University Times

Editor’s note:  Due to space constraints, this story was held over from the March 8 University Times.

The outcome of the current national health care debate has far-reaching historical significance, according to one expert.

Paul Starr, Pulitzer Prize-winning author and professor of sociology and public affairs at Princeton, said, “A few months from now someone will stand on the steps of the Capitol and be inaugurated president. Who that will be and what it means for health care reform, we don’t know. The Affordable Care Act may be repealed; it may be revised. One thing, however, I think we can predict: Health care reform will remain an intense matter of political conflict in the United States.”

Starr, who in 1993 served as a senior adviser to the White House for the formulation of President Bill Clinton’s health care plan, addressed a packed Scaife Hall auditorium Feb. 23, focusing discussion on his book, “Remedy and Reaction: The Peculiar American Struggle Over Health Care Reform.”

“We have been at each other’s throats over health care,” Starr said. “Health care is not a central issue of ideological or political conflict in the other Western democracies” because those other countries already have decided the public has a responsibility to share in health costs, he said.

Why is there such partisanship in the United States? “In no other country do conservatives equate public financing of health care with a loss of freedom,” Starr maintained.

But that partisanship did not always exist, he noted. In the early 1970s, for example, most political pundits assumed that the basic questions of national health care policy would be resolved in a bipartisan manner. President Richard Nixon, a Republican, had one proposal about comprehensive health insurance and Democratic Sen. Edward Kennedy had another.

With Nixon mired in the Watergate fallout, however, the moment was lost, and decade by decade since then costs have increased, the number of the uninsured has grown exponentially and the political dialogue has become much more acrimonious, until what is left is intense systemic polarization, Starr said.

That polarization evolved into what Starr calls the American health policy trap. The policies governing the employer private health care insurance system, in place since the mid-20th century, became increasingly complicated, expensive and more difficult to change, resulting in today’s political intransigence, he said.

“First, the policies tremendously enriched the health care industry; second, the policies protected the majority of the public, including unionized workers, veterans and seniors,” spawning for those groups an intractable unwillingness to change, Starr said.

“Third, the policies effectively concealed a lot of the true costs of health care — employees don’t see the share of premiums paid by employers, and even some don’t see the share that’s taken out of their paychecks,” he said.

Finally, the policies sent a message to people who believed that by working they were earning their health care coverage. “Many people consequently felt: Why should they pay for others’ unearned health care?” Starr said.

The upshot of the policy trap is that today Americans continue to disagree about whether health care is a matter of citizenship, a matter of basic human rights or whether it needs to be earned.

“That division is still there,” Starr noted. “That policy trap has become a politically treacherous national imperative. Treacherous, because every time someone steps forward with a remedy, it generates a reaction. Every proposal becomes a problem. There is no way of dealing with these issues except by making hard choices. Every hard choice has the effect of generating an intense response. It’s not just because of the enormous financial interests involved; there are moral ones and emotional ones that lend power to this debate, so different from other debates we have.”

Starr compared the history of the national health care debate to a three-act drama with the denouement still unwritten.

The first act, where there was some optimism that national health care legislation would become a reality, is set in the early  20th century and consists of three scenes, he said.

“In 1919 in New York State an alliance of Republicans and Democrats almost did pass a bill to provide a program of health insurance in New York. The next governor, Franklin Roosevelt, might have brought such a program with him to Washington and who knows, things might have played out in an altogether different way,” Starr said.

The second scene casts Roosevelt in the White House considering health care legislation. But on the advice of advisers who favored pushing employment and social security issues, Roosevelt tabled attempts to pass such legislation. “He never returned to the effort,” Starr said.

Act 1’s third scene, set in the late-1940s, shows Harry Truman — the first president openly to endorse a program for universal health insurance — being stymied by Republican and some Democratic opposition in Congress, as well as by strong opposition from the American Medical Association.

“Opponents of the program in the World War I era correlated it with socialized medicine, and identified it with an enemy regime — Germany,” Starr said. In the 1930s and ’40s, opponents identified national health insurance proposals with another enemy regime — the Soviet Union.

“Opponents saw government-run health insurance as a very insidious idea, undermining the American way. That opposition became a very powerful weapon in preventing these plans from being enacted,” Starr explained.

“The second important thing that came out of Act 1: We adopted an employer system of private insurance,” he said.

In Act 2, the policy trap is set, he said. “Instead of dealing with health care as a separate issue, policymakers said: ‘Let’s just add hospital benefits on to Social Security.’ That was the germ of Medicare. In 1965, Congress passed three layers of legislation, Medicare Part A and Medicare Part B and Medicaid, that, although viewed as a great achievement, in some ways was a great flop,” Starr said. He said the three layers represented “too much frosting on the cake, including the extravagantly generous reimbursement fees for hospitals and physicians.”

The climax of Act 2 came in the 1970s, with President Nixon amidst the agony of Watergate. “He wanted desperately to pass a health care insurance bill to restore his popularity and negotiations were in progress. If Nixon was merely wounded politically and not destroyed, a bill might well have passed,” Starr said.

Act 3 begins with the 1991 election of Harris Wofford as a senator of Pennsylvania, which kicked off anew the debate about national health care reform.

“Under President Clinton, again there was a moment when health care reform had an aura of inevitability about it. Alas, that’s not what happened. Democrats couldn’t agree among themselves and Republicans withdrew their support. What happened in the end, like a grand opera, there were bodies strewn all over the stage — I was one of those bodies, and we failed,” Starr said, referring to his efforts in 1993 and 1994 to convince Congress to approve the Clinton plan.

“In the final scene of Act 3 we see President Obama — in what really began from Mitt Romney in Massachusetts — being able to get legislation through Congress in 2009. It wasn’t easy, and there was debate about the individual mandate in the Affordable Care Act and about the public option.”

