As the battle for healthcare reform rages on, many of the myths that I once expected to quietly die have instead become stronger and more entrenched. In particular, the degree of misunderstanding surrounding the “public plan” portion of healthcare reform proposals continues to astound me, both on the Right and the Left. I addressed some of those concerns in a post last week entitled “All About the Public Plan” and I think some of the misconceptions I discussed in that article have pertinence to the discussion of alternate reform mechanisms as well. Especially in regards to Co-ops, I think misunderstandings on the part of the Left have hobbled any chance at real discussion of this viable public plan alternative. So hopefully this will help clear some things up:

What is the Healthcare Co-op?

First off, it’s important to know that when we’re talking about co-ops, we’re not talking about the local health insurance co-operatives found in states like Wisconsin. CNN recently wrote an entire article while apparently operating under this misunderstanding, and pretty much all of the statements deriding co-ops that have come from Gov. Tom Pawlenty recently also fall into this category. We are talking about a single, national co-operative or small group of cooperatives, given special permission to compete nationally across state lines to provide competition to the overly-consolidated private health insurance markets. To fully understand this type of co-op, you should first go back and read “All About the Public Plan” if you haven’t already. Seriously, you won’t understand this article without it. I’ll wait… Okay, are you done? Do you understand what the Public Plan is? The Co-op is exactly the same, except administered by elected board members rather than government appointed officials. Literally, that is the only difference I have been able to come up with.

Disadvantages of the

Healthcare Co-op

Now I should clarify that the Co-op idea has the potential to be exactly the same as public plan proposals, and would likely function almost exactly like the public plan, but since no bill has actually been written up with a co-op component, we can’t say for sure yet exactly what it would be like. Sen. Kent Conrad, one of the first to propose co-ops in the context of the current healthcare reform debate has said that they could operate on a state level, a regional level, or a national level. It’s a national healthcare co-op that would function like a public plan. State or regional co-ops would probably be beneficial but would not have nearly the same strength in bargaining power as a national co-op or a public plan and thus would be a less formidable competitor to private insurers. So this remaining ambiguity is certainly one disadvantage to dumping the public option in favor of a co-op.

The only other reasonable argument I’ve heard against the healthcare co-op is that since administrators would not be appointed by the government, it’s not a guarantee that the co-op would remain dedicated to its original mission of lowering America’s insurance premiums. There’s not much to prevent the administrators of the co-op from pursuing the interests of their organization over those of the American people should they ever come into conflict. The primary situation in which that might occur would be if the co-op became too successful and threatened the fabric of our private insurance industry. In that situation, those not participating in the healthcare co-op would not have any direct input into its operations, while those who are members would have only an incentive to increase the size of their organization to grow their risk pool. Of course we’d still have some control over the co-op through legislation, but as we’ve seen that can be a slow and arduous process. In other words, a government administered program would theoretically give the American people (through our elected officials) somewhat more direct and time-sensitive control over how the plan operates.

Advantages of the

Healthcare Co-op

While I’ve stated several times in the past that I believe it to be very unlikely that a public plan would bankrupt private industry, it’s impossible to say that it could never happen. With that in mind a state or regionally based healthcare co-op plan would essentially eliminate that risk, which should ease the minds of conservative reform opponents.

But I think the primary advantage is political. It’s clear that, due to unfortunate naming, insurance company smear tactics, and the white house’s perplexing decision to sit back and let the wings define the debate for the first several months, the public plan has become a very, very controversial proposal. To many conservatives it has become synonymous with “Socialized medicine” and a “government takeover of healthcare”. If a strong, national, healthcare co-op would give us nearly the same result without the controversy then it seems like the logical choice.

I know some are frustrated with that option because they see it as a sign of giving in to misinformation. Yes it’s true that the Public plan has been unfairly smeared and is almost universally misunderstood. Yes it’s true that if it were abandoned, healthcare reform opponents would trumpet from the hilltops that they were clearly right all along and that their protests and screaming had succeeded in averting socialism. The liars would be gratified and the screamers would not learn their lessons, and that would be frustrating. But there will always be liars and there will always be screamers. One win or loss on one item of policy will not change that. Are we willing to accept no reform at all in place of a healthcare system with a strong national co-op, or even strong regional co-ops, for reasons that essentially amount to pride?

Unfortunately I’ve found that this is a frequent occurance in politics. Idealogues often get their way because they’re loud and more than willing to lie their faces off. But if anything is going to be accomplished then somebody has to compromise, and it won’t be them. And in the end, I think it’s less about who believes they won or lost and more about the end result for the American people. I think the most noble policy makers are those who pragmatically seek the best result for their constituents. They’re rarely anyone’s hero, they don’t often make the news, and they don’t have a rabid fan base since they’re not out there boldly and defiantly waving some ideological banner. But they’re the one’s we can thank for most of the positive change that has actually been enacted over the years.

Conclusion

So is the co-op the way to go? If that’s what we have to do to get a bill passed, then I say yes. And all signs from the Senate say that the public plan is a no-go there. I’m all in favor of a public plan, I think it’s the superior choice. But not by so much that healthcare reform is worthless without it. I think it’s wise to push the public plan as much as we can and fight the misunderstanding that’s out there. But when it becomes clear that it will not succeed, we need to accept the co-op and move forward as quickly as possible, before the next smear campaign has time to gain momentum. I really liked what Pres. Obama had to say about this subject in his healthcare address last week actually. and I’ll let his words close out this article.

“It’s worth noting that a strong majority of Americans still favor a public insurance option of the sort I’ve proposed tonight. But its impact shouldn’t be exaggerated – by the left, the right, or the media. It is only one part of my plan, and should not be used as a handy excuse for the usual Washington ideological battles. To my progressive friends, I would remind you that for decades, the driving idea behind reform has been to end insurance company abuses and make coverage affordable for those without it. The public option is only a means to that end – and we should remain open to other ideas that accomplish our ultimate goal. And to my Republican friends, I say that rather than making wild claims about a government takeover of health care, we should work together to address any legitimate concerns you may have.

