The morning after the historic health-care deal
Obama may see an uptick in his popularity, but will Democrats be able to hold their congressional majority? And how solid were those projections that the reform bill wouldn't add to the federal deficit?
White House
White House
Historic health-care legislation narrowly passed the House of Representatives, 219-212, Sunday night. The Senate will consider a package of amendments this week and the process is likely to be messy. But the main battle has been won and congressional action from this point forward amounts to clearing the battlefield.
In the aftermath, political and media pundits and affected interest groups have taken predictable cheering-or-jeering postures, depending on their predispositions. My own emotions are conflicted and this post-mortem thus likely will disappoint both the legislation's boosters and detractors.
Was the legislation's passage a Pyrrhic victory — that is, a victory gained at too great a cost — or was it a point of departure for further legislative victories for President Obama and Democratic congressional leaders? It will be many weeks, perhaps months, before we have an indication either way.
• The substance of the policy changes which will be triggered by the legislation: I felt genuine elation after the 1965 passage of Medicare and Medicaid and satisfaction after the 1990s approval of a Medicare prescription-drug benefit. Those historic changes got bipartisan support and met clear national need.
The bill passed yesterday barely made it through the House, where a heavy Democratic majority prevails, and fills some needs while leaving others unmet. It extends health-care coverage broadly, especially to low-income citizens, but does not include catastrophic coverage, meaningful tort reform, or changes allowing insurers to sell their products across state lines. It compels insurers to cover all who want coverage and to not cap their claims. It also puts new financial burdens on state governments and cuts Medicare expenditures — mainly by further reducing fees to health-care providers and eliminating so-called Medicare Advantage coverage carried by many seniors. There are new taxes and new costs for insurers and providers, most of which will be passed along to consumers.
The premises given by Democratic congressional leaders to the Congressional Budget Office facilitated a CBO projection, just before the House vote, showing federal deficits being reduced a bit over 10 years with passage of the package. However, the premises included some shaky and downright disingenuous information that cannot stand morning-after scrutiny. I know of no serious analyst who does not believe that it will result in more, rather than less, federal red ink over the next 10 years and beyond. Only the blindest partisans believe otherwise.
My greatest concern thus is the one shared by deficit watchdogs, such as the bipartisan Concord Coalition, founded by former Sens. Paul Tsongas and Warren Rudman and now chaired by Rudman and former Sen. Bob Kerrey. The Coalition issued a statement Sunday night warning that "expanding coverage without curbing costs is a recipe for fiscal disaster," pointing out that the legislation's cost-control measures are problematic. It pointed in particular to the new tax on high-cost insurance plans, believed to be the most important cost-control component of the legislation. As a result of last-minute concessions by the White House and Democratic congressional leaders, the effective date of this tax has been moved from 2013 to 2018.
There is no doubt that the principal components of the legislation will remain public law. Even if Democrats suffer losses of congressional seats this fall (see below), President Obama would be certain to veto Republican attempts at rollback in 2011 and 2012. No one believes the GOP will make congressional gains enabling them to override a veto.
Down the road, it is clear, emergency measures will be needed to save Medicare, Medicaid, and the drug benefit from the financial hole in which they now exist. The new federal health-care "entitlement" approved Sunday will make that hole even deeper and necessitate even more drastic bailouts which, in the end, will force big benefit reductions, tax increases, or both. But that is in the future.
One historic footnote: The benefits contained in the original 1965 Medicare legislation were quite modest compared to those which have been added since to the program. President Johnson, at time of passage, foresaw this expansion and was not concerned about it. "We have established a universal program here," he told a White House staff meeting, "and from this point forward nothing will turn it back. Over the years it will expand and that is good." Johnson made this statement, however, in a time of robust national economic growth, low federal budget deficits, and a national mindset that this would be the straight-line situation into perpetuity. Only two years later LBJ would be asking for tax increases to pay for the unforeseen expenses of the Vietnam War.
Now, what about critics' charges that the new legislation — reordering 17 percent of the economy — is a dangerous step toward European socialism and/or, gasp(!), a British or Canadian health system in the United States?
Americans, time and again, have signaled that they do not want a British/Canadian, national-goverment-run health system here. They clearly want a public-private system in which the national government will be expected to fill various gaps and, in particular, help the elderly, poor, and uninsurable get care they cannot get in a wholly private system. The legislation passed Sunday gives the federal government greater reach and responsibility in the health sector but certainly less reach and responsibility, for instance, than were contained in either Medicare or Medicaid. It is evolutionary, not revolutionary.
• The political effects of the legislation's passage: It is tempting to say that President Obama wanted to pass health legislation in the worst way — and that was the way he did it.
