This diary is one in an ongoing series examining the policy positions of Senator Barack Obama, whom I support for President.
In the previous essay, I analyzed Senator Obama's technology agenda, acknowledged to be the strongest of any candidate running for President.
In this essay I will discuss the core debate around Senator Obama's Health Care policy and examine a key insight that debate gives us into Senator Obama's basic political philosophy.
When it comes to health care and Barack Obama the person to meet is Harvard Professor and Economist David Cutler. Professor Cutler is the author of the well-regarded book on health policy: Your Money or Your Life. (Yes, it's possible to be a policy wonk and have a sense of humor.) From the Ezra Klein review:
Cutler, a Harvard economist, worked on Clinton's doomed effort and, upon its death, set about reflecting on where they'd gone wrong. His eventual answer was virtually everywhere, but not just in the political sense. According to Cutler, the health-care debate is deeply flawed, myopically mired in issues of cost and access. Both, he grants, are important. But with most Americans able to afford health care, calls for reform based solely on those concerns will continue to fail. The fee-for-service system encourages a reliance on technology-intensive treatments -- the costly procedures that are richly reimbursed by insurers -- while simple, but potentially more valuable, services are often overlooked.
-Ezra Klein, American Prospect
If you want to meet David Cutler outside the glare of the presidential campaign, try this informative profile by Roger Lowenstein written for the New York Times in 2005:
A tweedy, self-effacing 39-year-old, Cutler is a seriously modified lefty. He envisions a system in which everyone could get insurance while free-market incentives would motivate health-care providers to be more effective as well as more efficient. Instead of suppressing the market by rationing care, restraining prices or regulating doctors, he wants to liberate it. It is neither Clinton nor Bush -- but closer to Bill Bradley, whose 2000 campaign Cutler advised. Dr. Robert Galvin, head of global health care at General Electric, says, "David has showed everyone that the way to rein in costs is not to squash innovation."
-NYT
(Yes, that was a supporting quote from someone at General Electric. Following Senator Obama's lead, I am not going to hide or sugar coat things. If an article quotes someone from GE, it quotes someone from GE!)
Now, David Cutler is a brilliant guy who has some of the core ideas that are behind Barack Obama's philosophy on Health care. I think his overall position underlies a philosophy that runs through the entire Obama campaign.
The Obama approach to health care is pragmatic (as policy and as politics), innovative and idea-driven (witness Cutler), and focused like a laser on maximizing healthy outcomes for everyone, maximizing affordability for everyone, and enunciating a plan that is doable and that will actually happen as politics and policy in the America of 2008. Barack Obama's proposals are different from those of Edwards and Clinton. Here's the core of the debate.
Edwards and Clinton:
Senator Hillary Rodham Clinton of New York and John Edwards, the former North Carolina senator, support a mandate. It is, they say, the only way to guarantee that everyone is covered and to thereby bring down costs by spreading the country’s insurance risk as broadly as possible.
"The sad reality is that the uninsured don’t just struggle with costs themselves, they impose costs on the rest of us," Mrs. Clinton said in September. "It’s a hidden tax: the high cost of emergency room visits that could have been prevented by a much less expensive doctor’s appointment, the cost of unpaid medical bills that lead insurance companies to raise rates on the rest of us."
Mr. Edwards echoed those remarks a week later. "The reason the mandate is necessary is because you cannot have universal health care without it," he said. "Does not exist, and anyone who pretends it is, is not being straight."
-NYT
Now, here's how Barack Obama put it:
Senator Barack Obama of Illinois sees it a different way. He argues there is danger in mandating coverage before it is clear it can be affordable for those at the margins. While Mr. Obama does not rule out a mandate down the road, his emphasis is on reducing costs and providing generous government subsidies to those who need them. He would mandate coverage for children.
That distinction set off a pointed exchange in the Democratic debate in Las Vegas on Nov. 15. "I don’t think that the problem with the American people is that they are not being forced to get health care," Mr. Obama said. "The problem is they can’t afford it."
