Why Democrats Should Worry

Obama press conference July 24, 2009.
Ben Domenech is the editor in chief of the The New Ledger.

One of the best encapsulations of President Barack Obama's policy views, and the methods he uses to promote those views and avoid solid criticism of them, was his approach to health policy during the 2008 campaign. At every turn, then-Senator Obama spoke in terms that were amazing for their vagueness about such important issues, always couching answers in the form of positive outcomes for hypothetical situations, and allowing for the broadest possible interpretation of what his reform would look like. Pages 23-25 of Obama's "Blueprint for Change really represent the most robust description of his policies the campaign released, and it's mostly in bullet point format.

The impression is that the candidate himself may not have made up his mind, an impression backed up by the initial selection of the highly opinionated Tom Daschle as his HHS Secretary - which would have put the track of health care reform on a slightly different direction than it has since traveled. Without Daschle's involvement, health care has defaulted to Peter Orszag and a group of ex-Center for American Progress staffers to form his plan.

The end result of Obama's campaign posturing, of course, was that any individual, at any age, with any kind of care, would think that as President, Obama was promising dramatic improvements for their personal situation. This is good politics, but bad policy: in every reform, there are winners, and there are losers. In the case of Obama's plan, now adjusted and set by the House in a form Nancy Pelosi claims to have the votes to pass, there are a great deal of losers, a great many of whom are shocked to find out that they are losers, given that they voted for Obama.

The arguments Obama is making, and made the other night at what was astoundingly his fourth prime-time press conference in his brief presidency, betray several problems with his overall approach, and not just of the fact-checking variety. Obama implies, again and again, that his plan would solve problems by placing more regulation and bureaucracy over what doctors do.

The best example of them all was Obama's hypothetical invocation of a doctor who wants more money, and greedily decides to unnecessarily remove a child's tonsils.

"Right now, doctors a lot of times are forced to make decisions based on the fee payment schedule that's out there. ... The doctor may look at the reimbursement system and say to himself, 'You know what? I make a lot more money if I take this kid's tonsils out,'" Obama told a prime-time news conference. The president added: "Now, that may be the right thing to do, but I'd rather have that doctor making those decisions just based on whether you really need your kid's tonsils out or whether it might make more sense just to change; maybe they have allergies. Maybe they have something else that would make a difference."

Besides this being a rather eyebrow raising circumstance - given that tonsils, just like other tissues, are examined after removal, and a doctor who repeatedly did this surgery unnecessarily would be called on it -- unnecessary testing and defensive medicine is a major problem when it comes to rising health costs, one systemic to our insurance system, fueled by medical malpractice concerns and the nervousness of patients (or in Obama's example, the concerned parents of a patient). But the conceit that Obama betrays assumes that doctors are alone in operating based on number-crunching greed, while bureaucrats would always seek the right medical path.

This is fantasy land, of course. It is particularly fanciful given Obama's recent personal experience, as he described it to The New York Times magazine three months ago: (emphasis mine)

THE PRESIDENT: ...I actually think that the tougher issue around medical care - it's a related one - is what you do around things like end-of-life care -

Yes, where it's $20,000 for an extra week of life.

THE PRESIDENT: Exactly. And I just recently went through this. I mean, I've told this story, maybe not publicly, but when my grandmother got very ill during the campaign, she got cancer; it was determined to be terminal. And about two or three weeks after her diagnosis she fell, broke her hip. It was determined that she might have had a mild stroke, which is what had precipitated the fall.

So now she's in the hospital, and the doctor says, Look, you've got about - maybe you have three months, maybe you have six months, maybe you have nine months to live. Because of the weakness of your heart, if you have an operation on your hip there are certain risks that - you know, your heart can't take it. On the other hand, if you just sit there with your hip like this, you're just going to waste away and your quality of life will be terrible.

And she elected to get the hip replacement and was fine for about two weeks after the hip replacement, and then suddenly just - you know, things fell apart.

I don't know how much that hip replacement cost. I would have paid out of pocket for that hip replacement just because she's my grandmother. Whether, sort of in the aggregate, society making those decisions to give my grandmother, or everybody else's aging grandparents or parents, a hip replacement when they're terminally ill is a sustainable model, is a very difficult question. If somebody told me that my grandmother couldn't have a hip replacement and she had to lie there in misery in the waning days of her life - that would be pretty upsetting.

