Why Not Single Payer? Part 4. In Partial Defense of Obama Against Clinton's Attacks on His Health Care Plan

In this ongoing multipart Huffpo series entitled "Why Not Single Payer?" I've written extensively about why Single Payer/Medicare For All represents both better social policy and better political strategy than the healthcare plans advanced by the leading Democratic candidates, including both Hillary Clinton and Barack Obama (whom I enthusiastically support for numerous reasons other than his Healthcare plan. Among these is Obama's ability to encourage popular movements which could push change beyond his own campaign proposals.).

However, as a single payer advocate, I find Obama's healthcare plan to be politically superior, and certainly more honest, than Clinton's.

First, let's be clear on one thing: Despite the rhetoric, neither Clinton's nor Obama's plan guarantees Universal Health Care for all Americans. Hillary is being less than candid when she proclaims "My opponent will not commit to Universal Healthcare. I do not believe we should nominate any Democrat who will not explicitly support universal health insurance."

Hillary is using a deceptive rhetorical slight of hand. "Universal health insurance," which is at the heart of Clinton's plan, is not the same as "Universal Healthcare" which can only be guaranteed by a single payer system under which all Americans are automatically covered for all medical care by a single, taxpayer funded, not for profit health insurer from birth until death. (Even one of Hillary's top health care advisors, MIT Prof. Jonathan Gruber acknowledges that Clinton's plan will not include everybody, admitting that "Any system that does not have a single payer will not have 100% coverage".)

Clinton's "Universal health insurance" is a plan under which, if your employer doesn't provide health insurance or you don't have a job, the government mandates that you must buy health insurance out of your own pocket. If your income is less than a certain level (which level Hillary's plan glaringly does not specify) you will retroactively receive a tax refund or tax credit, on a sliding scale, after April 15th of the following year to reimburse you for part of the premium which you already laid out in the prior year. If you fail to buy your own health insurance, the federal government will penalize you.

Again, glaringly, Clinton's plan does not spell out what the penalties will be. It should be noted, however, that if the penalties are small, the plan will not be Universal because many people will take the penalty, rather than pay thousands of dollars in insurance premiums that they cannot afford. That's what is happening in Massachusetts under the Romney plan on which Hillary is modeling her plan. If the penalties are large -- for example, if the government can garnishee your wages, keep your tax refund, or charge you a large fine -- many middle class people who make too much to receive subsidies but too little to afford the premiums will see their standard of living go down.

While, notably, Clinton has not specified an enforcement mechanism in her plan, on Sunday she stated that "I think there are a number of mechanisms" [for enforcing a mandate, including] "going after people's wages". Clinton plan punishes the uninsured middle class which makes too much money to qualify for a tax subsidy but too little to afford a meaningful insurance policy which averages $5,000 for an individual and $12,000 for a family of four.

Obama responds, "It's not that people don't want health care, it's that can't they can't afford it". Unless and until health insurance costs come down to a level that everyone can afford, Obama would not punish people for not buying insurance.

Obama circulated a mailer last week which criticized Hillary's plan, showing a photo of a couple sitting at a kitchen table, stating truthfully "Hillary's health care plan forces everyone to buy insurance, even if you can't afford it". In response, the Clinton campaign convened a conference call of health care policy advisors to denounce the mailer. One of the advisors, Len Nichols, denounced the leaflet and photo, stating, "It is as outrageous as having Nazis march through Skokie, Illinois. I just find it disgusting that this kind of imagery is being used to attack the only way to get to universal coverage."* (The Clinton campaign and Nichols later apologized for the remark.)

In fact, Obama's mailer demonstrated why Clinton's individual mandate plan is a political loser for Democrats. If Clinton's campaign freaks out so badly at relatively mild criticism from Obama, imagine what it will face from Republicans if Hillary is the nominee in the fall. Already, the Republican National Committee put out a press release saying "Hillary Clinton wants to garnishee your wages". Here's what the Republicans will be saying in the fall: "If you're an uninsured family making over $40-$50,000 a year so you aren't poor enough for subsidies but can't afford insurance, Hillary will garnishee thousands of dollars of your wages since the average policy for a family of 4 is around $12,000." That should be enough to scare off millions of middle class families earning less than $100,000, and make them think twice about voting for a Democrat.

