Crunch Time for Health Care

The future of health care will likely come into into much clearer focus in the next few weeks, which explains why President Obama is suddenly getting more involved. I wrote a week ago about how health care will be Obama's big test. Well, we're getting close to exam period.

Despite surprisingly broad agreement about the need to hold down costs and expand insurance coverage, there are still several key issues that remain far from settled.

Last week, Obama clarified his position on several of those key issues. He signaled his strong support for a "public option" that would compete with private insurance plans and urged senators to cap income-tax deductions for the rich. At same time, he indicated he might support some sort of insurance mandate for all Americans, and might be willing to tax employer-sponsored health insurance.

Now, in the next few days, he's expected to talk in greater detail about where he thinks the money to pay for expanded coverage would come from. Kim Chipman and Ryan Donmoyer write for Bloomberg:

Within the next 10 days, Obama will give details of plans that White House aides say would pay for the bulk of a new health-care system. This includes his recent call for an extra $200 billion to $300 billion in savings for the Medicare and Medicaid programs for the elderly and the poor, the officials said.

Sheryl Gay Stolberg writes in the New York Times:

After months of insisting he would leave the details to Congress, President Obama has concluded that he must exert greater control over the health care debate and is preparing an intense push for legislation that will include speeches, town-hall-style meetings and much deeper engagement with lawmakers, senior White House officials say.

But as Mr. Obama wades into the details of the legislative debate — a process that began last week when he released a letter staking out certain specific policy positions for the first time — he will face increasingly difficult choices and risks.

For instance, Stolberg writes:

If he embraces a tax on employee benefits, an idea he attacked when he was running for president, he may infuriate labor and the middle class. If he insists on a big-government plan in the image of Medicare, he could lose any hope of Republican support and ignite an insurance industry backlash. If he does not come up with credible ways to pay for his plan, which by some estimates could cost more than $1 trillion over 10 years, moderate Democrats could balk.

Obama is reprising an idea he first floated in his February budget proposal, but which even some congressional Democrats termed a nonstarter.

Obama senior adviser David Axelrod told CNN's John King yesterday that at a meeting with Senate Democrats last week, Obama

made a very strong case for the proposal that he put on the table, which is to cap deductions for high income Americans. And he urged them to go back and look at that. He said, I'm not -- you know, everybody ought to put their ideas on the table. I'm not foreclosing anything, but I really think my idea is the best.

The so-called "public option" is shaping up as the single biggest item of contention. Paul Krugman writes in his New York Times opinion column:

The big health care push is officially on....

But the devil is in the details. Health reform will fail unless we get serious cost control — and we won't get that kind of control unless we fundamentally change the way the insurance industry, in particular, behaves....

Without an effective public option, the Obama health care reform will be simply a national version of the health care reform in Massachusetts: a system that is a lot better than nothing but has done little to address the fundamental problem of a fragmented system, and as a result has done little to control rising health care costs.

Right now the health insurers are promising to deliver major cost savings. But history shows that such promises can't be trusted. As President Obama said in his letter, we need a serious, real public option to keep the insurance companies honest.

Robert Reich blogs for TPM Cafe:

This is it, folks. The concrete is being mixed and about to be poured. And after it's poured and hardens, universal health care will be with us for years to come in whatever form it now takes.

And as Reich sees it:

Big Pharma and Big Insurance are gaining ground in their campaign to kill the public option in the emerging health care bill....

They don't want a public option that would compete with private insurers and use its bargaining power to negotiate better rates with drug companies....

One of their proposals is to break up the public option into small pieces under multiple regional third-party administrators that would have little or no bargaining leverage. A second is to give the public option to the states where Big Pharma and Big Insurance can easily buy off legislators and officials, as they've been doing for years. A third is bind the public plan to the same rules private insurers have already wangled, thereby making it impossible for the public plan to put competitive pressure on the insurers.

And then there's the option being championed by moderate Republican Sen. Olympia Snowe, which would automatically "trigger" a public option if certain goals haven't been met. Reich is skeptical of that one, as well.

