Is There Hope for Health Care?

What a difference a year makes. Just 12 short months ago, health care was nowhere on the political agenda, and pundits were confidently stating that, after the failure of the Clinton health plan a dozen years prior, Americans continued to be wary of serious action. Affordable, quality health care for all Americans was a pipe dream.

Fast forward to Saturday morning, when leading presidential hopefuls gathered in Nevada for the "New Leadership on Health Care" forum, jointly sponsored by Center for American Progress and the Service Employees International Union. The event didn't create the kind of political fireworks that journalists crave. No Republican candidates showed up, unfortunately, and the Democrats who came -- in the order they spoke, John Edwards, Bill Richardson, Barack Obama, Hillary Clinton, Chris Dodd, Dennis Kucinich and Mike Gravel -- were all civil and, to varying degrees, substantive. But the event did showcase something far more important than inter-campaign squabbles: Health care is the number one domestic policy issue going into the 2008 presidential race.

Why now? Surely, American health financing is a mess. The United States spends far more than any other nation on health care, yet leaves nearly 50 million of its residents uninsured. Even insured Americans are pervasively insecure. Medical costs and health premiums are skyrocketing while employers are cutting back on coverage, and medical debt is a mounting even among the middle class. Perhaps half of all personal bankruptcies in the United States are due, at least in part, to medical costs and crises.

But while these problems are substantially worse than they were when Bill and Hillary Clinton, as president and first lady, pledged to provide health security to all Americans, they are not qualitatively different. What's really changed is perceptions of the politically possible. The 2006 midterm featured a highly successful drive by winning Democrats to highlight the insecurities created by the new economy, especially on health care. Yet it's three deeper changes in the debate that best explain why bold reform plans, rather than piecemeal fixes, were talked about on the campaign trail in 2006 and are now atop the agenda.

Acknowledging Failures, Changing Positions

The first is the clear failure of the incremental policy strategy of the past fifteen years. Yes, expansions of Medicaid and the creation of state children's program have done enormous good. But they have not stanched the rise in the number of uninsured and underinsured, because employers have raced away from providing insurance even faster than government has signed up new enrollees. And these fixes have done little or nothing to deal with the underlying cost explosion that is the root cause of health insecurity. All the leading Democratic presidential candidates made clear on Saturday that "stay the course" is no longer a viable strategy on the health policy battlefield.

The second change concerns the positions of business and labor. We hear a lot about the business conversion -- earlier this year, Wal-Mart's CEO famously appeared alongside service workers head Andy Stern (a cosponsor of Saturday's event) to declare that real reform is desperately needed. Though many corporate leaders were favorable toward action in the early 1990s -- at least until the Clinton plan came out and Republicans and key industry interests went on the warpath -- even more today seem to recognize that absent action, they will increasingly be caught between the rock of rising costs and the hard place of hurting their workers by dropping coverage or providing bare-bones plans.

The shift in organized labor's stance isn't as obvious or discussed, but it shouldn't be overlooked. Leading unions were deeply split in the early 1990s over the right course on health care, and a substantial number still clung to the notion that the generous employer-provided benefits they negotiated after World War II could be sustained against the tide of economic transformation and business resistance. Today, there's a bold new pragmatism evident in the labor movement, born of greater realism about the health of voluntary employment-based benefits. Labor leaders know their movement's future rests on getting health care right, and that clearly means moving beyond the current system.

Which bring us to the third change: an emphasis on simple, jargon-free policy solutions that really work. There's still too much of the policy wonk in some of the leading Democrats' discussions of health care. But at the same time, there's a refreshing return to first principles. Much ink has already been spilled noting, correctly, that former senator John Edwards had the most detailed and thought-out plan of the leading Democrats who came to Las Vegas. (In the interests of full disclosure, I should say Edwards plan bears more than a family resemblance to the Health Care for America proposal that I have developed as part of the Economic Policy Institute's Agenda for Shared Prosperity.) But Sens. Hillary Clinton and Barack Obama, despite not arriving with detailed blueprints, were both refreshingly straightforward in their discussion of the big issues at stake -- and, beneath differences of emphasis, the ideas for reform they offered were remarkably similar.

Five Key Questions

What are these common elements? In a piece written before the debate, Campaign for America's Future co-director Roger Hickey laid out five key questions that all candidates should be required to answer:

1. Will the candidate's plan really cover everyone -- with a decent guaranteed level of coverage -- at an affordable cost?

