Health Care Reform Hits Bump, Not Derailed

President Barack Obama promotes health care reform at a town hall meeting in Annandale, Va., on July 1. (Zuma Press)

When Douglas Elmendorf, director of the Congressional Budget Office, told lawmakers last week that the Democrats’ health reform plans wouldn’t control long-term costs, the reverberations were as immediate as they were inevitable.

Republicans blasted the majority’s health strategy as a failed approach that would raise costs on individuals without tackling the broader issue of system sustainability. Reputable news organizations began writing that the Democrats’ health reform agenda is “in trouble” and “endangered.” And public opinion polls indicated waning support for the party’s plans to overhaul the health care system this year.

Illustration by: Matt Mahurin

The combination of factors has played right into the hands of conservatives who’d like nothing better than to see the Democrats’ health plans crash and burn. Yet health care experts across the political spectrum maintain that the recent developments, while likely to stretch the debate further into the year than the Democrats had hoped, hardly close the coffin on their sweeping health reform approach. Rather, observers say, the week’s shifting sentiments are merely a natural part of the legislative process — bumps amplified by the size and scope of the health reform effort. In the context of the larger debate, these experts argue, the events of the last week constitute something like a hiccup, not a mortal wound. The Democrats will probably have to tweak their proposal to cut costs, they say, and they’ll be forced to push the vote to later in the year. But health reform, in some configuration, will become law in 2009.

“Something will pass,” said Julius Hobson, former lobbyist for the American Medical Association and now a senior policy analyst at the Washington law firm Bryan Cave. “It’s not going to be what everybody’s looking at right now, but the president will sign something in December … The drive is there to do something, and they will.”

Jacob Hacker, professor of political science at Yale University, echoed that message, conceding that Washington’s long history of failed health system overhauls makes it tempting to predict that this year will be no different. But with the full weight of the White House, Congress and the health care industry receptive to at least the concept of health reform, success on some level is likely. “The safest prediction is always that things will go down in a flaming ball of defeat,” said Hacker. “But it’s still too early to write this year off … It’s sort of like a roller coaster. Most likely it will go back up again.”

Almost no one disagrees that policymakers must do something to control the nation’s health care costs. Medical spending nationwide is projected this year to hit $2.6 trillion, or 18 percent of the gross domestic product, according to the Congressional Budget Office. Within eight years, that number is projected to jump to 20 percent of GDP. How to rein in those costs, however, is very much in dispute.

Central to the debate thus far has been the inevitable concern over cost. Democrats have already begun work on two separate proposals — one in the House and the other in the Senate — with both designed to cover the more than 45 million Americans who currently lack health insurance. But that strategy doesn’t come cheap. Indeed, the CBO on Friday estimated the cost of the House proposal to top $1 trillion over the next 10 years. The pricetag highlights a pickle facing many voters, who simultaneously say they’d like to cover the uninsured on moral grounds, but don’t want to incur the additional costs that might accompany the expansion.

“Nearly all voters already have health insurance,” Joseph Antos, health-policy analyst at the conservative American Enterprise Institute, said in an email. “They want relief from health costs, and are willing to help others obtain insurance as long as that does not increase their costs materially.”

That dynamic, other observers say, will force the Democrats back to the drawing board in efforts to lower those costs. “Is health reform over? — No,” said Robert Blendon, professor of health policy at Harvard University. “But they [Democrats] are going to have to go more slowly, and they’re going to have to get those costs down … ‘Too expensive’ is the word that’s come around.”

A number of health policy experts pointed to another central dilemma surrounding the health reform debate: The same provisions representing fundamental changes to the health care system — changes almost everyone agrees are necessary — are also untested, leaving the CBO unsure how to score them. Provisions encouraging the use of preventative care, the transition to better health information technology and the creation of medical homes, for example, are all expected to save money. CBO, however, “took a more cautious view,” said Blendon, an expert on the Clinton administration’s failed attempt to pass comprehensive health care reform in 1993.

Republican leaders, already aligned in opposition to both the House and Senate bills, appear unconcerned with such nuances. Senate Minority Leader Mitch McConnell (R-Ky.) said over the weekend that the CBO score is indication enough that the Democrats’ proposals don’t meet the intended goal of reining in costs. Additionally, Republicans are lined up squarely against a Democratic proposal to create a government-backed insurance option to compete with private companies. The bills offered thus far, McConnell said on NBC’s Meet the Press, “shouldn’t pass at any point, either before the August recess or later in the year. What we need to come up with is a truly bipartisan proposal.”

With the public plan a non-starter for the GOP, McConnell’s call for bipartisanship sends a clear message to those across the aisle: Eliminate the public option or kiss your bipartisan bill goodbye.

Not that Democrats haven’t voiced their support for such an approach. Party leaders from President Obama down have said for months that the most lasting health reform bill would be one with bipartisan backing. Yet, as the debate has evolved, and GOP opposition has tightened around things like the public plan, majority leaders seem more and more to be faced with a stark choice: Either accept a bipartisan bill that doesn’t include all of their policy priorities, or fight for their provisional goals at the expense of GOP support.

For some, the choice has already been made. Sen. Christopher Dodd told The New York Times over the weekend that a bipartisan bill would be preferable, “but given the choice between a bipartisan bill that’s weak and doesn’t do much for my people at home, or one that is a partisan bill that actually gets more done,” the Connecticut Democrat said he’d take the latter.

In May, Sen. Charles Grassley (R-Iowa) indicated that Obama was ready to sacrifice some policy goals for a bipartisan bill. “He would like to have a bipartisan compromise even if he doesn’t get all that he wants, as opposed to getting all he wants in a partisan vote,” Grassley told MSNBC after a White House meeting with the president.

More recently, however, Obama seems to have taken the opposite tack. Appearing Monday at Children’s Hospital in Washington, the president indicated that he’s ready to fight for a comprehensive bill designed to get everyone covered. “We’re a country that chooses the harder right over the easier wrong,” he said. “We have to do that once more.”

Such “saber-rattling,” said Antos of AEI, “indicates that a bipartisan agreement is no longer a priority to them [Democratic leaders].” Conservatives are hoping that a third and final health care proposal — still being drafted by leaders of the Senate Finance Committee — will be more moderate than the previous two. Finance Chairman Max Baucus (D-Mont.) has a long history of working with Grassley on legislative compromises. Still, if the Finance proposal strays too far from the Democrats’ goals, some experts warn, then Baucus risks losing support from his own party — a move that could sink the entire enterprise.

“If it comes down to a commitment to bipartisanship above all else, then I fear the whole thing will fall apart,” said Hacker, author of Health at Risk: America’s Ailing Health System — and How to Heal It. Still, he added, Democrats appear to realize that a failure to pass health reform this year would be to miss a historic opportunity — something that’s eluded policymakers for decades.

“The White House,” he said, “recognizes that this is a do or die debate for them.”