The Washington Post editorial board writes that Obama

ought to reconsider his aversion to changing the unfair and counterproductive arrangement by which employer-provided health insurance is not treated as income for tax purposes. Following a White House meeting, Mr. Baucus reported that the president was open to limiting the value of this tax-free benefit, and we hope that is what the president meant when he referred in the letter to "appropriate proposals to generate additional revenues."

E.J. Dionne Jr. writes in his Washington Post opinion column that

the toughest behind-the-scenes battles will be about how much the insurance companies, the drug companies and the providers are willing to give up to get a government bailout of the health system....

The hardest part of the health-care fight, says Ralph Neas, the CEO of the National Coalition on Health Care, may not be providing assistance for the uninsured... but getting all the players to agree to serious cost controls.

Obama pitched his plans -- in general terms -- in his weekly address on Saturday.

Matt Bai writes in the New York Times Magazine that the stakes are enormous. Unlike Obama's past legislative victories, designing a new health care system

is a legislative goal that has eluded every Democratic president since Harry Truman and that Obama repeatedly vowed to accomplish during last year's campaign; he has said that it is not only a moral imperative but also a crucial part of his plan to remake the American economy, an ever-expanding share of which is swallowed up by doctors' bills and hospital stays. Making good on his promise will require not just public expenditure on a disorienting scale but also the kind of activism and creativity, the birthing of new rules and institutions, at which Washington hasn't succeeded for generations....

Obama's success in passing an expensive and sprawling new health care program will depend, in some part, on whether he can persuade Democrats in Congress that he is not going to wilt under pressure from industry lobbyists or allow a bill to be undone by tensions in his own party. They also have to be persuaded that the cost savings Obama is projecting from a new health care system really are going to materialize in the near future — and that members aren't going to have to face furious voters a few years out, when deficits are reaching unsustainable levels and showing no signs of remission."

Bai's story, written before Obama began asserting himself last week, sings the praises of his hands-off-Congress approach. He writes:

If the president were to shed his reticence and set out his terms for a bill, Republicans would focus on their differences with Obama and would most likely end up abandoning the process, either because they wouldn't believe a compromise was possible or because they would want to seize on any excuse to derail his agenda.

And almost on cue, as Erika Werner writes for the Associated Press:

Republican Sen. Chuck Grassley says that President Barack Obama "got nerve" to go sightseeing in Paris while telling lawmakers it's time to deliver on a health care overhaul.

Grassley, the top Republican on the Finance Committee, is key to any bipartisan health care deal. Using Twitter — the Internet-based social connection service allows users to send mass text messages called "tweets" — the Iowa Republican issued two angry "tweets" Sunday morning as the president wrapped up an overseas tour....

Grassley's first tweet: "Pres Obama you got nerve while u sightseeing in Paris to tell us 'time to deliver' on health care. We still on skedul/even workinWKEND."

And Laura Litvan writes for Bloomberg:

A group of Senate Republicans sent a letter to President Barack Obama declaring their opposition to including a government-run plan in a health-care overhaul, saying it would be a 'federal government takeover' of the health system.

By Dan Froomkin  |  June 8, 2009; 2:30 PM ET
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Ahhh... froomiekins finally heard me.

Posted by: alutz08 | June 8, 2009 2:59 PM | Report abuse


Howard Dean and the Democrats are correct.

"a" (Toothy, Robust, Affordable, Immediate, Triggerless, Medicare-Like ) "public health insurance option" (For All Who Want It) "is more important than bipartisanship, and Democrats should pass health-care legislation that includes the option with 51 votes if necessary."

"Democrats should have "no intention" of working with Republicans if it's not the strongest possible legislation that could be passed with a simple majority." (Howard Dean)

CONTACT CONGRESS and your representatives Now! And tell them you demand ALL of the minimum requirements above. This is the time for maximal, toothy, sustained pressure on Congress to get this done. Be creative. But be relentless.

This is what WE THE PEOPLE gave the Democrats all that power to do for ALL of us.

