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Is this 1994 All Over Again? An Interview with Nancy-Ann DeParle


Nancy-Ann DeParle is the director of the White House Office on Health Reform. But she's been around this issue a long time. In 1994, she was the Office of Management and Budget's point person on health care, and later in the Clinton administration, she oversaw the powerful Health Care Financing Administration, and served as a commissioner on MedPAC. We spoke Tuesday about the similarities between this health-care reform effort and 1994, what is left to be decided in the Finance Committee, and what the administration promised the pharmaceutical industry. A lightly edited transcript follows.

You were around in 1994. Is this all feeling eerily similar?

Up until now, no. There has been so much broad agreement. And when you step back, there is broad agreement about 85 percent of what we're talking about. The insurance market reforms. The efforts to change the delivery system. Really, there's much broader agreement about the things that need to happen here than in 1994.

But the tactics and the sudden charges about euthanasia and death boards. I just saw Linda [Douglas] on C-SPAN getting calls from people saying section 29 says this and section 29 says that. You've read the bill. There is no section 29. The numbers don't start till the thousands. That part does seem eerily reminiscent.

Or take your interview with Sen. Isakson [on end-of-life counseling]. I've also been talking with Sen. Mark Warner about this. He wanted to work on this in Congress. The idea of taking a step towards helping people who want to voluntarily understand what's available to them in terms of advance planning has been a bipartisan effort, and it's mainly been Republicans who have brought it up to me in my visits to the Hill. So that part does seem reminiscent.

A Rasmussen poll result said that in May, 35 percent of respondents rated the United States health care system as either good or excellent. Today, it's 48 percent. Why are those underlying perspectives changing?

I have no idea. If anything, I'd expect it to be slightly worse because there's been a lot of discussion about the need for reforms of the insurance market.

The public plan has received a lot of attention as an unfinished part of the bill. But what are the other pieces? You see 85 percent of the bill is basically agreed on. What else is in that 15 percent?

If you just talk to folks on the Finance Committee who are working with the Group of Six, there are a handful of issues. What will truly bend the cost curve over a longer period of time?

The Group of Six recently sat down with [CBO director] Elmendorf and others to ask about the right ways to attack this. His prescriptions and those of other economists are challenging. One set is changing payment systems for Medicare. Another is delivery system reforms with varying degrees of support. That's hard enough. But requiring beneficiaries to pay more for their care under Medicare? Changing the tax system? Those are really difficult.

Then there are things like Medicaid. The bills agree we should expand Medicaid as part of the first step of getting everyone covered. They'd all do it to 133 percent of poverty. Then CBO came in and said its probably a mistake to do 100 percent federal financing for this, so the Finance Committee spent some time talking about that this week. Geographic variation is kind of hard. Long-term cost containment around a Medpac on steroids commission. That's hard. Then abortion, illegal immigrants. I'd say there are half a dozen to 10 issues that they're going round and round about.

What's the day-to-day relationship between the White House and Senate Finance Committee's Gang of Six? Do you have a representative in their meetings?

Oh no. They talked about inviting me last week but it ended up not happening. I talk at least weekly to Republican staffers and to the Democratic staffers in the room and we talk to the members themselves. I talked to Senator Enzi just before he left town, and Senator Grassley separately. We have a cordial relationship. They're working hard. Anyone who works on health policy for more than half an hour sees how tough it is. There's a definite camaraderie among those of us trying to figure out these problems.

There's been a lot of talk lately about this deal with the pharmaceutical industry. Want to set the record straight on that?

Sen. Baucus was sitting down with various sectors in the health care industry with the organizing principle being everyone will benefit from health-care reform and everyone will have to help pay for it. You have to give a contribution towards this. There need to be savings.

We had proposed as part of our budget around $95 billion from our industry. They came forward and after some negotiations, said $80 billion is a number we can support. Having been through many budget reconciliation and health-care negotiations in my career in Washington, if you can get an industry to offer $80 billion in savings when you only wanted $90 billion, that's a good give-and-take. We agreed to support the number and we support the fact that one of the policies in there is the deep discounting of drugs in the donut hole. That's about four million seniors a year, and it's their number one issue of concern, if you look at the polling.

Is that locked in stone? Will you protect them from further savings?

No. We support the number. The policies are what the Senate Finance Committee and the House bill enacts. We have to see what they end up with.

Photo credit: Dennis Brack/Bloomberg News.

