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Obama Caving on Health Care, Says Robert Reich

"Don't make the perfect the enemy of the better" is a favorite slogan in
Washington because compromise is necessary to get anything done. But the way
things are going with health care, a better admonition would be: "Don't give
away the store."

Many experts have long agreed that a so-called
"single-payer" plan is the ideal, because competition among private insurers who
pay health-care bills inevitably causes them to spend big bucks trying to find
and market policies to healthy and younger people at relatively low risk of
health problems while avoiding sicker and older people with higher risks (and
rejecting those with pre-existing conditions altogether), and also contesting
and litigating many claims. A single payer saves all this money and focuses on
caring for sick people and preventing the healthy from becoming sick. The other
advantage of a single payer is it can use its vast bargaining power to negotiate
lower prices from pharmaceutical companies, hospitals, and suppliers.

surprisingly, insurance and drug companies have been dead-set against a single
payer for years. And they've so frightened the public into thinking that "single
payer" means loss of choice of doctor (that's wrong -- many single payer plans
in other nations allow choices of medical deliverers) that politicians no longer
even mention it.

On the campaign trail, Barack Obama pushed a compromise
-- a universal health plan that would include a "public insurance option"
resembling Medicare, which individual members of the public and their families
could choose if they wished. This Medicare-like option would at least be able to
negotiate low rates and impose some discipline on private insurers.

now the Medicare-like option is being taken off the table. Insurance and drug
companies have thrown their weight around the Senate. And, sadly, the White
House -- eager to get a bill enacted in 2009 rather than risk it during the
mid-term election year of 2010 -- is signaling it's open to other approaches.
What other approaches? One would create a public insurance plan run by multiple
regional third-party administrators. In other words, the putative "public plan"
would be broken into little pieces, none of which could exert much bargaining
leverage on Big Pharma and Big Insurance. These pieces would also be so
decentralized that the drug companies and private insurers could easily bully
(or bribe) regional third-party administrators.

Another approach now
being considered in the Senate would have states create their own insurance
plans. That's even worse: Big Pharma and Big Insurance are used to buying off
state legislators and officials. They'd just continue their current

A third option is to create a public plan that pays for itself
and, according to the office of Senator Charles Schumer, who came up with it,
"adheres to private-insurance rules." But adhering to private insurance rules is
exactly what the public plan is not supposed to do. How can it possibly
discipline private insurers and get good deals from drug companies and medical
providers if it adheres to the same rules that private insurers have

It's still possible that the House could come up with a real
Medicare-like public option and that Senate Dems could pass it under a
reconciliation bill needing just 51 votes. But it won't happen without a great
deal of pressure from the White House and the public. Big Pharma, Big Insurance,
and the rest of Big Med are pushing hard in the opposite direction. And
Democrats are now giving away the store. As things are now going, we'll end up
with a universal health-care bill this year that politicians, including our
President, will claim as a big step forward when it's really a step sideways.


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