Barack Obama and Health Care

[ProSense]

Barack Obama and Health Care

by kid oakland
Sun Jan 20, 2008

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When it comes to health care and Barack Obama the person to meet is Harvard Professor and Economist David Cutler. Professor Cutler is the author of the well-regarded book on health policy: Your Money or Your Life. (Yes, it's possible to be a policy wonk and have a sense of humor.) From the Ezra Klein review:

Cutler, a Harvard economist, worked on Clinton's doomed effort and, upon its death, set about reflecting on where they'd gone wrong. His eventual answer was virtually everywhere, but not just in the political sense. According to Cutler, the health-care debate is deeply flawed, myopically mired in issues of cost and access. Both, he grants, are important. But with most Americans able to afford health care, calls for reform based solely on those concerns will continue to fail. The fee-for-service system encourages a reliance on technology-intensive treatments -- the costly procedures that are richly reimbursed by insurers -- while simple, but potentially more valuable, services are often overlooked.
-Ezra Klein, American Prospect

If you want to meet David Cutler outside the glare of the presidential campaign, try this informative profile by Roger Lowenstein written for the New York Times in 2005:

A tweedy, self-effacing 39-year-old, Cutler is a seriously modified lefty. He envisions a system in which everyone could get insurance while free-market incentives would motivate health-care providers to be more effective as well as more efficient. Instead of suppressing the market by rationing care, restraining prices or regulating doctors, he wants to liberate it. It is neither Clinton nor Bush -- but closer to Bill Bradley, whose 2000 campaign Cutler advised. Dr. Robert Galvin, head of global health care at General Electric, says, "David has showed everyone that the way to rein in costs is not to squash innovation."
-NYT

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Edwards and Clinton:

Senator Hillary Rodham Clinton of New York and John Edwards, the former North Carolina senator, support a mandate. It is, they say, the only way to guarantee that everyone is covered and to thereby bring down costs by spreading the country’s insurance risk as broadly as possible.

"The sad reality is that the uninsured don’t just struggle with costs themselves, they impose costs on the rest of us," Mrs. Clinton said in September. "It’s a hidden tax: the high cost of emergency room visits that could have been prevented by a much less expensive doctor’s appointment, the cost of unpaid medical bills that lead insurance companies to raise rates on the rest of us."

Mr. Edwards echoed those remarks a week later. "The reason the mandate is necessary is because you cannot have universal health care without it," he said. "Does not exist, and anyone who pretends it is, is not being straight."

-NYT

Now, here's how Barack Obama put it:

Senator Barack Obama of Illinois sees it a different way. He argues there is danger in mandating coverage before it is clear it can be affordable for those at the margins. While Mr. Obama does not rule out a mandate down the road, his emphasis is on reducing costs and providing generous government subsidies to those who need them. He would mandate coverage for children.

That distinction set off a pointed exchange in the Democratic debate in Las Vegas on Nov. 15. "I don’t think that the problem with the American people is that they are not being forced to get health care," Mr. Obama said. "The problem is they can’t afford it."

-NYT

That seems to be pretty clear and makes a great deal of sense, but it's clearly a marked difference from what Clinton and Edwards are saying. Now, David Cutler worked on Senator Clinton's failed 1993-94 Health Care Task Force, he knows the Massachusetts policy of mandated coverage inside and out. Let's let David Cutler make the case for tackling affordability first:

The main difference between Obama's plan and his rivals' is this, they would mandate health coverage first and fix cost problems later. Obama would do the opposite. While both approaches are problematic, there is a strong case to be made that Obama's plan is fairer - and more politically progressive.

While it's true that Obama's plan won't "cover everyone," neither will anyone else's. Mandates have never achieved 100% effectiveness. The practical design problems of subsidies, exemptions, and benefit levels that accompany mandates are complex and unwieldy. That's why the Massachusetts Authority responsible for that state's plan - which Krugman would describe as "covering everyone" - just exempted an estimated 20% of uninsured residents from the mandate.

-Huffington Post

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Either you like the way David Cutler makes his argument or you don't. He's speaking, like Obama, in very clear terms. And what he's saying is, like Obama's technology agenda, innovative and straightforward. Don't take my word for it.

To cover most (but not all) of the roughly 45 million Americans without health insurance, Obama advances ideas that split the bill between individuals, government and business.

His first step would be to require parents to insure their children. Then he proposes to expand eligibility for government programs for the poor and to offer subsidies to help other uninsured individuals buy coverage through a new, nationwide purchasing pool modeled on the insurance available to federal employees. Finally, Obama would require all but the smallest employers to provide insurance for workers or else pay about 6% of their payroll to help government fund the cost of covering those employees. That last proposal marks a crucial turn in the healthcare debate.

Obama also revived the best policy idea of Sen. John F. Kerry's 2004 campaign: a proposal for Washington to fund most of the bill for high-cost patients once their annual healthcare bills exceed a fixed level. Shifting those catastrophic expenses to government would lower employer premiums. So might Obama's surprisingly sharp-edged proposals to limit insurance company profits.

The best chance for reaching (or even nearing) universal healthcare coverage is a system of shared responsibility that requires government, individuals and business to all contribute.
-Ron Brownstein, LA Times

If that's not enough informattion for you, here's a link to a chart prepared by the Henry J. Kaiser foundation comparing every aspect of both Clinton's and Obama's plans.

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