Orszag’s Broken Cost-Cutting Promises

June 24th, 2010 at 4:56 pm | 30 Comments |

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Researchers have estimated that nearly 30 percent of Medicare’s costs could be saved without negatively affecting health outcomes if spending in high- and medium-cost areas could be reduced to the level in low-cost areas—and those estimates could probably be extrapolated to the health care system as a whole. With health care spending currently representing 16 percent of GDP, medical that estimate would suggest that nearly 5 percent of GDP—or roughly $700 billion each year—goes to health care spending that cannot be shown to improve health outcomes.

For the most part, Congressional hearings are a sleepy affair, nothing like the dramatic television portrayal with hard questions from flashy politicians and gillions of reporters hanging on every word. Most witnesses tend to be noncontroversial, sticking to pre-written talking points.

When I was asked to testify on a hot summer’s day in 2008, the topic hardly seemed controversial: Getting better value in health care.

But the first witness – invited by the Democratic majority – was bombastic and made striking comments. Indeed, the above quotation was one of his opening comments.

Strip away the rhetoric (“researchers”, “extrapolate”, and “high- and medium- cost area”) and the idea is sweeping. No – radical. The witness argued that fully 3 in 10 dollars of American health care is wasted away without any result. The implication is also clear: with successful reforms, it would be possible to dramatically trim cost without affecting quality.

Those words weren’t uttered by a provocative member of a Washington think tank. Rather, they came from the CBO director. More importantly: with candidate Obama ahead in the polls, he seemed likely to land a significant job in the White House.

He did. Peter Orszag became the youngest Cabinet member and the budget director.

And in that post, he continued to advocate for health reforms to tame future health costs. “If we fail to do more to move toward a high-value, low-cost health care system,” he said in a New York address last July, “we will be on an unsustainable fiscal path, no matter what else we do.”

As I noted last August, “If you’re starting to wonder why the President doesn’t sound like the Barack Obama you remember, it’s because he’s starting to sound almost exactly like Mr. Orszag, the President’s budget director.”  Indeed, health reform is deficit reduction became something of a mantra at the White House. “Bending the curve” – Orszag’s most famous phrase – became a staple of the President’s speeches on health reform.

And Orszag’s fingerprints are all over the Affordable Care Act. Yes, the legislation includes initiatives for electronic medical records, fraud and abuse reduction, and administrative simplification. But it also contains a more radical pill: looking at the wide variation of spending across the country, and drawing on the controversial Dartmouth data, the administration concluded that the way to get better value for money was through a government committee. Medicare pays for services; under Orszag-turned-Obama’s vision, Medicare payments would be guided by a committee of learned experts, empowered by Congress but arms-length, to pay for quality service. The committee went through different forms in the different Senate and House bill, but the Independent Payment Advisory Board (IPAB) was included in the final legislation.

Writing in this week’s New England Journal of Medicine, Orszag and OMB advisor Dr. Ezekiel Emanuel explain:

The most important institutional change in the ACA… is likely to be the establishment of the Independent Payment Advisory Board (IPAB), an independent panel of medical experts tasked with devising changes to Medicare’s payment system. Beginning in January 2014, each year that Medicare’s per capita costs exceed a certain threshold, the IPAB will develop and propose policies for reducing this inflation. The secretary of HHS must institute the policies unless Congress enacts alternative policies leading to equivalent savings. The threshold is a bit complex; initially, it is a combination of general and medical inflation, but in 2018 and thereafter, the cap is set at general inflation plus 1%.

IPAB draws its inspiration from Britain’s NICE, similarly charged with getting better value for money in health care across the pond. As I’ve noted here before, NICE is a policy flop – sparking controversy and lawsuits, and ultimately failing to reign in health expenses (British health inflation has bested 7% at points over the past decade).

But as Peter Orszag packs his boxes, David Cameron’s government prepares to dismantle NICE as we know it.

