Health Reform

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I don't think this was the most accurate or informative video I've ever seen on health reform, but it did feature a good quote from Jonathan Oberlander, a professor from my master's degree at UNC. I was his research assistant for a year and provided support for a couple papers published in Health Affairs on which he was kind enough to acknowledge me, including "The Politics Of Paying For Health Reform: Zombies, Payroll Taxes, And The Holy Grail," and "Beyond Incrementalism? SCHIP And The Politics Of Health Reform."



So how likely do I think significant health reform is to pass this year? This was a topic of conversation at the PhD recruiting day I attended at Berkeley, and I seemed to be the most optimistic at the table. Everyone else put it between 10-30%, though I said somewhere closer to 50%. That was in March, what do I think now? Believe it or not, I still think the chances are pretty good. The big question is how you define “significant.” My opinion is that the best reform will include a requirement that everyone purchase health insurance (similar to requirements that everyone with a car purchase car insurance) and the creation of a new public plan which will be allowed to compete with the current private plans. The health insurance industry obviously likes the first idea but hates the second. I agree with Nobel Prize winner Paul Krugman’s recent column that insurance companies have understandable concerns about a public option, but I think that Americans should have more options, not fewer. If a public plan is able to deliver better care at a better price, private companies will have to become more competitive. As Krugman describes, companies that are already innovative should do just fine while it will be the inefficient companies that don’t survive. It might be that these companies will ultimately outperform the public option and be a more attractive option anyway. I’m perfectly happy to let the market sort this out, though I think it makes sense to let the government become a player.

The politics of the current reform debate are fascinating. The House this week came out with a bill crafted by the Chairman of three powerful committees (including Charles Rangel, who I interned with a couple years ago), which contains an individual mandate, a public plan option, a new agency to regulate insurance, closes the Medicare Part D donut hole, expands Medicaid, and increases Medicare reimbursment rates. Sen. Max Baucus (D-MT) is essentially taking the lead on the Senate side to forge some type of compromise with Senate Republicans. I think this is a worthwhile endeavor that could strengthen the final product, but I share the concern of many that seeking compromise will ultimately weaken the reform so that it doesn't please either the left or the right. The pieces of the puzzle are in place so that Senate Democrats can get this through without worrying about a filibuster, but hopefully they won't have to use this budget reconciliation option.

My Prediction: The House passes the more aggressive reform including a public option while the Senate passes a compromise package that includes insurance cooperatives instead. What happens as the two bills are hashed out in conference is anyone's guess. Given the results of a recent poll in which 72% of Americans (including 50% of Republicans) favor a public option, and that 57% would be willing to pay higher taxes to provide coverage for all Americans, it seems reasonable to guess that the House version might win. Of course I'm getting way ahead of myself. Any health reform bill getting out of committee would be a historic accomplishment in its own right.