As much as I have been following the healthcare debate closely, I haven't been writing about it; I feel bad about it, because it's been ceding the field to a number of people (Jon Cohn and Ezra Klein perhaps most prominently), who tend to offer the establishment views of the left without generally facing or examining the things that call the status quo perspective into question.
But the main reason for not writing has been that very status quo - despite a flurry of blogging and anxious "reporting" of minute developments, in fact, very little has happened; while the House has a bill out of committee (3 committees actually), and the Senate Health Committee (HELP) has passed their part of a Senate bill... there is, still, not a comprehensive, finished proposal to address healthcare reform. All the bills are messy works in progress, and a key piece of reform - the Senate Finance Committee's bill which would be the best guide to what's doable in actually paying for these reforms - is just about nowhere to be seen.
The reason to start writing again, though, is that in the past month, as the possibility of actual reform has begun to take shape, the actual health care debate we've needed all along is actually beginning to surface. Finally, people are waking up to the fact that in order to have a public that understands what's at stake, you have actually discuss what the stakes are, what's working, and what isn't in our national healthcare system (or, more precisely, systems). The start of that discussion, which I find to be the most heartening development, has, of course, thrown a wrench into that "Establishment" plan... but that's probably all to the good. Doing the "healthcare reform" that's been lurching along, and not subjecting it to a "kick the tires" assessment of what's actually being proposed, whether it makes sense, and just how much it will cost, was an unrealistic way to approach reform all along.
And now, as we look at it... this may not be the right reform, and it may not get done at all. And while that would be the worst of all possible worlds... I think we may have the necessary wake up call here to finally think seriously about a different kind of reform - the one where we ask more about the healthcare we're getting, and less about the insurance we use to "pay" for it.
First, let's try and give the broad brush ideas that are currently in the reform package, because I think some of this has not been widely shared or understood:
- Keep the employer based system - most people get health insurance through their employers; that would not change. The proposals would likely expand and solidify the employer system, by making it easier for smaller businesses to insure their workers without breaking their budgets, and by eliminating the "pre-existing" condition limits that keep some people from obtaining reasonably priced coverage through employment.
- Expand Medicaid - Both the House proposal and the Senate Finance Committee (Medicaid is not under HELP's jurisdiction) would expand Medicaid, probably to 150% of poverty as measured by the government. The details of how this expansion would work are unclear - currently Medicaid is a block grant to each state, administered as they see fit (and covering usually only the poorest of the poor).
- The reform plan would offer "Healthcare Exhanges" which would serve as "one stop shopping" for businesses and individuals to obtain coverage in group plans that covered a basic set of services, at some sort fo fixed rate. This would probably expand insurance among smaller businesses and the self employed.
- The much discussed "Public Plan" would probably be created as a way to cover others who fall through the cracks - mostly workers and families just over the Medicaid line to about 400% of poverty - who would be able to purchase subsidized coverage, offered by a government agency, and administered by private entities
- The reforms would probably address Medicare on the margins - making some attempts to institute "Best Practices" type projects that would standardize care for basic chronic conditions, reduce payments fopr hospital readmissions, and make a stab at restructuring the Medicare reimbursement system... none of which amounts to substantive change in how Medicare operates, nor is any of that likely to substantially rein in growth of costs anytime soon.
So... at least some of that sounds good. What are the problems?
- Cost of insurance - there's a real tangle in the proposals over premiums for health insurance, which affects the "Healthcare Exhanges" and the Public Plan, as well as the success of expanding employer based coverage; already the Senate HELP proposal has to scale back the Public Plan subsidies for premiums to 400% of poverty and that may well drop to 300% in future negotiations. At 300%, it's unlikely that a real dent can be made in reducing the uninsured. As well, private insurers are balking at any suggestion that a Public Plan have premiums priced at a discount that's unrealistic to the coverage provided - that is, that government would subsidize (beyond some support for poverty) large numbers of people acquiring cheap coverage even if their healthcare costs were much higher. This is not a small problem.
- Cost of Care - More to the point in all of this, as was discussed at the end of this week... none of the existing proposals do very much to control healthcare costs. This is an enormous piece of the puzzle of healthcare reform, and without some attempt to address how the cost of care is spiraling (even more) out of control... it's unlikely that insuring more people will help anything at all. The proposals to "reform" Medicare are especially weak in this regard... and the real looming issue, still, is Medicaid, which everyone has been studiously ignoring. Assuming Federal control of Medicaid, or mandating much more comprehensive coverage for the poor through the states will add enormously to the costs of the bills under consideration. Without it... there's an enormous hole at the bottom of the healthcare reform safety net.
- Cost of the Reform Bills - then there's the fact that, all in, we simply can't afford this insurance reform; you can dress up ideas of making a "revenue neutral" bill, but what's becoming increasingly clear is that the committees responsible for finding the funds for reform are struggling, and failing, to find the revenue and the cost controls that make healthcarte reform doable. The House Ways & Means committee has proposed a "surcharge on the wealthy" that seems unlikely to succeed (never mind that it's probably also wildly unrealistic to expect the revenue they're dreaming of from it), and the Senate Finance Committee has found... well, nothing at all. Oh, well they have one idea...
- Taxing Employee Health Benefits - Basically, if the Finance Committee flies with this idea - which, as I've mentioned before, rehashes the Republican proposals started under President Bush - consider healthcare reform dead. If the employer healthcare deduction is substantially altered, even on some theoretically "gold standard" plans for wealthy executives, you can expect businesses to exit the insurance system, not enter it... and that throws off the calculations of selling a "Public Plan" limited to only a small subset of uncovered workers and others... and also raises enormously the government's costs of running such a plan.
So, why do I think we're facing a dead end? I can't say exactly... and I won't say it confidently: given President Obama's determination to succeed here, he may be able to manhandle enough of Congress to get... something. It does seem clear, now, that the much discussed "August deadline" will come and go without the final bill being passed. As bad as this week was - with the discussions of failure over cost control - the questions only get worse from here. It's likely the "millionaire surcharge" of the House will not fly, and it's not clear how the Senate will pay for anything... and all of the financing questions will get harder when, as is likely, it becomes clear that a) the federal deficit is soaring and b) tax revenues are dropping in the face of continued economic downturn and high unemployment. Never mind healthcare reform... How does Obama plan to pay for everything else in an expansive federal budget that has almost no reductions in spending over previous years?
Moreover, I'm not sure where the public is on this; although theoretically people embrace the idea of expanded coverage and other reforms... there's been little to suggest that people are willing to accept the harder parts of reform - changes that doctors, other providers and even patients will need to make to improve how we deliver care and how we right-size our expectations when it comes to health. Without asking people to make sacrifices, and change behaviors... we can't really have meaningful healthcare reform. And what's clear, now, is we can't have more something for nothing, like insurance for all that can't be paid for, or healthcare where everybody gets whatever they want, while paying next to nothing for it. Real healthcare reform isn't a question of finance; it's a question of changing how we thnk about care, how we get it, and what it is. But we may need an enormous failure - which we seem liley to get, just now - to start that discussion. That's about all the hope I've got, when the cupboard looks so bare.
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