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Getting Ugly Over Health Care Non-Solutions

by: David Dayen

Fri Oct 19, 2007 at 12:55:37 PM PDT


So after being peppered with criticism from both term limits groups and the California Nurses Association, the Speaker's office has chosen which group to strike back at: the nurses, of course, using the exact same standard of judgment that they called a "smear job" when it was used against Nuñez.

This is an argument over improving the delivery and cost of health care, and there's plenty of ideological rigidity to go around.  What started as a promising "year of health care reform" has devolved into putative allies arguing about how much money the other spends on hotel rooms.  Behind the mere gaining of political points is a serious debate about how to best allow all California citizens, not just the ones with full-time employment (us freelancers need health care too), the highest quality affordable health care they can manage.  And the real truth of the matter, the one that nobody really wants to talk about, is that none of these state-based plans, by definition, have any hope of working and have serious potential consequences, besides.  I think that's why everyone's getting so mad at one another, because it's easier to do so than to face the facts.

We've got all these great universal bills passing at the state level, and I'm here to tell you that, well, they are pretty great, but they're not going to work. It didn't work in Washington State, when they tried it, and the insurers first jacked up the premiums, and then moved out of the state in order to kill the model. It didn't work in Hawaii, which saw an economic downturn move more people onto their subsidies exactly as the state's revenues dropped. It didn't work in Tennessee, where the Democratic governor, Phil Bredesen, upon killing off Tenncare and leaving 300,000 people uninsured, told his state that, "I say to you with a clear heart that I've tried everything. There is no big lump of federal money that will make the problem go away." Similar plans failed in Oregon, in Massachusetts, and many other states.

The plans fall for a few small reasons, and one big one. The big one is that states don't have the fiscal stability to run universal health care. 49 of 50 states cant deficit spend. That means that when the state goes into recession and more people need subsidies and the revenues to give them don't exist the state can't borrow the money. So they dismantle the program. It's happened time and time again -- in some states, like Oregon, more than once.

Moreover, you don't really want this being a state-run solution. As a stopgap, increasing coverage through state plans is worthwhile, but health care reform is more than access - it's actual reform to bring down costs, which are, at the end of the day, the biggest problem in the system. And the states don't have the regulatory authority, the money, or, save in a few cases, the size to do that. I simply don't trust them to fundamentally reform the system.

California is obviously one state that has the size, and certainly could float ever more bonds to spend the necessary money.  But we're almost certainly on the cusp of a new recession, and the combination of massive debt passed on to grandkids and a pay-to-play system that still reigns supreme in Sacramento is unpalatable to reform.

I repsect the efforts of groups like Physicians for a Naitonal Health Plan, who have studied the issue and recommended some of the best possible solutions.  But that word "national" is hard to get around; it's the only way to create the real economies of scale and managed risk necessary for a solution.  I believe in health care for everyone, not simply in red states or blue states.  As Ezra Klein notes,

You know, whenever you talk about the state reforms, you always hear the old Brandeis quote about the "laboratories of democracy." But there's another Brandeis saying that I think is more applicable: "If we would guide by the light of reason," he said, "we must let our minds be bold." And that's what I'm asking: Be bold. Because nothing else will, in the long term, work.
David Dayen :: Getting Ugly Over Health Care Non-Solutions
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Good post (0.00 / 0)
I'm not sure Ezra is completely right about how things went down in Washington State - the universal plan passed in 1993, and the Democrats were wiped out in the 1994 elections, as Republicans promised to repeal "socialized medicine" in the Evergreen State. Which they did as their first order of business in the 1995 session.

I also think Ezra is right that we need action on the federal level - that state efforts alone are too fragile, dependent on strained budgets and lacking the necessary scale to be viable. Initially when I read Ezra's post I thought about Saskatchewan and how they created a universal health care system on the provincial level, but in fact the fully universal system did not come about until 1962 - AFTER the Canadian federal government had already promised matching funds for single-payer plans.

Is this debate really one about ideological rigidity? Or is it instead about political assumptions? The key divide that I see consistently repeating itself isn't that single-payer is bad, but that it's not politically possible. So we have to instead craft a health care reform that is "politically viable" which so far has meant a mishmash of probably unworkable ideas that, in actuality, have made little political headway.

The Rockridge Institute earlier this week put out a fascinating paper: "The Logic of the Health Care Debate", examining the framing of the health care question. I haven't yet wrapped my head around it to craft a post here on it, but its core point - that "the neoliberal mode of thought is at the center of the health care debate" - is worth thinking about.

Neoliberal thinking can lead to a dangerous trap. We call it the Surrender-in-Advance Trap. With an exaggerated emphasis on system-based solutions, neoliberal thought may lead one to surrender in advance the moral view that drives an initiative in the first place. Those who pragmatically focus on appeasing what they assume will be unavoidable political opposition to their proposals also run the risk of moral surrender. For instance, assuming strong, possibly insurmountable, conservative resistance to government-based health care solutions, they will embrace profit-maximizing insurance solutions because they believe that 1) political opposition can be muted; and 2) the "free" market, properly regulated, can serve moral purposes, such as providing health care for all Americans. Proponents of these neoliberal solutions often overlook the fact that the very source of the health care crisis is the structure of insurance: the less care they authorize the more profit they make, and profits come first and are maximized.

