Posted by Michael Kennedy on October 28th, 2013 (All posts by Michael Kennedy)
The latest meme I’ve noticed on the Obamacare implosion is that the Republicans are to blame. After all, it’s Romneycare, or it’s the idea of the Heritage Foundation.
In fact, the mandate was promoted by Hillary in 2008 and opposed by Obama. Of course, he doesn’t know much about what is going on so we can understand. In fact, the entire website fiasco, slipped by him, unnoticed.
President Barack Obama didn’t know of problems with the Affordable Care Act’s website — despite insurance companies’ complaints and the site’s crashing during a test run — until after its now well-documented abysmal launch, the nation’s health chief told CNN on Tuesday.
David Remnick, editor of The New Yorker, quotes White House senior adviser and longtime Obama friend Valerie Jarrett: “I think Barack knew that he had God-given talents that were extraordinary. He knows exactly how smart he is. … He knows how perceptive he is. He knows what a good reader of people he is. And he knows that he has the ability — the extraordinary, uncanny ability — to take a thousand different perspectives, digest them and make sense out of them, and I think that he has never really been challenged intellectually. … So what I sensed in him was not just a restless spirit but somebody with such extraordinary talents that had to be really taxed in order for him to be happy. … He’s been bored to death his whole life. He’s just too talented to do what ordinary people do.”
Oh well, at least we know if we really get in trouble, we have someone who can bail us out. I don’t doubt the comment about him never being challenged intellectually.
Besides, this is all Republicans’ fault.
“Facing such intense opposition from congressional Republicans,” Politico wrote, “the administration was in a bunker mentality as it built the enrollment system, one former administration official said. Officials feared that if they called on outsiders to help with the technical details of how to run a commerce website, those companies could be subpoenaed by Hill Republicans, the former aide said. So the task fell to trusted campaign tech experts.” OMG ! Subpoenaed.
What about the meme about the Mandate being a GOP idea? Is there any truth to that ?
Nevertheless, the myth persists. ObamaCare “adopts the ‘individual mandate’ concept from the conservative Heritage Foundation,” Jonathan Alter wrote recently in The Washington Post. MSNBC’s Chris Matthews makes the same claim, asserting that Republican support of a mandate “has its roots in a proposal by the conservative Heritage Foundation.” Former House speaker Nancy Pelosi and others have made similar claims.
What is the truth ?
The confusion arises from the fact that 20 years ago, I held the view that as a technical matter, some form of requirement to purchase insurance was needed in a near-universal insurance market to avoid massive instability through “adverse selection” (insurers avoiding bad risks and healthy people declining coverage). At that time, President Clinton was proposing a universal health care plan, and Heritage and I devised a viable alternative.
It was just a tiny bit different from what we know today as “The Mandate.”
But the version of the health insurance mandate Heritage and I supported in the 1990s had three critical features. First, it was not primarily intended to push people to obtain protection for their own good, but to protect others. Like auto damage liability insurance required in most states, our requirement focused on “catastrophic” costs — so hospitals and taxpayers would not have to foot the bill for the expensive illness or accident of someone who did not buy insurance.
Second, we sought to induce people to buy coverage primarily through the carrot of a generous health credit or voucher, financed in part by a fundamental reform of the tax treatment of health coverage, rather than by a stick.
And third, in the legislation we helped craft that ultimately became a preferred alternative to ClintonCare, the “mandate” was actually the loss of certain tax breaks for those not choosing to buy coverage, not a legal requirement.
Many years ago, I was on the California Medical Association’s Commission on Legislation. At the time, the CMA and particularly the Neurosurgeons, were pushing for a helmet law for motorcycle riders. There was an epidemic of head injuries in uninsured motorcycle riders. Hospitals, especially smaller rural hospitals, and neurosurgeons were spending huge amounts of time and resources caring for these devastating injuries. The helmet law passed and the incidence of motorcycle head injuries dropped sharply. In fact, the availability of organ donors also dropped significantly. My hospital, which was a trauma center after 1979, had prided ourselves in keeping in touch with the families of head injured patients and we had become a major source of organ donors for the state. That’s not as bad as it sounds. We were located on Interstate 5 in south Orange County and most of our traumas were motor vehicle accidents. We got few stab and gunshot wounds, which were mostly in inner city locations.
How do I feel about the mandate?
First, the Obamacare mandate is a bloated leftist wish list written into law. Maternity care is mandated for men and post-menopausal women. Many questionable elements of healthcare are included. Among them are drug, alcohol and mental illness coverage. I have no objection to such care but it is very hard to measure or justify in the individual case. I spent a few years on the UR committee for “Tricare”, the health plan for military dependents. We had a lot of trouble with mental health care for teenagers. We had kids sent to San Diego from Guam for treatment of what sounded like teenage angst.
What about the Heritage Foundation concept of a mandate ?
First, health research and advances in economic analysis have convinced people like me that an insurance mandate isn’t needed to achieve stable, near-universal coverage. For example, the new field of behavioral economics taught me that default auto-enrollment in employer or nonemployer insurance plans can lead many people to buy coverage without a requirement.
