The Post-Mortem on Obama’s Health Care Speech

If, as the case increasingly appears to be, there will be at best modest changes to the existing health care system (modification of insurance coverage, e.g., forcing companies to cover preexisting illnesses; an increase in the number of individuals with insurance coverage; and perhaps the creation of consumer cooperatives), it will be tempting to blame President Obama for failing to achieve more sweeping change, such as the creation of a governmental insurance option or universal coverage.

That would be wrong.  As I’ve tried to argue in previous blog postings, Obama has not made major mistakes in his efforts to persuade Congress to enact more sweeping health care reform.  Indeed, he’s largely avoided the key errors that the Clintons made in 1994.  This is not to say his performance has been flawless. His recent national television address, for example, fell short, in my view, because it lacked specifics on how he proposed to pay for health care reform, and because he sent mixed messages, by both appealing to Americans’ higher motives while also taking thinly veiled partisan jabs at opponents of his plan and setting up insurance companies as the bogeyman.  Far better, I think, that he spelled out the true costs of the plan, including the almost certain necessity that taxes will need to be raised to fund it, in the context of appealing to American’s more virtuous side and bringing business, including insurance companies, on board.  Businesses – particular small businesses – cannot be expected to support any initiative unless they know what the costs will be, and how they will be apportioned.

But even a perfect speech, I argue, was unlikely to significantly change the underlying dynamics of the health care reform debate.  As it was, his less-than-perfect speech had at best a modest impact on public attitudes, as indicated by the national polls released in the last couple of days (see here and here).

Why, then, is broad-based health care reform so difficult to pass, if not because of Obama’s leadership failings?  I’ve hinted at the answer before, but let me address it more directly.   The reason has less to do with failed political strategies, and much more to do with the complexity of health care policy itself in the context of public attitudes toward reform.  Simply put, there is not a lot of strong, unabashed public support for the type of sweeping reform envisioned by most advocates of health care reform.  This fact is often easy to overlook in the welter of survey data that is frequently tossed around by both sides in the debate.   A careful read of this data suggests two basic dimensions to public opinion on this issue – dimensions that have not changed appreciably since 1993-94.  First, most Americans support reform in the abstract if it promises to control rising health care costs and prevent loss of coverage.  But when they are presented the options, and competing arguments, for achieving these goals, support for reform begins to erode, and for very predictable reasons.

To see this, consider public attitudes toward the “public option” – the idea that insurance costs can be contained by providing a nonprofit government-run insurance option to compete with private insurance companies.  In the abstract, most Americans by slim majorities, like this idea. Here’s a chart containing polling results from several surveys asking about the public option (see source here).

If we look at a single poll with consistent question wording, moreover, we find these numbers are pretty stable throughout this debate. For example, a recent ABC poll finds 55% support a public option, with 42% opposed. Although down from June, when it was supported 62-33, the public option still has majority approval.

However, as the chart below suggests, if you include in the question the notion that the public option would give the government an “unfair advantage” in competition with private companies, or is the first step toward a single-payer system, public support erodes.  Conversely, if you present the public option as increasing insurance options, and as a means of holding down costs, support, not surprisingly, goes up. (For more on this, see source here).

The debate over the public option, I believe, mirrors Americans’ uncertainty over health reform more broadly.  In the abstract, support is there for change. But when confronted with competing arguments, uncertainty grows.  Over time, as the particulars of the competing viewpoints are disseminated, we see a gradual erosion in overall support. This happened in 1993-94.  And it’s happening again, as indicated in the latest polls. Looking at the ABC poll, we see that a plurality of Americans think that health care reform, as outlined in the president’s speech, would make their own care worse, rather than better (32-16 percent, the rest no change);  cost more, not less (40-20), and worsen their own coverage (37-11). And here’s the kicker – among the uninsured, only 51 percent think reform would improve their own coverage. Similarly, the latest CBS poll suggests that most Americans (52-42) think Obama’s health care plan will increase the deficit, and by 27-22 they believe the proposed reforms would hurt rather than help them personally.