Of course, Orszag is right in the diagnosis. Health costs are unsustainable. He’s wrong in the treatment, seeing a robust role for government as payer, guardian, and manager of all things health care.

In medicine, the equivalent mistake is known as malpractice. In Washington, it’s known as Obamacare.

Recent Posts by David Gratzer

30 Comments so far ↓

  • TerryF98

    Tax Cuts!

  • Rabiner

    David Grazer:

    I’ve read this article twice to be sure of the argument that you’re attempting to make. However I fail to see how you got to the title “Orszag’s Broken Cost-Cutting Promises”. What promises did he make that warrant such an accusation? Orszag is correct that we spend much of our health care dollars as a nation on health care that does not improve our health, our quality of life and has marginal affects on our lifespan. The problem with NICE is not that it made incorrect recommendations which would make health care dollars more efficient in their allocation but rather Politicians using these recommendations as a political football to scare the population as a whole.

    Look at the recent recommendations for Mammograms which said that having a mammogram every 2 years starting at age 40 was inefficient usage of health care dollars. Woman’s groups were up in arms over the recommendations (which are nonbinding) and politicians used it as a way to scare Americans that government bureaucrats are going to take away your access to health care.

    The last part of your article offers no solution but rather juts rhetoric. “Of course, Orszag is right in the diagnosis. Health costs are unsustainable. He’s wrong in the treatment, seeing a robust role for government as payer, guardian, and manager of all things health care.”

    What would you personally suggest that would limit the increased cost of health care in this nation and improve outcomes without government intervention?

  • TerryF98

    Was this piece rushed out just to get the disastrous Guardiano piece off the front page. If so I can understand.

    It was that embarrassing.

  • CAPryde

    “But it also contains a more radical pill . . . Medicare pays for services; under Orszag-turned-Obama’s vision, Medicare payments would be guided by a committee of learned experts, empowered by Congress but arms-length, to pay for quality service.”

    This is not actually a very radical pill; Medicare payments are currently set by a board of medical professionals. Orszag’s proposal changes the chairs a bit, but it’s hardly a whole new world.

  • Oldskool

    “In medicine, the equivalent mistake is known as malpractice. In Washington, it’s known as Obamacare.”

    Another column promoting the status quo or at least a leave-it-all-up-to-the-insurance-industry approach. And how would it be complete without using “Obamacare” as a dog whhistle to the lunatic fringe.

    There must be a print shop in DC where you can buy these columns by the case. They all end up saying the same stupid thing, albeit in different fonts.

  • TerryF98

    Well worth a read. We have the best health care in the world, apart from the fact that we don’t by a long way. Give the chart a good look.


    “We’ll have to wait and see how well the United States men’s soccer team fares now that they are in the knockout stages of international competition at the World Cup, but if there’s one thing we can all take pride in is the fact that we are the Champions of Health Care! Top prize goes to the system that best combines mediocrity with stratospheric costs, right?

    No? Well, that’s bad news then, because according to a new study by the Commonwealth Foundation Fund that relieves health care reform proponents of having to cite outdated statistics from the World Health Organization, that’s precisely the sort of health care we have. And it’s all been rendered in handy-dandy chart form:”

  • LFC

    He’s wrong in the treatment, seeing a robust role for government as payer, guardian, and manager of all things health care.

    If not the government, then who? Private industry has failed miserably at the task over the past several decades. Their solutions included rescission and denial of coverage.

    In fact, private industry has absolutely zero interest in managing all things health care. Their sole responsibility is maximizing profits. The two are not synonymous.

  • easton

    Wow, excellent analysis from the first set of commentors. Nicely done.
    “He’s wrong in the treatment, seeing a robust role for government as payer, guardian, and manager of all things health care.” This is just assertion, no counter argument by Mr. Gratzer. It simply is not acceptable to say someone is wrong with showing how or why.

