Health Care Bill Going Over a Cliff

While I confess that health care reform legislation has made it further than I would have anticipated, it nonetheless seems an almost certain failure at this phase, with at least four Democrats committed to killing it in a Senate cloture vote and Republicans united in opposition to ANY health care reform. So do they now pick themselves up and start over again? Highly unlikely. Aside from the fact that an election year is coming and lawmakers always play defense on election years, the complexities of comprehensively reforming health care give lawmakers few realistic alternatives. While I lament the latest failure to reform health care and the continuation of America's de facto execution policy of the growing ranks of uninsured, I won't cry too many tears about the death of this mess of a reform bill (be it the Senate or the House bill...both suck beyond comprehension) which, if enacted, would be wildly unpopular and ineffective in reducing costs.

So what specifically is wrong with the two variations of the bill. Where to start....

1) The taxes start in 2010 but the benefits don't start until 2013 or 2014. That means Americans have three years of financial incentive for disliking this legislation before one person sees any benefit. Perhaps this would occur with any health care bill, but if Uncle Sam is gonna tax people for three years in advance of a new program, the program had better damn well deliver. Most people are unlikely to see any benefits from this one.

2) The existing health care system's unsustainable economic model will persist even after passage. The two best ways to reduce health care costs would be to salary doctors rather than pay them per procedure, and to ration care, particularly end-of-life care. Neither one of these is politically possible. Congressional leaders got the seal of approval from the AMA because they carefully avoided language about salarying doctors, a practice which has made Minnesota's Mayo Clinic the most cost-efficient medical facility in the country, but which most doctors fiercely oppose. Similarly, just the talk of shifting "cost rations" from the insurance companies who currently practice them on working-age Americans to geriatrics on Medicare invokes language of "death panels" run by the government to euthenize grandma.

3) Along those same lines, those privileged enough to receive reliable health care coverage for themselves are unwilling to make a single sacrifice to help out somebody else. And given the economics of health insurance, which requires either enlarging the risk pool or reducing coverage in order to cover more people, most of the haves will need to sacrifice some to empower the have-nots. We don't do that in America.

4) Rather than shifting the risk pool up the age ladder and requiring more financial contributions from the older Americans responsible for the vast majority of health care costs, the bill contains language that will push even more of the cost responsibility on young people. A stipulation to getting AARP support for this bill was language mandating that seniors pay more than twice the premium that able-bodied young people pay. Bottom line: young people will pay higher premiums for health insurance they don't use while older people will pay less for health insurance they use all the time. Sound like a realistic formula to cost sustainability?

5) The Democrats are lying to us about costs.....and everybody knows it. As gullible as we often are, even Americans aren't buying into the insane cost prognosis of this bill that pretends the deficit will SHRINK if only we create a new health care entitlement that covers scores of millions of high-risk people. Every time a Democratic politician tells us this health care bill will save us money, he or she is taking us for fools. And nobody enjoys being taken for fools. Even if costs stay within projected levels, and they very rarely do, the budgetary sleight-of-hand that allows for 10 years worth of taxes to pay for five years worth of benefits will not apply in subsequent decades, where this plan will run up huge deficits. Americans know it....and the Democratic lawmakers trying to con them know it as well.

6) The public option will either be too big or not big enough to work as advertised. The "public option" is an intriguing concept but I struggle to envision any scenario where it could either force insurance companies to become more competitive or to be an effective insurance option for the millions who lack it. Republicans allege that private insurers will dump millions of high-risk customers into the public option, simultaneously hyperinflating costs and forcing people out of their private plans. Not so fast, respond public option supporters. The public option will be very limited in scope and only 4-6 million people will qualify, thus making it impossible for insurance companies to dump high-cost customers into the public option. Unfortunately, supporters can't have it both ways. If only a small number of people qualify for the public option, there will be no legitimate measure of competition against private insurance companies since the 290+ million that don't qualify for the public option will still have to work within the exploding cost structure of the private health insurance industry.

Despite all these glaring downsides, I'm tempted to agree with most Congressional Democrats that either the Senate or the House reform bill is still better than nothing, but the more I study specifics, the less inclined I am to even given this bill a lukewarm endorsement. Ideal health care reform would either be a Canadian or British-style single payer system or a heavily regulated private system like that of Germany or Switzerland. But the reforms needed to engineer the formation of either system would be politically impossible in America, so instead we are left with lawmakers trying to operate both a private AND public health care system, neither of which can contain costs. Seems like the worst-case scenario. On top of already dysfunctional private health care system with costs spiraling out of control, we're asking taxpayers to continue propping that up and simultaneously fund a public health care system operating in tandem with it. How on Earth could this possibly work?

Do these highly unpersuasive pieces of health care reform legislation currently being debated mean our lawmakers are idiots? Not necessarily. Regardless of all the ignorant knuckleheads out there saying "why can't we just do this and this and forget about doing this?", health care policy is like a series of dominoes where if one falls it impacts everything. Lawmakers knew going in that the only truly effective ways of reforming health care would be politically impossible, so they devised a bill that they figured would be the best arrangement given what is politically possible. They have fallen short by my measure, but nobody should convince themselves that if this plan is deep-sixed, a more viable reform plan will emerge. This is it, folks. It's taken a year for lawmakers to get to where we are now. If better solutions existed and were politically doable, we would be debating them on the Senate floor now.