If you all can wait until Monday, I'll have something more detailed about the Rockridge piece then...

You can check out any time you like but you can never leave


Ezra is wrong on this (8.00 / 1)
Ezra Klein's piece doesn't address the specifics of SB 840, which has been carefully crafted to avoid the mistakes of every other State approach out there. He has no expertise in this field and we should not be paying any attention to his simplistic assessment.

SB 840 will not be complete until the funding package is finished, but the plan is to fully fund it separately from the State budget.  Other state programs have tanked on the failure to factor in long term economics.  Kuehl's bill is the most comprehensive one out there, and has been vetted with many, many stakeholders during its development. 

Behind the scenes support for SB 840 is strong.  Many (even some Republicans) admit privately, if not publicly, that single payer is the only way to deliver care and contain costs.  It's up to us to create the political will in "our leaders" to bite the bullet and make their support public.  We have time to do this. 

We can wait and build the political momentum for this Bill.  It will take a new Governor to get it passed.  We should create the conditions on the ground so that our candidate can run on support for single payer health care.  It's far preferable to have a bill supported by the legislature and the Governor than to opt for signature gathering for an initiative.  In either case because of the funding provisions, the voters will get their say, whether through a legislative initiative or one put forth through signature gathering. 

In general, progress on many fronts happens in the states 1st.  That has been shown time & time to be the case.  Often California is the State that steps up to the plate and makes things happen.  Waiting for the federal government to take the lead on this would doom the goal of cost conscious universal health care ever happening.  California must lead the way on this. We have the wealth, and we have more will than the collective 50 states. 


[ Parent ]
I support SB 840 (0.00 / 0)
And your points make sense. Perhaps I went a bit too far when I said I agreed with Ezra that "state efforts are not viable" - but I *do* believe they will be unnecessarily fragile without federal support, as the Canadian experience shows.

I still believe we should push ahead with SB 840, but we should not assume that means we can abandon the federal cause. We will eventually need them.

You can check out any time you like but you can never leave


[ Parent ]
california is larger than many countries that have single payer plans (8.00 / 1)
canada: 33 million
taiwan: 22 million
belgium: 10 million
sweden: 9 million
denmark: 5 million
costa rica: 4 million
norway: 4 million

california: 37 million

and our economy is significantly larger than any of those countries.

that a bunch of sellout politicians have decided, over and over again, that donations from big medical and insurance corporations is more compelling than doing right by the citizens of their states is hardly an argument for health insurance being impossible to do. countries all over the world manage to provide better care than we do, with a fraction of the economy and population.

nuñez has to decide whose side he's on. looks like he's siding with the rotten corporate status quo. i hope he enjoys his post-retirement career as a lobbyist.

surf putah, your friendly neighborhood central valley samizdat


True (8.00 / 1)
But the difference between California and those countries is that California is not the ultimate master of its own finances or economy. We're a donor state federally; and American trade and fiscal policies are not crafted to help a populous, urban state like California.

The Canadian system only works because of multibillion dollar transfer payments from the federal government to the provinces for health care. Those transfer payments have been at the center of big political battles in Canada for at least the last decade.

I do think California should still press ahead with SB 840. We ought to do everything we can do to provide universal health care in this state even if we go it alone. But I think Ezra Klein is right to point out that our efforts would be massively aided if the federal government were on board.

You can check out any time you like but you can never leave


[ Parent ]
The corporations are the ultimate masters (0.00 / 0)
of our finances and economy in both the nation and in California. Our elected representatives need to start representing us instead of the corporations.

OK I got that off my chest.  Now, I don't see the point of straying into American trade and fiscal policies here.  California (in the greater sense) is rich, rich, rich and can afford to take care of it's citizens even if we are a "donor" state.

Sure it'd be great if we had a responsive federal government, but we don't, and won't for a long time to come it seems.  However, that is not necessary for us to move forward on this.

Luckily most health care issues don't come under the Commerce Clause anyway, so we are more or less free to do our own thing here.


[ Parent ]
ERISA (0.00 / 0)
One reason why the federal role is still important is because of ERISA - the Employee Retirement Income Security Act. A couple weeks back the Christian Science Monitor had a great article about how federal courts have used this law to strike down state health care fees on employers, as happened in Maryland.

I agree that we can move forward without the feds - but if we are to have lasting success, we WILL need them.

You can check out any time you like but you can never leave


[ Parent ]
That's correct (0.00 / 0)
the bill has had an impact on exactly how AB8 was drafted.  It limits what the state can actually do in terms of the employers.