By Ezra Klein  |  August 12, 2009; 5:35 PM ET
Categories:  Health Reform , Interviews  
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I am NOT comforted.

DeParle: "I talk at least weekly to Republican staffers and to the Democratic staffers in the room and we talk to the members themselves."

I interpret 'the members themselves' to be the members of the gang of six. Did Yahweh appoint these six to make our laws? Has she spoken to Jay Rockefeller or Sherrod Brown?

Apparatchik is the word that comes to mind reading her words. I get no sense of urgency as support dwindles - she doesn't even seem to know the poll results.

Posted by: JimPortlandOR | August 12, 2009 5:48 PM | Report abuse

Biggest problem for the White House now is the Senate Dems and their insistence on negotiating with people like Grassley, who today gave voice to the euthanasia lie:;contentBody

These are negotiating partners???
One word- Reconciliation

Posted by: cmpnwtr | August 12, 2009 5:52 PM | Report abuse

Ah, now I understand: "Don't worry, $80 billion wasn't a huge concession to the insurance industry -- because the concession was already made before entering into negotiations, by starting at only $95 billion." Way to go, guys! Obama's negotiation skills, in a nutshell.

Posted by: Ulium | August 12, 2009 6:13 PM | Report abuse

"The Group of Six recently sat down with [CBO director] Elmendorf and others to ask about the right ways to attack this. His prescriptions and those of other economists are challenging. One set is changing payment systems for Medicare. Another is delivery system reforms with varying degrees of support. That's hard enough. But requiring beneficiaries to pay more for their care under Medicare? Changing the tax system? Those are really difficult."


Obama could have tried to push for any one of these reforms, if he was serious about cost control. Instead, he's decided to use his political capital on a $1 trillion coverage expansion and a public option. Those are both "hard" too. He just decided that pushing a public option was more important than trying to meaningfully change the course of Medicare spending before it bankrupts the country.

Posted by: wisewon | August 12, 2009 6:28 PM | Report abuse

I'm also confused about the Pharma deal. How did the White House come up with the $90 billion 10yr figure in the first place? Some reports have suggested that at a minimum, negotiating with Pharma should have resulted in a better deal of at least $30 billion/yr for a $300 billion 10yr net saving. We are watching this Obama admin very closely but so far their negotiating skills have been horrible. They are willing to give away tens of billions together with nary a peep on a robust public option with a health exchange which is the linchpin in driving down health care costs.

This White House seems very willing to give progressive groups who worked their butts of to elect Barack Obama the middle finger. Have you seen the latest polls on voter enthusiasm lately? Mr. President , don't spit in the face of the people who have stood with you up till now. Baucus, Rahm, and Messina have got to stop playing Democrats for fools.

Posted by: jasonr3 | August 12, 2009 6:42 PM | Report abuse

Odd how no one ever talks about bankrupting the country with military spending, or overseas bases, or agribusiness subsidies, or wars of occupation, or tax breaks for wealthy people. We always find money for what we want and make choices about what's important. Medicare is not going banktrupt and never will, because the citizens of this country want Medicare. And in time the same will be true of medical care for all citizens.

Posted by: cmpnwtr | August 12, 2009 8:25 PM | Report abuse

Despite the delays in the gang of six, I'm not sure we need to worry or feel rushed about healthcare. Either way, Nov, 2010 isn't happening for quite a while, so that is plenty of time to cool down.

What matters most is that we get an effective reform in place so that people start feeling the benefits when they go to vote, long after they've forgotten this circus.

Posted by: zosima | August 13, 2009 12:47 AM | Report abuse

She has no idea what is going on. The American people overwhelmingly reject this. And the GOP is just being nice to your face, but they hope and expect you to fail.

Posted by: G418 | August 13, 2009 9:37 AM | Report abuse

This seems like a revealing interview on the endgame that the White House foresees. They're going to get a bill that contains nothing except the insurance-company reforms, and they'll declare victory, sying that they got "85 percent" of what they wanted. The public plan, the individual mandate, and bending the cost curve will all be portrayed as just little details that got lost in the shuffle.

Posted by: tomtildrum | August 13, 2009 9:55 AM | Report abuse

Anyone else troubled by the interview going to Ezra Klein and not one of the Post's actual REPORTERS? When's the last time Nancy-Ann DeParle sat down with Washington Post reporters? According to this,"washington+post"+"Nancy-Ann+DeParle" , it wasn't recent.