For example, some have suggested that that the public option go into effect only in those markets where insurance companies are not providing affordable policies. Others propose a co-op or another non-profit entity to administer the plan. These are all constructive ideas worth exploring. But I will not back down on the basic principle that if Americans can’t find affordable coverage, we will provide you with a choice. And I will make sure that no government bureaucrat or insurance company bureaucrat gets between you and the care that you need.”

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For those who didn’t get to see it last night, I give you Obama’s healthcare speech, in both video form and text form (after the jump).  Frankly, it was better than I expected.  He effectively summarized the rational for many of the most controversial reform elements, and added in enough personal stories and emotional appeals to keep it from becoming too dense with policy details.  I also thought he did a fair job of criticizing some of the tactics that have been used by his opponents, while promoting cooperation.  I sincerely hope that the olive branch of tort reform Obama extended last night was in good faith, and that the republicans will actually become more cooperative as a result.  It would be nice if it felt like congress was actually trying to do what they thought was best for the country and not what they thought was best for their party or their political future.  Hit the read link to see the full text.

Madame Speaker, Vice President Biden, Members of Congress, and the American people:

When I spoke here last winter, this nation was facing the worst economic crisis since the Great Depression. We were losing an average of 700,000 jobs per month. Credit was frozen. And our financial system was on the verge of collapse.

As any American who is still looking for work or a way to pay their bills will tell you, we are by no means out of the woods. A full and vibrant recovery is many months away. And I will not let up until those Americans who seek jobs can find them; until those businesses that seek capital and credit can thrive; until all responsible homeowners can stay in their homes. That is our ultimate goal. But thanks to the bold and decisive action we have taken since January, I can stand here with confidence and say that we have pulled this economy back from the brink.

I want to thank the members of this body for your efforts and your support in these last several months, and especially those who have taken the difficult votes that have put us on a path to recovery. I also want to thank the American people for their patience and resolve during this trying time for our nation.

But we did not come here just to clean up crises. We came to build a future. So tonight, I return to speak to all of you about an issue that is central to that future – and that is the issue of health care.

I am not the first President to take up this cause, but I am determined to be the last. It has now been nearly a century since Theodore Roosevelt first called for health care reform. And ever since, nearly every President and Congress, whether Democrat or Republican, has attempted to meet this challenge in some way. A bill for comprehensive health reform was first introduced by John Dingell Sr. in 1943. Sixty-five years later, his son continues to introduce that same bill at the beginning of each session.

Our collective failure to meet this challenge – year after year, decade after decade – has led us to a breaking point. Everyone understands the extraordinary hardships that are placed on the uninsured, who live every day just one accident or illness away from bankruptcy. These are not primarily people on welfare. These are middle-class Americans. Some can’t get insurance on the job. Others are self-employed, and can’t afford it, since buying insurance on your own costs you three times as much as the coverage you get from your employer. Many other Americans who are willing and able to pay are still denied insurance due to previous illnesses or conditions that insurance companies decide are too risky or expensive to cover.

We are the only advanced democracy on Earth – the only wealthy nation – that allows such hardships for millions of its people. There are now more than thirty million American citizens who cannot get coverage. In just a two year period, one in every three Americans goes without health care coverage at some point. And every day, 14,000 Americans lose their coverage. In other words, it can happen to anyone.

But the problem that plagues the health care system is not just a problem of the uninsured. Those who do have insurance have never had less security and stability than they do today. More and more Americans worry that if you move, lose your job, or change your job, you’ll lose your health insurance too. More and more Americans pay their premiums, only to discover that their insurance company has dropped their coverage when they get sick, or won’t pay the full cost of care. It happens every day.

One man from Illinois lost his coverage in the middle of chemotherapy because his insurer found that he hadn’t reported gallstones that he didn’t even know about. They delayed his treatment, and he died because of it. Another woman from Texas was about to get a double mastectomy when her insurance company canceled her policy because she forgot to declare a case of acne. By the time she had her insurance reinstated, her breast cancer more than doubled in size. That is heart-breaking, it is wrong, and no one should be treated that way in the United States of America.

Then there’s the problem of rising costs. We spend one-and-a-half times more per person on health care than any other country, but we aren’t any healthier for it. This is one of the reasons that insurance premiums have gone up three times faster than wages. It’s why so many employers – especially small businesses – are forcing their employees to pay more for insurance, or are dropping their coverage entirely. It’s why so many aspiring entrepreneurs cannot afford to open a business in the first place, and why American businesses that compete internationally – like our automakers – are at a huge disadvantage. And it’s why those of us with health insurance are also paying a hidden and growing tax for those without it – about $1000 per year that pays for somebody else’s emergency room and charitable care.

Finally, our health care system is placing an unsustainable burden on taxpayers. When health care costs grow at the rate they have, it puts greater pressure on programs like Medicare and Medicaid. If we do nothing to slow these skyrocketing costs, we will eventually be spending more on Medicare and Medicaid than every other government program combined. Put simply, our health care problem is our deficit problem. Nothing else even comes close.

These are the facts. Nobody disputes them. We know we must reform this system. The question is how.

There are those on the left who believe that the only way to fix the system is through a single-payer system like Canada’s, where we would severely restrict the private insurance market and have the government provide coverage for everyone. On the right, there are those who argue that we should end the employer-based system and leave individuals to buy health insurance on their own.