    The US pays 16% of its health care costs on Medicine, by far the highest in the OECD, with no measurably better outcomes. Japan pays far less, at 8% with superior outcomes to the US, and Japan most assuredly has a robust role for government as payer, guardian, and manager of all things health care.

    Might I suggest: http://www.pbs.org/wgbh/pages/frontline/sickaroundtheworld/countries/

    It shows a fair and balanced (whoops, am I allowed to use those words or will Fox sue me?) treatment of health care systems outside of the US

    United Kingdom
    uk flag
    An interview with an expert on the UK’s system +

    Percentage of Gross Domestic Product (GDP) spent on health care: 8.3

    Average family premium: None; funded by taxation.

    Co-payments: None for most services; some co-pays for dental care, eyeglasses and 5 percent of prescriptions. Young people and the elderly are exempt from all drug co-pays.

    What is it? The British system is “socialized medicine” because the government both provides and pays for health care. Britons pay taxes for health care, and the government-run National Health Service (NHS) distributes those funds to health care providers. Hospital doctors are paid salaries. General practitioners (GPs), who run private practices, are paid based on the number of patients they see. A small number of specialists work outside the NHS and see private-pay patients.

    How does it work? Because the system is funded through taxes, administrative costs are low; there are no bills to collect or claims to review. Patients have a “medical home” in their GP, who also serves as a gatekeeper to the rest of the system; patients must see their GP before going to a specialist. GPs, who are paid extra for keeping their patients healthy, are instrumental in preventive care, an area in which Britain is a world leader.

    What are the concerns? The stereotype of socialized medicine — long waits and limited choice — still has some truth. In response, the British government has instituted reforms to help make care more competitive and give patients more choice. Hospitals now compete for NHS funds distributed by local Primary Care Trusts, and starting in April 2008 patients are able to choose where they want to be treated for many procedures.
    jp flag
    An interview with an expert on Japan’s system +

    Percentage of GDP spent on health care: 8

    Average family premium: $280 per month, with employers paying more than half.

    Co-payments: 30 percent of the cost of a procedure, but the total amount paid in a month is capped according to income.

    What is it? Japan uses a “social insurance” system in which all citizens are required to have health insurance, either through their work or purchased from a nonprofit, community-based plan. Those who can’t afford the premiums receive public assistance. Most health insurance is private; doctors and almost all hospitals are in the private sector.

    How does it work? Japan boasts some of the best health statistics in the world, no doubt due in part to the Japanese diet and lifestyle. Unlike the U.K., there are no gatekeepers; the Japanese can go to any specialist when and as often as they like. Every two years the Ministry of Health negotiates with physicians to set the price for every procedure. This helps keeps costs down.

    What are the concerns? In fact, Japan has been so successful at keeping costs down that Japan now spends too little on health care; half of the hospitals in Japan are operating in the red. Having no gatekeepers means there’s no check on how often the Japanese use health care, and patients may lack a medical home.
    de flag
    An interview with an expert on Germany’s system +

    Percentage of GDP spent on health care: 10.7

    Average family premium: $750 per month; premiums are pegged to patients’ income.

    Co-payments: 10 euros ($15) every three months; some patients, like pregnant women, are exempt.

    What is it? Germany, like Japan, uses a social insurance model. In fact, Germany is the birthplace of social insurance, which dates back to Chancellor Otto von Bismarck. But unlike the Japanese, who get insurance from work or are assigned to a community fund, Germans are free to buy their insurance from one of more than 200 private, nonprofit “sickness funds.” As in Japan, the poor receive public assistance to pay their premiums.

    How does it work? Sickness funds are nonprofit and cannot deny coverage based on preexisting conditions; they compete with each other for members, and fund managers are paid based on the size of their enrollments. Like Japan, Germany is a single-payment system, but instead of the government negotiating the prices, the sickness funds bargain with doctors as a group. Germans can go straight to a specialist without first seeing a gatekeeper doctor, but they may pay a higher co-pay if they do.

