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THE BAUCUS WHITE PAPER: THE POLITICS.
Fundamentally, Baucus's health policy plan is a political document. So it would, on some level, be irresponsible not to speculate on the politics of it. Right? Right!
There are a couple things going on here. I can't say if they're intended or not. It's possible that the whole political strategy is fairly inchoate on Baucus's part, and putting out a plan just seemed the logical next step. But I doubt it. Here, in any case, are the immediate ramifications of his proposal. As a caveat to this post, many of these might not come true. They just seem to be the path the strategy envisions:
The first and most obvious impact is on Baucus's stature. He just moved from Possible Player to Player. He's first out of the gate with a health reform plan. His position as chair of the Senate Finance Committee means his priorities are more than mere preference or moral exhortation: They are actionable. He controls the relevant committee, and if he decides it's doing health care, then it's doing health care. That's not to say he won't come to some sort of accommodation with Obama's preferences on sequencing, but it will be an accommodation that recognizes Baucus's agenda, too. The dude's got power.
Moreover, Baucus just signaled to his colleagues, his committee members, his party's president-elect, and everyone else that he means to take the lead on heath reform. This is inextricably tied up in Ted Kennedy's condition. If Kennedy were at full strength, there's no doubt that Uncle Ted would have a central role in any health reform fight. If he comes back even at half strength, he'll have a central role. But the honest and sad truth is that no one in Washingotn is hearing very good things about Kennedy's condition, and expectations among most reformers I speak to is that his role is, at best, uncertain. He may be the guiding sage and the moral force behind the next health reform fight, but few expect him to be able to take point on the legislative work.
If that turns out to be wrong, then it's wrong, and Kennedy will have a central role. But if it's right, Baucus just stepped into the vacuum. If Kennedy returns, then he will unquestionably have a leadership role. But if he doesn't, Baucus, by virtue of his substantive power as chair of the relevant committee and his early effort to take the lead on the issue, probably ends up in front. That's not to say others, like Clinton and Rockefeller, won't play a serious part. But Baucus looks ready to take point on the substantive process.
Not all of the jockeying is intra-congressional, though. Baucus is also staking out space for Congress, or trying to, against an executive-led process. In 1994, Bill Clinton ran health care reform out of the executive branch. In retrospect, most believe that a fundamental mistake (for a longer argument on this score, see The Lessons of 1994). But that's not to say Obama couldn't repeat it, or some form of it. Baucus is essentially stepping out in front. If the Finance Committee is already going to be working on his bill, then it would be odd for the president to construct a separate process for building the legislation. After all, Baucus, at the end of the day, is the guy who writes the thing. And he's under no obligation to write Obama's thing. So this defines a possible congressional process centered around Baucus and his committee that Obama could weigh in on (and, obviously, have tremendous influence over). And it makes a presidential process much less likely, as the bill eventually has to pass the Senate, and that won't happen if the president and the Finance Committee get into a turf war. The big question here is what role the House would lay in this scenario, and as of now, I don't have an answer to it.
COMMENTS (17)
didn't senator clinton have a plan? that doesn't that count why?
Posted by: polyblog | November 12, 2008 4:29 PM
I don't understand how this is gonna work. What will motivate a for-profit insurer to join up to provide coverage if they can't deny coverage? It would seem to me the only way they would do so is to set premiums so high they are at least as unaffordable for people like me as they are now.
If the gvt can incentivize them to take people like me thru tax credits and the like, then how are costs going to be contained? How is the gvt going to stop these companies from colluding?
Why does the plan only allow people 55+ and older to opt into Medicare? It seems to me that those are people most likely to need care, but denies younger folks like me the opportunity to buy into what should be theoretically lower rates then for-profit plans. You would think the gvt would want to insure the solvency of this Medicare expansion by including as many people into the program as want in.
Posted by: jdw | November 12, 2008 4:33 PM
Seems to me that the other important target of the white paper is Senator Wyden and the Healthy Americans Act. Baucus's proposal signals pretty strongly that, as far as he is concerned, any reform that tries to move away form employer-based coverage (as Wyden's does) is DOA. It'll be interesting to see where the Healthy Americans Act co-sponsors go from here, but right now it looks like they've had the door slammed on them pretty hard.