In medicine and healthcare there is only one acceptable standard. And that standard is the HIGHEST level of EXCELLENCE! you can provide for everyone. Nothing less is acceptable for a precious human life.

And the White House is right. "Good health care reform is essentially good economic policy." (Christina Romer)

BUT HEAR ME WELL! Just as I warned you before 911. Before the wars in Iraq and Afghanistan. And before the US and Global economic crisis.

I must tell you now that healthcare reform is now a critical matter of NATIONAL SECURITY. A-H1N1 (Swine Flu) was yet another loud WAKE-UP! call. And there is MUCH! worse lurking, and poised to strike at any moment. Working against the clock, many of us have known this for a long time now. And this is why we have been pushing so hard for so long without fully saying why. But Congress and the American people are literally running out of time.

I'll tell you more later. But get healthcare reform done NOW!.


God Bless All Of You

jacksmith -- WORKING CLASS

Posted by: JackSmith1 | June 8, 2009 3:43 PM | Report abuse

It is time for real health care reform and restructuring in this country; we have been at the mercy of the insurance industry and big pharma for too long. Too many Americans have to depend on emergency rooms for treatment of diseases that become critical before anything is done about them.

Physicians are still required to take the Hippocratic Oath: they need to take it seriously. Medicine can be a lucrative profession; for too many entering practice today, that is the only motivation. The government needs to control the insurance industry, and pharmaceutical companies need strict limits placed on what they are allowed to charge for medications.

Posted by: elprimojpvh1 | June 8, 2009 3:56 PM | Report abuse

elprimo--in many cases, doctors are taken advantage of by HMOs and insurance systems too. Often a doctor's practice is underfunded by its insurance sponsor, which gives the doc serious incentives to short the patients on drugs and treatment. That's the kind of fundamental dishonesty--the profit motive--that Krugman (and hopefully Obama!) is saying needs to be eradicated. Insurance companies have every incentive to deny care wherever possible.

Posted by: whizbang9a | June 8, 2009 4:17 PM | Report abuse

The LATimes just published an American Journal of Medicine study that showed 62.1% of bankruptcies in 2007 were related to medical costs as opposed to only 46.2% in 2001. About 60% of these bankrupt citizens had health insurance.

Posted by: olliebass | June 8, 2009 4:18 PM | Report abuse

Politics doesn't change. It deals with the ever and ongoing confrontation of "the people" with "commerce." In the case of healthcare, the insurance companies own the "golden goose" and will virtually stop at nothing to defend their possession. However, at stake is the health of each and every citizen (well residents, too, if you want to be totally honest - would you balk at your resident neighbor getting a shot at gov't expense if it meant your child would stay healthy?). How can it possibly cost more to eliminate the layer upon layer of claims, rebillings, micro-print disclaimers, and other hurdles put in place by an industry bent on profit?

We've got good hospitals, good doctors, good nurses and practitioners, good psychiatrists and psychologists. We've got superb medical technology. What we don't have is a clear and understandable system to let us insure ourselves for what we all need. There should be but one formula for a health policy. If wealthy people want to buy a la carte extras, well that's an option for the wealthy. But why can't there be a reasonable care policy for some fraction of what we now spend nationally to cover only 4/5 of the population?

We're America! We can't do what other nations have done? People are asking for a "public option." It would be "universal" in the sense that it would be accepted everywhere by all providers across all states. It could be an option through employers (if we insist on that klugey solution) or to individuals alongside the commercial options. It would put and keep pressure on the most expensive component of healthcare, for-profit insurers.

Ideally, families and individuals and the country as a whole are best served by a truly comprehensive single-payer insurance system. If we're not going to get that in this pass, at least let's enact a public option that creates a true change. If we do not, I assure you all that healthcare will continue to vex and drain American productivity, competitiveness, and peace of mind.

Posted by: Jazzman7 | June 8, 2009 4:24 PM | Report abuse

Just a warning to all the lefties that are rooting for universal Healthcare.

Do you really know what you are asking for and whether we can afford it? Look at the other countries who have tried it, and the resulting impact on their medical system.

