Leading Dems Miss the Boat on Health Care

As we face the 2008 presidential campaigns, the stakes have never been higher for health care reform. Health care is pricing itself beyond the reach of lower-income and middle-class Americans with no cost containment yet on the horizon. Seniors with Medicare are paying much more out-of-pocket for their medical care now than when Medicare was enacted in 1965.

We already have a perfect storm as the U.S. health care "system" falls apart, and many public polls put access to affordable health care at the top of our domestic agenda.

Although we spend far more than any other country in the world on health care, we have little to show for it except high prices, decreasing access, variable quality, underuse of essential care by vulnerable populations, and a significant amount of unnecessary and inappropriate care for those who can pay for it. Our enormous private health insurance industry of 1,300 insurers competes to cover healthier and lower-risk enrollees with more limited policies each year, while denying coverage of sicker individuals or raising premiums to unaffordable levels. That shifts the burden of the more costly care of sicker people to the public sector, defeating the whole principle of insurance: to spread risk broadly. Meanwhile, as the private insurance industry no longer finds growth in the employer-sponsored and individual markets, it has been shifting its sights to privatized public programs, including Medicare and Medicaid. Here it has found generous subsidies and little oversight from friendly conservatives in government.

Now would be the ideal time for leading Democrats to advance a progressive agenda for health care, such as Teddy Roosevelt did as a Progressive, with his call for national health insurance in 1912. The Republicans have been weakened by scandals, cronyism and incompetence, and have no new or credible ideas for health care reform. They still offer up only warmed-over ideas such as tax credits, health savings accounts, and how the competitive market can fix our problems, while limiting government's responsibility for care of the poor -- blatant social Darwinism. As William Greider recently observed in the Nation, "Democrats have a splendid opening to be substantive and political and righteous for working folks,all at once."

But so far, with only one exception, the Democratic presidential candidates have been disappointing, if not derelict, in reforming the system. In their misguided efforts to avoid too much controversy and to build a "centrist consensus," they are completely missing the target even before starting. Although Democrats in Congress united behind reauthorization of an expanded State Children's Health Insurance Program (SCHIP), that effort has diverted them from the real challenge -- how to reform the system to make accessible and comprehensive health care affordable for all Americans. That would require taking on powerful stakeholders, especially the insurance and drug industries, in the medical-industrial complex, now one-sixth of our economy. All but one of the Democratic presidential contenders shy away from that battle, usually with the limp excuse that real reform is not politically feasible.

What Are the Leading Democrats Proposing?

In their rush to build consensus for universal coverage, all three leading Democratic presidential candidates avoid taking on the real culprit -- a failing private health insurance industry. There is abundant evidence of the industry's failures, such as premiums increasing by three and four times the rates of cost-of- living and median family income. Projections show that, at this rate, premiums alone will consume all of household incomes by 2025. Administrative overhead will become five to nine times higher than Original Medicare."Denial management" is a vigorous growth area within the industry, while proliferation of near worthless limited benefit policies under the guise of insurance (e.g. deductibles up to $5,000 or annual caps as low as $1,000), and successful avoidance of regulation by state and federal regulators for many years is standard. Even as employer-sponsored insurance declines, the insurance bureaucracy keeps expanding as it seeks to exclude higher risk enrollees and keep its "medical loss ratio" attractive to investors (the industry's often-stated goal is to keep at least 20 percent of premium revenue for overhead and profits).