In the wake of the Massachusetts election and plummeting poll numbers, President Obama and Congressional Democrats should abandon efforts to pass a comprehensive health care bill this year in anything resembling the form it has emerged from the Senate and the House. In particular, they should ditch highly unpopular elements like individual mandates, the "Cadillac" (actually Chevy) tax, the deal with big Pharma to continue banning Medicare from negotiating for lower drug prices, and the continued prohibition on Americans buying cheaper drugs from Canada and other countries. At the same time, there are elements of health care reform--both elements that are part of the comprehensive bills and elements that were abandoned in an attempt to cobble together enough votes for a comprehensive bill-- that are popular with voters, can make a difference in peoples' lives, and can be passed in several separate bills, some with 60 Senate votes and some through reconciliation.
Passing the most popular parts of health care reform while ditching the rest, can give Democrats a "win" on health care without jamming controversial and unpopular elements down the throats of American voters.
Why abandon comprehensive reform for the time being? First, it deserves to lose -- the Frankenstein-like Rube Goldberg contraption of a health care bill that has emerged from the past nine months of Congressional sausage-making is the product of insider deals with drug, insurance, and private health care companies and was written largely by lobbyists and ex-lobbyists. I've previously analyzed in The Huffington Post why it's a bad bill here and here -- among other things, by mandating that every American buy the defective products of private health insurance companies at unregulated prices or be fined by the IRS, by taxing the health care plans of many workers, by doing too little to lower drug prices, and by still leaving over 20 million Americans uninsured, it has rightfully become unpopular with a majority of the American people.
Second, Democrats would greatly harm their prospect in the 2010 and 2012 elections if they pass such an unpopular comprehensive bill which remakes 1/6 of the American economy over the objections of a majority of voters. Polls now show that only 33% of voters support the passage of the Democrats' bill in Congress while 48% oppose it. (This despite the fact that nearly 60% supported a public option and, a year ago, before the Congressional sausage-making began, nearly 60% even supported the idea of Medicare for all.) The Massachusetts election was a shot across the bow of the Congressional Democrats' health care bill, a shot that they ignore at their peril. For a supposedly shrewd political operator, Rahm Emanuel shows extraordinary stupidity by suggesting that Democrats first pass the bill and then sell it to the American people afterwards. If anyone had suggested that FDR first pass Social Security, or LBJ first pass Medicare, and then sell it to the American people afterwards, they would have been laughed off the political stage. (Come to think of it, after having helped Bill Clinton lose his Congressional majority in 1994, and being well on the way to helping Barack Obama lose his Congressional majority in 2010, maybe it's time for Rahm Emanuel to be laughed off the political stage.)
Nevertheless, Democrats have promised the American people they would help make health care more accessible to more Americans, and it's still important that they at least make a down payment on that promise. There are a number of reform provisions-- some of which are in the current House or Senate bills, and some of which were negotiated away in backroom deals -- that remain popular and achievable.
Rather than stubbornly trying to pass an unpopular comprehensive bill, the Obama administration and Congressional Democrats should propose a series of individual bills with popular incremental reforms, pass those they can through reconciliation, and with other popular provisions seek a few Republican votes and challenge obstructionist Republicans to filibuster them, if they insist. In that way, Democrats can regain the political initiative in health care and put Republicans back on the defensive.
Democrats should drop individual mandates and the "Cadillac" tax, both of which Barack Obama opposed during his Presidential campaign, and instead pass some of the following:
• Ban insurance companies from rejecting applicants for pre-existing conditions or charging too great a price differential based on age or health. This would be the single most popular measure that Congress could pass.
Health insurance companies will claim that people will intentionally game the system and wait to buy insurance until they are already sick. But Democrats and liberals have been far too willing to buy into this insurance company argument that the reason people don't have health insurance is because they're gaming the system, rather than because it's unaffordable. Most sensible people aren't going to wait to buy insurance until they have a catastrophic auto accident, and then believe they're going to wake up the next day and think to buy an insurance policy. Anyway, insurance companies already sell group plans to employers with as little as two employees without a limit on pre-existing conditions, undermining their argument that this would be too expensive. A ban on pre-existing conditions combined with meaningful subsidies (see the next point below), will encourage, rather than compel, more people to buy health insurance (although admittedly, not as many as a government mandate.) If necessary to mitigate the "gaming the system argument", Congress could agree to a short wait--say 60-90 days--before a new policy would cover pre-existing conditions.