The growing failure of Romney's Massachusetts plan will give ample evidence to back these Republican charges. In Massachusetts, premiums are subsidized for people earning up to 3 times the poverty level (i.e. up to $30,630 for individuals and $41,880). If you make more than that, you have to pay the full cost of insurance, which ranges from $1464 a year for young adults to $9600 a year for those over 55. At those prices, it's no surprise that only 7% of the 244,000 uninsured Massachusetts citizens who are mandated to buy unsubsidized insurance had signed up by last Dec. 1, although fines for each uninsured individual will be $2,000 in 2008.

So Obama is right to criticize Clinton for putting forward a plan that would penalize the uninsured middle class, unless and until the cost can be brought down to an affordable level. Hillary's plan is morally wrong, and it's a political loser.

Obama's plan is in most other ways similar to Clinton's. Both plans would prevent insurance companies from denying coverage based on pre-existing conditions, provide community rating under which risk is shared by limiting the premium difference between the healthy and less healthy and the young and old, and provide subsidies for the less well off to buy insurance. They also both provide for a public plan to compete with private insurance. If enacted by Congress (absent the mandate), these plans will help millions of people obtain health insurance who don't now have it. Obama's plan has an additional provision that will lower premiums more than Clinton's plan would. 80% of health care costs cover the care for the sickest 20% of the population. Obama's plan provides for the Federal government to reimburse insurers for part of the cost of catastrophic care if they use that reimbursement to lower premiums.

Nevertheless, neither Obama's nor Clinton's plan will provide truly Universal Healthcare for all Americans. At a cost of a little more than $100 billion a year each, financed largely through letting Bush's tax cuts for the wealthy lapse, neither plan can make health insurance affordable for all Americans. That can only be done through a single payer/Medicare For All plan which would save approximately $350-$400 billion dollars a year by eliminating the nearly 1/3 of health care costs that go to paying the overhead, advertising, executive salaries, and profits of private health insurers, and the cost of employees in Doctor's offices and hospitals required to process claims from multiple insurers (as opposed to 3%-4% overhead for Medicare.)

That's why I still find it disappointing that Obama -- who has a sophisticated understanding of the single payer concept -- did not have the political courage to join the 78 Congressional co-sponsors of HR 676, the Medicare For All bill introduced in Congress by Rep. John Conyers. But unlike Clinton, at least Obama is not hostile to single payer. In the South Carolina debate, Clinton angrily accused Obama of having once been a supporter of single payer, as though he had once been a Communist. Obama responded that if he were designing a health care system from scratch, he would support single payer, but that since many people are happy with their current health insurance, he thought it was better for the time being to build on the present system. I disagree with Obama. The present system of employer-based health insurance is collapsing under its own weight and an attempt to build on this shaky foundation will also collapse, if not right away, then within a few years.

Despite Obama's political calculation to the contrary, the combination of a President with Obama's extraordinary leadership skills and a budding mass movement already supporting HR 676 (which includes over 235 union organizations in 40 states, including 60 Central Labor Councils, as well as many citizens and religious organizations) the American people can be convinced to support Medicare For All. A CBS News poll in September asked "Which do you think would be better for the country: Having one health insurance program covering all Americans that would be administered by the government and paid for by taxpayers, or keeping the current system where many people get their insurance from private employers and some have no insurance?" 55% chose "One Program For All" and 29% chose the "Current System".

If Obama is elected President, there will be a strong and serious mass movement supporting HR 676. A President Obama is less likely to meet such a movement with hostility than would a President Clinton. Morever, if Obama manages to pass something resembling his plan, when it fails to provide Universal Healthcare, and when increasing numbers of employers drop or reduce their health benefits within a few years, it is conceivable that Obama could support an evolution towards a single payer system in his second term.

Moreover, in California, a similar coalition just defeated an individual mandate plan proposed by Gov. Schwarzenneger and the Democratic Speaker of the California Assembly with only a single State Senator supporting the bill in Committee. In contrast, a year ago both houses of the California Legislator passed SB 840 which would have created a single payer system for the state's 37 million citizens, had it not been vetoed by Gov. Schwarzenneger. If California gets a Democratic Governor in 2010, it could be the first state to enact single payer healthcare on a state level. To succeed, it will need a series of waivers from the Federal government and the ability to use Federal healthcare funds towards the cost of the State system. Whatever the fate of Obama's national plan, it is unlikely that a President Obama would try to block a state from experimenting with its own single payer system which, if successful, could provide the model for the rest of the country. (Canada's single payer system started first in the Province of Saskatchewan under a Conservative government, before expanding to cover the entire country.)