Cost increases are due to technological advances in medicine, but as the technology becomes mainstream, costs start to go down, only to be replace by new advances. Its a continual cycle.

When the government gets a hold of this bill, this will open up a pandora's box to everything else they can mandate about our daily lives. What and how much to eat, where we can live, environmental surrounding, etc.

This health care is not about univeral coverage... its about more control to government over our lives. More for them to say what we can and cannot do under the banner of "welfare for everyone." What doctor or specialist you are allowed to see, the hoops you have to jump through to get approval to see specialists, waiting months on a list for non-emergency medical procedures such as reparing a hernia, and a total reduction in the redundant medical care muscle available for the entire population. Universal coverage means the government will dictate staffing levels at hospitals and what medical equipment will be available. They will also dictate how much doctors can charge for their services, and take away some incentive to work hard at the education for a medical career.

And all of this and more before we even get to the subject of how it will be paid for. When the government offers its medical plan, will employers feel the need to continue offering their own medical coverage, knowing the government will pick up the people?

The expenses required to manage a monster program like this will cripple our country and may be our downfall...

Posted by: alutz08 | June 8, 2009 5:33 PM | Report abuse

. "Insurance companies have every incentive to deny care wherever possible."

Posted by: whizbang9a

And the same will be true for the bureaucracy setup to handle the government healthcare. If you really want to see a waste of money, the layers of government workers setup to handle this will really be a sight.

Posted by: alutz08 | June 8, 2009 5:38 PM | Report abuse

All you doomsayers -- look at Canada, and compare the situation of Canadians with that of UNINSURED Americans, of which you have millions, or health-care bankrupted Americans, of which Canada has none.

Posted by: sm11 | June 8, 2009 5:48 PM | Report abuse

alutz08 wrote:
And the same will be true for the bureaucracy setup to handle the government healthcare. If you really want to see a waste of money, the layers of government workers setup to handle this will really be a sight.

in response to
Posted by: whizbang9a

. "Insurance companies have every incentive to deny care wherever possible."
Dear lutz,
Do some analysis. The facts prove you're wrong.
27 cents of every "healthcare" dollar in our current for profit model today goes to overhead. By comparison, 1.5 to 2 cents go to malpractice. (Lutz, did you know that?)

Head-to-head comparisons show that administrative costs are 600% HIGHER with the for-profit insurers than with government run program. This study by the US House of Representatives Committee on Oversight and Government Reform in 2007 compared Medicare Part D. "Of the average $180 per enrollee only $30 went to “Sales Cost”, while $107 went to administrative costs and $43 went to profit." That's a 24% profit margin and 60% admin costs.

To put that in other terms: Going to single payer would save $500 billion a year, about $1,660 per person, based on the current $2.4 trillion annual spend.

My wife and I already get coverage denials from for-profit firms and we're in top 10% of health per my life insurance agent. We can get insurance, but what good is it if it doesn't pay potential medical bills?

If I'm a lefty you're in big trouble. I'm an entrepreneur, inventor and company founder. i'm ticked off that my G&A has risen through the roof because the for-profit people -some of whom are on my Board of Directors, are screwing us all with unconscionably high profits and denial of coverage.

Posted by: boscobobb | June 8, 2009 6:23 PM | Report abuse

A question: If the American health care system is so clearly superior to that of all other countries, why don't we see any -- ANY -- politicians in other countries saying, "Let's scrap our public single-payer health insurance and turn it over to private insurance companies, like they do in America"?

Seriously, other democracies have conservative parties, don't they? Did Maggie Thatcher ever make such a proposal? How about Merkel and Sarkozy, aren't they supposed to be conservatives? Why is it that politicians in other democracies utterly fail to recognize the superiority of the American system, and don't try to replicate it in their own countries? What are they missing?

Or is it we who are missing something? (Do you suppose it might have anything to do with our "private" campaign contribution system?)

Posted by: dwiltzee | June 8, 2009 6:24 PM | Report abuse

alutz08 said about government healthcare:

"What doctor or specialist you are allowed to see, the hoops you have to jump through to get approval to see specialists, waiting months on a list for non-emergency medical procedures such as reparing a hernia, and a total reduction in the redundant medical care muscle available for the entire population."