What does this mean for fundamental health care reform?  There simply is not enough political support for any proposal that would radically change the way Americans receive health care today.  That means proposals including the public option, mandated universal coverage, higher taxes on “Cadillac coverage” – in short, all the core components of what most people think of when they talk about significant change – lack enough support to overcome opposition from well-entrenched and vocal minorities.  Americans, as a generally risk-averse and pragmatic populace, one ideologically more conservative than the publics in other industrialized democracies, are more reluctant to sign on to major policy change in the face of these uncertainties.  (This is why I am always surprised when politicians, including Obama, point out that America is the only industrialized country without universal health care coverage.  For many Americans, that’s an argument against universal coverage – not in favor of it!) And our open system of shared powers at the national level, with geographical-based representation in Congress, and federalism, by affording many access points to block change, works to amplify this uncertainty.  Change can occur, but not nearly on the scale envisioned by proponents of fundamental health care reform.

The bottom line is that polling data indicate that Americans want change, yes, but only in the context of maintaining the broad outlines of the private insurance/fee for services/employer-based system they know.  If Obama made any mistake, it was in suggesting that anything more than incremental change was possible.  In the end, I think he can get incremental changes through, with some (minimal) Republican support.  But because so many portrayed this battle as the last, best chance to implement a universal health care system enjoyed by most other “western” industrialized democracies, passage of only incremental change will invariably be portrayed by some as failure.  In fact, given that Obama was elected with about “average” political support, (see my numerous previous posts on this issue), even incremental change– particularly in the midst of an economic recession – of the type described above is a significant accomplishment.  We ought not to lose sight of this in the midst of the inevitable wailing and gnashing of teeth that is certain to follow if more sweeping change does not occur.

4 comments

  1. “There simply is not enough political support for any proposal that would radically change the way Americans receive health care today.”

    And the usual response to this is: “Define ‘radically.'”

    Republicans in the House and Senate have publicly indicated support for:

    1) Prohibiting insurance companies from denying coverage of preexisting conditions
    2) Strengthening “portability” (from job to job, or more critically from job to no-job, or job to job-that-doesn’t-come-with-health-care)
    3) Opening up the insurance market to expand purchases across state lines.

    The Devil is in the details, of course, but some of this stuff could really reshape the way Americans pay for health care. But you should take my point here with a grain of salt since I’m far from a health care expert.

    On the speech, you know, Obama doesn’t need to sway “national” views. He needs to win over a fairly small percentage of the electorate — wavering voters in at-risk Democrats’ districts, for instance, or people on the left-flank of the Democratic party who may be growing disaffected, or voters in the districts of the handful of ‘gettable’ Republicans.

    I tend to view this fight as a repeat of the 2004 election more than the 1993 health care feud (happy to expound on this over drinks in Middlebury in a few weeks). But I thought the speech was an effort to position Obama as speaking for the people in the rough middle of US politics who worry about whether they would still be able to choose their doctors, or whether there would be rationing — very, very fundamental worries about Obama’s plan.

    That’s because something funny happend while “We In The Media” gave over August to the raucous town halls, the Obama-Is-A-Nazi, His Government Is Coming To Kill Granny fringe arguments: Poll after poll found the bulk of the objections (especially among “gettable” voters) to be more down-to-earth. The Obama White House spent an enormous amount of energy trying to fend off the “Obama = Hitler” folks.

    And that left the concerns of independent voters mostly unaddressed — on either side.

    To my ears, Obama was trying to stake out a claim to the middle. He made several points meant to distance himself from the left of the party (Vermont Senator Bernie Sanders was basically a lone clapper when Obama mentioned how some want the Canada model), then he defined his opposition as the “death panel” crowd (rank and file House GOP happily obliged him throughout the speech) and finally he said “here are legitimate complaints and my answer to them.”

    Others have fact-checked him so I won’t repeat the process here, but that was, I think, the strategic thinking.