So what do we as a reader get? Sympathetic questions from a heathcare reform proponent. Want to set the record straight, Nancy? Jesus Christ is that what journalism is these days.

Posted by: ralph4100 | August 13, 2009 10:23 AM | Report abuse

The rantings and ravings of some of the town hall attendees has been embarassing. Many should be ashamed of their rudeness and ignorance. However, I'm one of many who will probably never attend such a meeting - prefering to obtain my information about the various bills through reading and analyses. I don't support Obama's rush to pull together health care reform and I'm a reliable voter in national and local elections. I won't vote for any plan that doesn't immediately sharply reduce health care costs. "Bending the curve" is just not enough. Obama has gone about reform all wrong.

First, he thought it enough to distance himself from the Clinton's effort in 1994 by criticizing their approach. He claimed hearings would be televised; that the effort would be transparent. Where's the transparency he promised?

Again, he mistakenly thought that the Clintons' major error was outlining a detailed plan and presenting it to Congress. HIS mistake? Thinking that Congress - with an approval rating matching that of GWB in his final year in office - would have the confidence of the American people. He should have brought in experts from every area and spent the time it took to develop a plan he was willing to promote and defend. Instead, he finds himself a cheerleader for a congress we've lost confidence in. I'm wondering just how smart a politician he really is. Where are the stories questioning the naivete or worse the narcissism of a man who thought health reform could be tied up so neatly and quickly?

He's squandered so much of the confidence the public was willing to extend to him. We voted for an inexperienced politician, short on substantive accomplishments who promised that he would take on the challenges we faced. In exchange, we asked for leadership, the ability to cut through the clamoring of special interests. We're tired of all his appearances (town halls, press conferences) where he only displays how smart he is - a kind of "Educator in Chief". We want effectiveness. He needs to remember that his role as "Commander in Chief" extends beyond military issues.

Finally, where is the outrage about the deals he's reached with Big Pharma? How can we believe that Obama is interested in controlling health care costs when he's unwilling to impose drug fee schedules?

Posted by: alto1215 | August 13, 2009 10:24 AM | Report abuse

"Odd how no one ever talks about bankrupting the country with military spending, or overseas bases, or agribusiness subsidies, or wars of occupation, or tax breaks for wealthy people. "

The country IS bankrupt and you libs are oblivious to the problem, as evidenced by the 787 billion porkulus bill.

The "wealthy" already pay the vast majority of taxes; if you crush their incentives you will kill even more jobs. We let the government keep some of the money we earn, not the other way around.

Everything Obama does, destroys wealth and kills jobs.

Posted by: FreedomFan | August 13, 2009 10:30 AM | Report abuse

those that don't admit that a public option is a grab for single payer are being at least naive and at most being deceptive.

Any public plan that has provider reimbursements that are set at medicare or medicare +5% or are not negotiated like private insurers have to negotiate, does not pay state premium taxes are setting those of us with private plans at a severe disadvantage that won't allow private plans to compete and will eventually lead to a single payer rationing type system that you see in Britian and Canada.

I'm sorry I'd like to get the care I want as opposed to what the federal government says that I can get.

Posted by: visionbrkr | August 13, 2009 10:52 AM | Report abuse

Obama is on the defensive on this issue. He's lost the high ground, and when he has to go around the country saying I'm not for death panels, I think that defensive of a posture has massive implications... Read The Elderly Attack Obamacare at....

Posted by: ronsuev | August 13, 2009 11:03 AM | Report abuse

Ms. DeParle was primarily responsible for Tennessee's disastrous public healthcare policy "TennCare",
which has forced huge tax increases, long waits for services and limited provider access. Wow. Now Obama wants to put her in charge of doing the same to the rest of us.

No, thanks.

Posted by: OttoDog | August 13, 2009 11:52 AM | Report abuse

I'm not sure what to make of the argument that there is consensus on 85% and disagreement on only 15%. So what? I see this kind of thing in meetings all the time at work. The last few details are always the ones that generate the most controversy. That is the norm.

Posted by: invention13 | August 13, 2009 11:53 AM | Report abuse


No matter what side you're on I think your point is a pretty stark one.

I don't know how you come back from being in the position of distancing yourself from "death panels".