Hmmm, pretty much sounds like private health insurance today--waiting ages for them to "approve" things, coming up with clever or downright devious ways to wriggle out of paying, leaving 45 million people out of the loop altogether, or making exhausted patients on their deathbeds spend their final moments arguing with claims adjusters.

No other country would trade in what they have for what we have--read up on that one. All the things you listed are just scare tactics propogated by an EXTREMELY overcompensated insurance industry. And it's Orwellian because everything they say will be so bad about a government health insurance plan is exactly what is already wrong with the "system" (rather, house of smoke and mirrors) they have set up for us today.

Who could possibly argue for the status quo at this point?

Posted by: jaimyeb | June 8, 2009 6:27 PM | Report abuse

for lutz,
"Cost increases are due to technological advances in medicine, but as the technology becomes mainstream, costs start to go down, only to be replace by new advances. Its a continual cycle."

BS. Lutz, I have pending patents in medical technology and am privileged to work with some of the top oncology surgeons on the planet.

When you understand that the health deniers (I prefer to use that word to insurer) are in business to get paid to do nothing but deny coverage, you'll realize costs are not directly related to technology.

We have technologies that can significantly improve healthcare - and also reduce expenses - but the insurers don't directly benefit so they don't endorse the reimbursement codes needed for these new procedures and technologies. It literally is not part of their business model to promote new healthcare technologies.

Posted by: boscobobb | June 8, 2009 6:38 PM | Report abuse

Three observations:
1) Republicans are going to oppose anything Obama proposes
2) Republicans are going to oppose anything Obama proposes
3) Republicans are going to oppose anything Obama proposes

Negotiating with them is pointless.

Like any successful business, identify a mission, set a goal, start moving, rally allies, persuade those on the fence, watch opponents but don't allow them to distract you from your goal.

Posted by: boscobobb | June 8, 2009 6:46 PM | Report abuse

lutz wrote
"When the government gets a hold of this bill, this will open up a pandora's box to everything else they can mandate about our daily lives. What and how much to eat, where we can live, environmental surrounding, etc."

Have ever traveled outside the US?

Let me make it very easy. Take a short drive up to Canada. Yep, those darn Canadians have already gone over to that pandora's box.

Posted by: boscobobb | June 8, 2009 6:50 PM | Report abuse

Most costs incurred by private insurance nowadays are due to the many layers of management whose job it is to deny care to clients. That is not a lie, and unfortunately not a joke.

lutz does have one point: national health care will be very expensive, no matter what scenario. Progressive taxes are one possible method of covering at least some of the expense. The proposed savings from other health programs sounds good in principle, but the matter of what form those cuts take is the real question. I'll have to learn more about this employer-tax option before I have any opinion on it.

But I agree absolutely with the principle of a public option. It's important for poor Americans--whether destitute, or with low incomes--to have access to decent health care. The emergency room option mentioned above is about as well-informed as George W Bush was on the issue--which is to say, uninformed. If you have a low-to-moderate income, but no insurance, you're on the hook--usually to the tune of about a thousand bucks--for an ER visit. If you're unfortunate enough to need an ambulance, that's another grand.

We have already public education, with options for private. I see no reason health care should be any different.

Posted by: whizbang9a | June 8, 2009 9:57 PM | Report abuse


Our current illness care is extremely expensive. We, as a nation, are in terrible health. Our infant mortality rate shames any American who travels internationally. Our longevity is abysmal compared to developed nations. For the amount of money we spend we should be living significantly longer better lives, not shorter unhealthy ones.

You don't need an MBA to calculate that we could cover everyone in the country, with better care, and still spend less... but we have to get rid of the health insurance (sic) companies to do this.

We are willing to spend $650-800 billion a year on military. But if we're unhealthy, what are we protecting?