    What are the concerns? The single-payment system leaves some German doctors feeling underpaid. A family doctor in Germany makes about two-thirds as much as he or she would in America. (Then again, German doctors pay much less for malpractice insurance, and many attend medical school for free.) Germany also lets the richest 10 percent opt out of the sickness funds in favor of U.S.-style for-profit insurance. These patients are generally seen more quickly by doctors, because the for-profit insurers pay doctors more than the sickness funds.
    tw flag
    An interview with an expert on Taiwan’s system +

    Percentage GDP spent on health care: 6.3

    Average family premium: $650 per year for a family for four.

    Co-payments: 20 percent of the cost of drugs, up to $6.50; up to $7 for outpatient care; $1.80 for dental and traditional Chinese medicine. There are exemptions for major diseases, childbirth, preventive services, and for the poor, veterans, and children.

    What is it? Taiwan adopted a “National Health Insurance” model in 1995 after studying other countries’ systems. Like Japan and Germany, all citizens must have insurance, but there is only one, government-run insurer. Working people pay premiums split with their employers; others pay flat rates with government help; and some groups, like the poor and veterans, are fully subsidized. The resulting system is similar to Canada’s — and the U.S. Medicare program.

    How does it work? Taiwan’s new health system extended insurance to the 40 percent of the population that lacked it while actually decreasing the growth of health care spending. The Taiwanese can see any doctor without a referral. Every citizen has a smart card, which is used to store his or her medical history and bill the national insurer. The system also helps public health officials monitor standards and effect policy changes nationwide. Thanks to this use of technology and the country’s single insurer, Taiwan’s health care system has the lowest administrative costs in the world.

    What are the concerns? Like Japan, Taiwan’s system is not taking in enough money to cover the medical care it provides. The problem is compounded by politics, because it is up to Taiwan’s parliament to approve an increase in insurance premiums, which it has only done once since the program was enacted.
    ch flag
    An interview with an expert on Switzerland’s system +

    Percentage of GDP spent on health care: 11.6

    Average monthly family premium: $750, paid entirely by consumers; there are government subsidies for low-income citizens.

    Co-payments: 10 percent of the cost of services, up to $420 per year.

    What is it? The Swiss system is social insurance like in Japan and Germany, voted in by a national referendum in 1994. Switzerland didn’t have far to go to achieve universal coverage; 95 percent of the population already had voluntary insurance when the law was passed. All citizens are required to have coverage; those not covered were automatically assigned to a company. The government provides assistance to those who can’t afford the premiums.

    How does it work? The Swiss example shows that universal coverage is possible, even in a highly capitalist nation with powerful insurance and pharmaceutical industries. Insurance companies are not allowed to make a profit on basic care and are prohibited from cherry-picking only young and healthy applicants. They can make money on supplemental insurance, however. As in Germany, the insurers negotiate with providers to set standard prices for services, but drug prices are set by the government.

    What are the concerns? The Swiss system is the second most expensive in the world — but it’s still far cheaper than U.S. health care. Drug prices are still slightly higher than in other European nations, and even then the discounts may be subsidized by the more expensive U.S. market, where some Swiss drug companies make one-third of their profits. In general, the Swiss do not have gatekeeper doctors, although some insurance plans require them or give a discount to consumers who use them.

    Will Mr. Gratzer kindly rebut these?

  • TerryF98

    “Will Mr. Gratzer kindly rebut these?”

    Hell will be a frozen wasteland first :-)

  • easton

    By the way, what was the Republican plan to help the 50 million uninsured, ending recission, and ending denial of service for pre-existing conditions? Why HSA’s (health savings accounts) because we all know HSA’s will pay for cancer treatment, and of course low income workers are swimming in extra cash to funnel into their HSA’s, and as to recission, well the premium payers should never had gotten sick in the first place, so it suits them right.

