To Reform Health Care, Obama Must First Convince His Advisers

Posted by Michael F. Cannon

In The New Republic, Jonathan Cohn makes some interesting observations about how Barack Obama’s campaign and administration approach policy issues, particularly health care.

In early January, most of Barack Obama’s senior staff assembled with the president-elect . . . It was a pivotal moment in Obama’s transformation from candidate to commander-in-chief. Obama’s advisers had taken all of his campaign pledges, factored in his promise to reduce the deficit, and put together a provisional blueprint for governing. For the first time, Obama would get a sense of how his proposals fit together in the real world.

Does Cohn suggest that candidate Obama just threw out proposals without considering their cumulative, real-world impact?  That Obama launched a new administration with insufficient planning??  Perish the thought.

Obama . . . said he was mostly happy with what his advisers had produced. Investments in energy and education, plus real progress on reducing the deficit–it was all in there, Obama noted. But then the president-elect turned to his one major concern: a key item that was not, in his opinion, sufficiently funded. “Here’s my guidance to you,” one participant recalls Obama saying to the group. “Protect health care.”

It wasn’t the first time that health care had seemed to get short shrift from Obama’s advisers. Nor would it be the last. Indeed, there were moments during the transition and the early weeks of the administration when it appeared that the push for comprehensive health care reform might collapse before it had even begun. During this time, a debate raged inside the administration, with some senior officials arguing that the new president should wade into health care gingerly–or even postpone it altogether–because it would cost too much, distract from other priorities, and carry huge political risks.

Ultimately, however, these arguments failed to carry the day, and health care reform, against what occasionally seemed like long odds, managed to find a sizeable place in Obama’s budget…

The divide among Obama’s counselors was never over whether to pursue health care reform or even what it should look like in the end . . . What divided Obama’s team was the question of how to pursue reform–in particular, how quickly.

That tension stretched back to the campaign, when Obama’s political strategists advised him to soft-pedal the topic. One of them was David Axelrod. Although personally acquainted with the flaws in our health care system because of his disabled daughter, he also understood public opinion: The middle-class voters whose support politicians covet were worried about the cost of insurance, but their enthusiasm for universal coverage seemed shallow. Obama, though, always insisted on keeping health care prominent in the election.

Why so much dissension in the ranks? Partly because the nation faces much more immediate problems.

Axelrod’s anxiety hadn’t dissipated since the election. And now he had a new ally in Larry Summers, whom Obama had appointed to head the National Economic Council. One concern for Summers was the diversion of presidential and staff attention from other issues, like the economy.

But the dissension is also because Obama’s advisers understand just how difficult it will be to achieve universal coverage.

Mostly, though, Summers worried about money. Experts generally believe it will take years before better use of information technology, more preventive care, and other reforms start to yield serious savings. At least in the short run, health care reform is therefore likely to add to the government’s financial burden–during a time of rising deficits. This made Summers uncomfortable.

How bad was the dissension?

Particularly in Obama’s absence, the voices of the skeptics often predominated. “It was scaring the hell out of the rest of us,” says one of the advisers who favored more aggressive action.

Ultimately, Obama insisted on putting $634 billion in his budget to fund health care reform.  But Cohn acknowledges that Obama may be over-reaching.

At a time when the economy is collapsing, perhaps Obama can’t afford the distraction of such a major policy effort; at a time when the government is pumping out so much money for other priorities, perhaps it’s foolish to incur a new obligation that, if carried out by the book, still may not pay for itself in under ten years. And, even if it makes sense to seek health care reform this year, Obama’s decision to allocate health care money now could make the budget tougher to pass–inviting an extra political fight that might make reform even harder to achieve.

Nice thing about Cohn: he may be a high priest in the Church of Universal Coverage.  But he’s a darned good journalist.