The American Spectator

Drudge has been pumping up a video purporting to show Obama in March 2007 telling the SEIU that his health care plan would eliminate private health coverage. I haven’t blogged about it at this point because the video only excerpted a short clip, and I didn’t want to pass judgment until I heard the full context of his quote. I was able to track down the full video of his question and answer session, and wanted to set the record straight about what Obama did and didn’t say. Let me start by quoting Obama’s fuller statement (bold refers to section in the Drudge-linked video):

“As I indicated before, I think we’re going to have to have some system where people can buy into a larger pool. Right now their pool is typically their employer, but there are other ways of doing it. I would hope that we could set up a system that allows those who can’t go through their employer to access a federal system or a state pool of some sort. But I don’t think we’re going to be able to eliminate employer coverage immediately. There’s going to be potentially some transition process. I can envision a decade out, or 15 years out, or 20 years out, where we’ve got a much more portable system, employers still have the option of providing coverage, but many people may find that they get better coverage or at least coverage that gives them more for the health care dollars that they spend outside of their employer, and I think we’ve got to facilitate that and let individuals make that choice to transition out of employer coverage. I do believe that employers are going to have to pay or play. I think that employers either have to provide health care coverage for their employees, or they’ve got to make a decision that they’re going to help pay for those who don’t have coverage outside the employer system, so I think that’s one important principle.”

(Video below, relevant section begins around the 1:25 minute mark.)

Some background. There are health care policy experts on both the left and right who agree that the employer-based insurance system is problematic because people can’t take their health insurance from job to job and losing a job can often mean losing one’s health coverage. But these experts offer drastically different remedies. Advocates of a free market system argue for changing the tax code that currently discriminates against those purchasing insurance on their own to the advantage of those purchasing insurance through their employers. Such a change would not only address the portability issue, but also give people an incentive to search for better deals, since they’d be paying rather than their employers. But liberals argue, fundamentally, that there can’t be a functional market for individual insurance because in order to get a good deal on insurance a person needs to be part of a larger pool, typically either an employer or the government. And this is the point Obama is trying to make. 

In the video, when Obama talks about creating a different sort of pool, he’s referring to what is now being described as a government insurance exchange, along the lines of what they have in Massachusetts. What he’s saying is that he wants to give people the option of either getting insurance through their employers, or through the government exchange.  Over time, he says, he can see that leading to a system in which most (if not all) people buy their health insurance at a government store instead of through their employers. Would this be the same as eliminating private insurance? Not technically, since private insurers could do business through the exchange. But at the same time, all of the private insurers would be subject to much more government control, and if Obama gets his way, they’d have to go up against a new government-run plan that would also be offered on the exchange.

It’s important to note that these comments were made just two months after Obama announced he was going to run for president, and before he even had a formal plan. Now we have actual bills to look at and thus can see how they stack up against what he talked about in the March 2007 remarks.

On one hand, the House Democrats’ bill, once implemented, would not allow individuals to purchase insurance outside of a government store. (More detail here). On the other hand, much to the chagrin of liberals, the Democratic bills also restrict the ability of an individual already covered by his or her employer to opt out of that plan and purchase health insurance through the government exchange. In other words, one provision would accelerate the number of people who buy their insurance through government, while the other would place limitations on it.

The Drudge-linked video also includes the 2003 clip of Obama arguing that he favors a single-payer health care system to the AFL-CIO, as well as clips of Democratic Reps. Barney Frank and Jan Schakowsky arguing that offering a government-run plan (or “public option”) will lead to single-payer over time. Taken together, I think this highlights Democratic double-talk on health care. When speaking to liberal audiences who want a single-payer system, Democrats will argue to them that offering a government-run plan within a government-run exchange is the politically pragmatic way of getting to a single-payer system over time. But when addressing the general public, they talk about the government plan merely as something that will provide people with “choice” and foster “competition.” They don’t get to have it both ways.