-NYT
That seems to be pretty clear and makes a great deal of sense, but it's clearly a marked difference from what Clinton and Edwards are saying. Now, David Cutler worked on Senator Clinton's failed 1993-94 Health Care Task Force, he knows the Massachusetts policy of mandated coverage inside and out. Let's let David Cutler make the case for tackling affordability first:
The main difference between Obama's plan and his rivals' is this, they would mandate health coverage first and fix cost problems later. Obama would do the opposite. While both approaches are problematic, there is a strong case to be made that Obama's plan is fairer - and more politically progressive.
While it's true that Obama's plan won't "cover everyone," neither will anyone else's. Mandates have never achieved 100% effectiveness. The practical design problems of subsidies, exemptions, and benefit levels that accompany mandates are complex and unwieldy. That's why the Massachusetts Authority responsible for that state's plan - which Krugman would describe as "covering everyone" - just exempted an estimated 20% of uninsured residents from the mandate.
-Huffington Post
So, let's see, what Cutler is saying, essentially, is that Edwards and Clinton put the political message...solving coverage by mandating insurance...above an approach that will equally effectively get the job done on the ground but doesn't sound as good politically to our base. However, that given, Cutler is arguing that Clinton and Edwards will end up waiving many of the very people that the program is intended to cover. They will also re-fight battles with the GOP and the Chamber of Commerce over "mandates." Cutler cuts through that. That seems to be a theme in the Obama policy approach: work with innovative, pragmatic, fearless and brilliant people who aren't afraid to call it like they see it, who'll work out a plan that can work and be explained simply, so things get done, so that they actually happen.
Let's hear a bit more from Cutler:
Cutler: The mandate argument is, you must buy something - but I'm not going to tell you what it is, how much it will cost, or where you're going to get it. It comes down to this, you'll never get someone to buy something if it's not affordable and not accessible. People just don't do it.
Interviewer: That's an area where the Edwards campaign has taken the lead. They suggest automatic enrollment whenever an American intersects with the health care system or government services.
Cutler:You can enroll them and then forcibly collect the premiums. That's one way to solve the problem. But it's not necessary to do that. A better approach is to do everything possible to make it affordable and available. When it is, almost everyone will have it.
-Sentinel Effect
Either you like the way David Cutler makes his argument or you don't. He's speaking, like Obama, in very clear terms. And what he's saying is, like Obama's technology agenda, innovative and straightforward. Don't take my word for it.
To cover most (but not all) of the roughly 45 million Americans without health insurance, Obama advances ideas that split the bill between individuals, government and business.
His first step would be to require parents to insure their children. Then he proposes to expand eligibility for government programs for the poor and to offer subsidies to help other uninsured individuals buy coverage through a new, nationwide purchasing pool modeled on the insurance available to federal employees. Finally, Obama would require all but the smallest employers to provide insurance for workers or else pay about 6% of their payroll to help government fund the cost of covering those employees. That last proposal marks a crucial turn in the healthcare debate. [snip]
Obama also revived the best policy idea of Sen. John F. Kerry's 2004 campaign: a proposal for Washington to fund most of the bill for high-cost patients once their annual healthcare bills exceed a fixed level. Shifting those catastrophic expenses to government would lower employer premiums. So might Obama's surprisingly sharp-edged proposals to limit insurance company profits.
The best chance for reaching (or even nearing) universal healthcare coverage is a system of shared responsibility that requires government, individuals and business to all contribute.
-Ron Brownstein, LA Times
If that's not enough information for you, here's a link to a chart prepared by the Henry J. Kaiser foundation comparing every aspect of both Clinton's and Obama's plans.