    The other Republican solution? Selling across state lines, thereby undercutting state regulations (Republicans are all for states rights, except when they aren’t), and allowing states with the least regulations to cherry pick the healthiest in any given state, making in state companies that offer more expansive treatment uncompetitive, until we are left with all the insurance companies in Idaho or Montana, and good luck with companies and individuals negotiating with them (unless they live there). Every company can sell in every state, if they don’t like the regulations there they don’t have to. Now I would have no problem with selling across state lines provided there were National regulations setting minimum standards, but Republicans are against that. Their advice: Caveat emptor. And if Boise Health and Trust is nothing but a scummy fly by nighter, I suppose Premium holders can always drive across the country and sue them, provided Boise Health and Trust hasn’t already taken the money and ran.

  • easton

    Terry, the thing that kills me is years back when Obamacare was rightly called Romneycare, the Heritage foundation was touting it as the future of health care, and they were the ones calling for the individual mandate as an example of individual responsibility. Now, except for that which is cached, you can’t find any of this on their website.

    What I find so deplorable with Republicans is that good ideas (and Romney care was) are only good if Republicans design them. And Democrats in Mass. agreed with Romney. Reverse it and have Obama adopt Romneycare for the national model, and it becomes the worst evil in the history of the world.

  • TerryF98

    easton, the more I look at what the GOP are up to the more I am convinced that they would far rather allow this country to have huge unemployment and misery than allow the Democratic party any hint of success.

    The jobs bill in the Senate is the latest. A bill to provide money to the states so they can retain teachers firefighter and cops, so they can continue medicare funding. And what do the GOP do. As usual it’s NO.

    I firmly believe they are trying to worsen the jobs outlook and financial data so they can beat the Democrats over the head with this in November.

  • easton

    Terry, Jon Chait had a blog on just this today:

    Noting that Senate Republicans are refusing to extend expiring tax provisions now after having done so happily for years, Steve Benen wonders:

    It’s unpleasant to think about, and I really hope it’s not true, but it may be time for a discussion about whether GOP lawmakers are trying to deliberately sabotage the economy to help their midterm election strategy. After all, these same Republicans have supported deficit-financed tax-extenders before — there’s no credible reason to change course now.” End Benen
    Chait continues:
    It’s clear that the Republican Party has changed its positions in ways that are hard to explain without understanding that they once were in power and are no longer. The party fervently embraced the logic of Keynesian stimulus in 2001, when the underlying rationale was very weak, and fervently opposes it now when the underlying rationale is quite strong. If you were a principled opponent of Keynesian economic theory, you ought to have been more opposed to stimulus in 2001 than now, but very few Republicans were. Ezra Klein has another example today, of Republicans who favored an airline bailout in 2001. Most Republicans also supported a financial bailout in 2008. They just oppose bailouts when Democrats hold power.

    Still, I think you have to be careful about making assumptions about motive like this. Establishing motive is always very hard to prove. What’s more, the notion of deliberate sabotage presumes a conscious awareness that doesn’t square with human psychology as I understand it. People are extraordinarily deft at making their principles — not just their stated principles, but their actual principles — comport with their interests. The old Upton Sinclair quote — “It is difficult to make a man understand something when his salary depends upon him not understanding it” — has a lot of wisdom to it.

    I don’t think many Republicans are actually trying to stop legislation that might help the economy recover because they know that a slow economy is their best route to regaining power. I think that when they’re in power, consequences like an economic slowdown or a collapsing industry seem very dire, and policies to prevent this are going to sound compelling. When you’re out of power, arguments against such policies are going to sound more compelling.

    I’m not excusing their behavior. You can resist that kind of mental trap — it just takes a lot of intellectual discipline and integrity. I don’t think you’re going to find a great deal of that sort of intellectual discipline and integrity among high-level politicians.

  • TerryF98

    easton, you have a far more generous attitude to these people than I. I think they would do just about anything to get back into power.

    The irony is when they have power they don’t have a clue how to exercise it.

  • LFC

    easton, the more I look at what the GOP are up to the more I am convinced that they would far rather allow this country to have huge unemployment and misery than allow the Democratic party any hint of success.

