From Now On, We’re All In It Together

When I entered health policy more than 25 years ago, a mentor predicted that when things got ‘bad enough,’ we’d finally act to fix our health care system.  Last night’s vote of 220-215 signals that the human suffering and financial toll wrought by our broken system is no longer sustainable.  Stalemate is no longer an option.  Instead, the House of Representatives voted to move us in a better direction.

Key provisions in HR 3962 made last night’s vote historic, introducing changes that are long overdue.

• A framework for universal coverage. The uninsured today, overwhelmingly, have limited incomes and decent health coverage is expensive, so subsidies are a must. The House voted to require that everyone has health insurance, with attendant reforms to make that possible, including subsidies for individuals and small employers.  And the Medicaid program will be broadened to provide a true safety net, covering all of the poorest Americans up to 150% of the federal poverty level.
• Market reforms to end health insurance discrimination.  Today, getting and keeping health insurance is hard when you’re sick.  New rules will apply to all qualified health plans, whether employer-sponsored or individually purchased.  Coverage must be guaranteed issue, premiums community rated, and pre-existing condition exclusions will be prohibited. Insurers will have to justify their annual rate increases, and comply with fair marketing practices and claims payment procedures.  Transparency and accountability in health insurance will be enhanced.  And for first time, the federal government will take an active and direct role in oversight and enforcement of private health insurance rules – working alongside states, like two cops on the beat – to ensure consumer protections are real.
• Market reforms to promote competition.  Private health insurance markets today aren’t competitive at all.  Those few insurers that dominate most markets use their clout to enhance profits, but not to achieve cost savings for policyholders.  With reform, the term “health insurance” will mean something – all policies will provide at least a basic level of protection against medical expenses.   When consumers and small businesses price shop, they can be confident they are comparing like products. Insurers won’t be able to offer cheap policies that stint on coverage; instead they’ll have to compete based on efficiency.  Also, new organized marketplaces, called exchanges, will certify that participating insurers meet all requirements.  They will provide individuals and small businesses with plan comparison information and help navigating choices. And, a new public plan option will catalyze competition among insurers.

These features are key to effective reform and it is amazing that a majority in the House voted for them.

Political consensus for something this big is elusive – there’s a reason we’ve been at it for a century.  There’s always something for somebody not to like.  The reality of politics is that compromise will be necessary to pass reform and some of those deals will limit what reform accomplishes. 

Already, the House has compromised on the overall level of resources that will be available for subsidies.  The 10-year, $900 billion price tag on reform is less than the cost of the Clinton health reform plan 15 years ago.  That means subsidies for some will be watered down, and hardship waivers to the mandate will be needed. Insurance market rules in the House bill also feature troubling compromises. Age rating of 2:1 will severely raise premiums for the baby boom generation.  Middle-income 50- and 60-somethings who have to buy coverage on their own may need those hardship waivers.  And, a provision to allow the sale of health insurance across state lines vests in a single state responsibility for enforcing rules in multiple states, and that will put consumers at risk.

Then there’s cost containment.  Many criticize reform for not doing enough to slow health care costs.  Yet all year long, there were strong – and overwhelmingly bipartisan – efforts to weaken or eliminate other provisions that could have done more to bend the curve.  The public plan was weakened.  Rate regulation eschewed.  Comparative effectiveness research boxed in, with assurances that findings about what works better in medicine would not be linked to what gets covered by health insurance. 

In the end, cost containment is hard politically because every dime of our annual $2 trillion-plus on health care spending is somebody’s income.  We’re a nation of entrepreneurs, and we don’t like to limit what anybody can earn.

But, we are also a nation dedicated to justice and equality.  The House vote signals that we may be ready to listen to our better angels, and include all Americans in our coverage system. Health reform can also take important steps on cost control, and as we debate future efforts, at least we’ll all be in it together.