What was different from past efforts, Starr said, was that in 2007-08 a variety of groups supported the Romney approach. “By 2009, there is a reform consensus within the Democratic Party, and even the health care industry said this is an approach they could agree on,” Starr pointed out.

“Unlike 1994 when Democrats couldn’t agree, in 2009 Obama had built a consensus of support for the general architecture of the reform. But even though the basic idea had been taken from conservative Republicans, like in 1994 the proposal had no Republican support,” he said.

“I would like to say to you that’s the end of the play. But we have scenes yet to play out,” Starr said.

Later this month, the Supreme Court will hear arguments about the constitutionality of the individual mandate. “It is possible, depending on the court’s decision, that part or all of the act will be overturned,” Starr said.

Another possibility is that the court may invoke an 1867 law, the Anti-Injunction Act, which holds that laws remain in good judicial standing until a penalty is levied as a result of a violation. The Affordable Care Act, which goes into  effect in January 2014, specifies that there can be no penalties amassed until 2015.

“A decision by the court to invoke the Anti-Injunction Act would then throw back the whole issue into the political arena,” where Republicans could repeal some or all of the legislation, Starr said.

So a lot is riding on the outcome of the congressional and presidential elections, he said.

“Meanwhile, states are moving slowly in preparing for health care legislation. They’re waiting to hear what the Supreme Court will say, they’re waiting to see how the elections turn out,” Starr said.

“In addition, public opinion is based mostly on partisan reactions to the law, and so I don’t think any discussion, any speeches can really affect that until we get to open enrollment in 2013 and we get to see how it works, see the different plans, see the concrete reality — if we even get to that point. Things are very confusing right now, not knowing exactly which directions things will go.”

*

In the question-and-answer session following Paul Starr’s presentation, Starr responded to several audience members’ concerns about costs of the new health-care legislation.

What are the prospects that this law will bring meaningful cost savings and containment of mass expenditures?

Starr replied, “In 1992-94, the Clinton health plan called for a budget cap, it called for competition based on what we now call insurance exchanges, but it also called for limited premiums. That effectively would have capped health care.”

At that time, the health care industry was opposed to those steps and the Democrats in effect caved on the issue, he said.

“The new law calls for the creation of an independent payment advisory board, which is intended to change the politics. Right now, if there is an interest group, nothing happens,” Starr said. “Under the new arrangement, health care providers are required to make proposals and to control costs, particularly in any year when the costs are going up past the inflation rate.”

However, he said, due to the gridlock in Congress, it remains an open question whether Congress will block appointments to the board.

“I believe [cutting costs] is a two-pronged effort: Get better intelligence about costs and create better mechanisms to carry it out than we have currently,” Starr said. “These two things can make a difference in the end. Unfortunately, there wasn’t [Congressional] agreement on budget cuts, but the law puts in place things I think are the basis for having some degree of confidence that costs will be better contained.”

What do you see as the prospects for Medicare under the new law?”

Starr responded: “On the one hand, I believe Medicare deserves to be supported but on the other hand Medicare needs to be changed.”

The structure of Medicare is outdated, he said. “We have Medicare Part A and Part B because back in 1965 insurance was divided that way, between Blue Cross and Blue Shield. I believe the whole structure of Medicare needs to be changed. The difficulty is that many of the people are nervous about any changes at all.”

He noted the fickle nature of public opinion. “One of the things I learned from the historical record of public opinion is the tremendous anxiety of seniors about any change in Medicare. In 2003, Congress passed the Medicare Prescription Drug Act. Once it went into effect, public opinion turned in its favor. Now, seniors are the age group most opposed to the Affordable Care Act, but that could change once — this is, if — it goes into effect,” Starr said.

Does the United States need to create a cultural imperative that health care is a basic human right?

“I tend to resist that. We create institutions and patterns of expectations. From the standpoint of policy, I don’t know how to change a cultural imperative. But I do know how to change institutions,” Starr said.

“We should give practitioners better information and technology so they can make better health decisions and to track costs and outcomes. It’s a bottom-up strategy. We need better research on what works and doesn’t work. That’s what we want to have happen,” he said.

Do you think you’re misreading the opposition to the Affordable Care Act as only about politics when there also is economic opposition because the costs of government-run programs inevitably explode?

“I did not mean to give the impression that every piece of the legislation will be successful in cutting costs,” Starr responded. “But if it were generally true that government programs always escalate costs, why is it that all these other countries that have much more government intervention than we do have lower health care costs, and not just a little, but much lower costs? So, it’s not impossible for government programs to lower costs.

“The big difference between the United States and Germany and the Scandinavian countries and so forth is not the volume of services, it’s the price of services,” he continued. “The Affordable Care Act insists on paying for itself. The purpose of the law is not to provide a windfall for the health care industry. It calls for financial reforms within the industry, using financing measures.

“I believe the act is affordable. For millions of people it will provide less expensive insurance than what’s available in today’s market. Under the act, insurers are required to offer a policy to everyone at a rate that does not take into account their individual health condition. The idea is to take away the incentive to cherry-pick as insurers have done in the past. That was an idea that the Republicans endorsed a short while ago. Why they want to repeal it now, I don’t know,” Starr said.

Will adding some 34 million new people to the health insurance rolls put untenable demands on already over-burdened emergency rooms?

“After Medicare passed, people were worried about the same problem,” Starr replied. “That 34 million people are not insured does not mean they are getting no health care.”

If the affordable health care plan works as designed, he said, emergency rooms should be less burdened because patients will be able go to a physician and in some cases get better preventive care, which would lower costs in the long run.

—Peter Hart