    The term “you broke it, you bought it” never comes up in Republican circles. Obama and the Dems are trying to repair a staggering amount of damage caused by failed Republican policies, but rather than help the country, the Republicans just want to ensure that the Dems fail.

    This is the time when being a credible opposition could improve policy, preventing an excessive leftward swing or special perks, but the thought of reassessing their failed policies and trying to move forward in a thoughtful way is nowhere in their little right-wing heads.

  • sinz54


    Please try and keep up.

    It’s way too late to be looking at how other countries manage their healthcare.

    ObamaCare was already passed, the Dems aren’t going to repeal it, and Obama will veto any attempt to repeal it.

    For better or worse, ObamaCare is now the United States’ health care system. It doesn’t matter anymore how the Swiss do things. ObamaCare isn’t like the Swiss model.

  • easton

    sinz54, I am sorry, I had no idea time has stopped going forward, and that once one reform goes through, it means no other reform can ever go through. Republicans fought long and hard against even a weak public option because they knew once that happened, it would just be step one, towards a vigorous public option and then who knows. Of course it matters how other countries or places do things. Obamacare took its inspiration from Romneycare. Further reforms down the road can do the same. Neither you or I have any idea what 2016 can bring. As it is I find further reform towards more state control to be more likely than any future repeal.
    So, please, try to keep up with that.

  • sdspringy

    This is always extremely funny when the actual time line is mentioned. When exactly did the Reps. have control to ruin everything.

    Republicans only held all three branches of government from 2002- 2006, with never a filabuster proof majority in the Senate.

    So either Bush drugged the Dems into supporting his policies for the other 4 years or he actually was an evil mastermind.

    Currently the Dems have had legislative control for 4 years, since 2006, plenty of time to correct all the worlds problems, but unfortunately that is unlikely to occur no matter how long they have control.

    Eeaston, you should also refrain from using RomneyCare as an example of reform. In just a few short years RC has effectively bankrupted the Mass. state government. They are now begging for Federal support, such a great idea.

  • florishes

    Before I underwent 12 months of chemotherapy, my physician was required to get treatment approval from Blue Cross. My physician told me that she recommends the prescription but doesn’t make the decision on whether or not I receive treatment – Blue Cross will do that for both me and my physician.

    Once Blue Cross approved my physician’s treatment recommendation, 30 days had elapsed. I sold my home to pay for ancillary treatment that Blue Cross would not cover…blood transfusions, co-pays, additional surgeries to treat chemotherapy side-effects, business losses due to illness, and on and on.

    Don’t repeal – Repair the health care bill.

  • drdredel


    as I’ve said before, you should listen to republicans, they understand that private corporations are much better at figuring out what services to deny you than the government is. The government doesn’t care about you the way that Blue Cross does… just look at what they’re called “THE GOVERNMENT” (sounds spooky, cold, and ominous.. very George Orwell 1984)… vs. “Blue Cross” there you have tinges of Jesus as well as a placid color, which reminds you of calm and cool.

    Need I say more?!

  • LauraNo

    Sigh. As happens here pretty frequently, assertions are made but no evidence is proffered. What are the broken cost-saving promises?

  • Rabiner


    “Republicans only held all three branches of government from 2002- 2006, with never a filabuster proof majority in the Senate.

    So either Bush drugged the Dems into supporting his policies for the other 4 years or he actually was an evil mastermind.”

    You mean Democrats didn’t abuse the filibuster to make every piece of legislation require 60 votes to pass?

  • Rebellion News

    [...] Orszag’s Broken Cost-Cutting Promises [...]

  • msmilack

    I read this twice because I couldn’t find any content that matched your premise; you do not cite a single example to match your thesis. What is that about?

  • msmilack

    I always wait to read the preceding comments before I write mine so I won’t be influenced by them in forming my own opinion first. I just started reading them and see that Rabiner said the same thing I did in his first paragraph.

