Commentary

Health Care Reform? Maybe Next Year

Did comprehensive health care reform just get a big boost? The health care industry says it’s willing to trim $2 trillion off the nation’s health care bill over the next 10 years.

Could 2009 be the year we finally reform health care? Don’t count on it.

It’s not that we don’t need health care reform. Right now, Congress basically conditions health coverage on your ability to get and keep a job. That’s not health insurance. That’s survival of the fittest.

But there have always been two things standing in the way of Democrats’ plans for universal health insurance coverage: math and politics.

Right now, Congress basically conditions health coverage on your ability to get and keep a job. That’s not health insurance. That’s survival of the fittest.”

First, the math. According to the Urban Institute, covering the uninsured would cost a minimum of $120 billion per year. Over 10 years, the cost could easily hit $2 trillion.

That money’s gotta come from somewhere. And that’s where politics comes in. Everybody wants that money to come from someone else.

Look at what has happened to the ideas President Obama has already floated to raise just a part of that $2 trillion. Conservatives are up in arms about the government using comparative-effectiveness research to ration care. Insurance companies and home health agencies protested proposed cuts to their federal payments. Even Obama’s fellow Democrats have attacked his proposals to increase taxes and cut just one half of one percent of federal spending.

Everyone may be at the table right now, but that’s only because no one wants to be on the menu. Former Senate majority leader Tom Daschle says it’s a coin toss whether we’ll get comprehensive reform this year. But that’s assuming he can pry a coin from your fingers, or mine.

But now, the health care industry seems to be saying, “Here, take our coin.” Did the industry really just volunteer to pay for health care reform?

A good rule in politics is that if something sounds too good to be true, it usually is. Lobbyists don’t simply propose to reduce their members’ incomes. If they did, they would be fired and replaced with different lobbyists.

Another possibility is that the industry — which would get more customers under universal coverage — wants to help the president and Congress ignore the math.

Democrats have offered reforms that they claim would reduce health care spending over time, including more coordinated care, preventive care, and disease management. The industry endorsed those reforms in its recent letter to President Obama. But the number-crunchers at the Congressional Budget Office say there’s little to no evidence that those measures will produce savings. And unless the CBO agrees, Congress has to cut payments or raise taxes.

Senate Finance Committee chairman Max Baucus (D-MT) has spoken openly about getting the CBO to change its mind. If reformers can say that even the industry is committed to achieving savings with these reforms, that might make it easier to get the CBO to relent, and allow health care reform to pass without the necessary payment cuts or tax increases — even if there’s still no evidence that the assumed savings will appear.

Don’t call it cooking the books. Call it the new math of universal coverage.

Michael Cannon is director of health policy studies at the libertarian Cato Institute and co-author of Healthy Competition: What’s Holding Back Health Care and How to Free It.