As for Republicans, what are the alternative plans of the party that stands to benefit politically from the Democratic majority's incompetence? Well, they'd love to see an expansion of health savings accounts, which allows uninsured Wal-Mart part-timers to invest as much of their disposable income as possible in company-sponsored accounts, pretending that the $200 in the pot at the end of a year is the same thing as health insurance. They also want to end medical malpractice by enacting "tort reform"....where the scores of millions of uninsured Americans not only continue to remain uninsured with no viable options, but when the ER doctor leaves a can of Altoids in their chest cavity, they are restricted from suing for pain and suffering that resulted from the malpractice.

In other words, any meaningful health care reform has to happen at this brief snapshot in time when Democrats control every level of government with supermajorities. When Republicans are rewarded for their obstructionism at the polls next year, any hope of fixing the worst-run health care system in the world goes along with it.....at least until a generation from now when the next batch of naive "reformers" tries to take on this cause again. As I've said before, until the ranks of the uninsured hits 51%, reform is very unlikely. The trouble is, we'll be there before we know it if current trendlines continue.

Looking Back At Minnesota Governor's Races

Last week I profiled 20 years worth of Minnesota Senator's races. Gubernatorial races tend to be less exciting to those who don't live in a certain state, but there have still been some doozies in the recent past. Minnesota in particular has had some crazy ones, with four of the last five being memorable. Here are some highlights:

1990--This was the first gubernatorial race I remember. I was 13 years old and not fully tuned in since it wasn't a Presidential race, but the high drama of this particular race made it impossible to be ignored. Two-term incumbent Democrat Rudy Perpich, a colorful Iron Ranger (being colorful is a prerequisite to living on the Iron Range, I think) who defied traditional ideological characterization was seeking a third term and found himself holding onto a modest lead against conservative challenger Jon Grunseth, the Republican nominee who had beaten moderate Arne Carlson in the primary. From out of nowhere in the final couple weeks of the campaign, Grunseth found himself facing allegations of child molestation involving two teenage girls hanging out in the Grunseth family's backyard pool. With less than a week to go before the election, Grunseth adamantly denied the molestation charges but nonetheless dropped out of the race, elevating State Auditor Carlson to the GOP nomination. At that point, the election began to hinge around, of all things, abortion. Perpich was a pro-life Democrat while Carlson was a pro-choice Republican. Given the state's sinking economic condition, metro area voters who never fully connected with Perpich in the first place found Carlson an acceptable alternative to Perpich and to the more conservative Grunseth. As a consequence, Carlson's five-day campaign resulted in a win, with an unusual county map that was mostly blue outstate but red even in the heart of the metro area (Hennepin and Ramsey Counties). Arguably the two biggest upsets of November 6, 1990, were both in Minnesota, with Paul Wellstone and Arne Carlson narrowly prevailing over the incumbent Rudys (Boschwitz and Perpich).

1994--Far less drama this year. The drama that did occur all came in the endorsement process where the sincere but politically weak State Senator John Marty prevailed in a crowded Democratic endorsement and subsequent primary. On the GOP side, the hard-core pro-life activists that rejected the moderate Arne Carlson for Jon Grunseth four years later rejected Carlson once again this year, endorsing the hard-right Allen Quist and giving the incumbent Governor a black eye. Getting a black eye from the party helped Carlson's cause in the end though as he beat Quist handily in the September primary and then faced a weak campaign against the lightly funded DFL challenger Marty whose "no PAC money" campaign pledge almost completely shut him off the airwaves until the final week of the campaign. It was the first Minnesota gubernatorial race of my life where the outcome was predictable....a Carlson reelection landslide. Come election night, Carlson won by a 2-1 margin and carried 84 of Minnesota's 87 counties (Marty won only in northeastern Minnesota's St. Louis, Lake, and Carlton Counties) and, most impressively, managed to carry all three of Minnesota's biggest cities....St. Paul, Duluth, and even Minneapolis. Never again in my lifetime do I expect to see any Republican win in any of these cities. It was the only Republican landslide I've witnessed in Minnesota in the two decades I've been paying attention to political contests.