I have to say that there are arguments to be made for both approaches. But either one would represent a radical shift that would disrupt the health care most people currently have. Since health care represents one-sixth of our economy, I believe it makes more sense to build on what works and fix what doesn’t, rather than try to build an entirely new system from scratch. And that is precisely what those of you in Congress have tried to do over the past several months.

During that time, we have seen Washington at its best and its worst.

We have seen many in this chamber work tirelessly for the better part of this year to offer thoughtful ideas about how to achieve reform. Of the five committees asked to develop bills, four have completed their work, and the Senate Finance Committee announced today that it will move forward next week. That has never happened before. Our overall efforts have been supported by an unprecedented coalition of doctors and nurses; hospitals, seniors’ groups and even drug companies – many of whom opposed reform in the past. And there is agreement in this chamber on about eighty percent of what needs to be done, putting us closer to the goal of reform than we have ever been.

But what we have also seen in these last months is the same partisan spectacle that only hardens the disdain many Americans have toward their own government. Instead of honest debate, we have seen scare tactics. Some have dug into unyielding ideological camps that offer no hope of compromise. Too many have used this as an opportunity to score short-term political points, even if it robs the country of our opportunity to solve a long-term challenge. And out of this blizzard of charges and counter-charges, confusion has reigned.

Well the time for bickering is over. The time for games has passed. Now is the season for action. Now is when we must bring the best ideas of both parties together, and show the American people that we can still do what we were sent here to do. Now is the time to deliver on health care.

The plan I’m announcing tonight would meet three basic goals:

It will provide more security and stability to those who have health insurance. It will provide insurance to those who don’t. And it will slow the growth of health care costs for our families, our businesses, and our government. It’s a plan that asks everyone to take responsibility for meeting this challenge – not just government and insurance companies, but employers and individuals. And it’s a plan that incorporates ideas from Senators and Congressmen; from Democrats and Republicans – and yes, from some of my opponents in both the primary and general election.

Here are the details that every American needs to know about this plan:

First, if you are among the hundreds of millions of Americans who already have health insurance through your job, Medicare, Medicaid, or the VA, nothing in this plan will require you or your employer to change the coverage or the doctor you have. Let me repeat this: nothing in our plan requires you to change what you have.

What this plan will do is to make the insurance you have work better for you. Under this plan, it will be against the law for insurance companies to deny you coverage because of a pre-existing condition. As soon as I sign this bill, it will be against the law for insurance companies to drop your coverage when you get sick or water it down when you need it most. They will no longer be able to place some arbitrary cap on the amount of coverage you can receive in a given year or a lifetime. We will place a limit on how much you can be charged for out-of-pocket expenses, because in the United States of America, no one should go broke because they get sick. And insurance companies will be required to cover, with no extra charge, routine checkups and preventive care, like mammograms and colonoscopies – because there’s no reason we shouldn’t be catching diseases like breast cancer and colon cancer before they get worse. That makes sense, it saves money, and it saves lives.

That’s what Americans who have health insurance can expect from this plan – more security and stability.

Now, if you’re one of the tens of millions of Americans who don’t currently have health insurance, the second part of this plan will finally offer you quality, affordable choices. If you lose your job or change your job, you will be able to get coverage. If you strike out on your own and start a small business, you will be able to get coverage. We will do this by creating a new insurance exchange – a marketplace where individuals and small businesses will be able to shop for health insurance at competitive prices. Insurance companies will have an incentive to participate in this exchange because it lets them compete for millions of new customers. As one big group, these customers will have greater leverage to bargain with the insurance companies for better prices and quality coverage. This is how large companies and government employees get affordable insurance. It’s how everyone in this Congress gets affordable insurance. And it’s time to give every American the same opportunity that we’ve given ourselves.

For those individuals and small businesses who still cannot afford the lower-priced insurance available in the exchange, we will provide tax credits, the size of which will be based on your need. And all insurance companies that want access to this new marketplace will have to abide by the consumer protections I already mentioned. This exchange will take effect in four years, which will give us time to do it right. In the meantime, for those Americans who can’t get insurance today because they have pre-existing medical conditions, we will immediately offer low-cost coverage that will protect you against financial ruin if you become seriously ill. This was a good idea when Senator John McCain proposed it in the campaign, it’s a good idea now, and we should embrace it.

Now, even if we provide these affordable options, there may be those – particularly the young and healthy – who still want to take the risk and go without coverage. There may still be companies that refuse to do right by their workers. The problem is, such irresponsible behavior costs all the rest of us money. If there are affordable options and people still don’t sign up for health insurance, it means we pay for those people’s expensive emergency room visits. If some businesses don’t provide workers health care, it forces the rest of us to pick up the tab when their workers get sick, and gives those businesses an unfair advantage over their competitors. And unless everybody does their part, many of the insurance reforms we seek – especially requiring insurance companies to cover pre-existing conditions – just can’t be achieved.

That’s why under my plan, individuals will be required to carry basic health insurance – just as most states require you to carry auto insurance. Likewise, businesses will be required to either offer their workers health care, or chip in to help cover the cost of their workers. There will be a hardship waiver for those individuals who still cannot afford coverage, and 95% of all small businesses, because of their size and narrow profit margin, would be exempt from these requirements. But we cannot have large businesses and individuals who can afford coverage game the system by avoiding responsibility to themselves or their employees. Improving our health care system only works if everybody does their part.

While there remain some significant details to be ironed out, I believe a broad consensus exists for the aspects of the plan I just outlined: consumer protections for those with insurance, an exchange that allows individuals and small businesses to purchase affordable coverage, and a requirement that people who can afford insurance get insurance.

And I have no doubt that these reforms would greatly benefit Americans from all walks of life, as well as the economy as a whole. Still, given all the misinformation that’s been spread over the past few months, I realize that many Americans have grown nervous about reform. So tonight I’d like to address some of the key controversies that are still out there.