[ Parent ]
I associate myself with Robert's comments (0.00 / 0)
And in addition, I would add that insurers in those countries have nowhere else to go, whereas they can simply pull up stakes and leave California if the "business environment" became too great.  Same with hospitals and doctors.  A national plan shuts down any of that wiggle room.

Our economy is fast becoming unsustainable and propped up by gimmicks.  Those policies must change too.


[ Parent ]
um, why would insurers matter? (8.00 / 1)
i thought we would be effectively putting them out of business in the state with single payer. not that we shouldn't try for a national plan, but don't hold your breath; i suspect we couldn't even get single payer through the democratic caucus.

surf putah, your friendly neighborhood central valley samizdat

[ Parent ]
exactly (0.00 / 0)
We citizens are paying for health care right now.  It's our money going to the insurers.  Take them out of the picture and our dollars go farther.  We don't need Uncle Sam on this one.  California has th 7th largest economy in the world.  There is plenty of money to do this.

[ Parent ]
But the feds soak up a lot of that money (0.00 / 0)
If the income taxes from Silicon Valley all went to Sacramento instead of to DC - where they don't come back - it would be a hell of a lot easier. Ultimately we may need some form of federal transfer payments or subsidies to help.

That doesn't mean we stop SB 840, but we cannot expect to go it alone for very long successfully.

Another issue is that we do exist in a national market for medical services. In Saskatchewan in 1962, when the universal single-payer system was introduced, doctors mounted a three-week strike to try and stop it. When California goes it alone, there will be a risk that some doctors and other service providers will leave the state. I don't raise that concern to say we shouldn't go it alone - but to realize that to get the best, strongest, most effective system, we will need a national commitment.

You can check out any time you like but you can never leave


[ Parent ]
Why would doctors leave? (0.00 / 0)
Seems to me there would be more regular patients with SB840.  Nobody is talikg about doctors being paid too much.  In fact they have been falling behind where they once were as HMOs have gotten stronger.

Since our taxes are going to Iraq and North Dakota Corn farmers anyway, I don't see the health care connection re federal taxes.


[ Parent ]
Not all doctors are wonderful selfless people (0.00 / 0)
Some are in it for the money, and vehemently reject the notion that their incomes should not be set by a private market. That's why doctors struck in Saskatchewan, that's why some doctors in Canada have pushed to open private clinics.

I don't like it, I don't justify it, but if we're going to walk down the single-payer path - and I absolutely believe we should - we need to do so with our eyes open, with all possible obstacles in mind.

The issue with federal taxes is that they leave us with less wealth to use at the state level. I agree with you that there remains a lot of untapped wealth we can and should get at, and I agree that we can do so even with the loss in federal dollars. But it would help immensely if we started getting some of that federal money back for health care. And we should push for that regardless of what we do in CA regarding SB 840.

You can check out any time you like but you can never leave


[ Parent ]
We've cornered the market on plastic surgery (0.00 / 0)
in Hollywood anyway.

[ Parent ]
Great post--thanks (8.00 / 2)
Obviously this is a huge issue with any proposal in a federal system.

But I'm inspired the other way--by Canada.  The national politics there would have been too intense, so they passed their guaranteed healthcare system province by province.  People saw it working, and moved to adopt it.

The Lewin Group studies on Sen. Kuehl's SB 840 found it would cover everyone and save money.  So financial considerations in the face of a recession should lead us the other way.

And never forget, there has been and will be an active working majority in favor of SB 840.  Perhaps its time for the recall or the ballot initiative?  Or public financing?

I am a healthcare activist for the National Nurses Organizing Committee/California Nurses Association.  We are the nation's largest RN union, the nation's fastest-growing union, and leading advocates for single-payer healthcare.


I find it hard (0.00 / 0)
to be overly hopeful about such things.  I agree with you on the merits, and obviously I would love SB 840, but in an impossible-to-govern, harder-to-campaign state, and given national trends, I feel like a national solution has a little more sturdiness to it.

[ Parent ]
Indeed (0.00 / 0)
but we are a long ways away from that, at least a decade.

SB 840 is a good framework bill, but we would need to see the financing side of things.  It would have to be approved on the ballot.  We don't even have a majority support for the concept, let alone a real plan with a price tag.


[ Parent ]
An actual national solution on this one seems imaginary to me (0.00 / 0)
I don't find it sturdy at all.


[ Parent ]
ezra makes a compelling case (0.00 / 0)
noting the changed landscape since 1994, all of the progressive groups that united over the SCHIP debate and won't go away, the business community's need to get legacy costs off their hands, the end of the Southern Dixiecrat stranglehold on the Democratic Party - with some more and better Democrats, this is realizable with a Democrtic President.

[ Parent ]
Not taking them on ... (0.00 / 0)
DD, I am simply responding to their paid advertising and nasty personal attacks on Speaker Nunez and then is wife.
If nothing else, I'm glad to have raised the question of whether their solution of single payer health care in California is anywhere on the political horizon in California.


And I "struck back" (0.00 / 0)
back being the operative word, at Term Limits. The article is in the Sacramento Bee.

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