    Let me quickly say that advising the President to tell the American people that their taxes will go up to pay for the overhaul of US health care = immediately dooming the reform effort.

  2. VERY useful dissection, Matt. Thank you, thank you!

    Can you boil it down even more: Are most lawmakers just deer-in-the-headlights on this issue, or is this an issue that does jeopardize reelection? Is health care destined to be a significant factor in reelecting representatives next year (and in 2012) or not? Would it be feasible for many members to “do the right thing” here — with more forward-looking measures, though it would cut against current opinion?

  3. Matt, any significant change will be a win for Obama. Go back to 1965 and see how small Medicare was when it began.

    Passing a bill will 1) be the camel’s nose under the tent and 2) reduce the Democrats losses in Congress next year.

    No bill equals a blood letting for the donkeys in 2010.

  4. Olivier,

    You are precisely right that Obama tried to portray health care reform as a modest, centrist set of reforms, and that his goal is to attract the support of Blue Dog Democrats (and perhaps a handful of moderate Republicans) without losing his left flank. The question is whether he did so effectively. I argue that he did not, and for the reasons I spelled out: the speech lacked an even emotional keel; instead, he was both combative and conciliatory, partisan and above partisanship. More importantly, he fudged on precisely the details that his target audience needs to know before they will put themselves on the line for this bill. In this regard, he has already gone on record as supporting the House version of the bill that includes higher taxes on wealthy income earners, and a penalty for those who opt not to buy insurance, and on employers who don’t offer plans that meet the government’s standards. This isn’t a secret, but in his speech it suddenly seemed as if the bill would be funded entirely by wringing waste and fraud out of existing programs. This obfuscation for political reasons was at odds with the conclusion of his speech, which tried to rise above politics and instead justify the policy on the basis of more principled standards.

    As for what constitutes radical or significant reform, I thought I spelled it out pretty clearly: that would include mandates that force all consumers to buy insurance and a public option for insurance, at a CBO-projected cost that increases by some $1 billion or more. That’s radical. If, on the other hand, the final bill is essentially deficit neutral insurance reform – forcing insurance companies to include certain coverages in their base package, no denial for preexisting illnesses, incentives to expand coverage perhaps by expanding Medicaid eligibility – I think he could get a few Republican votes. His Left would scream bloody murder, of course. In the end, I think that’s what we’ll see: insurance market reform and modest expansion in coverage through subsidies, but no mandates and no public option. Radical? Given where this debate started, I don’t think anyone would say this is fundamental health care reform. But my point is that it would nonetheless be a significant accomplishment.

    Jack – If only more Democrats had your common sense! Many moderates have said all along that it is far better to take half a loaf than hold out for more, with the understanding that there’s always tomorrow. Whether you view this as the came’s nose, or a flea’s nose, under the tent, it can be sold as progress. Obama could (and would) claim victory. Of course, victory is in the eye of the beholder, and the Pelosi wing of the party would argue that Obama folded. But that’s the nature of politics today.

    Fred (from your question to my previous post): Obviously presidents prior to Obama have received their share of hissing and grumbling from a Congressional audience, but I’ve never seen such a direct affront from a single person. I think it crossed a boundary, which is why even Republicans pressured Wilson to apologize, which he did. The problem, of course, is that contributions to Wilson’s reelection campaign skyrocketed, and he’s used his comments as a springboard for publicity (see his website). Once again, it is a reminder that Obama’s election has done nothing to mute the partisan polarization characterizing discourse in politics today.

    Marty – Your question suggests that it would be useful to lay out the specific provisions in the various health care reform bills to see which get support and from whom. But I think moderates are very worried about getting hung out to dry by supporting a bill that will leave them vulnerable to consumer backlash come 2010, particularly if it’s a bill that passes with only Democratic votes. On the other hand, they do want to produce something. It would be very hard, in my view, for Republicans not to sign on to a bill that is essentially insurance reform – hating insurance companies is a bipartisan issue. But when reform spills over into employer mandates and the public option, moderates get nervous and Republicans bail.

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