Posted by: IUT1 | August 13, 2009 12:50 PM | Report abuse

@visionbrkr: "I'm sorry I'd like to get the care I want as opposed to what the federal government says that I can get."

Well, I'm sorry—I'd like to get the care I want as opposed to what my employer-chosen private health insurer says that I can get.

Posted by: jamesestevez | August 13, 2009 1:05 PM | Report abuse

" change the course of Medicare spending before it bankrupts the country."

People keep repeating this as if repitition makes a false statement true. Uwe Reinhardt, somebody who knows a little math, has computed that in 2050 we will have 70% more money (in real dollars) AFTER paying for Medicare than we have now after paying for Medicare. The problem is mostly in the wastefull mess of for profit insurers with their high overheads and compliance costs, not Medicare.

For those who know some math, here is Uwe's computation:

"If "economic sustainability," then exactly what do people have in mind with that phrase? During the past 4 decades or so, the long-run, smoothed average annual growth rate in real (inflation-adjusted) GDP per capita has been about 2%. Suppose that fell to only 1.5% for the next four decades. The current average real GDP per capita of about $40,000 would then grow to about $72,500 by 2050 in constant-dollar terms. Medicare now absorbs about 3% of GDP, leaving a non-Medicare real per capita GDP of $38,800. It was estimated by the CBO about a year ago that Medicare will absorb about 9% of GDP by 2050. Let’s make that 10%. At these numbers, the non-Medicare real GDP per capita available to today’s little critters who will run America in 2050 will still be close to 70% larger than is our current non-Medicare GDP per capita."

Posted by: lensch | August 13, 2009 1:18 PM | Report abuse

Wouldn't it be full-disclosure to inform readers that Nancy DeParle made $5.8 million dollars as a lobbyists in 2008 -- a lobbyist for home health care companies? Maybe that's the problem with healthcare -- overpaid political hacks getting $5.8 million. I am sure insurance companies and the uninsured would have liked to have been charged less by home healthcare companies - but instead, these companies padded their bills and wrote a big check to ----- ta da ---- Obama's Health Czar!!

Posted by: Cornell1984 | August 13, 2009 2:55 PM | Report abuse

Speaking about immigration, here's a BHO lie from a couple days ago that you won't hear about from Ezra Klein or the rest of Journ-o-list:

Posted by: LonewackoDotCom | August 13, 2009 4:58 PM | Report abuse

I can understand that many posters are frustrated that people have been using inappropriate characterizations to describe what they are opposing and incoherent yelling to get their point across. But you are sadly mistaken if you do not understand that these are simply metaphors for their frustration at a government that is not listening to them. To some extent this is the inevitable outcome of the fact that the administration has vigorously campaigned for a plan that they have not specified and the fear of a law that will likely be crafted in back room deals and voted in the middle of the night by a Congress that doesn’t even know what is in it. The public is being asked to buy a “pig in a poke.” As a result, all the passion is with the opposition and it is the proponents that have been driven to the embarrassing expedients of bussing in props and using children as plants. This doesn’t faze the “true believers” evidently to judge by the rationalization that this is all the product of "vested interests" (ignoring the fact that the administration has already bought off most of them).

With all due respect to a sensible progressive, Camille Paglia, who has called for Pelosi’s head, the senior people from safe districts who run Congress can thumb their noses at the opposition and attempt to divert attention to the manner it is expressed. That will work just fine for their constituents. But the so-called "blue dogs" will be decimated if things continue as they are now about health, cap-n-trade and other issues. Even the 42% of the people who support "reform" are, by and large, NOT in their districts.

This entire charade is a product of political wilfulness and hubris. A basic change such as this requires consensus. The AMA and the drug companies may have been co-opted onto the reform bandwagon (for a price)...but this will all be undone in the near future if a SUBSTANTIAL majority of the people are not on board. If Republicans can profit from this blunder by Obama, well sobeit. We all learn from our mistakes. Perhaps it will make him a better President.

Posted by: CincinnatiRIck | August 13, 2009 7:46 PM | Report abuse

Ms. DeParle state "our industry" in reference to Pharma savings? That speaks to Nancy's insider status as a health care private equity underwriter (PEU). Slip of the tongue or a several decade deep perspective?

With her huge pay at CCMP Capital Partners and numerous health care corporate boards, the "our" is likely not a slip. It's a for-profiteering, deeply ingrained perspective

Posted by: jepysdad | August 13, 2009 7:49 PM | Report abuse

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