And for those who not into the detailed wonk but want to take a "fact checker" approach, here's an article from the WaPo by Michael Dobbs that assesses the claims of the Clinton and Obama campaigns:
The truth is that neither the Obama plan, nor the Clinton plan, guarantees "universal coverage" for all Americans, although they both aspire to this goal. Let's look at the Clinton plan first.
MIT economics professor Jonathan Gruber, one of Clinton's health care advisers, describes her plan as a "universal coverage" plan, in contrast to the Obama plan, which he terms a "universal access" plan. But he also acknowledges that the Clinton plan will not include everybody. "Any system that does not have a single payer will not have 100 per cent coverage," he told me, when I reached him after the Las Vegas debate. "But you can come very close." [snip]
David Blumenthal, a professor of health policy at Harvard university and an adviser to the Obama campaign concedes that the Obama plan will not cover all the uninsured, at least to begin with. But he claims that Obama will do a better job than Clinton in reducing the cost of health care premiums. He says that Obama might consider a mandate at a later stage, if his present plan does not achieve its goal of universal coverage. [snip]
Neither Clinton nor Obama are being fully candid about the gaps in their health care proposals. Neither plan truly provides for "universal" coverage, although Clinton's proposal probably comes somewhat closer to reaching this goal than Obama's. There are strengths, drawbacks, and loopholes to both plans. At this point, nobody knows how many uninsured they will include, but it will not be 100 per cent. Much will depend on their ability to work with Congress once they are elected. If they were being honest with the voters, they would say that universal health care coverage is an aspiration, not a guarantee.
-Michael Dobbs, WaPo
::
the politics of it
I recently had dinner with a representative of a labor union here in California. We talked about Universal Health Care and Single Payer. To paraphrase, here's what he said to me: "All of us know that health care is probably the single biggest domestic political battle that we face. It impacts all of us. We're in this fight. Almost everybody on "our side" understands that this is a ten year battle made up of many smaller battles but with a resolute goal of universal coverage perhaps moving towards single payer in some states. The thing is, at this point, the politics is as important as the policy."
And that gets to the crux of the matter, as Michael Dobbs points out: The politics of it.
Here's Senator Obama's rhetoric:
The only difference between Senator Clinton’s health care plan and mine is that she thinks the problem for people without health care is that nobody has mandated — forced — them to get health care," Mr. Obama said. "That’s not what I’m seeing around Nevada. What I see are people who would love to have health care. They desperately want it. But the problem is they can’t afford it.
-NYT
Here's Senator Clinton's rhetoric:
Democratic presidential candidate Sen. Hillary Clinton announced a $110 billion health care reform plan Monday that would require all Americans to have health insurance. "Here in America people are dying" because they lack health insurance, Sen. Hillary Clinton said Monday. Clinton unveiled her "American Health Choices Plan," during a high-profile speech at a hospital in the key campaign state of Iowa, surrounded by supporters, American flags and campaign banners.
"Here in America people are dying because they couldn't get the care they needed when they were sick. I'm here today because I believe it is long past time that this nation had an answer. I believe America is ready for change. It's time to provide quality affordable health care for every American," Clinton said. "And I intend to be the president who accomplishes that goal finally for our country."
A Clinton adviser compares the plan's "individual mandate" -- which requires everyone to have health insurance -- to current rules in most states that require all drivers to purchase auto insurance, according to The Associated Press. In her plan, Clinton said families would receive tax credits to help pay for coverage. The tax credit would be designed to limit the premiums to a percentage of a family's income. Federal subsidies would be provided for those who are not able to afford insurance, and large businesses would be expected to provide or help pay for their employees' insurance. Clinton said her plan would not require small businesses to take part, but will offer tax credits to encourage them to do so.
-CNN
Which approach do you prefer? Which rhetoric will prove most effective?
Cutler and Obama are straightforward and put a premium on communicating a policy that makes sense to people. You can express it in one sentence: insurance should be more affordable so that everyone can buy it.
