Liberal’s Approach to Health Care Reform Made Abortion Controversy Inevitable

Democrats paid a heavy toll to keep health care reform moving forward. They were forced to accept substantial and virtually unprecedented limits on abortion coverage in order to get the Affordable Health Care for America Act through the House of Representatives. This result should awaken them to the need to rethink their approach, but it assumes they learned the key lesson: where government goes, ideology follows.

Speaker Nancy Pelosi needed 218 votes to make history: passage by the House of the Affordable Health Care for America Act. Liberals got her most of the way there, but to get across the finish line Speaker Pelosi needed support from moderates and conservatives. This meant cutting a deal with the pro-life caucus. The result: HR 3962 prohibits the government-run medical plan and coverage offered through the health insurance exchanges the bill would create from covering elective abortion procedures. Liberals are furious, but to pass health care reform they had to accept this restriction as part of the package.

This post is not about the politics or morality of abortions. Readers of this blog are on both sides of this issue. This blog is about health care reform and what happened to HR 3962 concerning abortion highlights one of the greatest pitfalls in Democrats approach to reform. If they continue down the road they are on, increasing the amount of America’s health care system government directly controls and manages, the party is guaranteeing that similar defeats on similar public policy issues is all but a certainty. The issue today is abortion. In the future it could be access to birth control. Or making coverage available to domestic partners. The fact is, government-run health care does not and cannot exist in a vacuum. Politics and ideology inevitably come along for the ride.

The final health care reform bill may loosen the prohibition on abortion coverage contained in the House bill. But if the restrictions are diminished, it will be because Democrats led by Speaker Pelosi and Senate Majority Leader Harry Reid are in control of Congress and President Barack Obama occupies the Oval Office.

For now.

Eventually conservatives will be in power again. No party or ideology dominates America’s politics forever. And a conservative government will not hesitate to use the tools given to it by Democrats to push forward their agenda merely because those tools were created by liberals. 

No one should be surprised about this political reality. In a post back in August 2007 I warned single payer advocates that a government takeover of health insurance would open the door to ideology meddling by conservatives. And in August of this year I reminded liberals that while Democrats are ascendant today, politics, like a pendulum, eventually changes direction. “In 2001 the President was George W. Bush, the Senate Majority Leader was Trent Lott and the House Speaker was Dennis Hastert (just two years earlier it had been Newt Gingrich). Their view of how a public health plan should work – what it covers and who it benefits – varies considerably from the Obama/Reid/Pelosi view. Yet the greater the role liberals give the government over health care, the more control over issues like abortion conservatives like Bush/Lott/Hastert will have when they take power again – and eventually, they will.”  And I’m hardly the only observer to state this reality.

So Democrats face a critical choice. They can pursue their health care reform goals care by increasing government’s direct participation in the market or by looking to the regulations the government imposes on the market.  One opens the door wide to groups of lawmakers holding health care reform hostage to unrelated public policy issues; the other narrows this opening.

For example, lawmakers want to prohibit carriers from denying consumers coverage because of their current or previous health conditions. Creating a health insurance exchange is one method of achieving this goal, but it is not the only way. And alternatives limit the opportunity for ideological meddling in Americans’ lives.

Yes, a public plan would increase competition in the market (a primary justification for a government-run plan), but so would health insurance co-operatives. And as non-government entities, co-operatives would be less susceptible to partisan interference.

By focusing on their goals and being careful of their methodology for achieving them, Democrats can have their health care reform and limit the price they’ll pay on other issues. Or they can continue down a road in which accepting limits on abortion coverage is merely the first of many heavy and painful tolls they will pay.

Health Care is Local

Former House Speaker Tip O’Neill famously noted that “all politics is local.” And he’s right. He was not talking about the rules of the political game. Those are established by a national constitution and subject to state laws as well as local ones. He meant that the political dynamics of each district are what determines the ideological shading of a district.

Some examples are obvious: compare the voting record of legislators from Massachusetts and Utah. Others are less so: Republican Senator Charles Grassley had been a reasonable voice on health care reform until he remembered he was up for reelection in 2010 and saw how conservative Iowans were responding to unfounded claims of “death panels” and the like; he is now embracing aspects of the silliness.