• Provide subsidies and incentives that encourage uninsured individuals to buy, and small businesses to provide, health insurance, something along the lines of the current House bill. Among other things, this would include providing a sliding scale of subsidies to encourage individuals making up to 400% of the poverty level to voluntarily buy health insurance but without the coercion of a government mandate that would have the IRS fine them if they don't. Provide tax credits to small businesses to encourage them to cover their employees. Keep the proposed national insurance exchange on which individuals and small business can compare and buy insurance plans. The parameters for these provisions are already in the emerging House and Senate bills. With a little bit of help from the government to individuals and small businesses, it's likely that millions of additional Americans will buy health insurance--It won't be universal coverage, but it will be a step. In exchange for the ban on rejecting people for pre-existing conditions, insurance companies are likely to get million of new customers, but not the 30 million they are predicted to get if the government forces all of the uninsured to buy private insurance. This would eliminate what is likely to be the most offensive and unpopular element of the health care reform Democrats are now proposing. But it would increase choice and allow more people to obtain insurance.
• Allow 55-65 year olds to buy into Medicare early.
• Keep some of the proposals in the current legislation to regulate the most egregious practices of the insurance companies like dropping people for errors on their insurance applications, after they become sick and need care.
• Keep current proposals to increase eligibility for Medicaid to 150% of the poverty line, and provide federal subsidies to the states to pay for the extra cost.
• Revoke the ban on Medicare using its market power to negotiate lower prices with drug companies, and allow the importation of lower priced drugs from Canada. This would lead to significant cost savings both for Medicare and for seniors and would be extremely popular among seniors and others who use prescription drugs. It would mean President Obama would have to revoke his backroom deal with the big pharma not to do this, but that deal was a major mistake by Obama and a reversal both of a specific campaign promise, as well as his more general promise to change the way Washington does business and to avoid back-room deals with lobbyists. President Obama should frankly admit that he made a mistake in entering into this deal and state that he's changing course.
• End subsidies to private insurers in the Medicare Advantage program so that they have to play on a level playing field with regular Medicare, and use the savings to help pay for the subsidies listed above.
• Revoke the insurance companies' exemption from Federal anti-trust law so that the Justice Department has the power to regulate anti-competitive practices like price-fixing and making agreements to divvy up insurance markets.
• Implement the proposed Comparative Effectiveness Board, which would study which treatments are more or less effective, and encourage doctors to use the most effective, rather than the most expensive treatments, but still allow doctors to practice the art of medicine based on the needs of individual patients and not just on statistical averages.
• Allow individual states to experiment with single payer systems within their state, if they so choose. If successful, this could provide a laboratory for more comprehensive health care reform in the future.
• Increase funding for community health centers.
The subsidies to individuals and small businesses to voluntarily buy health insurance, and the subsidies to the states to insure more people under Medicaid, would cost the federal government money, but far less than the projected $1 trillion over 10 years for more comprehensive reform that has become the flash-point for Republican attacks and centrists' fears. They could be paid for, in significant part, through the savings by negotiating cheaper Medicare drug prices, eliminating the private subsidies for Medicare Advantage, and implementing other reforms to Medicare. The rest could be paid for by a modest surtax on the wealthiest Americans.
Passing most of the above incremental reforms wouldn't be comprehensive universal health care reform that would cover all Americans--But then neither are the current House and Senate bills, which would still leave over 20 million Americans uninsured. I'm still a believer that the only way to provide comprehensive universal health care at an affordable price is Medicare for All. But passing many of these popular reforms--and going toe to toe with those Republicans who want to filibuster them--would improve the lives of millions of Americans and would help Democrats take back the political initiative that they have lost in the past nine months of backroom deal-making on health care reform.
It's a far better course than either doing nothing, or forcing an unpopular, lobbyist-brokered comprehensive health care bill down the throats of the voters.