Now that President Obama and the Congressional Democrats are twisting themselves like pretzels to get something – anything – passed on health reform with no Republican support, it might be worth reviewing what might have been.
During the campaign, Mr. Obama promised to work in a bipartisan fashion to solve problems. He told one interviewer, “I have always been able to work together with Republicans to find compromise and to find common ground.” If he had stuck with that in health care we might be telling a very different story today.
In fact, the health reform proposals presented during the campaign by Barack Obama and John McCain were not that far apart. Both candidates supported "reimportation" of American drugs and greater use of generic drugs. Both wanted to increase "coordinated care" and do more for people with chronic conditions and both supported transparency on costs and quality. Both wanted to do something about medical liability. McCain wanted to exempt physicians "who follow clinical guidelines" from malpractice actions, and Obama wanted to "strengthen antitrust laws to prevent insurers from overcharging physicians for their malpractice insurance." Both believed we could save a lot of money by using health information technology and both wanted health insurance coverage to be portable, so people can take it with them when they change jobs.
They had differences too, of course. Obama wanted to create a public insurance option with comprehensive benefits and subsidies for lower income Americans and a national insurance exchange with no limits for pre-existing conditions, and he was willing to make coverage mandatory for children but not for adults.
McCain wanted to provide vouchers of $5,000 per family to help them afford coverage and he wanted to allow people to buy coverage across state lines. He wanted to guarantee access for the uninsurable and provide additional premium assistance for lower-income people. He also wanted to create high-risk pools for people with pre-existing conditions and expand Health Savings Accounts.
Now if Obama had been serious about bipartisanship and about health reform he could have picked up the phone last January and invited McCain over to the White House to thrash out their differences and come up with a unified proposal.
Obama's "national insurance exchange" would have fit in nicely with McCain's support for buying coverage across state lines. And McCain's tax credit and additional low-income assistance would be one way for Obama to deliver the subsidies he desired.
Even McCain's support of health savings accounts could have easily been absorbed into Obama's desire for comprehensive benefits. A rarely mentioned advantage of HSAs is that they offer a way to fund comprehensive benefits while still offering flexibility and choice. One family might want coverage of alternative medicine while another wants dental and vision to be covered. HSAs enable both to get what they want without having Congress picking one over the other.
These differences could have been hammered out in a day of meetings between both men’s key advisors on health care – Peter Orszag for Obama and Douglas Holtz-Eakin for McCain. Interestingly, both are former directors of the Congressional Budget Office, so they can talk the same language and have deep knowledge of what Congress is looking for in legislative proposals.
With the endorsement of the presidential candidates from both parties, such a proposal would have sailed through Congress and Mr. Obama would have had the August signing ceremony he craved, and a bi-partisan love fest, too.
It is not a solution I would have liked, but it would have avoided the current incomprehensible mish-mash of proposals that are opposed by 61% of the people. What a way to run a railroad.