As readers know, I was quite skeptical a year ago when — in the midst of financial and economic crisis — he launched what would be a polarizing, sometimes brutal struggle for legislation that lacked majority public support and, in the Congress, could get only Democratic votes.
Why was Obama doing this before our financial/economic house had been put in order and when billions in federal red ink were being spent on recovery? Why not wait until recovery had set in and, then, present a proposal which could get consensus support in both Congress and country — as Medicare, Medicaid, and the drug benefit had done? Further, why farm out drafting of the legislation to Democratic congressional committee chairs rather than keeping it under White House control with, of course, involvement along the way of congressional leaders, affected interest groups, and with an eye toward attracting Democratic, Republican, and independent support in the electorate? Obama proceeded as he did, apparently, because he believed he had to act immediately, while he enjoyed the traditional Presidential "honeymoon period," and because he thought it important to his historic legacy. As it turned out, of course, the debate lasted well beyond his 100-day honeymoon period and consumed a full year during which partisan and ideological lines were deepened and the country polarized.
That is where the Pyrrhic victory interpretation applies. The term originated when King Pyrrus defeated Roman armies in an epic battle in 279 BC. Some 15,000 were counted dead on both sides — a huge number considering the relatively light population of Europe at the time. Afterward, the king said another such victory would end him. He had lost his key commanders, best troops, and closest advisors in the battle and been rendered weak thereafter.
Like what you just read? Support high quality local journalism. Become a member of Crosscut today!
Twitter
Facebook
RSS Feeds
Comments:
Posted Mon, Mar 22, 1:26 p.m. Inappropriate
Oh my, where to start correcting all the factual errors in this article?
1. The Medicare prescription drug benefit law Mr. Van Dyk celebrates was passed in 2003, not the 1990s, and it contained no funding mechanism, thus greatly enlarging the budget deficit he so often bemoans.
2. The bill doesn’t just help “low-income” citizens. Insurance subsidies will help Americans earning up to $88,000 a year buy coverage. It will allow children of middle-class and upper-class families to stay on their parents’ health insurance policies until they are 26. It will ensure that both poor and non-poor Americans with preexisting medical conditions can buy coverage. There are numerous provisions expanding and safeguarding coverage for both the poor and non-poor.
3. I have no idea what the writer means by saying the law does not include “catastrophic coverage.” The coverage everyone must have will certainly include catastrophic coverage, with no lifetime limits.
4. As I’ve pointed out before, the law does indeed allow insurers to sell coverage across state lines, but under tougher state and federal regulation than the deregulated model the Republicans were proposing.
5. The law does not reduce fees to providers.
6. The law does not “eliminate” Medicare Advantage coverage. It does what many experts, both Republican and Democrat, have urged, which is to eliminate the government’s 10-15% overpayment to Medicare Advantage insurers.
7. The law reduces the federal budget deficit by more than “a bit” over the first 10 years – actually the Congressional Budget Office says $130 billion -- even while expanding coverage to an additional 32 million Americans. Not a bad deal at all. Over the second ten years the CBO says the law might reduce the deficit by about $1 trillion, though it’s difficult or impossible to project that far ahead. “No serious analyst” believes the law won’t increase the deficit? The CBO is the scorekeeper accepted by both Republicans and Democrats, they’re not “blind partisans,” and they say it will reduce the deficit.
8. While the supposedly bipartisan Concord Coalition may think the law’s cost-control mechanisms are inadequate, many leading health care economists, both Republican and Democratic (including Republican policy experts like Gail Wilensky and Mark McClellan), have praised the numerous cost-control features in the law, such as the independent Medicare payment commission. Those features are designed to do exactly what Mr. Van Dyk says he’s interested in doing, which is to control Medicare (and overall) health care costs and head off the looming long-term crisis. Mr. Van Dyk seems not to understand that the real fix is reforming health delivery, not just shifting more costs onto patients.
9. Canada does not have a “national government run health system.” It has a system of provincially run health insurance programs, with private hospitals and physician practices.
10. As President Obama and others have repeatedly said, reforming health care is essential to shoring up our national economy, Americans’ personal finances, and our government finances, which are being eroded by the high and growing cost of health care. It’s not some sideshow, as Mr. Van Dyk seems to think.
11. As I’ve said before, Medicare was not a bipartisan political project. Republicans, led by AMA spokesman Ronald Reagan, harshly denounced the proposal as socialism or worse, and offered no support when the bill was proposed, though some Republican members of Congress did vote for the final bill when it became clear the popular train was leaving the station.