2. Does the candidate offer a public plan, like Medicare, that has a predictable, guaranteed level of benefits that "cannot be taken away?"

3. Has the candidate thought through how his or her plan will be financed?

4. Will the candidate's health plan control spiraling health care costs?

5. Is the candidate's health plan simple and clear enough that they can explain it -- and get us to describe it to someone else?

Of the leading candidates, only Edwards answered all five questions. He promised to cover everyone who works by requiring that employers either provide good insurance to their workers or pay into a new publicly overseen insurance pool. Americans without direct or family ties to the workforce -- no more than a tenth of the population -- would be signed up through public assistance programs and other outreach efforts, and all Americans would be required to have coverage. Cost control would come through the administrative savings of insurance pooling, competition among insurers, and, most promising of all, the creation of a Medicare-like public plan option with free choice of medical providers that would be available through the new insurance pools. As all this suggests, the Edwards plan is still a bit complex, but it's much simpler than the norm, and Edwards has gotten better and better at talking about it.

The other candidate with a clear plan isn't a frontrunner, by any stretch of the imagination. But Dennis Kucinich, the Ohio representative who has been an outspoken advocate for a universal national health plan, proved to be a forceful spokesperson for an idea that has been unfairly dismissed as a government takeover of American health care. (The fairer critique is that it would be a government takeover of American health insurance, a politically unlikely prospect, for both fiscal and political reasons. But government would no more be involved in providing or dictating the terms of care than it is in the operation of Medicare, and it would almost certainly be a lot less heavy-handed as an insurer than are most private plans.)

Where Kucinich racked up the most points was in emphasizing the inherent superiority of public insurance in pooling risks and bargaining for lower costs. He even scored some points against Edwards by noting that Edwards's call for competition between public and private insurance wouldn't work because, as with the private health plans that provide insurance to Medicare beneficiaries today, the game would be rigged in favor of private insurers.

Edwards's and Kucinich's plans were known quantities, so what was perhaps most notable about the event was how strongly both Clinton and Obama criticized the present system and called for major change. Reading between the lines of Clinton's impassioned oratory and Obama's more apologetic presentation of the principles that would guide his still hazy reform effort, it's possible to discern a common vision shared by all three of the top Democratic hopefuls. It is this: a system that is loosely based on the best elements of what we have now, but which decisively moves us away from a reliance on voluntary employer-sponsored insurance and toward a framework in which risk is pooled broadly across the non-elderly population.

This means a new (hopefully, national) insurance pool that provides a choice of public and private plans, and a requirement that employers either provide coverage or pay to enroll their workers into this pool. It also means a system with enough flexibility to evolve away from heavy employer involvement in administration and financing -- not only to ensure health security for all, but also to allow employers to focus on their prime mission: to innovate, produce, and prosper.

This is an attractive vision -- far, far better than the complicated blueprints of the recent Democratic past; much more attractive than plans that simply require that everyone have coverage, however substandard that insurance might be; highly consistent with public opinion; and politically and fiscally feasible (or at least much less infeasible than other options). But even in Edwards's admirably forthright plan -- which rightly says that taxes will have to be raised to create the new system, even if the economy as a whole will save big money -- this emerging vision still remains too fuzzy on two key issues. First, will the cost-control advantages of public purchasing be used to the fullest extent possible? Second, and related, will a good Medicare-like plan be offered on terms that are attractive to Americans and allow fair competition between public and private insurance?

A Movement Is Needed

The one point on which all the candidates seemed to agree is that health care reform requires a movement to press opponents toward political compromise. That movement is forming, and the political leadership on display in Nevada is essential to keeping health care on the agenda and pressing for comprehensive action. Movements demand transformative change; they don't necessarily push for 10-point policy blueprints. And so it was refreshing and inspiring to see all the candidates who came to Nevada agreeing that transformative change is the order of the day.

But when the time comes for the details to be hashed out and compromises to be made, we should remember why American health financing is in its current mess. It's not because Americans are medical moochers -- we visit the doctor and hospital less often than do people in other rich nations, despite having poorer overall health on many measures. It's not because we burden employers with regulations -- the United States is the only rich country where there isn't a basic requirement of coverage. And it's not because our insurance is overly generous -- ask the millions of uninsured and underinsured whether they feel coddled.

The problem is that health security in the United States is hostage to the choices of insurers and employers, rather than to the choices of the American people. If and when that finally changes, affordable, quality health care for all Americans will no longer be a pipe dream. It will be the American dream.

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