Crisis may force Obama to go with singlepayer

maryf

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Wed Apr-15-09 08:42 PM
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Crisis may force Obama to go with singlepayer

Edited on Wed Apr-15-09 08:48 PM by maryf

www.dollarsandsense.org/archives/2009/0309bybee.html

Crisis = Opportunity for Single-Payer
Fiscal crises may force Obama to save costs via a single-payer plan.

By Roger Bybee
<snip>the budget wreckage left by the Bush years, the federal government’s fiscal demands are exploding. Health care reform faces daunting competition from a $787 billion stimulus package; the president’s $72 billion decision to delay repealing the Bush tax cuts for high earners; a Wall Street, bank, and insurance company bailout at $700 billion to date and likely to grow; and the ongoing Iraq and Afghanistan wars, together costing $170 billion in “extra” defense spending in FY2009.
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Still, a leading advocate of the Obama plan, political scientist Jacob Hacker, argues that it can be billed as an important economic stimulus and thus escape the fierce budgetary competition. In December, Hacker cheerfully declared in The New Republic that the Obama plan offers nothing less than a “magic bullet” that will yield “short-term spending and long-term saving”—a perfect combination as the economy moves deeper into recession.

However, it is likely that Hacker seriously overstates the long-term savings while underestimating the clash of government priorities that lies just ahead. First, Obama-style individual mandate plans have run aground in at least six states that have tried them. With no mechanism to control the premiums charged by private insurers, the ever-higher cost of subsidizing low-income residents’ premiums soon exhausts available funds. Nor will sufficient savings be derived from Obama’s plan for electronic recordkeeping and more treatment of chronic illness, recent studies by the Congressional Budget Office and others suggest.

To many, a single-payer plan is the obvious way to ensure universal health coverage while containing costs. In addition to the dramatic reduction in administrative costs, single-payer plans offer other opportunities for controlling costs. For instance, they allow government—the “single payer” —to negotiate for lower costs with providers like doctors, hospitals, and pharmaceutical companies.

Unfortunately, Obama’s statements and key appointments suggest he has already disqualified single-payer as a serious option.

Tom Daschle, tapped for Health and Human Services secretary and “point man” on the health care reform effort until tax problems forced him to withdraw his name in February, appeared unwilling to let the private insurance industry go. His basic policy direction emerged in an interview last May. In a remark that seems staggering in hindsight, Daschle said, “And I would ask the question, if you think our banking system today is reasonably regulated, why not try the same model for our health-care system?”

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Promoted by this kind of team, Obama’s health-care plan could prove to be the most vulnerable component of his domestic program. The Republicans feel confident about their ability to brand Obama’s plan as overly complex and a threat to consumer choice in medical care, as they did so successfully with the Clinton plan in the 1990s.

The Obama plan’s “pay or play” component, giving employers a choice between insuring their employees or paying a tax to help finance the government plan, will no doubt open it up to conservative criticism as a coercive, big-government program. This line may also strike a chord among moderate-income citizens who earn too much to qualify for a subsidy and consequently lose enthusiasm for reform once they start to pay mandatory health premiums.

The single-payer approach, on the other hand, would disarm many of the most explosive Republican arguments. It is far less costly to both employers and individuals—nearly 50% lower per person in Canada than the United States, for instance—and there is no billing of patients or other complexity. Every citizen enjoys the right to health care and a free choice of doctors and hospitals. Start-up costs would be minimal, especially if Medicare were simply expanded to cover the entire public.

Back in 2003, Barack Obama told the Illinois AFL-CIO: “I happen to be a proponent of a single-payer universal health care program. I see no reason why the United States of America, the wealthiest country in the history of the world, spending 14% of its Gross National Product on health care, cannot provide basic health insurance to everybody . . . a single-payer health care plan, a universal health care plan. And that’s what I’d like to see. But as all of you know, we may not get there immediately. Because first we have to take back the White House, we have to take back the Senate, and we have to take back the House.”

Now that Obama himself occupies the White House and health care costs consume nearly 17% of GNP, the new president may rediscover that single-payer is the truly pragmatic course on health care reform. Hemmed in on all sides by the enormous costs facing the federal government, Obama may find—despite his misgivings—that pursuing a single-payer reform plan is the sole means of creating a low-cost and appealing alternative to the health-care status quo.