Health care is local, too. The medical delivery system in Los Angeles looks far different from the one in Cheyenne. Even what’s considered standard treatment varies from community to community. And as Dr. Atul Gawande demonstrated in his New Yorker article, the cost of care varies greatly among localities based on medical provider’s approach to health care.

How the local nature of politics and health care interact underscores the complexity of health care reform. Because health care is local, what’s broken in the current system varies from place-to-place. Because politics and is local, acceptable solutions vary depending on locale. It may just be a coincidence, but it is worth noting that the initial advocate for community-based health insurance co-operatives, Senator Kent Conrad, hails from North Dakota where rural electricity co-operatives are common while many of those claiming only a government-run health plan will do represent urban areas.

Recognizing this dynamic, the the House Energy and Commerce Committee has described HR 3200’s impact on each Congressional District. (My thanks to Dwight Mazzone for bringing these documents to my attention). Reading through these is a glimpse of the richness and variety of America.

For example, in Wyoming (which has one Representative for the entire state) up to 19,000 businesses would be eligible for tax credits to pay for health insurance, 7,400 seniors would benefit from reducing brand name drug costs, much of the $23 million in uncompensated care hospitals and health providers face would be eliminated, and the tax surcharge to pay for reform would impact 3,120 households.

Compare this to the Los Angeles area district represented by Henry Waxman, the Chair of the Energy and Commerce. In California’s 30th District up to 14,300 businesses would be eligible for the subsidy, 5,200 seniors would see lower prescription costs, hospitals and other providers would be relieved of much of the $85 million in uncompensated care they deal with today, while 22,100 households would pay the tax surcharge.

The statistics cited come from legitimate sources, but are presented in order to muster support for HR 3200. Were the same information to be presented by House Republicans it would no doubt have a different spin. Nonetheless, the information is a treasure trove of insight into the local politics and health care that drives the health care reform debate.

These statistics should also give lawmakers demanding a single, one-size-fits-all solution to health care reform pause. As I’ve argued before, state health care reform efforts usually fail. America’s health care system is too large, too interrelated and too complex to be reformed on a state-by-state basis. States lack the tools needed to make meaningful changes work; the national government has those tools. However, the reforms themselves could benefit from local implementation. For instance, instead of creating one, national government-run health plan to compete with private carriers, enabling the creation of local health insurance co-operatives to generate competition where it is needed is more appropriate.

Finding the balance between federal and local management of health care is critical to a well-functioning medical system. It is also good politics.

Coming Soon: Health Care Reform That Might Pass

We’re getting closer to seeing what the health care reform likely to emerge from Congress will actually look like. The Senate Finance Committee is likely to unveil its bi-partisan reform plan in the next few days. While it’s likely to disappoint members of both parties, it also holds out the greatest promise for serving as a framework for meaningful, comprehensive reform.

Some of those who will be disappointed with a more centrist approach to health care reform will be those who have created a cottage industry from highlighting the more egregious elements of the plans already passed by Congressional Committees. These proposals never had much chance of becoming law, but partisans across the spectrum embraced them as either statements of principles (on the left) or evidence of skullduggery (on the right). countless hours of heated argument, outraged accusations, misinformed attacks, and righteous indignation have been heaped on these bills. They also generated, to be fair, serious public policy debates on meaningful issues that shined a light on the complexity and trade-offs inherent in reforming one-sixth of the nation’s economy. They received all this attention in part because they were the only detailed reform plans around.

The Senate Finance Committee is about to change that. And it could be the House Energy and Commerce Committee, whose liberal and moderate Democratic members are seeking to find common ground, may also come forward with a detailed plan soon.

The health care reform proposal likely to emerge from the Senate Finance Committee will disappoint some in the White House. According to the Associated Press, it does not call for creating a government-run health plan as President Barack Obama has proposed to provide competition for private carriers. Instead, such competition would be provided by non-profit health insurance cooperatives. While the federal government would provide seed money for launching these cooperatives, they would have to survive in the market without government subsidy or management. The Senate Finance Committee is also expected to forgo requiring businesses to offer health insurance coverage to their employees, although individuals would be required to obtain such coverage on their own if their employer does not offer it.