Some of people’s concerns have grown out of bogus claims spread by those whose only agenda is to kill reform at any cost. The best example is the claim, made not just by radio and cable talk show hosts, but prominent politicians, that we plan to set up panels of bureaucrats with the power to kill off senior citizens. Such a charge would be laughable if it weren’t so cynical and irresponsible. It is a lie, plain and simple.

There are also those who claim that our reform effort will insure illegal immigrants. This, too, is false – the reforms I’m proposing would not apply to those who are here illegally. And one more misunderstanding I want to clear up – under our plan, no federal dollars will be used to fund abortions, and federal conscience laws will remain in place.

My health care proposal has also been attacked by some who oppose reform as a “government takeover” of the entire health care system. As proof, critics point to a provision in our plan that allows the uninsured and small businesses to choose a publicly-sponsored insurance option, administered by the government just like Medicaid or Medicare.

So let me set the record straight. My guiding principle is, and always has been, that consumers do better when there is choice and competition. Unfortunately, in 34 states, 75% of the insurance market is controlled by five or fewer companies. In Alabama, almost 90% is controlled by just one company. Without competition, the price of insurance goes up and the quality goes down. And it makes it easier for insurance companies to treat their customers badly – by cherry-picking the healthiest individuals and trying to drop the sickest; by overcharging small businesses who have no leverage; and by jacking up rates.

Insurance executives don’t do this because they are bad people. They do it because it’s profitable. As one former insurance executive testified before Congress, insurance companies are not only encouraged to find reasons to drop the seriously ill; they are rewarded for it. All of this is in service of meeting what this former executive called “Wall Street’s relentless profit expectations.”

Now, I have no interest in putting insurance companies out of business. They provide a legitimate service, and employ a lot of our friends and neighbors. I just want to hold them accountable. The insurance reforms that I’ve already mentioned would do just that. But an additional step we can take to keep insurance companies honest is by making a not-for-profit public option available in the insurance exchange. Let me be clear – it would only be an option for those who don’t have insurance. No one would be forced to choose it, and it would not impact those of you who already have insurance. In fact, based on Congressional Budget Office estimates, we believe that less than 5% of Americans would sign up.

Despite all this, the insurance companies and their allies don’t like this idea. They argue that these private companies can’t fairly compete with the government. And they’d be right if taxpayers were subsidizing this public insurance option. But they won’t be. I have insisted that like any private insurance company, the public insurance option would have to be self-sufficient and rely on the premiums it collects. But by avoiding some of the overhead that gets eaten up at private companies by profits, excessive administrative costs and executive salaries, it could provide a good deal for consumers. It would also keep pressure on private insurers to keep their policies affordable and treat their customers better, the same way public colleges and universities provide additional choice and competition to students without in any way inhibiting a vibrant system of private colleges and universities.

It’s worth noting that a strong majority of Americans still favor a public insurance option of the sort I’ve proposed tonight. But its impact shouldn’t be exaggerated – by the left, the right, or the media. It is only one part of my plan, and should not be used as a handy excuse for the usual Washington ideological battles. To my progressive friends, I would remind you that for decades, the driving idea behind reform has been to end insurance company abuses and make coverage affordable for those without it. The public option is only a means to that end – and we should remain open to other ideas that accomplish our ultimate goal. And to my Republican friends, I say that rather than making wild claims about a government takeover of health care, we should work together to address any legitimate concerns you may have.

For example, some have suggested that that the public option go into effect only in those markets where insurance companies are not providing affordable policies. Others propose a co-op or another non-profit entity to administer the plan. These are all constructive ideas worth exploring. But I will not back down on the basic principle that if Americans can’t find affordable coverage, we will provide you with a choice. And I will make sure that no government bureaucrat or insurance company bureaucrat gets between you and the care that you need.

Finally, let me discuss an issue that is a great concern to me, to members of this chamber, and to the public – and that is how we pay for this plan.

Here’s what you need to know. First, I will not sign a plan that adds one dime to our deficits – either now or in the future. Period. And to prove that I’m serious, there will be a provision in this plan that requires us to come forward with more spending cuts if the savings we promised don’t materialize. Part of the reason I faced a trillion dollar deficit when I walked in the door of the White House is because too many initiatives over the last decade were not paid for – from the Iraq War to tax breaks for the wealthy. I will not make that same mistake with health care.

Second, we’ve estimated that most of this plan can be paid for by finding savings within the existing health care system – a system that is currently full of waste and abuse. Right now, too much of the hard-earned savings and tax dollars we spend on health care doesn’t make us healthier. That’s not my judgment – it’s the judgment of medical professionals across this country. And this is also true when it comes to Medicare and Medicaid.

In fact, I want to speak directly to America’s seniors for a moment, because Medicare is another issue that’s been subjected to demagoguery and distortion during the course of this debate.

More than four decades ago, this nation stood up for the principle that after a lifetime of hard work, our seniors should not be left to struggle with a pile of medical bills in their later years. That is how Medicare was born. And it remains a sacred trust that must be passed down from one generation to the next. That is why not a dollar of the Medicare trust fund will be used to pay for this plan.

The only thing this plan would eliminate is the hundreds of billions of dollars in waste and fraud, as well as unwarranted subsidies in Medicare that go to insurance companies – subsidies that do everything to pad their profits and nothing to improve your care. And we will also create an independent commission of doctors and medical experts charged with identifying more waste in the years ahead.

These steps will ensure that you – America’s seniors – get the benefits you’ve been promised. They will ensure that Medicare is there for future generations. And we can use some of the savings to fill the gap in coverage that forces too many seniors to pay thousands of dollars a year out of their own pocket for prescription drugs. That’s what this plan will do for you. So don’t pay attention to those scary stories about how your benefits will be cut – especially since some of the same folks who are spreading these tall tales have fought against Medicare in the past, and just this year supported a budget that would have essentially turned Medicare into a privatized voucher program. That will never happen on my watch. I will protect Medicare.