So, as a supporter of single payer/Medicare For All, I find it disappointing that Obama did not have the audacity to support single payer. Nevertheless, his program is better than Hillary's coercive individual mandate plan. It will certainly be easier to run on against the Republicans in the fall, and to potentially gain enough popular support to get through Congress without too many crippling compromises. Maybe I'm being naïve, but, in the long-run, the fact that Obama understands single payer and is not hostile to it as a concept, gives me hope that we might get there, or close to there, over the course of an 8 year Obama Presidency.

For that to happen, it will take a mass movement in support of single payer health. Obama speaks eloquently of the fact that real social change is hard and starts from the bottom up through organized movements, not from the top down from a government that institutionalizes fundamental social change only when forced to from below. A mass movement for single payer healthcare has already begun to take shape. My hope is that an Obama Presidency will help give it the space to flourish, and to push Universal Healthcare beyond the bounds of Obama's more modest proposals.

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*Nichols is head of the Health Policy Program of the New America Foundation, which helped advise Romney, Schwarzennegger and Clinton on their health plans. His predecessor at NAM was Laurie Rubiner, a former aide to Bob Dole who was assigned by Dole in 2003 to devise a competing plan to Hillary Clinton's first health reform plan. She developed the idea of individual mandates, which had roots in conservative economist Milton Friedman, Richard Nixon's attempts to counter Democratic efforts to enact single payer, and the conservative Heritage Foundation. After leaving her Senate posts, she went to NAM where she further developed the individual mandate idea and helped lay the basis for Romney's Massachusetts plan. In 2005, Rubiner became Hillary Clinton's legislative director (a post she just left) where she was instrumental in developing Hillary's individual mandate plan. In the next installment of this "Why Not Single Payer?" Huffpo series, I will trace the history of individual mandates as a conservative Republican idea that has ironically been adopted by leading Democrats, including Hillary Clinton.

You can find previous parts of the "Why Not Single Payer" series at:
Part 1
Part 2
Part 3

Comments

[Coastwords]

As a Canadian I can tell you the single-payer system is to health care what democracy is to government: In Churchill's words, it's the worst possible system, except for all the others. We have a serious problem with wait times for elective surgery, but that is offset by excellent emergency care and, equally important, the peace of mind that comes with knowing a serious illness will not bankrupt one's family.
One quibble with this well-written article: The Saskatchewan government that introduced medicare (our term for universal health insurance) in 1962 was not Conservative. The party in power was the Co-operative Commonwealth Federation, the first socialist government in North America. It and its successor, the New Democratic Party, have governed Saskatchewan for 47 of the past 67 years. (The NDP was defeated by a right-of-centre coalition party in 2007.)
T.C. "Tommy" Douglas was Saskatchewan premier from 1944 to 1961. Although medicare was enacted by his successor, Woodrow Lloyd, Douglas is often referred to as the father of medicare.
In 2004 a national television poll named Tommy Douglas the greatest Canadian ever, largely due to his championing of medicare.
Despite its flaws an overwhelming majority of Canadians of all political stripes considers our medicare system not only a worthwhile service, but a key ingredient of our culture and national identity.

[ProudLiberalDan]

I appreciate Miles Mogulescu's intelligent commentary on this topic. Paul Krugman would be first to say that we need single-payer health care. We CAN have it. We just need to mobilize a political movement powerful enough to overcome the influence of the fortunes the health care and pharaceutical corporations pay for campaign contributions.

It is certainly arguable that campaign finance reform may have to unfortunately precede any Congressional passage of comprehensive health care reform.

Most people don't know there is a single-payer bill that many members of Congress have already signed onto.

Many Californians don't realize that the State Legislature already passed single-payer health care but it was vetoed by our vacuous governator.

