The Buy Now, Pay Later Strategy For Health Care Reform
At this point, outside the administration and its most ardent supporters, it's fairly widely accepted that the new health care law won't sufficiently address the unsustainable growth of health care costs. Congressional Budget Office director Doug Elmendorf, for example, has said that "rising health costs will put tremendous pressure on the federal budget during the next few decades and beyond. In CBO's judgment, the health legislation enacted earlier this year does not substantially diminish that pressure." Former CBO director Alice Rivlin (who supported the health care law) recently told Business Week that when it comes to long-term budgeting and deficit reduction, the "central issue" remains "reducing the rate of health care growth." And now The Washington Post's Alec MacGinnis points out that although the law includes some reforms designed to reduce the overuse of medical care, little in the law is expected to make a difference in terms of health care prices.
MacGillis suggests that if the law had focused on price reductions, perhaps by including a government-run insurance option, it might have been more popular. Ignoring the policy problems with a government-option for a moment, it's worth remembering that broad public opinion wasn't the only popularity measure that legislators had to worry about: Big stakeholders in the health care sector had to be brought on board in order to avoid an industry-vs.-government PR war. If HillaryCare is any lesson, an air battle with doctors and drug makers, both of whom ended up supporting reform, would've had a pretty significant negative effect on the law's popularity.
The other, related thing to remember, though, is that despite all the chatter about bending the cost curve and reducing costs, failing to address the long-term cost issue was the explicit legislative plan of attack all along. MacGillis hints at this in her final paragraph, when he quotes Brookings budget scholar Henry Aaron arguing that "if we attacked costs right at the front end, [the legislation] would have died….Now, we'll have a mechanism that will force us to address it. There are only so many fronts you can fight a war on at the same time." In other words, we have two problems. First, the ship is slowly sinking. Second, not everyone is on it. We chose to bring most of the swimmers onto the decks, but long-term, the boat is still going to sink. It's the Buy Now, Pay Later strategy, and we're going to be paying for it for a long time.