Also, advances in “risk adjustment” tools are improving the stability of voluntary insurance. And Heritage-funded research on federal employees’ coverage — which has no mandate — caused me to conclude we had made a mistake in the 1990s. That’s why we believe that President Obama and others are dead wrong about the need for a mandate.
Additionally, the meaning of the individual mandate we are said to have “invented” has changed over time. Today it means the government makes people buy comprehensive benefits for their own good, rather than our original emphasis on protecting society from the heavy medical costs of free riders.
Those heavy costs are costs like those of caring for motorcycle rider head injuries. It was bankrupting hospitals and neurosurgeons who had no time for anything else.
Let’s start with EMTALA.
EMTALA, one of the great unfunded mandates in American history, required any hospital participating in Medicare—that is to say, nearly all of them—to provide emergency care to anyone who needs it, including illegal immigrants, regardless of ability to pay. Indeed, EMTALA can be accurately said to have established universal health care in America—with nary a whimper from conservative activists.
The act was the result of a horror story in Texas. A pregnant woman was turned away from a hospital in Texas because she was uninsured (and I believe an illegal alien) and because the hospital could not get an obstetrician to come in to treat her. OBGYN doctors have traditionally had the highest malpractice insurance premiums in most states. In our own hospital, we finally had to make ER call mandatory for staff privileges for OB. One reason was that we had a local practitioner who had no hospital privileges who was doing home deliveries in San Juan Capistrano, a small city with a large illegal alien population. When his patient was unable to deliver at home, she would come unaccompanied to the ER. She would be in advanced labor, often with fetal distress and with an angry humiliated state of mind. The OBs were very afraid of such patients. They were a potential lawsuit and the guy at home had no insurance. The OB she saw in the ER would get the lawsuit if anything went wrong.
With EMTALA, no ER could turn away a patient who needed “emergency care” which was broadly defined. The mandate envisioned by Heritage was to complement the EMTALA situation. California has a “Good Samaritan” law for doctors who happen on an emergency but it does not apply to childbirth. I remember a physician who got sued for responding to a “CODE BLUE” in the hospital. The legislation followed as doctors began to be reluctant to respond to cardiac arrests.
What did Heritage have in mind ?
Bill Clinton’s 1993 proposal for universal health care revolved around an idea called “managed competition,” based on the work of a group of academics and industry figures called the Jackson Hole Group. That group, led by Paul Ellwood, Alain Enthoven, and Lynn Etheredge, building on years of work by its participants, had in 1992 proposed a plan which included an employer mandate.
One of the “Jackson Hole Group” was Jack Wennberg MD with whom I got a Masters Degree in Health Policy in 1995. Bill Clinton actually handed me my degree. Somewhere I have a photo of that.
For what it’s worth, the Jackson Hole group vociferously opposed the Clinton plan, which combined aspects of Canada’s single-payer system with their managed competition idea. Clinton’s plan, wrote Enthoven in the Wall Street Journal in 1993, “threatens to be a monopolistic, regulatory government agency that will cause more problems than it solves.” Enthoven had once hoped that Congress could fix Hillarycare, but ended up concluding, “The first thing Congress should do is delete pages 1 through 1,342 of Clinton’s 1,342-page bill.”
Alain Enthovan spent a weekend retreat with my county medical association Board when I was president of it.
the employer-based system insulates consumers from the value of the health care they are paying for, giving them no incentive to economize, thereby driving up the cost of health insurance. The fifth is that the employer-based system leads to “job lock,” whereby people are afraid to leave their jobs if they fall ill on the job, because switching plans could mean higher premiums or denial of coverage.
These are major weaknesses in the concept. We must find a way to get some market mechanisms in any health reform. Obamacare goes exactly the wrong way. They plan to use forced rationing on patients and doctors to control utilization. This is the way you get black markets.
Ferrara correctly points out that a key flaw with the individual mandate is that the government is then required to define what types of insurance qualify for the mandate, and government will always be tempted to require costly, comprehensive insurance: This is the lethal flaw in Obamacare.
Romneycare, as passed by the Massachusetts legislature, included both an individual mandate and an employer mandate, making it more like Enthoven’s “managed competition” plan than Heritage’s individual-market plan. Romney vetoed the employer mandate, but the legislature, which was 80 percent Democratic, overrode his veto.
Obamacare is the bastard son of Hillarycare with all the bad features and none of the positives of catastrophic care.
Unless conservatives coalesce around a free-market vision of health reform, they will always find themselves rushing headlong into tactical policy proposals—like the individual mandate—that they haven’t fully thought through. Conservatives are always playing defense, instead of offense, when it comes to improving our health-care system.
I have suggested several approaches to health care reform. Mostly the French system, which I discussed here. Another objection to the Clinton plan was the use of criminal penalties for provision of care outside the cooperatives in Hillarycare. The left always turns to coercion.