And it's going to be hard for people who don't have the option of paying for it.

THE PRESIDENT: So that's where I think you just get into some very difficult moral issues. But that's also a huge driver of cost, right? I mean, the chronically ill and those toward the end of their lives are accounting for potentially 80 percent of the total health care bill out here.

So how do you - how do we deal with it?

THE PRESIDENT: have to have some independent group that can give you guidance. It's not determinative, but I think has to be able to give you some guidance. And that's part of what I suspect you'll see emerging out of the various health care conversations that are taking place on the Hill right now.

Let's ignore the disturbing euthanasia implications here -- already covered here and by Mickey Kaus here, the thought that, as Ezra Klein puts it, a board of officials should decide when "a person's life, or health, is not worth the price" is frightening enough on its face -- and just apply the philosophy Obama describes in his last paragraph toward his more recent hypothetical. Let's assume for the sake of argument that his description is a fair one.

If, on the one hand, what Obama is offering is determinative regulation by an independent body with the power of government behind them, it would presumably go a long way toward preventing that doctor from needlessly removing a child's tonsils. The threat of bureaucratic oversight on the doctor if he did something unnecessary would be a strong one, and he would presumably act accordingly (this is the reverse of defensive medicine -- making the judgment that it is better to only do what you know is necessary, and lose the occasional patient, than do more than what is necessary in almost every case, raising costs significantly to keep a few more people alive). But Obama is specific about saying that, at least when it comes to more serious illnesses, this regulation is not intended to be determinative, but that it is merely guidance.

Yet guidance, even guidance with the power of government behind it, is nothing more than giving doctors one more sheet to look at, one more list of rules for them to be afraid of breaking. Doctors practice medicine today that is already informed by the guidelines of their profession, the rules of the insurance system, and the needs of the patient -- adding one more element to that list is extremely unlikely to result in care that is either better for the patient or for the bottom line.

And it's not just doctors who will have more bureaucracies and boards to answer to: by requiring governmental approval for all ERISA insurance offerings, as the WSJ pointed out this week, 132 million people will now find that the insurance coverage (which the vast majority say they are happy with) will now be subject to a bureaucratic standard that will naturally gravitate toward anti-market solutions:

ERISA's pluralistic structure will gradually constrict toward a single national standard. Yet a computer programming firm, say, and a grocery store chain have very different insurance needs, and in any case may not be able to afford the same kind and level of benefits. Innovation in insurance products will also be subject to political tampering. Likely casualties include the wellness initiatives that give workers financial incentives to take more responsibility for their own health, such as Safeway's. Some politicians will claim that's unfair. High-deductible plans with health savings accounts are also out of political favor, therefore certain to go overboard. [These plans typically make the most economic sense for young Obama voters. -ed.] If you have one of those and like it, too bad.

Today, CNN gave a nod to the downfall of the Clinton health care plan 15 years ago. In many ways, their tracks are looking more and more similar: the difference being that Obama's plan has more support from industry and less coherent opposition from the populist right.

There's another difference from 1993, though, one Hill Democrats should be aware of: unlike President Clinton, since coming to office President Obama has shown himself profoundly uninterested in risking his popularity in defense of any policy (one of the reasons his poll numbers show such a gap between approval for them and approval for him) or any candidate. He prefers to be cool and aloof, and on issues like the stimulus package and cap and trade, he's letting substitutes do most of the water-carrying. But ever since the Clinton presidency failed to achieve the kind of social change many liberal Democrats had in mind, there have been plenty of those on the left in Congress -- representing safe, tiny, urban districts -- who were biding their time until they had a shot at doing it all over again. And now, they have their chance -- and when it comes to health care in America, members of Congress, not the President who still speaks in vague terms and anecdotes, may be the ones who determine the actual form of this plan, and who are given its political ownership by uncertain Americans.

No wonder the Blue Dogs are breaking. In their districts, they remember 1994.

By Ben Domenech:
Reprinted with permission from The New Ledger