1998--The wackiness was back big-time in Minnesota in the 1998 race. St. Paul Mayor Norm Coleman switched from a Democrat to a Republican specifically to run for this race and had little trouble getting the nomination. The Democratic side had its usual deluge of contenders, with Hennepin County Attorney Mike Freeman getting the party endorsement but Attorney General Skip Humphrey riding the coattails of his name to win the September primary despite his bleak and uninspiring performances in previous high-profile statewide races. Coyly and shrewdly smirking in the background was center-left Reform Party candidate Jesse Ventura, the former pro wrestler who was Mayor of a Minneapolis suburb and had a local radio show that raised his profile in the state and helping him register in the low double-digits in the polls. Humphrey had small leads heading into October until the dynamic of the race was turned on its head by the televised debates. Humphrey and Coleman went after each other, predictably, while Ventura capably and intelligently answered all the questions and managed to seem like a witty breath of fresh air compared to the stuffy major party standard-bearers. Still, Ventura continued to have a hard time getting enough people to take him seriously even though his poll numbers were ascendant. The weekend before the election, Ventura's clever ads were filling the airwaves and I just sensed something in the air that suggested a Ventura victory had suddenly become a real possibility even though the polls still officially showed Humphrey and Coleman duking it out in the 35-40% range with Jesse in the low 20s. The rest, as they say, is history as Ventura "shocked the world" pulling in 37% of the vote, clearly at the expense of Humphrey whose numbers cratered to 28% on election night and whose victories were limited to the Iron Range and northwestern Minnesota farm counties that are not even in Minnesota media markets. Definitely one of those "only in Minnesota" elections, but the most priceless result of the night was seeing Coleman coming in THIRD place in St. Paul, the city for which he was the sitting mayor.

2002--Another unpredictable stunner of a race featuring two very hard-fought endorsement battles in both parties. All candidates agreed to abide by the endorsement this year rather than proceed to a primary, leaving the Republicans with House Majority Leader Tim Pawlenty and the Democrats with Senate Leader Roger Moe, two parties who both conspired in the legislature to punt the state's dire budget issues to the following year using one-time gimmicks as a way of simultaneously one-upping Governor Ventura and avoiding tougher budgetary decisions that would harm their own candidacies. A high-profile Independence Party candidacy from former southern Minnesota Democratic Congressman Tim Penny was extremely competitive throughout the summer and early fall, with Penny branding himself as the sensible centrist not as rigidly ideological and thus better positioned to handle budget issues than Moe or Pawlenty. For months, the polls were pretty evenly divided among the three candidates, with Penny narrowly leading in most. All the winning candidate was likely to need was 35%, and that's exactly what Democrat Moe was counting on, running a dreary and almost invisible campaign that ignored southern Minnesota and hoped to get to 35% simply with the DFL base of Minneapolis, St. Paul, and his own political base in northern Minnesota. The three-way deadlock finally budged a little in early October when Pawlenty's campaign was found guilty of illegally using campaign donations in its advertisements and a judge decreed the campaign could run no more TV ads, a decree that would have effectively ended his campaign. But the decree was overruled just in time for the candidate debates, where Pawlenty played the role of Ventura four years later, the charismatic guy sitting in between the uninspiring middle-aged stiffs Moe and Penny. Polling those last two weeks reflected the race's altered dynamics as Penny's support crumbled while Pawlenty's surged. Moe was static in the mid-30s, his campaign strategy of ekeing out 33.3% +1 having collapsed now that Penny was no longer competitive. Pawlenty apparently got a little more momentum from the Wellstone Memorial in those closing days of the campaign and, unlike the Senate race, the outcome here seemed certain, with the least responsible of the three candidates poised to take over the reins of state government amidst a then record $4 billion deficit. That outcome played out as expected on election night with Pawlenty winning 44% of the vote, a healthy eight-point margin over Moe, and Penny rolling in at a dismal 16%, pretty much forfeiting all of the suburban-based Ventura coalition of four years ago to Pawlenty.

2006--The narrative of the 2006 race was less complicated than the two previous races since this year's Independence Party candidate was not a major factor, even though he did ultimately swing the election. Tim Pawlenty enjoyed approval ratings right near the 50% range and most Republicans were comfortable that he'd have an easy reelection against the abrasive Attorney General and Democratic nominee Mike Hatch. But as the election neared, it was pretty clear that 2006 was going to be a strong Democratic year and Hatch was either tied or narrowly ahead of Pawlenty in the polls. Most Republicans remained confident that Pawlenty's charisma advantage would prevail while Hatch's mean streak would be publicly exposed before the election. Turns out they were right, at least on Hatch, as an embarrassing gaffe by Hatch's running mate over ethanol-based E-85 ultimately led Hatch to call an interrogating reporter a "Republican whore" over the phone....with only four days to go before the election. Meanwhile, a good number of left-leaning voters were seeing something they liked in eloquent Independence Party candidate Peter Hutchinson, and it's a good bet that a significant number of would-be Hatch voters ultimately defected to Hutchinson. Any other year than the 2006 Democratic landslide, Pawlenty would have had an easy re-election, but he still barely eked it out, beating Hatch by a mere 22,000 votes mostly on the strength of his numbers in the suburbs while Hatch's strength was mainly confined to Roger Moe's Minneapolis, St. Paul, and northern Minnesota coalition. Still, Hutchinson scored 6% of the vote, pulling in his best numbers in heavily Democratic urban precincts and almost assuredly costing Hatch the election.

2010 is poised to be another wild Minnesota gubernatorial race with more than a dozen candidates vying for the statehouse being vacated by Pawlenty. If recent history is any indication, it should be another wild ride. I don't anticipate 2010 to be a good year for Democrats, but Pawlenty's derelict stewardship of the state probably won't put the Republicans in much better standing. For that reason, I could envision a strong showing or even an outright victory for the Independence Party is they nominate another compelling candidate in the mold of Hutchinson.