The following post is one I’m afraid I’ll look back on and say, “What was I thinking?”! At a time when the right wing is in high dudgeon and many states, with Tea Party encouragement, are essentially fomenting massive civil disobedience against the health insurance reform legislation, I’m making a more positive (albeit contrarian) argument about the long-term effects of this historic achievement.
We now know most of what’s in the legislation, who the winners and losers are, and the continuing shape of the political battle to come. What we don’t know are the contours of the political and cultural changes to follow. Will its enactment stimulate a broad political shift toward sustained libertarianism (along the lines of the current level of civil disobedience) and hence the legislation’s collapse? Or, will the implementation process accelerate broad cultural changes that fundamentally reshape health care delivery? Given the level of vitriol directed toward proponents of the bill, smart money will probably be on collapse.
But maybe the smart money is wrong. (Am I setting up a straw man here? Would I do that?) Every legislative enactment has unintended consequences. Up to now, the legitimate critiques of the legislation have been the failure to adopt more stringent cost controls, the potential for an increased tax burden on middle-income Americans, and the failure to change the health care delivery system. Combined with the sustained distortions and illegitimate critiques, the opponents have dominated the debate, though, fortunately, not the legislative outcome.
As unlikely as it may now seem, there’s a chance that the legislation will actually stimulate the kinds of reforms that many hoped would be included in the bill from the beginning. But these changes may not need additional legislation to occur. Instead, there’s a serious possibility of deep cultural change that will force stakeholders to achieve voluntarily what they failed to achieve through the legislative process.
First, the legislation includes numerous demonstration projects with the potential to provide information that will encourage policymakers and stakeholders to develop new delivery arrangements. For example, demonstrations may indicate which cost control mechanisms will be effective and how to implement them across the country. These projects may determine whether accountable health systems will reduce inefficiency and improve the coordination of care. Taken together, the demonstrations may stimulate the broad re-thinking of how health care is delivered that health policy scholars have advocated for many years.
Second, many actions can be taken voluntarily. As I’ve argued in previous posts, health insurers could have deflected some of the public’s antipathy toward them through changes that would have reduced the adverse consequences of pre-existing conditions. Tobacco control provides an analog. Many businesses decided to go smoke-free, even in the absence of tobacco control laws, because it was in their economic interests, because the public demanded it, or because they saw the inevitability state and local clean indoor air laws. Without doubt, health insurers could argue that their economic model precluded coverage for pre-existing conditions absent the full mandate included in the current legislation. But practices such as rescission were unnecessary and certainly compromised the industry’s public image.
Third, don’t underestimate the power of culture to change and to force policymakers and stakeholders to meet public demands. Once the hysteria over “government takeover,” etc., subsides and people get a better sense of how the legislation can improve their health insurance coverage, a swing in how the legislation is viewed is entirely possible.
Facts matter, and the facts favor reform. Opponents have saturated the media with lies and distortions, and it will take time for the benefits of the legislation to be disseminated and absorbed. For instance, several provisions, nicely summarized in Monday’s New York Times, may mollify Medicare recipients once they learn that the donut hole is less onerous, etc. When people digest that pre-existing conditions will no longer bar them from health insurance coverage, average citizens may well rethink their initial opposition. As passions cool and people realize that the fear mongering was deceptive, the environment for cultural change, which now seems quite hostile, will be more favorable.
Two counterexamples, however, should give pause. First, Congress enacted the Medicare Catastrophic Coverage Act of 1988. A year later, the Act was repealed later after massive protests from Medicare recipients. Second, the managed care backlash seriously undermined managed care’s implementation of cost containment initiatives.
Republicans, along with its Tea Party and talk radio/TV sympathizers, will surely foment the kind of outrage that saw angry senior citizens surround Representative Dan Rostenkowski’s car following the Medicare Catastrophic Coverage Act. I honestly believe that’s a losing strategy in this case. For one thing, AARP strongly backs the current legislation. For another, the Obama administration has the opportunity now to convince the public that the fears are overblown, and, to the contrary, many people will benefit from the changes.
At a minimum, the public is more engaged now and perhaps susceptible to a reasoned explanation of what’s actually in the legislation as opposed to the misleading distortions they’ve heard for months. None of this will mollify the Tea Party acolytes, who are beyond reach. And we can assuredly expect a period of continuing trench warfare to shape the legislation’s public image.
Nonetheless, the early signs are not terrible. It’s interesting that many Republicans have been predicting economic calamity if the bill is enacted. It would appear that Wall Street doesn’t agree. Even though the reconciliation process has yet to unfold, Wall Street’s initial response was a shrug. If Atlas Shrugged and Ayn Rand is rolling over in her grave, the mavens of Wall Street also shrugged. To be sure, Wall Street factors in the potential benefits to pharmaceutical manufacturers and hospitals, whose stocks rose on Monday, though health insurance stocks fell. But if Wall Street truly thought the legislation would wreck the economy, the market would have taken a dive. Maybe it will today or next week. Maybe not.
And if the legislation survives the initial onslaught, Republican members of Congress may be compelled to rethink their obdurate opposition to the law. Ultimately, their just say no philosophy did not impede enactment of a law they refused to help shape. Assuming that the Democrats retain their majorities in Congress, the real bargaining will begin after the 2010 elections. When the new Congress convenes in 2011, bargaining to strengthen the legislation will commence. At that point, the cultural shift will have begun. Once Republicans stop fomenting civil resistance and begin to bargain in good faith, the reforms will gain bipartisan legitimacy.
As congressional attention returns to other issues, such as banking reform, the exclusive focus on health care will subside somewhat, allowing the cultural process to operate naturally. With banking reform, Democrats may be able to place the Republicans on the defensive, forcing the Republicans to defend Wall Street malefactors. This, too, can help solidify the health insurance reforms.