Fall 2009

Blowing It

Obama, the Democrats, and Health Care

Pham Binh

Obama and the Democrats are about to blow it big time on health care.

Instead of adopting a single-payer plan, which would both cover everyone and be the most cost-effective solution, they're going to pass an outrageous insurance-and-drug-industry-friendly bill. Then, they'll brag about how they passed "landmark legislation."

At least until the bills come due and the government goes bankrupt.

Despite the armed racist mobs turning their brains off and running their mouths at town halls (Trotsky called them "human dust" in his day), Congress will pass and President Obama will sign into law something mislabeled health care reform. The devil, as always, is in the details.

First and foremost, a robust public option is pretty much off the table, and with it, anything meaningful, substantive, or worthy of the name "reform." A public option would be a government-run single-payer health insurance program similar to Medicare. You know, that big scary socialist-fascist-communist-anti-American-beginning-of-the-Gulag government program that has sent tens of thousands of patriots to their graves thanks to Soviet death panels? Yeah, that Medicare.

Despite their trash talk, Republicans in Congress refused to kill Medicare in a recent vote. Not a single Republican would vote against this diabolical Marxist scheme. We ought to deport these single-payer-loving commies back to Cuba where they belong, but only after some "enhanced interrogation" at Gitmo, of course. We can start with Michelle Bachmann. At least then she'll have something real to fear for a change.

President Obama said "those who profit from the status quo" are behind the efforts to sabotage the legislation. The funny thing is, he gave them a seat at the health care reform table in an effort to buy their acquiescence. Instead of going to war with the institutions that have a vested interest in sabotaging his agenda, the president allowed them to shape the legislation. This is Dick Cheney's Energy Task Force all over again, except its out in the open. When people voted for change, they weren't voting for lobbyists to use the front door of the White House instead of the back door.

At a "historic" summit, Obama announced that hospitals, drug and insurance industries, and doctors' associations agreed to $2 trillion savings over the next 10 years. But as the New York Times noted, "None of the proposals are enforceable, and none of the savings are guaranteed. ... At this point, cost control is little more than a shared aspiration."
Obama surrendered any hope of meaningful health care reform in exchange for - nothing. Absolutely nothing. The drug companies, for example, agreed to voluntarily cut costs by $80 billion over the next 10 years. In exchange, the legislation won't legalize the re-importation of cheaper drugs from abroad, and there won't be government negotiation of drug prices for Medicare beneficiaries. (For anyone who's counting, that's another campaign promise Obama reneged on and another Bush policy he's adopted.)

Never mind the fact that these agreements don't have the force of law behind them. Never mind that they are so vague as to be totally meaningless. Never mind the lack of an enforcement mechanism in case these industries don't live up to their obligations. While we're at it, never mind health care reform.

The reason the Right is screaming against a single-payer or public option is very simple: it works. Cheap, universal, quality health care coverage is what the drug companies, insurance crooks, doctors' organizations, and the rest of the health care industrial complex are so deathly afraid of. They stand to lose hundreds of billions of dollars and could be driven out of business if the profit motive is removed from the health care equation.

We get the least bang for the buck because our system is set up to get the private sector the most buck for the bang. In McAllen, Texas, where medical costs are among the highest in the nation, an investigative journalist found that doctors did all kinds of medically unnecessary procedures to increase their income. One doctor claimed that ordering superfluous tests was a necessary evil to avoid lawsuits, to which a general surgeon replied, "We all know these arguments are bullshit. There is overutilization here, pure and simple. ... [T]he way to practice medicine has changed completely. Before, it was about how to do a good job. Now it is about ‘How much will you benefit?'”

The fee-for-service system, where doctors get paid every time they run a test, see a patient, do a procedure, etc., is one of the reasons health care is so costly. The Mayo Clinic, which Obama touts as a model for the nation, keeps costs low and has excellent outcomes because their doctors are essentially proles. They work under one year contracts for a salary instead of deriving their incomes from individual services performed.

None of the legislation in Congress would touch the fee-for-service system.

David Roderick, the chairmen of U.S. Steel, once commented: "US Steel is not in the business of making steel. It is in the business of making money." Ditto for doctors' associations, insurance companies, hospitals, and pharmaceutical giants. They're not in the business of helping sick people, they're in the business of making money. The health care system can either prioritize making money, or it can prioritize delivering the best possible health care for the population. It can't do both.

Private sector profits are at the heart of why the U.S. health care system is number one in the world when it comes to costs but is 72nd in terms of the health of its population.

Plans that fail to address this issue are doomed. The Congressional Budget Office (CBO) says that none of the plans under consideration by Congress would halt or reverse health care inflation. (By contrast, the CBO says single-payer would save $1 trillion(!) over the course of a decade, yet no fiscal conservatives are screaming for single-payer at the town halls.)

Obama's version of the public option is not even worthy of the name. He says, "it shouldn't be something that's simply a taxpayer-subsidized system that [isn't] accountable, but rather [has] to be self-sustaining through premiums and that [has] to compete with private insurers." For those who don't spend their lives inside the Beltway, here's the translation: I don't want to drive the insurance industry out of business with an effective public option that would provide cheap quality health care for everyone. So, I want the government plan to emulate what the private sector does, even though those practices are what's creating the rapid inflation and terrible outcomes for patients in the first place.

Setting up a public option this way guarantees it'll be a miserable failure. Not only would it lead to political blowback that could dislodge the Democrats from power (not that I care), it would discredit the very idea of a public option (which I do care about). On top of that, it'd make the health care system even more dysfunctional, chaotic, and costly than it already is. It'd do for the Democratic Party what the Bush's Iraq war did for the Republicans.

Sadly, it looks like we won't even get the half-assed version of the public option described above, mainly because the insurance industry spent $11 million since 2007 getting Democrats elected to Congress. The Democrats are prepared to bear the political consequences of a deeply flawed version of the public option without even delivering it. In all likelihood, cooperatives will take the place of a public option, thanks to Senate Finance Committee, which the White House directed industry lobbyists to work with.

That's right: President Obama directed industry lobbyists to focus their efforts on the Senate Finance Committee. Your president has betrayed you.

After the legislation passes, health care decisions will continue to be made exclusively by penny-pinching insurance company bureaucrats. Medical bills will continue to be the number one reason people declare bankruptcy. Denying people coverage because of preexisting conditions will be outlawed, which is well and good. But lawyers and accountants for the insurance companies have probably figured out a way around the ban: charge people with preexisting conditions ten, a hundred, or a thousand times more than the average policyholder. Those who are too poor or sick to buy private insurance will be forced into the co-op system, which will be quickly overloaded and become insolvent. The government will then be forced to either subsidize co-ops with taxpayer dollars, kick people off the rolls, charge them higher rates, or some combination of all three.

The bottom line is that whatever passes promises to be a costly, ineffective failure.

The health care industrial complex is in a win-win situation. If reform fails to pass because right-wing Democrats join the miserable Republican rump, they win. If reform without a real public option, they win. An aide to the Senate Finance Committee admitted, "The bottom line is that health reform would lead to increased revenues and profits." The law that passes will make buying health insurance coverage mandatory for all Americans. That will boost the industry's profits as almost 50 million Americas are forced into the insurance marketplace, aided by small tax credits.

Obama said, "I would rather do the right thing and have one term than be mediocre and have two." At this rate, he won't be forced to choose. American history has plenty of one-term mediocrities who broke campaign promises at the behest of Corporate America.