Are We Learning From the “Correct” Failed Attempt at Health Reform?

by Greg Pierce on June 17, 2009

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President Obama, Secretary Sibelius, Senators Kennedy and Baucus, and Representatives Waxman and Rangel have each trumpeted their commitment to learn from the lessons of the failed 1992-1994 effort to reform our healthcare system. To that end, the President has limited the Administration’s guidance to general principles – thus avoiding the sound of the 900-page thud left by First Lady Clinton’s White House-led effort to draft a bill.

Seeking to avoid premature conflict, Senators and Representatives have gone to great lengths to keep all options on the table, to meet with hundreds of interest groups, and to wrap their deliberations in an apparently-genuine effort to find a common ground. Each of these new tactics draws inspiration from the lessons of the 90s.

But what about the lessons of the 80s? In 1986, then-President Reagan challenged Congress to enact sweeping healthcare legislation to protect seniors from the cost of catastrophic illness. In 1988, Congress obliged, and passed the Medicare Catastrophic Coverage Act of 1988, which included the first-ever prescription drug benefit for Medicare.

By 1989, Ways and Means Chairman Rostenskowski found himself surrounded by angry seniors, furious about the new bill’s increased taxes and poorly-understood benefits. In a remarkable reversal of fortunes, the law was repealed shortly after enactment, and serious efforts to expand coverage to include drugs would wait fourteen years for the eventual passage of the Medicare Modernization Act of 2003.

What happened? The Medicare Catastrophic Act of 1988 was negotiated in good faith across both Houses of Congress, across both sides of the aisle, and with dozens of industry and patient and provider groups intimately engaged in the drafting and passage of the Act.   In a nutshell, the lawmakers of the late 80s forgot to engage the American people in a thoughtful, deliberate discussion, ignored the need to educate them on the specific elements of the reform proposals, and inappropriately relied only on experts and advocates to draft a bill.

Research conducted in the aftermath of the repeal indicated clearly that the ultimate recipients of the carefully-crafted and complex legislation neither understood the new law, nor, when educated, agreed to its provisions. The Fall 1990 Health Affairs issue reported results of a poll taken post-enactment (but pre-repeal) which found substantial numbers of seniors opposed the new bill (36% support, 43% oppose).  Once briefed on the legislation, opposition increased (33% support, 47 % oppose.) Importantly, of the informed group, only 9 percent strongly favored the legislation, and 25 percent strongly opposed the bill.   Against these findings, repeal should come as no surprise. 

The efforts by current lawmakers to address our national challenges to expand access, reduce cost, and improve quality seem well-informed by lessons of the 90s; it is far from clear whether the lessons of the 80s are similarly front-of-mind. Recent examples of Administration, Congressional and interest group leaders seeking to convey an extremely-optimistic view of the prospects for reform, to limit discussion of the details and attendant disruption associated with real reform, and to limit critical public discourse are worrisome to advocates of reform who have seen one too many efforts go up in smoke.

The current environment of silence, coupled with vague statements of support and apparent consensus seems strangely at odds with the issues at stake here. Changing the way we pay hospitals and doctors, changing the way small businesses purchase insurance, mandating coverage of all Americans, and possibly changing our tax code are monumental changes that affect each of us directly.  

Soon, the American people will expect details, debate, and discourse. Understanding the changes under consideration is a necessary first step; discussing and debating the meaning of the proposed changes, the impact of the proposed changes, and the unintended consequences of the proposed changes are also necessary steps. Such discourse takes time, since contentiousness lies in the details. Efforts to enact such sweeping legislation by the end of this year – as recently reinforced by the President’s statement that it’s “now or never” may unintentionally set the stage for a repeat of the “pass it – repeal it” two-step of the 1980s.

In the 80s, lawmakers and interest group leaders under-invested in education and engagement on the details, and assumed they knew best. Today’s lawmakers and leaders would do well to temper expectations on timing, engage the American people in a sustained and thoughtful two-way discussion on the benefits and risks of reform, and take a lesson from the “correct” failed effort to reform Medicare. Success requires nothing less.

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