  • msmilack

    You wrote: “By the way, what was the Republican plan to help the 50 million uninsured, ending recission, and ending denial of service for pre-existing conditions?”

    The GOP plan was to insure 3 million instead of 50 million. They said we couldn’t afford to insure more than 3 million so the alternative plan they brought to the televised healthcare meeting with Obama was a plan for 3 million. They often failed to mention that discrepancy when they falsely claimed that Obama turned down their plan, one they said was better because it saved more money. Obama had challenged them to come up with a better plan and this is what they brought back. Well, yes, eliminating 47 million people from your plan will save you money but that was hardly the point.

  • easton

    Hey Rabiner, don’t forget Bush passed his tax cuts via Reconciliation, which only required 50 votes in the Senate. Of course the Republicans had control of everything, especially when there are as many blue dog democrats as there are. And as to the prescription drug bill, well this from Ezra Klein:
    Lessons from the Medicare Prescription Drug Benefit vote

    Here are some things that happened on the night the GOP pushed the Medicare Prescription Drug Benefit through the House of Representatives:

    A 15-minute vote was scheduled, and at the end of 15 minutes, the Democrats had won. The Republican leadership froze the clock for three hours while they desperately whipped defectors. This had never been done before. The closest was a 15-minute extension in 1987 that then-congressman Dick Cheney called “the most arrogant, heavy-handed abuse of power I’ve ever seen in the 10 years that I’ve been here.”

    Tom DeLay bribed Rep. Nick Smith to vote for the legislation, using the political future of Smith’s son for leverage. DeLay was later reprimanded by the House Ethics Committee.

    The leadership told Rep. Jim DeMint that they would cut off funding for his Senate race in South Carolina if he didn’t vote for the bill.

    The chief actuary of Medicare, Rick Foster, had scored the legislation as costing more than $500 billion. The Bush administration suppressed his report, in a move the Government Accounting Office later judged “illegal.”

    Rep. Jo Ann Emerson, a “no” vote, spent the night “hiding on the Democratic side of the floor, crouching down to avoid eye contact with the Republican search team.”

    Rep. Butch Otter, who provided one of the final votes after hours of arm-twisting from the Republican leadership, said, “I thought there was a chance I would get sick on the floor.”

    Remember all this? Probably not. There wasn’t much reporting on it at the time. It wasn’t a major controversy, despite resulting in multiple official investigations. I went back through the archives of National Review’s “The Corner” to see if they covered the scandal. Not really. There are four or five posts on it, and the most substantive is Ramesh Ponnuru telling some columnist that “it’s silly to act as though holding a vote open for a long time is an act of lawbreaking.”

    They’re considerably more exercised about the use of reconciliation today. Obama is “shoving health care down the throats of the American people in the teeth of overwhelming public opposition and any sense of parliamentary decency,” writes Mark Steyn, and I think he means “without” any sense of parliamentary decency.

    But the point isn’t to claim hypocrisy, as I think charges of hypocrisy are boring. First, it’s to note that the health-care reform process has been a model of transparency and parliamentary decency in comparison to the Medicare Prescription Drug Benefit process (no actuaries have been intimidated into silence, for instance); second, to note that Americans don’t really care about process, and people forget about even serious abuses of legislative power; and third, to suggest that Republicans are a whole lot better at making controversies out of their opponents’ behavior than Democrats are.

    Whatever you think of the process that resulted in the Medicare Prescription Drug Benefit, the bill today is settled, and even popular, law. The abuses that ushered it into existence are mostly forgotten. Democrats spoke of its repeal in the months after its passage but are now strengthening it in the health-care reform bill. Republicans, meanwhile, were so confounded by Medicare’s popularity that they authored and passed a massive expansion of the entitlement state. Democrats, who are currently trying to pass health-care reform in a way that doesn’t break congressional rules but does upset some Republicans, should take note.

