Don’t Call It Obamacare

The Tortured, Tortuous History of the Conservative Solution to Universal Health Care

As the Nixon Administration was nearing its collapse, the man who was said – with reason – to have ‘a face like a foot’ made a concerted effort to find a Republican solution to health care that would, first, maintain and fortify the grasp of the private insurance companies, second and almost as important, reduce or at least slow the growth of the costs of medical care and, third and largely a pretense, expand the percentage of Americans with health insurance with the idea that the uninsurable residue would be small enough that it could be covered by the Government, if it had to.  In this effort, Nixon enlisted the help of the then-CEO of Kaiser Permanente, aided by expertise largely from private industry.

They studied the matter intensely, and came to the conclusion that, for such a private-insurance-centered system to be successful, it had to have three legs:

  • Business mandates requiring that all companies above a certain size provide their employees with comprehensive coverage;
  • Individual mandates requiring everyone self-employed or working for small businesses to buy their own insurance; and
  • Insurance policy minimum requirements, so that insurance companies wouldn’t sell ‘junk’ policies that didn’t actually pay out anything, dumping the costs of needed treatment back on the government.

Nixon then pitched this idea to an unresponsive legislature.  The R’s balked because of the proposals’ dependence on mandates; the Democrats, led by Teddy Kennedy, resisted because they wanted ‘single payer’, that is, government-supplied health care; and both sides resisted because by then they smelled blood in the water.

And so it went nowhere.  But only a very few years later, conservative ‘think tanks’, particularly the Heritage Foundation, took the matter up again, not because they actually had any interest in anybody except the rich having health care but because they realized that the increasing costs of health care was becoming a drag on American competitiveness in the growing global market and creating increasing demand for single-payer, to which they were opposed with religious fervor.

And so, once again, a tremendous amount of experience with and expertise in insurance and health care was summoned.  How can a health care system be designed to meet the goals of protecting the existing insurers, reducing the growth of costs, and (minimally) covering as many as possible with the least expansion of government-supplied care?

And so, late in the brief Ford administration, they came out with their conclusions, which were that, for such a private-insurance-protecting system to be successful, it had to have three legs:

  • Business mandates requiring that all companies above a certain size provide their employees with comprehensive coverage;
  • Individual mandates requiring everyone self-employed or working for small businesses to buy their own insurance; and
  • Insurance policy minimum requirements, so that insurance companies wouldn’t sell ‘junk’ policies that didn’t actually pay out anything, dumping the costs of needed treatment back on the government.

You could feel the wave of disbelief and anger that swept over the Republican Party.  Weren’t these clods listening?  No mandates!  No!  Several researchers lost their jobs, and the whole effort was once again shelved.

 

So, back to the drawing board.  After a few years to cool off, the same pressures arose to solve the problems of rapidly-increasing premiums, high costs of using the Emergency Room as provider of first (usually the only) choice for the increasing number of the un- and under-insured, and (most importantly for the R’s) decreasing profits for insurers.  Once again, the Heritage Foundation’s health care experts were called upon, still bruised and limping from the last go-round, to tackle the problem.

Now I do not at all want to pretend that I have any expertise in insurance or health care.  But I found that first, Nixonian effort to be, as a question of how systems work, how ideas live or die, and of politics, quite interesting.  I had no interest in health care per se, but this ballet being danced again and again was fascinating.  So I kept reading about it, whenever it arose again as the conservative answer to the challenge of creating a health care system.  And it kept coming up, again and again, arising every five or so years through the Reagan, Bush I, Clinton and Bush II administrations.  And every time – every single time, without exception, with me laughing harder and harder each time the Gorgon reappeared – every time these researchers, with all their broad and deep expertise, were forced to exactly the same conclusions:  You must have employer mandates; you must have individual mandates; you must have minimum policy requirements.  They couldn’t even support one or two of those legs without the others; people with infinitely more knowledge than you or I would ever have, and with all the reasons in the world to avoid the same result – kept coming to the same result.

And every time, without a single exception, the same result brought the same reaction; howls from the rank-and-file R’s, researchers sacked and careers ended, indifference from leadership, and the turned backs of D’s who were only interested in single-payer.  Again, I am no expert; but when massive efforts of the well-informed keep coming to the same conclusions despite all the dangers to their jobs, over and over, then it’s pretty clear that for such a private-insurance-centered system to be successful at achieving the arbitrary demands the conservatives make for it –

It has to have three legs:

  • Business mandates requiring that all companies above a certain size provide their employees with comprehensive coverage;
  • Individual mandates requiring everyone self-employed or working for small businesses to buy their own insurance; and
  • Insurance policy minimum requirements, so that insurance companies wouldn’t sell ‘junk’ policies that didn’t actually pay out anything, dumping the costs of needed treatment back on the government.

 

That’s the real reason that the enemies of what they, as racists, want to pretend is Obamacare but which is actually Nixoncare, have been utterly unable to describe a replacement that doesn’t humiliate them by being no different from the Affordable Care Act in any important way, and further infuriate their base.  They may repeal; they can’t replace.  They are in a Sisyphean trap of their own making, where the task as they have described it – ‘First, Do No Harm’ to the powerful private health interests – can only be achieved one way, through three mandates that cause their base to set its hair on fire.  The only possible solution that achieves the only acceptable result causes the unacceptable result of them being turfed out by the revolting of their revolting base.

 

In the meantime, other forces came into play.  Starting late in the Clinton administration and culminating in changes contained in the ACA and in separate legislation, there arose a broad consensus right the way across the entire political spectrum, from conservatives as passionately as progressives.  A broadly-expressed demand arose that insurance companies should not be allowed to refuse to insure anyone, that the specter of the pre-existing condition as a limiter of coverage should be ended, and that insurance companies must limit their use of defining group charateristics to only a few – primarily, to age and geography.  A strong, healthy individual should be put into the same actuarial group as the sedentary smoker.  So wide-spread was this rejection of lifestyle markers being used to create similar-risk insurance groups that actuarial science – defined by Wikipedia as ‘the discipline that applies mathematical and statistical methods to assess risk’ – has largely disappeared from insurance.  So popular has this proved that this actuarial limitation has become an irresistible force in the political equation.

This effort to remove the actuary from his central role in insurance, though of course not seen as such, has made the insurance company ultimately unimportant.  The result is entirely predictable, and inevitable; as premiums and costs continue to increase, and they will, any further attempts to corral expenditures will be forced to one unavoidable conclusion.

Private insurance, at least as the provider of health care for the vast majority of consumers, must die.

The only benefit to anyone (other than Wall Street) of private insurers is that, by ever more precise and detailed application of actuarial tables, free market forces will result in savings that will keep cost growth to a minimum.  Healthy competition in health care will keep the whole system healthy, and at least somewhat affordable.  But once the actuarial table is removed as a source of savings that put the more costly individual in groups that pay higher premiums, the only way one company can out-compete any other is by limiting payouts.

We’ve now eliminated that possibility, in legislation both within and outside of the ACA – legislation which has such wide-spread support that ending it cannot be done.

Thus the trap the Republicans in Congress are in.  They will never be able to replace Nixoncare with anything that isn’t itself just another iteration of it; they will never be able to repeal it un-replaced without ending their own cushy, self-important, insurance-supplied careers; and they won’t survive the torch-carrying, pitchfork-wielding Trascists massing at the barricades if they don’t.  And no matter what they do, single payer – probably Medicare For All – has been made inevitable as the removal of actuary from insurance spells its doom as the moment nears when people realize that no further savings can be made in the system except by removing profits, and thus profiteers, from the equation.

 

What fun!

 

 

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