Where Hillary Clinton failed, the team of President Barack Obama and HHS Secretary Tom Daschle is determined to succeed—and the political momentum is all on their side.
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WHILE THE DETAILS OF ANY plan would take months to hash out, Daschle’s writings, along with Obama’s campaign proposal, provide a good idea of the broad outlines. Both Obama and Daschle have touted the benefits of a single-payer health care model, which is a more academic way of describing a socialized system in which government is the sole purchaser of health care.
“I happen to be a proponent of a single-payer universal health care plan,” Obama declared in a 2003 speech to the AFL-CIO. “[W]e may not get there immediately. Because first we have to take back the White House, we have to take back the Senate, we have to take back the House.”
During the presidential campaign, Obama refined the statement to mean that he would set up a single-payer system if he were “designing a system from scratch,” but said he supported working within the existing system because it was more politically feasible right now.
In order to stave off Republican charges that they want to bring European-style socialized medicine to America, Obama and Daschle have preemptively appropriated rhetoric from conservatives. They speak of “choice” and “competition” and emphasize that they don’t want a government-run system, but merely one that is made up of “public-private” partnerships.
However, once you look behind the veneer it becomes obvious that the aim is to craft a plan that maintains the current mixed public-private structure while making it function more like a government-run system. Over time, this can seamlessly evolve into the single-payer model that both Daschle and Obama clearly prefer.
“Supporters say single-payer is brilliantly simple, ensures equity by providing all people with the same benefits, and saves billions of dollars by creating economies of scale and streamlining administration,” Daschle writes in his book. “But a pure single-payer system is politically problematic in the United States, at least right now.”
Daschle goes on to ask, “If passage of a single-payer system isn’t realistic, what should we do?”
His answer, which has been echoed by Obama, would be a system in which individuals would be given subsidies to purchase insurance in a government-run exchange, choosing either a government plan modeled after Medicare, or among private plans that would have to meet certain government standards. Large employers would likely be required to either provide health insurance to their employees or pay into a government pool to purchase coverage for the uninsured. Such a plan would also require insurance companies to cover anybody who applies for insurance without taking into account pre-existing conditions, and insurers would have to charge rates that the government deemed affordable.
The new government-run option didn’t get much attention during the election, but it was a key element of Obama’s campaign proposal, and any piece of legislation that does not include it would be a non-starter for progressive activists and liberal members of Congress. Their hope is that they can design a public plan more generous than any of the private options offered by insurers in the exchange (a task made easier when government is setting the rules of the game and doesn’t have to worry about making a profit because it can always raise taxes or issue more debt). Thus, liberals can gradually shift more Americans toward government health care while arguing that it was an aggregation of individual choices.
THE CENTRAL PILLAR OF Daschle’s health care vision is a Federal Health Board. “Like the Federal Reserve, the Federal Health Board would be composed of highly independent experts insulated from politics,” Daschle explains in his book. “Congress and the White House would relinquish some of their health-policy decisions to it. For example, a shift to a more effective drug service would be accomplished without an act of Congress or the White House.”
Daschle has argued that the Federal Health Board will manage health care just as the Federal Reserve “skillfully managed monetary policy for decades…” (That is not a joke.)
Through the Board, government could control health care costs by rationing treatment based on what its experts consider effective or good value. While the Board wouldn’t technically be a regulatory body, Daschle writes that “its recommendations would have teeth because all federal health programs would have to abide by them, and those programs account for 32 percent of all health spending and insure roughly 100 million Americans.”
Furthermore, any private insurer that wants a piece of all the money the federal government will be throwing around in the new insurance exchange would have to abide by their recommendations. And, Daschle writes that “Congress could opt to go further with the Board’s recommendations” by passing legislation that would coerce more insurers into abiding by them.
Conveniently enough, the entity would be composed of a Board of Governors that would be appointed to 10-year terms, subject to Senate confirmation. In other words, any Obama appointments would be allowed to serve until at least 2019.
It’s uncertain whether the Federal Health Board concept will be part of any final Obama proposal, but in a blurb on the back of Daschle’s book, Obama praises the idea. “[Daschle’s] Federal Reserve for Health concept holds great promise for bridging this intellectual chasm and, at long last, giving this nation the health care it deserves,” Obama writes. Furthermore, Daschle’s Board is not just part of his vision for the future of health care—it plays a central role in his strategy for getting any proposal passed in the first place. The idea, as he presents it, is that having “independent experts” make difficult technical decisions down the road—rather than members of Congress during a heated legislative battle—will reassure interest groups while allowing lawmakers to vote on a much simpler health care proposal than the Clinton-Magaziner leviathan.
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