The long road to healthcare reform

A new column for the FT on Tom Daschle's chances of reforming the health system:

He is a good choice. He combines years of experience in Washington with longstanding expertise in health policy. He watched at close hand as the last big effort to reform US healthcare - the project led by Hillary Clinton in 1993 - came to nothing. He thinks he knows why that project failed and how to do better next time. And he has just published a book on the subject: Critical: What We can Do About the Healthcare Crisis.

Reforming US healthcare is a heroic undertaking, crucial to long-term economic prospects. Now, on top of all the difficulties that sank the Clinton plan, healthcare reform must bid for financial and political resources against the vast outlays that the recession will pre-empt. What are Mr Daschle's chances?

Consider first the errors of Hillarycare. A lot went wrong, says Mr Daschle, but the overall design was not the mistake. The plan was one of many similar schemes to build on (rather than replace) the current mostly private, employer-based system. The plan sketched by Mr Obama during the campaign has much in common with it - so does Mr Daschle's variant; the system already operating in Massachusetts is similar. In each case, the idea is to use subsidies and mandates to fill gaps in coverage, while adding a layer of control to press down on costs.

What killed Hillarycare, Mr Daschle argues, was the process. Behind closed doors, her team devised a 1,342-page law that nailed down every last detail of the new system. Little effort was made to get sceptics invested. The administration then gave its critics an almost infinite number of technical issues around which to organise resistance. Mr Daschle's book suggests a different approach...

Comments

Roger Tompkins December 15, 2008 6:24 PM

Why not call this "Reducing the healthcare tax" instead. When 16% of GDP goes to healthcare and medical insurance companies can raise rates to cover their losses in the dirivitives market the resulting drag on our economy becomes unacceptable. The fact that so much of the tax is collected for profit rather than spent for services makes even more obscene.

Asp December 15, 2008 10:31 PM

The notion that Americans are gorging on unneeded healthcare, and that making them pay more fee-for-service is the way to drive down costs, depends on the Republican shibboleth of moral hazard, which in the healthcare realm negates the very idea of insurance. See John Nyman's debunking of the RAND study on which the concept of moral hazard in health insurance is largely based - abstract with link to full paper at http://findarticles.com/p/articles/mi_hb5661/is_/ai_n23695477

zic December 16, 2008 11:01 AM

Anything that's this complicated is going to be used to benefit someone at someone else's expense.

I'm looking for flop two; and calling for taking the profit out of it, (at least at the insurance risk end) and going for a single payer system. It's too big a burden to continue placing on business, it continues to make our business uncompetitive. (I've watched Maine wood processors sink over and over because they couldn't compete against Canadian companies due to health care.)

If business has to pay Anthem's profits, salaries, CEO bonus, etc., on top of administration costs, that's just added weight. We need to delete these costs from the system. It's time to recognize that health care isn't a responsibility, as McCain claimed, but a right.

Currently, because it's a responsibility, people who have access to health care DON'T have to be responsible. I spoke with my mother-in-law yesterday about elderly neighbors who don't follow doctors orders for cardiac care, and burden the system with their repeated surgeries etc., while my 20+ children go without because they can't afford it. What's wrong with this picture? My kids take very good care of themselves, because they can't afford to get sick.

Bail out the auto industry, and shut down the for-profit health insurance industry.