Now, because Medicare is such a big part of the health care system, making the program more efficient can help usher in changes in the way we deliver health care that can reduce costs for everybody. We have long known that some places, like the Intermountain Healthcare in Utah or the Geisinger Health System in rural Pennsylvania, offer high-quality care at costs below average. The commission can help encourage the adoption of these common-sense best practices by doctors and medical professionals throughout the system – everything from reducing hospital infection rates to encouraging better coordination between teams of doctors.

Reducing the waste and inefficiency in Medicare and Medicaid will pay for most of this plan. Much of the rest would be paid for with revenues from the very same drug and insurance companies that stand to benefit from tens of millions of new customers. This reform will charge insurance companies a fee for their most expensive policies, which will encourage them to provide greater value for the money – an idea which has the support of Democratic and Republican experts. And according to these same experts, this modest change could help hold down the cost of health care for all of us in the long-run.

Finally, many in this chamber – particularly on the Republican side of the aisle – have long insisted that reforming our medical malpractice laws can help bring down the cost of health care. I don’t believe malpractice reform is a silver bullet, but I have talked to enough doctors to know that defensive medicine may be contributing to unnecessary costs. So I am proposing that we move forward on a range of ideas about how to put patient safety first and let doctors focus on practicing medicine. I know that the Bush Administration considered authorizing demonstration projects in individual states to test these issues. It’s a good idea, and I am directing my Secretary of Health and Human Services to move forward on this initiative today.

Add it all up, and the plan I’m proposing will cost around $900 billion over ten years – less than we have spent on the Iraq and Afghanistan wars, and less than the tax cuts for the wealthiest few Americans that Congress passed at the beginning of the previous administration. Most of these costs will be paid for with money already being spent – but spent badly – in the existing health care system. The plan will not add to our deficit. The middle-class will realize greater security, not higher taxes. And if we are able to slow the growth of health care costs by just one-tenth of one percent each year, it will actually reduce the deficit by $4 trillion over the long term.

This is the plan I’m proposing. It’s a plan that incorporates ideas from many of the people in this room tonight – Democrats and Republicans. And I will continue to seek common ground in the weeks ahead. If you come to me with a serious set of proposals, I will be there to listen. My door is always open.

But know this: I will not waste time with those who have made the calculation that it’s better politics to kill this plan than improve it. I will not stand by while the special interests use the same old tactics to keep things exactly the way they are. If you misrepresent what’s in the plan, we will call you out. And I will not accept the status quo as a solution. Not this time. Not now.

Everyone in this room knows what will happen if we do nothing. Our deficit will grow. More families will go bankrupt. More businesses will close. More Americans will lose their coverage when they are sick and need it most. And more will die as a result. We know these things to be true.

That is why we cannot fail. Because there are too many Americans counting on us to succeed – the ones who suffer silently, and the ones who shared their stories with us at town hall meetings, in emails, and in letters.

I received one of those letters a few days ago. It was from our beloved friend and colleague, Ted Kennedy. He had written it back in May, shortly after he was told that his illness was terminal. He asked that it be delivered upon his death.

In it, he spoke about what a happy time his last months were, thanks to the love and support of family and friends, his wife, Vicki, and his children, who are here tonight . And he expressed confidence that this would be the year that health care reform – “that great unfinished business of our society,” he called it – would finally pass. He repeated the truth that health care is decisive for our future prosperity, but he also reminded me that “it concerns more than material things.” “What we face,” he wrote, “is above all a moral issue; at stake are not just the details of policy, but fundamental principles of social justice and the character of our country.”

I’ve thought about that phrase quite a bit in recent days – the character of our country. One of the unique and wonderful things about America has always been our self-reliance, our rugged individualism, our fierce defense of freedom and our healthy skepticism of government. And figuring out the appropriate size and role of government has always been a source of rigorous and sometimes angry debate.

For some of Ted Kennedy’s critics, his brand of liberalism represented an affront to American liberty. In their mind, his passion for universal health care was nothing more than a passion for big government.

But those of us who knew Teddy and worked with him here – people of both parties – know that what drove him was something more. His friend, Orrin Hatch, knows that. They worked together to provide children with health insurance. His friend John McCain knows that. They worked together on a Patient’s Bill of Rights. His friend Chuck Grassley knows that. They worked together to provide health care to children with disabilities.

On issues like these, Ted Kennedy’s passion was born not of some rigid ideology, but of his own experience. It was the experience of having two children stricken with cancer. He never forgot the sheer terror and helplessness that any parent feels when a child is badly sick; and he was able to imagine what it must be like for those without insurance; what it would be like to have to say to a wife or a child or an aging parent – there is something that could make you better, but I just can’t afford it.

That large-heartedness – that concern and regard for the plight of others – is not a partisan feeling. It is not a Republican or a Democratic feeling. It, too, is part of the American character. Our ability to stand in other people’s shoes. A recognition that we are all in this together; that when fortune turns against one of us, others are there to lend a helping hand. A belief that in this country, hard work and responsibility should be rewarded by some measure of security and fair play; and an acknowledgement that sometimes government has to step in to help deliver on that promise.

This has always been the history of our progress. In 1933, when over half of our seniors could not support themselves and millions had seen their savings wiped away, there were those who argued that Social Security would lead to socialism. But the men and women of Congress stood fast, and we are all the better for it. In 1965, when some argued that Medicare represented a government takeover of health care, members of Congress, Democrats and Republicans, did not back down. They joined together so that all of us could enter our golden years with some basic peace of mind.