Posted by: boscobobb | June 8, 2009 11:56 PM | Report abuse

Republicans and insurance companies are going to oppose any really significant reform, period. This issue is important enough that it can wait two years. Obama and progressives (evidently not the same) should refuse compromise and if the bill fails, take it to the country in 2010. A public option will have strong voter support.

Posted by: dowty | June 9, 2009 9:38 AM | Report abuse

"The expenses required to manage a monster program like this will cripple our country and may be our downfall..."

That's right, endless wars on multiple fronts won't affect us in the slightest. What will really destroy us is following the lead of every other civilized country on the planet in providing health care for citizens. And you've proven it so eloquently with made up facts and lies!

"If you really want to see a waste of money, the layers of government workers setup to handle this will really be a sight."

Yeah, that Medicare program and its ridiculously inflated overhead costs of about 1/3rd that of private insurers! What a nightmare scenario we're headed towards - affordable, universal health care that remains in effect even when you lose your job.

This simply can not stand, keyboard warriors. Call Rush NOW and tell him to veto universal health care!

Posted by: BigTunaTim | June 9, 2009 10:10 AM | Report abuse

Scare tactics about how the demise of Democracy in America will be brought on by the Government mandating healthcoverage be affordable, and accessible to all, falls on deaf ears to those of us who have been denied coverage, whether it be by preexisting conditions, loss of employment, or other inability to pay.
It is unconscienable that people can live in this country and treat those in need of life saving health service yet are unable to pay, as subhuman weaklings who need to just suck it up and get with the program. If Sen. Kennedy had ANY other job other than being a U.S. Senator when he found out he had cancer, he would have been forced onto longterm disability (if he was lucky enough to have purchased the extra coverage before falling ill), and he eventually would have lost his job when he found out his tumor was inoperable. After his job loss, he would have been offered the choice to purchase COBRA at an astronomical rate, or lose his healthcoverage. He would have eventually lost his home due to the cost of his medicine and healthcare, leaving his family destitute and without hope, at the worst possible time in their lives~ when their loved one was sick and dying. Yet as a Senator, he has a staff to perform his duties while he receives medical care, is allowed to keep his Senate seat even though he is absent most days, and has no interruption of healthcoverage. Financially he and his family remain secure.
No other industrialized nation in the world outside of ours allows their citizens suffer this sort of fate, especially while protecting their elected officials at a different standard. If given a choice, every person without healthcoverage in this country would GLADLY wait a week to see a doctor if it meant they might live another week (most of us do even WITH healthcoverage, so why this is used as an argument by naysayers is hard to understand), and not go bankrupt or leave their family in ruins at their death. Yet we crassly turn our backs on our fellow citizens, smuggly believing that it must somehow be their fate to have befallen on such hardtimes, and secretly glad that those same hardtimes seem to have passed over us personally.
As the poem goes, no man is an island. If healthcoverage is not overhauled, it will be the death of all of us. Our economy will never recover. It is up to our elected officials to somehow gain the backbone to stand up to the special interests who are only interested in their bottomlines, and not on their customers bottoms. The time for Univeral Healthcare is NOW!!!

Posted by: jdm58 | June 9, 2009 10:47 AM | Report abuse

As a physician who spent most of his professional life in Canada, I may have a unique perspective. As usual, the solution will lie in a compromise, meeting in the middle. How does this sound?

1) A publicly funded health plan providing basic, necessary health care to all U.S. citizens, at the docto of their choice.
2) All doctors to participate in the public plan at remuneration (pay per act, or salary) and percentage of time, (15%?) to be negotiated.
3)Public hospitals providing BASIC health care open to all citizens.
4) Private hospitals, with private rooms, luxuries, bells and whistles, latest gadgets, etc., available to those with private insurance, or willing to pay for it.
5) Doctors who have satisfied the public provisions required free to work whenever, and at whatever price they choose to charge, to be covered by private insurance, or self-pay.
6) Required drugs, in generic form, available to all at subsidized prices. Name brand drugs covered by insurance or self-pay.

True, it is a 2-tier system, but then, so is life in general.

Posted by: williambilekmd | June 9, 2009 11:09 AM | Report abuse

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