Mitch McConnell enjoys spending time in the waiting room at the local free clinic.

Posted by: Augustus on December 20, 2007 at 4:20 PM | PERMALINK

Further to kis's comment, I prefer to start with what I call Medicare-Lite: a Federal umbrella, which is a high deductible before the Fed kicks in and pays everything from there. At least Mr and Ms Middle Class, even if they went bare from there, wouldn't face financial extinction from a bad event after the unexpected (but always feared) pink slip.

Then let the insurance companies battle for the space underneath, with some (few) rules: set levels of deductibles (to make comparisons easier), maximum co-pays, no pre-existing conditions, no cost discrimination based on health or age. Completely divorced from employment unless a company wants to (like converting from current comprehensive plan that's getting too expensive, still a nice touch for employee morale). Premiums for such policies should drop dramatically from cap on maximum exposure, plus actual competition.

The combined aggregate and individual cost of the revenue required for the Federal umbrella (and Federal subsidization, see below), plus the premiums for capped insurance below the umbrella should be a lot less than current. No profits or outrageous management compensation in the umbrella space, no more wasted manpower on pre-existing conditions or coordination of benefits, for example. Health providers can cut back on their collection agencies, too, in part because they'll get paid better just because there's more coverage, but also because reponsibilities will now be crystal clear (no more duns for bills you aren't supposed to be responsible for).

Then, lots of subsidization of the underneath policies for lower incomes from current Medicaid, SCHIP. May still need SCHIP in concept, though, to assure bigger deductibles adults might take a chance on do not prevent timely care for kids.

Simple, easy to describe, easy for even a moderate libertarian who isn't hostile to Social Security, for example, to accept, reluctantly or otherwise. Once we get the concept in place, it will never be reversed, and we can let future decisions dictate how far down we can pull the umbrella.

Posted by: urban legend on December 20, 2007 at 4:31 PM | PERMALINK

Health care reform is going to happen soon.

It won't be destructive or revolutionary for most people.

It will be a constructive add-on which benefits many people without harming anyone seriously.

Many corporations will love it since they can dump their expensive programs and save money.

People will like having more options and the competition will help keep costs down across the board.

It's a good thing.

Posted by: MarkH on December 20, 2007 at 4:41 PM | PERMALINK

One thing to remember is that it is going to take 60 votes in the senate to pass any kind of health care reform

That might not be as hard to reach as it is now. The Democrats should have a larger majority than they do now, and without the backup of a veto threat, the filibuster is going to be tougher to maintain. Faced with a Democratic majority and backed by the President, the Senate Republicans will stand out as the road block. There could be enough Republican Senators who will be up for re-election in 2010 who won't want to carry that water for the party and give the Democrats their 60 votes.

Posted by: tomeck on December 20, 2007 at 5:13 PM | PERMALINK

The business lobby against healthcare will only grow stronger with time. - Joe S

The sort of plans that are in the works right now wouldn't mandate that business cover their employers, from what I understand. I believe that it puts the onus on the individual to buy coverage if their employer doesn't provide it. From an employer's POV, what's not to like? I just don't see any funding issues that increase employers contribution (in the aggregate) to health care costs.

Posted by: Doc at the Radar Station on December 20, 2007 at 5:58 PM | PERMALINK

Oops-make "costs"-funding.

Posted by: Doc at the Radar Station on December 20, 2007 at 6:01 PM | PERMALINK

Jack and Doc are sanguine about the long-term business response to health care. I'm not. Here's why.

A civilized health care system will work off tax revenues. To increase these revenue, the Democrats will make the system more progressive, to get to where the money is. Jack and Doc are correct: the corporations will be spared the cost of their health care. But their executives will have to pay significantly higher taxes.

Lower corporate expenses or higher personal taxes. Which do you think is more important to corporate decision-makers?

Posted by: Joe S. on December 20, 2007 at 6:28 PM | PERMALINK

There will never be universal health care because . . .

1) Americans believe, as a basic tenet of life, that anything that benefits YOU must hurt ME. Therefore, screw you.

2) That universal health care is socialism -- and socialism benefits YOU at the expense of ME

3) That only the lazy, shiftless and corrupt are without health coverage, except when they are without coverage which is caused by YOU getting something you didn't deserve at the expense of ME.

4) That if God had wanted universal health care he would have told Bush -- he didn't.

Posted by: Dicksknee on December 20, 2007 at 6:28 PM | PERMALINK

Joe Klein whatever. Bleh

Posted by: luci on December 20, 2007 at 8:21 PM | PERMALINK

But their executives will have to pay significantly higher taxes.- Joe S.

How so?

Posted by: Doc at the Radar Station on December 20, 2007 at 9:27 PM | PERMALINK

I must take issue.

In 1992-3-4, the bloom was definitively off the HMO rose. Mainstream health care cost projections were drastically worse than 2007 (actuals or projections).

In 2007's favor, there's increased appreciation of the single-payer concept (though nobody's going there), and increased appreciation of competing national systems' comparative advantages.

But popular opinion? Not buying it.

Posted by: RonK, Seattle on December 20, 2007 at 11:20 PM | PERMALINK

you need to "connect the dots" as the bushies are fond of saying

the health insurance indutry has been an integral player in designing the california and mass plans

they are in transition from a "group insurance" business model to an "individual insurance" business model

the "individual insurance mandate" suggests that the fix is in and the popular "universal health insurance" notion will be blocked once again

the individual insurance model allows coverage to be extended to many of the people who were uninsured because the group insurance business model made insurance unaffordable for them

they are touting the idea of using the power of the government to force people to buy the products of the very health insurance industry they are campaigning against

wow! and neither bloggers or the press has anything to say about it

Posted by: jamzo on December 21, 2007 at 11:53 AM | PERMALINK

I live in a fairly wealthy area (northern San Diego County), and people are a LOT more worked up about this issue than in 1994. Plenty of people (including those who make good money) are scared about their health coverage.

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