Posted by: Dev | November 12, 2008 4:34 PM
Krugman writes in his blog today that Obama's opposition to mandates is just political tactics. Sounds to me there's not very much daylight between his plan and Baucus's approach. Personally I'm finding it hard not to be optimistic they're finally going to get UHC enacted.
Posted by: Jasper | November 12, 2008 4:37 PM
One additional effect of Baucus stepping out first with the health care plan is that, since his plan includes a mandate, it can give Obama a shield. I happen to think Obama was criticizing mandates was simple politics: his plan didn't have a mandate and he was getting attacked for it by Edwards and Clinton so he tried to make the argument that mandates were a bad thing. I think he was wrong for doing that, but I happen to think it wasn't an expression of his personal beliefs.
However, having spent all this time fighting back on mandates if he takes the lead on health care and his plan includes a mandate, then he's given the right a perfect attack angle. If he stands back a bit and mostly fights for health care in general terms, while congress works out the details, then he can sign a bill that includes a mandate and say, "while I don't agree with a few parts of it, its still a very important step and one that we have to take immediately."
Posted by: Matt | November 12, 2008 4:38 PM
But is Baucus' outline an ambitious-enough high bid, to be negotiated down?
Posted by: M | November 12, 2008 4:43 PM
"Fundamentally, Baucus's health policy plan is a political document. So it would, on some level, be irresponsible not to speculate on the politics of it. Right? Right!"
Right. When do we f**k the thing up and form the circular firing squad? This has been much too promising and hopeful for me to take. Baucus taking the lead on this is a very pleasant surprise, plus it gives Obama political cover.
And yesterday, I heard Marty Feldstein on the Newshour call for massive public infrastructure spending. I'm gonna have to go lie down. This hope is much too audacious for me.
Posted by: Sock Puppet of the Great Satan | November 12, 2008 5:23 PM
Idle curiosity, but did Baucus have a candidate in the primaries that he supported?
Posted by: Salvo | November 12, 2008 6:02 PM
What I don't understand is the _larger_ politics of it. Did he vet it through Obama and 60 senators first or was this an independent power play? If not, why hasn't he learned anything from failures of health policy in the past - get your coalition, don't let one person (not Clinton, Nixon, FDR alone can push health care through) or else it will be squashed. If Obama did approve, why was it released by one guy, instead of in the structured ways he normally prefers? I thought we were done playing solo agent.
Posted by: jsu | November 12, 2008 6:34 PM
Why not just tax everyone, give them a Health Card, like Social Security, and be done with it? The insurance will only coverage catastrophic emergencies. Standard regular exams have a small co-payment.
People who can afford something more privileged can buy more insurance.
Posted by: Anonymous | November 12, 2008 7:45 PM
Idle curiosity, but did Baucus have a candidate in the primaries that he supported?
I believe Baucus remained neutral until June 3 and then was one of that raft of superdelegate endorsements that put Obama over the top.
Posted by: John | November 12, 2008 8:23 PM
I also want to know whether Baucus did this in coordination with Obama or in an independent and somewhat aggressive move to control the debate. The interpretation of what this means is totally different depending on which is true.
In the first case, this gives cover to Obama to enact universal health care and indicates a relatively smooth and collaborative process to come. In the second, well, Ezra described that scenario.
Posted by: jd | November 13, 2008 12:12 AM
Does Ezra have any evidence whatsoever that Obama wouldn't be 110% thrilled to just stand back and watch a bill run through Congress, quietly nudging it this direction or that on specifics behind the scenes, declare it the will of the people through their duly elected representatives, and hold a celebratory signing in the Rose Garden, sign a historic piece of legislation, and become a first-order iconic Democratic legend? Does he even have a theory about why he wouldn't take this route?
If Baucus r anyone else has the stuff to get this to sail through and be popular, believe me, he's not going to get in the way and muss it up. If it stalls it'll be because there are signs of the public sensing overreach. Then he'll have to push and shove to get it through, which would have unpredictable electoral consequences. That's when we'll find out what his real commitment level is to accessible health care.
Posted by: Mike | November 13, 2008 12:37 AM
It's too bad Baucus reinforces the employer based non-system. People in the modern economy switch jobs so frequently that coverage will be too erratic for continuity and prevention. Besides, it's when you lose your job that you need insurance the most since you have no income to pay for services otherwise. Also, this will only increase the tendency for people to work at jobs for benefits, a drag on the economy discouraging new small businesses and their ability to compete with other countries.