Regardless of whether one supports Clinton's plan or Obama's plan as a pathway to single-payer health care, the fact is the real fight will be in Congress. One mistake that Hillary and Bill made in 1993 is that they waited WAY too long for their plan. It only gives the opposition time to mobilize. Whoever wins, Clinton or Obama, they will have to hit the ground running in their first 100 days while they still have political capital.

Comprehensive or even limited health care reform will only happen while conservatives are on the backfoot.

For any substantive health care reform, the candidate we most want is the one that has sufficient coattails to send some of these conservative Senators and Representatives down to the defeats they deserve. I won't get into the argument over who that will be here.

But it is important to remember that the new President can only make a proposal and then stump for it. Congress will draft the eventual legislation and pass or not pass it, which the President may or may not veto, which Congress may or may not override by a 2/3 vote.

I just hope that whoever wins, Clinton or Obama, they don't waste time with a black hole bipartisan commission that won't issue a recommendation until after the political capital from the election is gone and opposition has been mobilized.

[bspoons]

Will anyone remind Obama and Clinton how many innocent American lives and health care dollars are being wasted by refusing to solve this problem? A recent study in Health Affairs concluded at least 101,000 of us die each year due to lack of medical care for just a handful of common medical conditions that are not being addressed. That's like a large plane full of 277 sick people crashing every day. Our current health care systen is leaving us morally and fiscally bankrupt. Clinton's non-solution is bad. Obama's is worse. All the Republicans running are even worse. A health care voter truly has no viable option left, and innocent American lives will be lost simply because we lack real leadership on this issue.

[plutorage]

I have been pushing a plan that leaves matters as they are for the insured while enrolling the uninsured in a medicare type plan and charging them a percentage of their income (as determined on tax return) as premium.

The insurance companies would issue annual policies and give social security numbers of insured to IRS. If your social security number isn't included you would have premiums deducted along with social security from payroll (for employed not on a private plan) or pay along with estimated taxes or at end of year if that is how you pay taxes.

In short, everybody pays, but only what they can afford, and everybody is covered while leaving the private insurance industry in place and simply expanding existing medicare for uninsured.

I don't see why anybody should object.

[Ides]

Edwards repeatedly pounded this drum in the South Carolina debate but those who support Clinton's health plan have gracefully side-stepped it. How is it paid for? How much does it cost? Obama lays out all of the details, but I see nothing from Clinton. The pill's bitter, so let's have a go.

[kuulray]

Thanks Miles. This helps me get past the one thing that's been holding me back on Obama. So what's Paul Krugman's problem? He's been relentless on bashing Obama on health care.

[MRb1000]

Hillary will make you get her plan. If you chose not to get health care you will be getting a fine. This is what she stated on TV.

[Storm]

Riiiiiiiiiiiight. Obama's plan that covers fewer people actually covers more people.

Obama is magic. Seriously, you people amaze me with your blind devotion to Obama and your blind hatred of Hillary. Neither are really that different.

[doubledown]

Rubiner developed the initial idea, along with Christie Ferguson (later Romney's Commissioner of Public Health) while they both were working for the late Senator John Chaffee or Rhode Island.

[SeveredinTwain]

This is one of the main reasons I am voting for Obama; his willingness to include and encourage the electorate into creating a movement. Under his presidency, I plan on being a part of any grassroots movement supporting single payer health care, and I encourage others to do the same.

[bspoons]

Singling out an drating up sick people (AKA "cherry picking and lemon dropping") is the only loopholes health insurers need to tilt the playing field in their favor and force all the people who actually need to use the insurance onto the public plan. That's a sure-fire road to fiscal failure for the public plan. Plus HR-676 has 88 co-sponsors in the House, but yes it would have been fabulous had Obama, Clinton (or any other honest, well-intentioned and informed U.S. senator) introduced a companion bill for HR-676 in the Senate.

[bspoons]

Neither Clinton nor Obama would actually guarantee Community Rating. Specifically Clinton says insurers would be prohibited from charging "large" premium differences based on "modified" community rating. Specifically Obama says health insurers would have to "justify" charging large premium differences, as if discriminating against Americans when they become sick and vulnerable is justifiable at all. The plan allowing the rest of us to have the "same" coverage as Congress also says "except for the way (we) are rated"...(sigh). The devil IS in their details. Guaranteed Issue is meaningless without Community Rating, and "we the people" deserve those two bones at the very least.