You see, our predecessors understood that government could not, and should not, solve every problem. They understood that there are instances when the gains in security from government action are not worth the added constraints on our freedom. But they also understood that the danger of too much government is matched by the perils of too little; that without the leavening hand of wise policy, markets can crash, monopolies can stifle competition, and the vulnerable can be exploited. And they knew that when any government measure, no matter how carefully crafted or beneficial, is subject to scorn; when any efforts to help people in need are attacked as un-American; when facts and reason are thrown overboard and only timidity passes for wisdom, and we can no longer even engage in a civil conversation with each other over the things that truly matter – that at that point we don’t merely lose our capacity to solve big challenges. We lose something essential about ourselves.

What was true then remains true today. I understand how difficult this health care debate has been. I know that many in this country are deeply skeptical that government is looking out for them. I understand that the politically safe move would be to kick the can further down the road – to defer reform one more year, or one more election, or one more term.

But that’s not what the moment calls for. That’s not what we came here to do. We did not come to fear the future. We came here to shape it. I still believe we can act even when it’s hard. I still believe we can replace acrimony with civility, and gridlock with progress. I still believe we can do great things, and that here and now we will meet history’s test.

Because that is who we are. That is our calling. That is our character. Thank you, God Bless You, and may God Bless the United States of America.

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Of all issues in politics, this one is probably most dear to me.  No I’m not talking about healthcare, though that may be a close second, I’m talking about maintaining and improving the quality of our political dialogue.  For those who don’t know, healthcare town hall meetings have been held over the last week all across the country, and small groups of radical protesters have shown up at many of them with the express goal of “shouting down” their elected leaders.

To be clear, I have absolutely no problem with somebody being against the current healthcare bills being developed in congress.  If they’ve researched the issues thoroughly and have cut through the mists of misinformation and still come out thinking its not the best idea for America then more power to them.  I would welcome those people at a healthcare town hall and I would encourage them to go and speak their mind, even forcefully if they feel its appropriate.  But that’s not what this is.  This is just mobs of people screaming slogans and platitudes.  It’s people who are clearly unfamiliar with the content of the healthcare bill chanting things like “read this bill” for half an hour while their elected leader tries in vain to explain to them that they actually have read each and every iteration of the bill.  This news article, after the jump, will give you a picture of what’s going on:

From the St. Petersburg Times:  ”TAMPA – Bitter divisions over reforming America’s health care system exploded Thursday night in Tampa amid cat calls, jeering and shoving at a town hall meeting.

“Tyranny! Tyranny! Tyranny!” dozens of people shouted as U.S. Rep. Kathy Castor struggled to talk about health insurance reforms under consideration in Washington, D.C.

“There is more consensus than there is disagreement when you get right down to it,” Castor offered, immediately drowned out by groans and boos.  She pressed on, mostly unheard among the screams from the audience of more than 200.

“Tell the truth! Tell the truth!”

“Read the bill!”

“Forty-million illegals! Forty million illegals!”

The spectacle at the Children’s Board in Ybor City sounded more like a wrestling cage match than a panel discussion on national policy, and it was just the latest example of a health care meeting disrupted by livid protesters. Similar scenes are likely to be repeated across the country as lawmakers head back to their home districts for the summer recess.

Thursday’s forum/near riot was sponsored by state Rep. Betty Reed, D-Tampa, and the Service Employees International Union, who apparently had hoped to hold something of a pep rally for President Obama’s health care reform proposal.

Instead, hundreds of vocal critics turned out, many of them saying they had been spurred on through the Tampa 912 activist group promoted by conservative radio and television personality Glenn Beck. Others had received e-mails from the Hillsborough Republican party that urged people to speak out against the plan and offered talking points to challenge supporters…

She [Castor] left before the forum ended, which drew more boos. State Rep. Reed said she encouraged Castor to leave because nobody could hear her any way.”

Clearly shouting things like “tyranny!” and “tell the truth!” adds nothing to the debate.  And I’m still scratching my head about the “forty-million illegals” thing.  Are they under the impression that the bill would give free healthcare to illegal immigrants?  Because it specifically denies them healthcare subsidies.

Another important issue is the one brought up at the end of the article.  While some members of congress and certain partisan news organizations are trying to pass this off as a grassroots movement of citizens, it’s become clear that they’re nothing more than an organized group of traveling protesters, moving from town hall to town hall to create a public spectacle.  The conservative organization “Freedomworks” has already taken credit for several of the protests and has proudly posted a video of protesters shouting at a befuddled Arlen Specter, labeling it a “must emulate”.  They’ve also bragged about how their members have driven as much as 4 hours to disrupt town halls in other districts.  And the group “Conservatives for Patient’s Rights” has also admitted to being behind many of the protests, even going so far as providing lists of slogans and phrases for their members to shout out and encouraging people to interrupt and “drown out” their public servants.  Obviously there’s nothing wrong with organized protests, but it does irk me some when they then vehemently deny that they’re anything but regular ole town hall attendees.  Its very reminiscent of the Tea Parties that FoxNews and Freedomworks organized and promoted for months, and then covered as “an inspiring, spontaneous, grassroots call for liberty”.  But more than simply being dishonest, these shipped-in protestors deny the real constituents of that district their opportunity to participate.

To those who may be sympathetic towards these protesters, or who may be warming up their lungs for a town hall appearance of their own, I submit for your consideration this quote from one of our great founding fathers, John Adams:

“I fear that in every assembly, members will obtain an influence by noise not sense. By meanness, not greatness, By ignorance, not learning, By contracted hearts, not large souls.
There is one thing, my dear sir, that must be attempted and most sacredly observed or we are all undone. There must be decency and respect, and veneration introduced for persons of authority of every rank, or we are all undone. in a popular government, this is our only way”
–John Adams, from a letter to one of his constituents.