Wyden's plan fixes these problems, covers more people, is budget neutral and actually creates a "system" which can be improved. The one good thing about the Obama/Clinton/Edwards/Baucus/Kennedy plan is the promotion of a federal insurance plan. Theoretically, this could allow an avenue for single payer. Unfortunately, it probably creates the basis for a two-tiered insurance system whereby only great jobs get private insurance and the public plan, therefore, cannot be funded through taxes or becomes too expensive, or basic, to be helpful. Forcing employers to cover people is not the answer.
Posted by: PG | November 13, 2008 8:48 AM
It's too bad Baucus reinforces the employer based non-system.
He doesn't. Giving people the option to join a public plan will undermine the employer-based system, at least over the long term. I don't have any problem with that because, unlike with McCain's proposal, Baucus (and Obama) provides an alternative.
Unfortunately, it probably creates the basis for a two-tiered insurance system whereby only great jobs get private insurance and the public plan, therefore, cannot be funded through taxes or becomes too expensive, or basic, to be helpful.
I agree that under the most likely Democratic (I'll call it Baucus/Obama)approach, the slow but sure erosion of the employer-based insurance system will likely continue, and probably accelerate. But how does it therefore follow that the public plan "cannot be funded" through taxes? This seems nonsensical. Yes, what you're describing is a two-tier system. But we already have a multi-tier system (the more money, the higher your tier). If the vast majority of Americans ultimately find themselves in the "lower" (ie, public) tier of a two-tier system, the political pressure to adequately fund said tier is likely to be quite intense. Britain has such a system, for instance: wealthy people can but their way into gold-plated healthcare delivery. Canada, too (although sometimes you have to leave the country). The point is, in both Britain and Canada political support for government-guaranteed UHC is broad and strong, just like support for existing American social insurance programs (ie Medicare and Social Security) is broad and strong in the US. America is a pretty exceptional country in a lot of ways -- but we're not that exceptional.
Posted by: Jasper | November 13, 2008 1:58 PM
I agree with Jasper that the public plan will erode away at the employer based system and that McCain's plan would be a disaster. But if erosion is the goal (it is the opposite of the stated goal by the way), this reform is a horrible way to enact it. Think of all the companies that will be in the situation of providing insurance until they can no longer afford it, to be good businesses, only to be in competition with ones that don't. This would only harm businesses that want to be good to their employees.
I also agree the two-tier system would not be so bad compared to the current. However, it would be different than Britain since the percentage in the top tier would start out large and it's not clear it would ever shrink as far as in Britain. Therefore, support would always be less broad.
In general, the employer risk pool has been a terrible feature in American health care that has sabotaged good public policy and apparently will continue to do so.
Posted by: PG | November 13, 2008 4:59 PM
But if erosion is the goal (it is the opposite of the stated goal by the way), this reform is a horrible way to enact it.
I doubt very much erosion is the goal. In the first place, it's already occurring -- no government action needed. Secondly, the goal is to provide all citizens with meaningful, regularized access to health care. The "erosion" part (to the extent that an already-in-place dynamic gets exacerbated by the eventual Democratic plan) seems to me an utterly unavoidable side effect of introducing publicly-funded universal health insurance in a country with a huge system of employer-based health insurance. The latter simply isn't going be be able to compete over the long term -- at least not for the premium dollars of the vast majority of Americans who aren't millionaires.
The only way to avoid this outcome would be to consciously solidify the employer-health insurance link by government action, or elsse legislate it out of existence altogether via the imposition of Canadian-style UHC. But that's just not in the cards. Even if we went to a single payer option along the lines of what Canada has, ain't no way Congress is going to enact legislation that covers everybody and makes existing private health insurance illegal. At any rate, I personally think the economics of for-profit health insurance are so unsustainable that the introduction of UHC will inexorably lead to a situation wherein eventually the percentage of Americans who get their coverage this way will be tiny. (Although I also think it's likely -- and perhaps quite desirable -- that many Americans will have private health insurance for incidentals, as is the case in France).
Posted by: Jasper | November 13, 2008 5:57 PM