There will no doubt be much in the Senate Finance Committee’s proposal to raise the ire of, well, most everyone. If there was a path to health care reform that triggered spontaneous outbursts of Kumbaya in the halls of Congress, it would have been introduced and enacted by now. So we get to look forward to plenty of controversy, sniping, partisan positioning and serious policy debate over the next several weeks.

The good news, however, is that all that energy will be directed to refining a health care reform plan that has the chance of actually being enacted. And that is progress.

President Obama Entering Health Care Reform Arena

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.”

Could Co-ops Provide Competition Where It’s Needed?

Based on what was being said on the Sunday talk shows today, the justification for creating a government-run health plan to compete with private carriers seems to be expanding. One of the fresh arguments does not seem to carry much weight, but the other might.

Some are claiming that consumers need to know they can buy the same health plan anywhere in the country. By having a public plan offering coverage nationally they would be able to change jobs, move to a different state and still keep their current coverage. Accepting that this would be a nice situation, it certainly isn’t a strong reason for a public plan given the risk that step entails. As I’ve posted before, the temptation to tip the playing field in favor of government programs is too tempting for lawmakers. Already on the table is allowing tax credits to make premiums more affordable eligible only for coverage purchased through an Exchange, for example.

The simple fact is, without a level playing field a government-run plan will eventually — not the first year, maybe not the fifth, but eventually — drive private carriers out of the market. If that’s what Congress and the Obama Administration want to do, they should just say so and try to make it happen. But if they are sincere about preserving private options for Americans, then they need to tread carefully. Creating a public plan just so consumers can keep the exact same plan when they move to a new state is simply not worth the danger.

The second justification is an amplification of the original rational for a public plan: that it would encourage competition in the market. On CNN’s State of the Union, this morning, Secretary of Health and Human Services Kathleen Sebelius brought up the lack of competition in her home state, Kansas (until her confirmation as Secretary, she was Governor of Kansas). And it is true that in some states a single carrier will have 60 percent or higher market share for medical policies sold to individuals and small businesses. In those states, additional competition should be beneficial.

Yet in other states competition is far more robust. In California, for example, there are several carriers competiting for individual and small group coverage. None, I believe, have more than 45 percent and at least three have more than 20 percent. A government venture is, arguably, unnecessary here.

If competition is sufficient in some states, but lacking in others, perhaps a national solution isn’t required. Instead, allowing the solution should be fashioned at a more local level. Senator Kent Conrad’s compromise proposal could be adapted to do just that. Senator Conrad is calling for the creation of non-profit health insurance co-operatives, much like what exists in some areas for electricity. They would be owned by local residents and businesses. They would compete under the exact same rules as private carriers. The government’s only role would be to provide seed money to get them launched. These co-ops could bring competition to places where it currently doesn’t exist. In an area where one carrier controls more than 50 percent of the market, for example, the government could assist in creating a health insurance co-operative — or several of them.

The health care reform debate is getting closer to the nitty-gritty stage every week. President Barack Obama is urging Congress to put a bill on his desk this year and Congressional Leaders are working hard to make that happen. To pass anything, let alone pass it quickly, controverseys like government-run will need to be resolved. Liberal Democrats are insisting it must be included in the final health care reform package. Republicans, including those who broke with their party to pass the Administration’s stimulus package, are adamantly opposed to it.  As the Associated Press reports Senate Minority Leader Mitch McConnell as saying, “I think that, for virtually every Republican, a government plan is a nonstarter.” Some  moderate Democrats are opposed to the idea, too.

Senator Conrad’s co-op idea may provide the needed common ground. Moderate Republican Senator Susan Collins noted, according to the Associated Press article, that the co-ops are “far preferable to the government-run plan that has been discussed by the administration. We need to better understand how it would work. But it’s certainly better than a Washington-run plan.”

The idea of a government-run plan is not the only controversey that will need to be addressed to pass comprhensive reform. But it is an obstacle. And it can serve as a template for resolving other issues. Replace targeted solutions for national ones where the problems are not national in scope. Helping health insurance co-operatives get launched in areas where there is no competition could solve local problems without creating a national one.