Is that really too much to ask?  While I was no fan of President Bush’s policies I always cringed when protesters would hold up signs comparing him to hitler, or when I’d hear someone call him an “idiot” or “ignoramous”.  And I cringe now that the tables have turned and it seems that in less than 6 months our country is already more comfortable disrespecting our elected leaders than we were 6 years into the Bush administration.  I mean seriously, when did we get to the point that a very friendly looking man like the one in the picture above feels comfortable being photographed while hanging his congressman in effigy at a town hall meeting?  Certainly this is not the direction our country should be headed in, and its not the kind of political discourse our founding fathers hoped we’d be engaging in 200 years later.  Whether you like your leaders or not, they were elected fairly and justly through the rules of representative democracy.  And whether you feel like their opinions mirror your own or not, to disrespect them to this degree is to disrespect the system laid down by our founding fathers.

Even pushing all that to the side, this kind of incivility is just plain stupid.  These protesters are complaining that their voice isn’t being heard and when they have the opportunity to make their concerns known directly to their elected leaders they opt instead to hurl insults and angry non sequiturs, missing an opportunity to contribute thoughtfully to the discussion and instantly identifying themselves as solution-less obstructionists.  Healthcare reform is an exceptionally complex issue, and the bills going through congress are actually impressively moderate.  There are certainly elements of them that are controversial, but as US Rep Kathy Castor tried to tell her incensed Tampa crowd, “There is more consensus than there is disagreement when you get right down to it”.  I think most people, including conservatives,  would find upon actually studying these bills that there is a lot to like.

So please, lets all calm down and take a deep breath.  If you’re concerned about healthcare reform then get educated using balanced and unbaised sources (this post: Some Basic Info on the House’s Healthcare Reform Bill  will get you started).  Then if you find that once you understand the bills circulating congress you still oppose them then by all means work to modify or even defeat them.  But please do so thoughtfully, with civility, sans fear-mongering and hyperbole, and with a healthy respect for those who disagree, and those your community has chosen to represent you.

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Well needless to say there’s a lot going on in the healthcare arena lately.  In case you missed it, the House of Representatives released their healthcare bill last week.  I’m planning on writing up my analysis of it but unfortunately I’ve got midterms early next week so you’ll all have to wait a week or so for that.  But in the meantime I thought I’d provide some basic information about what the bill contains since I’ve had several people recently express frustration to me that they don’t know where to get an objective description of the contents of the bill.  So I’ve provided some helpful links after the jump.

The text of the bill can be found here:

http://edlabor.house.gov/documents/111/pdf/publications/AAHCA-BillText-071409.pdf

Its 1018 pages. So they have prepared summary sheets of the most important points, broken down by topic:

Public plan: http://edlabor.house.gov/documents/111/pdf/publications/AAHCA-PUBLICOPTION-071409.pdf

Guaranteed Benefits: http://edlabor.house.gov/documents/111/pdf/publications/AAHCA-BENEFITS-071409.pdf

The Health Insurance Exchange: http://edlabor.house.gov/documents/111/pdf/publications/AAHCA-EXCHANGE-071409.pdf

Making Coverage Affordable: http://edlabor.house.gov/documents/111/pdf/publications/AAHCA-AFFORDABILITY-071409.pdf

Paying for Healthcare Reform: http://edlabor.house.gov/documents/111/pdf/publications/AAHCA-PAYINGFORHEALTHCAREREFORM-071409.pdf

And finally, here’s the CBO’s (Congressional Budget Office) analysis of the bill. They’re a non-partisan research organization that does forecasting for congress:

http://www.cbo.gov/ftpdocs/104xx/doc10430/House_Tri-Committee-Rangel.pdf

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While politicians hammer out the details of healthcare reform legislation and debate some of the more “controversial issues” (which I put in quotes because they shouldn’t be as controversial as they are) surrounding healthcare reform, the administration is busy doing things that everyone should be able to happy about.  Of course good news doesn’t draw as many readers as doom and gloom so its easy to miss some of these developments if you’re just clicking through a news website or taking in a bit of CNN, so I’ve highlighted a couple of the recent positive developments after the jump.

Key Senator, White House Strike Deal With Drug Industry for Health Coverage

First up is an article from several weeks ago.  And I apologize for using partisan news sources but I’ve got one from each side of the aisle so I guess it balances out.  Basically, Senator Max Baucus was able to negotiate a deal with the Pharmaceutical industry whereby they will eat some of the cost of drug coverage for seniors on medicare who make less than 80-85,000 per year.  They’re expecting to subsidize about 80 billion dollars worth of care over the course of the next ten years.  Not too shabby.

Biden, Hospital Leaders Announce Pact To Help Cover Uninsured

Next up is an article from today.  Joe Biden announced that the nation’s hospitals had agreed to comp 155 billion dollars worth of medicare and medicaid care over the course of the next ten years.  Nice.

These developments, along with the pledge from leaders of the healthcare industry a few months back (Titans of Healthcare Pledge to Reduce Healthcare Costs) are good news for members of congress as they attempt to draft legislation that is “budget neutral”, they’re good news for the country since healthcare costs are the primary drivers of our dismal deficit projections, and its good news for average Americans, who for some time now have been dealing with healthcare costs that are rising at more than three times the rate of their wages.

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Well its been a while hasn’t it?  Sorry about that.  I’ll be posting with more regularity in the future.  As many of you know I recently got back from an AMA conference in Chicago and it was a surprisingly eye-opening experience in a lot of different ways.  There’s no way I can cover it all in one post so I’m just going to talk about one of the issues that was discussed at this meeting.  There is a now-famous article that was recently published in the New Yorker entitled “The Cost Conundrum” which analyzes some of the drivers of high healthcare costs.

