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Globe Editorial

Next stop, health reform

March 15, 2009
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PRESIDENT OBAMA gets high marks for courage and vision in pushing for health reform during the worst economic downturn since the Depression. The challenge will be to get Congress to approve thoroughgoing revisions to the system in the face of special interests that will decry them as threats to both jobs and profits. Change you can believe in is easy; health reform you can believe in will be a tall order.

Still, in less than two months of his presidency, Obama has already changed the health landscape in significant ways. He signed the expansion of the State Children's Health Insurance Program, which will add 4 million youngsters to the 7 million it now covers. His stimulus package includes $20 billion for electronic medical records and $1.1 billion for research comparing the effectiveness of different treatments. Both tools are crucial for sweating waste out of the system.

Most significantly, his 10-year budget includes $634 billion in new revenues and savings as a down payment on the cost of covering the 47 million Americans - and rising - who are now uninsured.

This is all sound groundwork. For the next stage of real changes in the system, Obama has drawn a lesson from the behind-closed-doors Clinton health reform debacle of the 1990s: Congress, the drug industry, medical device makers, insurers, doctors, and hospitals must be involved in basic decision-making. This is wise, but only if Obama and congressional leaders make clear that none of these interests gets a veto over the broad outline for reform that Obama laid down as a candidate.

Lessons from the Clinton years
This will doubtless be a sticking point with insurers, who dread having to compete with Obama's proposed new, Medicare-like public insurer for consumers younger than 65. Candidate Obama's health plan was less fully developed than John Edwards's or Hillary Clinton's. But by backing a public alternative, Obama showed he understood the necessity of an affordable option for those who cannot get work-based insurance, either because their employer does not offer it or because they aren't working.

The need for such a public provider - and yardstick - is vividly evident in Time magazine's March 5 cover story. Reporter Karen Tumulty recounts in heartrending detail her time-consuming effort to get an insurer in Texas to pay for treatments for her brother, who suffers from kidney disease.

Health reform in the United States has stalled in the past not just because of missteps by elected officials like Bill Clinton but also because most of the 250 million who have insurance are more or less satisfied with their coverage - and are worried about how change in Washington might limit their options or raise their costs. Tumulty points out that many of the 250 million insured are actually underinsured, just one serious disease or injury away from financial ruin. She cites the 2005 finding of Harvard's Elizabeth Warren: that half of all bankrupties in the United States are caused by medical bills and, in 75 percent of those cases, the people filing for bankruptcy actually had health insurance.

The Massachusetts example
The Clinton experience from 1993 to 1994 offers "how not to" tips on healthcare reform. Massachusetts, whose 2006 reform plan now covers almost 98 percent of residents, can provide some "how to" tips. One is that Congress should assemble strong majorities in both houses for its health bill. The Massachusetts plan won the support of a Republican governor, a Democratic Legislature, advocates for the poor and underserved, and representatives of business, hospitals, the insurance industry, and healthcare professionals. This consensus has helped the program weather a need for increased funding from all sides last year.

The chairman of the Senate Finance Committee, Max Baucus, told the Globe recently that he hopes his committee's health bill will win the support of 75 of the 100 senators. This would provide it far more than the 60 votes needed to stop a filibuster by opponents. But there have been reports out of Washington that reform advocates might try to push through a bill as part of a budget reconciliation measure, which cannot be filibustered and thus could pass with as few as 51 votes. This could be a mistake.

In Massachusetts, reform won such broad support in part because the bill focused solely on expanding access to the uninsured and did not attempt to control health cost inflation at the same time. This could work in a relatively rich state, in which healthcare and medical research are seen as economic mainstays. But evading the difficult choices that cost-cutting requires is not an option for Congress.

The escalating cost of care is at least as pressing a problem as the scandal of the uninsured. The nation's healthcare system consumes one-sixth of the Gross Domestic Product, but the World Health Organization in 2000 ranked it just 37th in the world for quality. France, which spends 51 percent per capita what the United States does, was first.

Obama has got it right. Fixing healthcare cannot wait until the economy is back on its feet because its waste, inefficiencies, and special-interest coziness are a drag on economic growth. Skyrocketing health costs for workers and retirees are a key cause for Detroit's collapse. Indeed, all US firms seeking to compete internationally carry the albatross of bloated health costs.

Ratcheting back the nation's medical bills while also extending coverage in a way that commands a solid congressional majority is a daunting task. But the price of inaction is steep: constantly spiraling cost increases for a healthcare system that does not even cover all Americans.

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