Edwards and Clinton put a value on a principle, universal coverage, and then dive directly into what will prove to be a tough political battle over mandates and their effectiveness and even selling the plan itself: Clinton's "Individual Mandate" and her "American Health Choices Plan" are not strong selling points. Clinton and Edwards also leave themselves vulnerable over whether or not the mandate actually ends up covering everybody. I would read that CNN piece above one more time. It's from the Clinton roll out of her plan; that's a big deal. It represents the best that Senator Clinton has to offer to sell her proposal. Is that rhetoric that you think will be politically successful? Has Senator Clinton, like David Cutler, learned the lesson of 1994?
The American Health Choices Plan?
Hmmmm.
Double-hmmmmm.
::
I've tried to lay this debate out in as straightforward a manner as possible. I deliberately haven't covered all of Senator Obama's proposals on health care, proposals dealing with issues as varied as Mental Health care, Mercury, Autism, Biomedical Research and the previously mentioned Electronic Health Information Technology System, to name just a few. Click on that link to read more.
I've kept things simple and avoided a laundry list of proposals (all our candidates have good laundry lists...we're Democrats) because I wanted to get to the core of the policy debate.
I think there's a key line in the Ron Brownstein piece that shouldn't be overlooked:
Obama would require all but the smallest employers to provide insurance for workers or else pay about 6% of their payroll to help government fund the cost of covering those employees. That last proposal marks a crucial turn in the healthcare debate
That's a tough political battle.
Obama is proposing tackling it head on, without fancy names. Senator Clinton isn't. It's also probably a path that coupled with Obama's coverage of children and his nationwide catastrophic coverage (taking a great idea from Kerry 04) really could lead to true universal coverage someday, which, per my conversation with that union official, is the goal of everyone on "our team."
That expresses something that if you read the supporting material about David Cutler, you'll see is a prized value on the part of Senator Obama's policy team. Innovation. Pragmatism. A willingness to ditch ideological battles to get something done. Fighting a tough fight up front that pays dividends down the road. A willingness to be flexible and upfront and not sugar coat things for anyone on any side.
That's Barack Obama.
And that's David Cutler.
He's concerned about outcomes. He's concerened about how best to pragmatically achieve them. His approach to health care is, of all things, to focus on health:
America's fee-for-service system does not require doctors to measure. It rewards them for each instance of delivered "care," Cutler notes, but not necessarily for the end result -- for "health." This is especially true for chronic patients, whose well-being depends on following a long-term regimen of care. Diabetics, for instance, should receive yearly eye exams, regularly monitor blood sugar and cholesterol and take other steps to avoid problematic (and expensive) complications. ''Doctors say, 'You really should get your eyes examined,''' Cutler notes. ''There is no follow-up. Every doctor you talk to says: 'I know we don't do a good job on that. We don't get paid for it.' My way, we would pay them.''
-NYT
::
This debate comes down, in part, to how you view the kind of politics Democrats should follow. I like what Senator Obama is doing. I've been on blogger conference calls with candidates and heard them say things like, "We all want this, but it's never going to happen."
That's not what Obama is saying. He's saying a health care plan should put a premium on making people healthy. It should have maximum buy in from the public. To do that, you have to explain it in terms they can understand. You have to give them something that they want, and show them you can do it.
None of the candidates fully achieve universal coverage. None of them are for single payer. (Which many here, including myself, support.) Given that, however, most of us have the same goals, we're on the same team here. What it comes down to is which concept do you think will be most effective politically with the American public?:
Affordable Insurance
or
Individual Mandates?
::
"The sad reality is that the uninsured don’t just struggle with costs themselves, they impose costs on the rest of us"
or
"I don’t think that the problem with the American people is that they are not being forced to get health care, the problem is they can’t afford it"
::
"Here in America people are dying because they couldn't get the care they needed when they were sick."
or
"What I see are people who would love to have health care. They desperately want it. But the problem is they can’t afford it."
::
I think the choice is pretty clear, what do you think?