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1.) A More Perfect Health Care System
2.) Sen. Baucus' Bold and Progressive Health Care Proposal
3.) Budget Rules to Unite Reformers, not Divide Them
Within days of winning the election, President-elect Barack Obama began to shape his presidency by setting expectations about the pace of change he will bring to Washington. The economic crisis, he noted in a press conference, requires both swift action and a measure of time to get the nation out of the hole.
When he begins to talk about health care, he might wish to refer to forming a more perfect union as he did in his speech on race. Health care reform will be an ongoing effort spread across many years, not a single act of Congress.
For decades, the United States has seen declining coverage, runaway costs, and inconsistent quality of care. The political responses have been unproductive: proposals for too much government from the political left, and too little action from the political right.
Health care reform needs to be a series of confidence-building steps. Each step should engender trust that collective action will, in fact, help. Subsequent steps will be easier as a consensus emerges over the right direction for reform.
All other developed nations see health care as a work in progress. Despite their success in covering all their citizens, their health care systems are constantly evolving. The United States will need to do the same once we find our own path forward.
A successful legislative strategy for health care reform will produce not only immediate results but also set the political tone and dynamics for future action. President-elect Obama will surely choose carefully the first critical steps so he can also tee up future steps.
The economic crisis has made it nearly impossible to cover all the uninsured at once. But this necessity is really a virtue. Like a mountain climber, the nation needs a firm footing for each step upward. The more confidence we have, the faster we can go.
Barack Obama's Speech on Race, transcript, National Public Radio, March 18, 2008:
http://www.npr.org/templates/story/
story.php?storyId=88478467
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Finance Committee Chairman, Sen. Max Baucus (D-Mont.) has released a white paper that outlines a bold and progressive proposal for health care reform. It deploys a simple, mainstream strategy: government action without a government takeover of health care.
It would provide publicly financed, sliding scale subsidies to make coverage affordable. At the same time it would expand choice of private sector health plans. Specifically, it would offer workers a menu of health insurance plan choices similar to the Federal Employees Health Benefits plan that serves federal workers and members of Congress. Employers could join this new national health insurance exchange or continue to offer their current coverage.
It is similar in many key respects to President-elect Barack Obama's proposal during the campaign because it requires parents to cover their children. It goes one step further and requires all adults to have coverage, too, as Sen. Hillary Clinton proposed during the campaign.
Those elements are the same as PPI has championed for over a decade. In addition, the proposal mirrors PPI's call for payment reform that rewards doctors for the quality, not the quantity of care and medical malpractice reform that both expands patients' access to justice and increases deterrence against medical mistakes.
The importance of the Baucus proposal cannot be overstated. The Finance Committee is at the epicenter of health policy. It has jurisdiction over the nation's three largest health care programs: the tax break for health insurance, which underpins the employment based health care system; Medicare; and Medicaid.
The Finance Committee often works in a bipartisan manner. Although there are no clear signs yet of bipartisan support for the Baucus proposal, the potential for bipartisanship remains greater in Finance than any other committee on Capitol Hill.
Lots of questions remain about the Baucus proposal. How will it sequence coverage expansions within the constraints of available financing? How strongly will employers resist a requirement that they either provide coverage or pay a fee to help cover the uninsured? Will insurance companies and doctors join together to exclude a public insurance plan from the menu for the national insurance exchange because the public plan uses price controls to restrain costs?
Most importantly, however, the Baucus proposal is flexible. It could sustain some blows and survive. Provisions like the public payer option could drop out without undermining the integrity of the proposal. In the rough and tumble of the legislative process, it's best not to start with proposals that are built like a house of cards. It is also critical to start roughly in the political center so that the give and take of politics does not produce unworkable compromises.
Sen. Baucus has given reform a huge boost, one that could well sustain it through final passage.
Call to Action: Health Care Reform 2009,
By Sen. Max Baucus, U.S. Senate Committee on Finance, November 12, 2008:
http://finance.senate.gov/healthreform2009/home.html
"Fixing America's Health Care System,"
David B. Kendall, Progressive Policy Institute, September 2005:
www.ppionline.org/documents/
Fixing_Health_Care_092205.pdf
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In an online column, Kaiser Family Foundation President Drew Altman observes that there are two camps in the world of health policy advocates: financing reformers who want to cover the uninsured and delivery system reformers who want to improve the quality of care and lower costs. He raises the concern that with little money to spend on financing coverage only the delivery system reformers may see legislative success.
To the uninitiated, it might seem as if these two camps would be natural allies. Savings from delivery system reform would neatly offset the costs of expanding coverage. But a single institution stands in the way of a beautiful relationship: the Congressional Budget Office.
CBO has the unenviable task of predicting the future when Congress passes laws that change government spending and the nation's economy. Specifically, they have to "score" how much money a delivery system reform will save the government. They naturally don't want to overestimate the savings because that would commit the government to spending increases that it might not be able to afford.
CBO has to be conservative, and no one should complain too loudly about its tough love. But the actual results from legislation have often proven much better than CBO predicted. For example, its projections of the cost the Medicare prescription drug benefit were much higher than the actual results delivered through a competitive system. In 1990s, managed care -- despite all its other problems -- far exceeded CBO predictions of its ability to restrain costs.
The solution is new budget rules as PPI proposed in its presidential memo, "Improving Health Care -- By 'Spreading the Mayo.'" CBO should first project the high health care spending that will occur without any delivery system reform. Then, if the savings from reform exceed the projections, the extra funds can be automatically applied to coverage for the uninsured.
Such a solution may be easier said than done, but something like it will be critical to achieving the result the public wants: coverage for all that doesn't break the bank.
"Keeping the Health Reform Coalition Together,"
By Drew Altman, Kaiser Family Foundation, November 11, 2008:
http://www.kff.org/pullingittogether/111108_altman.cfm
"Improving Health Care -- By 'Spreading the Mayo' (the Mayo Clinic Model, That Is),"
By David B. Kendall, PPI's Memos to the Next President:
http://www.ppionline.org