12. In case Mr. Van Dyk didn’t notice, the “expensive bribes” to Democratic fence-sitting like Ben Nelson were removed in the reconciliation bill passed yesterday by the House.
Mr. Van Dyk concludes by cheering that “now, finally, we all can turn our attention to the rest of the country’s public business.” He has seemed oblivious for the past year to the outcry from millions of Americans for universal health care and cost control -- a central campaign plank that got Obama and the Democrats elected in 2008. Perhaps that’s because he already has secure health coverage courtesy of the government. For myself, I look forward to Mr. Van Dyk now turning his attention to other issues about which he may know more about.
Posted Mon, Mar 22, 2:45 p.m. Inappropriate
Thanks for the correction on the Medicare prescription-drug benefit. I absent-mindedly had it being enacted ahead of its time. It was indeed enacted during GW Bush's first term, with strong bipartisan support led by Sen. Ted Kennedy.
The other information in the piece is factually correct and/or my independent commentary on the facts. Meyer can find his own "facts" and make his own interpretations. The First Amendment permits it.
Posted Mon, Mar 22, 4:28 p.m. Inappropriate
Well, call me old-fashioned, but I am all for the idea of legislation originating in Congress and going to the President for a signature. I have seen more than enough of the "strong man" theory of the Presidency, an office often occupied by the venal or incompetent.
And this becomes even more impressive when we consider that apparently Obama was willing to cave in on Republican demands, but was not allowed to do so by the Representatives of the people. These, after all, are the men and women who have to return to their districts and win another election every two years. These are our Representatives where we actually have something like "one man one vote", in contrast with the Senate, in which body one person in Montana has as much representation as 70 people in California.
Naturally there are grave concerns for the future. The legislation does not go far enough, and when Van Dyk says the majority opposes it, he's including in that 'majority' those holding out for single-payer and universal coverage. When polled, 'Medicare for all' consistently got 60% and above over the past year.
There are a variety of reasons to go further, but they may be summed up in the fact that, compared with several nations in Europe providing coverage for all of their citizens, we fail to provide coverage for over 40 million but still pay twice as much per capita for the same quality of care.
Not only that, but if the present (i.e., previous to health care reform) situation were not altered, premiums for families were projected to double by 2020 and health care, as a share of our GDP, to rise to almost a third by 2030.
So I'm inclined to think that, in a very real sense, a health care reform that reduces the deficit is a valuable first step towards reducing the deficit.
Posted Tue, Mar 23, 2:21 a.m. Inappropriate
we the people will remember and vote the bums out in november this is not health-care reform but health-care distruction.
Posted Tue, Mar 23, 9:46 a.m. Inappropriate
When the final and complete analysis of this historic reform is written it is sure to include the story of the nuns vs. the bishops. What could have caused Rep. Stupak's reversal other than the voices of the thousands of catholic nuns who, unlike the church hierarchy, understand the need for universal health care because they deliver it every day. These unsung heroines deserve credit along with the political leaders for the crucial votes on the Sabbath, Sunday, March 18, 2010.
Posted Tue, Mar 23, 10:34 a.m. Inappropriate
In the bigger picture Obama needed to move on and it was better to go out with a win than a loss. Even a Pyrrhic victory is better than a humiliating defeat. And Americans instinctively respect success, even if they have misgivings about its objectives. Given the limitations on our national attention span, if Team Obama is able to frame the upcoming financial reform debate as Wall Street versus Main Street, no one will even remember how angry they thought they were over health care.
Posted Tue, Mar 23, 11:04 a.m. Inappropriate
Woofer's analysis is particularly astute and what the Obama White House and congressional Democrats hope will happen.
Posted Tue, Mar 23, 3:43 p.m. Inappropriate
Some Random Thoughts:
I am happy that the country now has a structure in place for building a new health care system.
My disappointment is that there is no public option which people can opt out of if it does not work for them.
I am happy that a young man I know who wanted to join the Navy but was turned down because he has a pre-existing condition--a mal-formed cornea that is "...not a problem now but could be a problem later...," and would have prevented his attaining his new goal--to become a police officer. Now he can go forward to fulfill that dream.
Socialism means the government owns the means of production. Making physicians and other care providers government employees and having the government own the medical facilities was never a proposal. I continue to be amazed by a choice of people to remain ignorant by refusing to use a dictionary.
I appreciate market economies. When it comes to health care, it's a moral choice for me. Libertarians who say, "the best government is no government" might like to try life in Somalia for a full blown No-Government Experience.
Has Rush Limbaugh packed his bags for Costa Rica, yet? He said that's where he would go if Congress passed this bill. I think Costa Rica has a national health care system, so I'm confused by his motives.
Login or register to add your voice to the conversation.