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Looks Good, Doesn’t Fly

Mar
21
2007

Two weeks ago, what seemed to be a very interesting survey appeared in The New York Times. It suggested that most Americans were supportive of universal health care, and more importantly were interested in considering raising taxes to pay for it. Several gleeful commentators on the left, and even a few on the right, considered this was a new dawn for the health reform movement.

Unfortunately this is nothing new. Americans have always been in favor of universal health care. At least they have been when you ask them about it in surveys. Unfortunately there are several other things they say in surveys that they are also in favor of that undermine the prospects for “universal” coverage. For example, in 2003 by small plurality, Americans said they preferred the Canadian health care system to their own. But don’t worry they said the same thing in 1989! None of these polls mean either that Americans do actually prefer the Canadian system (especially given how little they know about how either country’s system actually works) or that something similar will actually hop the border and come to the lower 48 any time soon.

What it does mean is that Americans have some vague idea that they don’t like what they have now. And honestly, what’s to like? There’s no need to go into a long litany of the problems of the US health care system here – again – other than to note – once again – that it is expensive, unfair, and essentially run for the benefit of providers and suppliers.

The truth is that the Times survey showed a very similar interest in universal health-care reform and raising taxes to pay for it as did one done in the middle of the Clinton reform effort in 1993. John Cohn of The New Republic was very quick to jump on this – pointing out that the numbers in the current survey were actually not quite as good as they had been in September 1993 – right at the time that Clinton made his speech introducing his health reform plan. But as I pointed out in a much longer piece about the prospect of reform at The Health Care Blog a couple of years back, Americans have always said in surveys that they’re willing to pay more taxes in order to cover the less fortunate.

In fact, as a Harris poll has shown, Americans “value” about this issue has some cross-party foundation.

But if you ask people as Harris finally does at the end of its survey – which pre-dates the Times’ – if they’re wiling to see a “substantial” increase in taxes to help the less fortunate, then support for the whole idea falls off. It’s worth noting that the Times poll only asked about a $500 increase – which probably doesn’t sound like that much money. And more importantly, when Harris got to the part about asking for a substantial tax increase, the support was lost of most everyone polled, especially those independent voters who politicians treasure so dearly.

The problem is that more Americans have to start to consider themselves “less fortunate” before they give political cover to the timorous moderate Democrats and the scant few remaining liberal Republicans who may actually enact changes to the health care system.

That’s why the nation’s elderly are so well covered. They are the only group to consistently understand that they are “less fortunate” or may become so without the government’s assistance and protection. From roughly the mid-80s all the way through to 2003, America’s seniors realized that retiree benefits were heading out the door along with the social contract that got them retiree health coverage from their employers in the first place. With Medicare, they already had coverage for physician and hospital care, but not for drugs. That’s one of the reasons why a drug coverage bill passed in 2003.

But to get to legislation enacted that genuinely covers the uninsured – who aren’t elderly – will by definition put the entire health care system into a vortex. That’s because it will have to include some mechanism to limit the overall financial contribution of government and business into that system. And that means that the plans, providers and suppliers in the system will have to see a relative reduction in what they’re getting – something they won’t like. That means that they’ll kick strenuously against any change. Thus far they’ve been muddying the waters by coming out with their own confusing “reform” plans – all of them nakedly self-interested. But when the politicians settle on a real reform effort with a chance of passing, the industry will mobilize the opposition as hard as it can. Things will have to be very bad for the politicians to resist and stay the course.

So how bad are things? Again, I tend to believe that they’re bad but not bad enough.

From this series of Harris surveys, you can look at the the proportion saying that the system needed to be completely rebuilt (the most negative of 3 choices). Two decades ago it consistently increased from 19% in 1987 to 24% in 1989 to 42% in 1991, in the middle of that recession. The fact that 42% were looking for a complete rebuilding meant that there was an appetite for something real to be done–hence the Clinton effort. But, as the economy picked up, the number fell to the mid-30s% in 1993 where it remained. In an August 2006 survey it was still stuck at 30%.

But in 2006, 48% of those who were uninsured for any part of the year want the system to be completely rebuilt. So the more that we see people cycle in and out of health uninsurance – something that’s contiguous with the big increase in people seeing huge swings in income year to year, and seeing less security of benefits with a particular job – the more likely it is that they’ll support big changes. But of course even for those who have been uninsured (and I assure you that whatever the free-marketeers might think the system is not working for any of those people) there’s still not a majority in favor of “complete rebuilding.”

The only variable this time around (as opposed to the 1990s) is that business is even more grumpy. But only slightly. And they have escape clauses for their unhappiness. Low wage employers have a way out. They just stop offering health benefits, which they’ve been doing in droves. And for high wage businesses, health costs are still not quite enough to be a real issue, or at least not bad enough to get the CEO’s attention in many of them.

So, regardless of what the New York Times says, you can still put me down as a pessimist. The rash of reform plans in the states and in Congress is encouraging, but this is one place where I see politicians putting themselves ahead of the populace. And the backlash against that, err, “leadership” is now going to be dealt out by a $2 trillion dollar industry, as opposed to the smaller $1 trillion health care system that, last time around, took out any chance of reform.

Share  Posted by Matt Holt at 7:02 AM | Permalink

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