  • easton


    Yeah, I know, it is just too easy to eat Partisan Republicans for lunch with this issue. I am pretty Conservative, I supported the Iraq war, am pro-life, pro-gulf drilling, am very pro-Israel, etc. but I could easily see our health care system is a mess. 16% versus 8% of GDP (for example in Japan) is a vast waste of resources and eats at our competitive advantages. Japanese automakers don’t have to worry about being a health care provider and instead could focus on building cars, and Japanese cars are cheaper even though costs in every other aspect of production is more expensive in Japan (they import all their raw materials, land is much more expensive, etc.) Employer provided health care is idiotic, it was simply a remnant of WW2 industrial planning. I don’t care what political persuasion you are, my employer wasting time negotiating with various health care agencies is a waste of manpower. Far better to just have state run exchanges where everyone can come in and be part of a huge statewide pool. The people of the states can elect their insurance commissioners, the people who negotiate with the insurance companies. As to Japan, I don’t know think these people are elected, but they do work for the Government, and as I said 8% with better outcomes is better than 16% with worse.

  • sinz54

    easton: it is just too easy to eat Partisan Republicans for lunch with this issue. I am pretty Conservative, I supported the Iraq war, am pro-life, pro-gulf drilling, am very pro-Israel, etc. but I could easily see our health care system is a mess.
    FYI, conservatives don’t defend our current health care system. (As you say, it was put in place by FDR, and conservatives never liked him much.)

    The National Review, the Heritage Foundation, and the American Enterprise Institute all had proposals for reform that were quite different from ObamaCare.

    The main difference is that conservatives do NOT regard universal coverage as the Holy Grail of reform, but improving efficiency and lowering costs instead. (If costs decline, more and more Americans will be able to afford insurance, and the number of said insured will increase. But it will never be anything close to 100%.)

    But now that ObamaCare has passed, the only way to create a conservative type health care reform package is to repeal ObamaCare first.

    It’s only the real hard-core elements like RedState.com that keep claiming that the U.S. has “the best health care system on earth.” But I’m sure that they’re saying that just to stir up the masses for the upcoming election.

    Instilling fear in voters works to get them to the polls. Liberal activists told their liberal friends that Bush-Cheney were the reincarnation of fascism or somesuch and only Obama could save the world from rogue America. Now the shoe is on the other foot.

  • easton

    Sinz54: The main difference is that conservatives do NOT regard universal coverage as the Holy Grail of reform, but improving efficiency and lowering costs instead. (If costs decline, more and more Americans will be able to afford insurance, and the number of said insured will increase. But it will never be anything close to 100%.)

    I am sorry, but Republicans had their chance and did nothing. Improving efficiency and lowering costs is not easy, especially when many peoples livlihoods depend on this not occurring.

    And Universal Coverage already exists. Hospitals are duty bound to treat all comers. You come in with a gun shot wound, they will treat you first, and if you can’t pay will pass it along to those who do (the patients with coverage)

    And the Conservative proposals are all pretty much useless, Health Savings accounts only affect the well to do, malpractice reform is nice, but we are only talking about a few percentage points, in Texas it made no difference, but this is likely because Texans are not anywhere as litigious. As to tax credits, remember cash for clunkers, it was funny how car prices went up at that time and went back down after it was over. And, of course, tax credits only truly benefit the healthy, who can afford cheap premiums. Companies would cherry pick them, leaving a large group of uninsurable people who are most in need of insurance.

    Now, to give credit to Heritage foundation, they were the ones who came up with the Individual mandate, and they were one of the inspirations for Romney care.

    Look, personally I feel that State Insurance exchanges, where an elected Commissioner and his staff negotiate with regulated insurance companies, financed by a flat payroll tax (up to a certain % of income) is the way to go. Everyone pays, everyone is covered, and everyone gets to choose the plan they feel is best for them. If they want premium coverage they can pay out of pocket. Insurance companies can offer wellness plans, and even rebates. Employees will also not be bound to any job, free to move.