The New Health Dialogue

Credit: Steve Rhodes

Elections, especially off-year elections, are mainly referenda on the economy. This one was no exception, and the recent health reform legislation was viewed as part of the problem, a source of unnecessary federal spending. Ads opposing the Affordable Care Act, many fueled by new and unregulated campaign spending, topped those favoring it by a 5-1 margin. Having voted in favor of the legislation also hurt many Democrats among voters who feel the legislation did not go far enough. Among Republican voters, according to Gallup, repealing the Affordable Care Act is the number one priority.  

So does this mean that the legislation is fated to be “ripped up, root and branch,” as Indiana Congressman Mike Pence predicted on election night?

Probably not. The reasons go well beyond President Obama’s veto pen and the simple political reality that benefits, even those slated to roll out over time, are rarely withdrawn.

The main reason is that the legislation, despite being passed without bipartisan support, represents a genuinely bipartisan approach that tackles two major and intensifying social and economic problems: inadequate health insurance coverage and out-of-control health care costs.

Its individual mandate and the fees on employers actually resemble Republican alternatives to the Clinton Health Plan of the 1990s. The expansion of Medicaid, while large, continues the decades-long direction of moving this program away from its welfare roots towards a safety net for all low-income Americans.

Meanwhile, the insurance exchanges, where individuals and small businesses will be able to purchase coverage, take their cue from the Massachusetts universal coverage plan, which was championed by then-Republican governor Mitt Romney and implemented in 2006.      

Ensuring that the bill not add to the 10-year deficit, as scored by the Congressional Budget Office, was pivotal to its passage. Both the drawn-out passage of the bill and the slow phasing-in of benefits, two developments that have hurt the current popularity of reform, reflected this desire for fiscal responsibility.

Yet health reform was successfully painted by conservatives as the emblem of a big-spending, liberal administration.

In the end, both conservatives and liberals will be forced to recognize that repealing the legislation will serve no one. Republican preferences—such as capping malpractice damages and tackling fraud and waste—are likely to yield at best only pennies on the dollar in savings. Nothing that the GOP has proposed to date would make more than a very modest dent in the numbers of uninsured.   

The left would prefer single-payer financing, caps on what government can spend on health, and stepped-up rate regulations for insurers. Polls in fact showed that dislike of the ACA is quite evenly split between those who think the legislation overreaches and those, mostly advocates of single-payer financing, who think that it is too modest. But a single-payer approach is a non-starter with the health industry, problematic in view of decades of U.S. health care practice, and wholly unacceptable to those who think the current legislation already goes too far. 

With feasible alternatives scarce, the sound and fury over health care will continue, but it is a good bet that on balance the legislation will endure.

With one possible and unfortunate exception. Some will seek to trim funding for implementation of reform by Medicare and Medicaid, and the bill’s many demonstrations and pilot programs. This risks being penny-wise and pound-foolish. Rising health costs dwarf any other contributors to long-run deficits. These costs largely stem from the US reliance on a fee-for-service payment system that has fostered a disorganized, dysfunctional, and wildly expensive system for delivering medical care. Estimates for the amount of money spent on unnecessary care range from 20 to 30 percent. Many of the law’s fledgling programs are aimed at finding ways to encourage greater organization, improve the quality of care, and thus rein in unnecessary spending.

Should these programs be nipped in the bud, it will be especially ironic for California, whose health systems have by and large been pioneers in implementing similar payment and medical delivery systems and are poised to lead the nation in this mission.