Everybody was talking about this article.  The President of the AMA called the article a “watershed moment” for healthcare reform.  Supposedly President Obama had everyone on his healthcare team read the article.  So if you have even a passing interest in healthcare policy and reform, you should probably read it too.  So for your enjoyment I’ve posted a link to it after the jump.

But first, a quick warning.  While I think this article is extremely important and talks about an often-overlooked issue driving healthcare costs, we should keep in mind that it brings attention to this issue by focusing on an extreme case.  The behavior of the doctors in McAllen TX discussed in this article is in no way typical.  They are identified as an unusual case in the article but its still important to keep that idea in mind.  And the way this is portrayed as almost the sole driver of rising healthcare costs near the end is a bit misleading.  I don’t think very many people studying the economics of healthcare would speak quite so strongly.  And finally we should keep in mind that this is not a new problem, but has been talked about by organized medicine for years now.  There are plenty of physicians who support the principles laid out in this article.  In fact some companies, particularly in California (Kaiser), long ago embraced the capitated model recommended by this author (there’s even a mention of Sacramento as a “low-cost city”!)

So my point is, this article rips a lot on doctors.  Some of it is warranted but it uses extreme examples and a bit of hyperbole to make its case, without really acknowledging the work physicians have already been doing for a while to solve this problem.  With that said it brings attention to an important issue and makes recommendations that I (and many other students and physicians) wholeheartedly support.  So with no further delay, your article awaits.

The Cost Conundrum by Atul Gawande

ps – its really long.

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Well while I’m on the topic of the future of Healthcare here’s another one for you.  The CEO of the CMA, Joe Dunn, came and spoke at the UCD School of Medicine several weeks ago and he gave a great speech.  And now, through the miracle of technology, that speech is available to all of you!  His speech was directed towards medical students but it really has relevance to anyone who wants to get something done in politics.  Its long but he’s a very engaging and entertaining speaker and the speech really gets better as it goes along so if you have the time its definitely worth watching it through.  You would be hard-pressed to find a better primer on how things get done in government.

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Well with finals over and done with you can expect to get a lot more posts from me in the coming weeks!  And we start out today with some very exciting  news.  President Obama held a press conference today for what he called, “a watershed event in the long and elusive quest for health care reform.”  The American Hospital Association, the American Medical Association; PhRMA; AdvaMed; America’s Health Insurance Plans, the SEIU, and the Greater New York Hospital Association and the California Hospital Association announced a new cooperative effort to drastically reduce the rate of growth of healthcare costs beginning immediately.  They pledged to cut the rate of growth by 1.5%.  This may not seem like a lot but this means a cut from about 7% to 5.5%, bringing us much closer to the annual rate of income growth which tends to hover around 4-5% but which has at times grown to near 6%.  And that’s what really matters, that’s really our baseline here.  If healthcare costs can be reduced such that their growth is equal to the rate of income growth in the US then the future of healthcare suddenly gets a lot rosier.  And this commitment brings us much closer to that goal.

And this is also great news for America’s future financial security.  Many people don’t realize the huge impact that rising healthcare costs have on our country’s national budget.  The reasons why that is are a subject for another article but even a savings of 1.5% will mean much smaller deficits and less national debt.  One Obama aid put it this way:

“I don’t think there could be a more significant step to help struggling families and to help the federal budget than reducing the growth rate of healthcare spending by 1.5 percentage points per year. With regard to the federal budget… the only way that we are going to restore the nation to a sound fiscal path over the long term is to reduce the growth rate in health care costs… Reducing the growth rate of health care costs overall by 1.5% per year would virtually eliminate the nation’s long term fiscal gap. … This, by an order of magnitude, is far more important [than Social Security or related reforms] to the fiscal trajectory that we’re on, especially over the long term, than anything else that could be done.”

Perhaps a bit hyperbolic but nobel-prize winning economist Paul Krugman was almost as excited:

“And serious cost control would change everything, not just for health care, but for America’s fiscal future. As [Budget Director Peter] Orszag has emphasized, rising health care costs are the main reason long-run budget projections look so grim. Slow the rate at which those costs rise, and the future will look far brighter. I still won’t count my health care chickens until they’re hatched. But this is some of the best policy news I’ve heard in a long time.”   And later says, “…shaving 1.5 percentage points off the growth rate of health care spending. That may not sound like much, but it’s actually huge: achieving that goal would save $2 trillion over the next decade.”

So certainly nothing to sneeze at.  The details of how these savings will be accomplished were not released today but will be revealed over coming weeks.  As for why they’ve chosen to independently take this step?  The only answer from the industry was that they’re being “good Americans”.  This commitment will have no enforcement mechanism beyond the press and there will be no formal regulations.  Apparently the industry just came to this conclusion themselves.  Fantastic, if its that simple, but some fear this may be a preemptive attempt to block the healthcare reform that’s currently taking shape in congress.  Insurance companies can ask for patience first to see if their efforts are sufficient or they can claim that they tried to do their part but congress simply wouldn’t compromise.

I’m actually more optimistic.  In the industry’s statement on the issue they implicitly endorsed the healthcare economics currently being used by the administration to justify healthcare reform.  Which means that somewhere there has been a fundamental shift.  Previously, the insurance industry was holding up their own fringe economists to testify on their behalf against the wave of economic opinion opposing them.  Sort of like the tobacco industry doctors or the oil company ecologists.  But it seems they’ve accepted the fact that they’re part of the problem.  Of course the fact that they can suddenly reduce cost growth by 1.5% just for the heck of it seems to validate that idea as well. There’s been easily reducible waste in the private healthcare system for some time now, and this commitment just highlights that fact.

Healthcare reform plans will be presented in the next few months and I suppose the industry’s intentions will become clear then.  I’ll keep you updated as events unfold and as more details about these cost-reducing measures come to light.

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