Healthcare Policy

Introduction to Public Policy: Healthcare II

Class Plan

• Class updates.

• Discussion of Arnold's work on Congress and public opinion.

• Overview of the healthcare problem.

• History of healthcare policy.

• Analysis of the Clinton proposal's failure.

• Analysis of the ACA's success.

Short Paper #2

• Analyze how the Clinton and Obama healthcare proposals fared in Congress, drawing on the Mettler reading.

• Explain why Obama’s healthcare legislation passed when Clinton’s failed (500 words).

Key Questions

• Why did Clinton’s (and other previous attempts) healthcare reform fail while Obama’s succeeded?

• What explains why Congress sometimes passes universal versus particularistic policies? How do people respond differently to each type of policy?

• What role have healthcare and insurance industry groups played in healthcare proposals over time?

Mettler Review

• Submerged State: Many social policies are structured to be "hidden" via the tax system or private-public partnerships.

• This leads to low awareness and support for government policies.

• It is defended by key interest groups (FIRE).

• To overcome, requires "revealing" the submerged state through discourse and/or compromising with key interest groups.

Arnold 1990

• If reelection is a primary goal for members of Congress, pursuing "particularistic" goals for constituents makes sense.

• However, they sometimes seek universal policies.

• Most people don’t pay attention to public policy or have opinions on most policy issues, and congressional elections rarely come down to specific policies.

• Yet, representatives pay attention to constituent public opinion (rational anticipation).

Arnold’s Model

• Members of Congress consider the "potential preferences" of constituents, especially those who may be unhappy, suffer costs of policy, and issues that could be raised by future challengers (instigator).

• Thus, even those without an opinion at the time can impact legislator’s policy design.

Drawing on Kingdon’s Interviews

• Politicians are wary of any aspect of their record that opponents might exploit, even seemingly minor votes.

• “I know that nobody will notice it right now…But it may be used against you in the next campaign. I learned that in my first campaign for reelection. About five days before the election day, they hauled out the charge that I was prohomosexual because I cast a vote against some ridiculous District [of Columbia] bill. You see, most people don’t notice it. But your opponent will comb down through every aspect of your record, every vote you’ve ever cast, looking for dirt and using it.” (10)

The Model

• Coalition leaders anticipate how legislators will anticipate how voters will react electorally to policies.

• Legislators and coalition leaders need to know how citizens will weight policy in their electoral decisions, which they gauge via “potential preferences”.

What informs “potential preferences”?

• Causal Chain:

  • Do people link policy with effects?

  • Do they blame the legislator or the party?

  • Prospective (policy position).

  • Retrospective (effects of enacted policy).

• Costs and Benefits:

  • General.

  • Group.

  • Geographic.

Legislators worry about…

• Those hurt by legislation (general, group, geographic).

• Those issues the opposition might exploit during elections.

• If people can link the legislator directly to a policy they perceive as hurting them (causal chain).

Coalition Leaders

• Similar to “policy entrepreneurs” pushing preferred policies; they help set alternatives, policy design, and strategies.

• Expectations of how legislators are judging citizen potential preferences inform strategy.

• Tactics:

  • Persuasion/Argumentation.

  • Procedure (omnibus bills).

  • Modification.

Estimations of Public Opinion

• What factors might impact whether and how voters connect representatives to policy via a causal chain?

• What factors explain how legislators estimate what voters think? What indicators do they use?

  • Polls (issue-specific, general).

  • Protest (less key in theory).

  • Interest group preferences.

  • Direct correspondence (letters, phone calls, etc.).

Discussion Questions

• This was written in 1990—what factors have changed in terms of how legislators know their constituent’s preferences and the extent to which they respond to it? Does the model still work for today?

• What role might the media or causal narratives play in this story?

Defining the Problem- Healthcare

• Cost

• Access

• Quality

Cumulative Increases in Health Insurance Premiums, Workers' Contributions to Premiums, Inflation, and Workers' Earnings, 1999-2015

• Health Insurance Premiums

• Workers' Contribution to Premiums

• Workers' Earnings

• Overall Inflation

Health consumption expenditures per capita, U.S. dollars, PPP adjusted, 2017

• United States: $10,224$

• Switzerland: $8,009$

• Germany: $5,728$

• Sweden: $5,511$

• Austria: $5,440$

• Netherlands: $5,386$

• Comparable Country Average: $5,280$

• France: $4,902$

• Canada: $4,826$

• Belgium: $4,774$

• Japan: $4,717$

• Australia: $4,543$

• United Kingdom: $4,246$

Average price, Avastin, 400 mg vial, 2014

• Switzerland: $3,930$

• United States: $~3,500$

• United Kingdom: $~1,000$

Percent of adults who have experienced medical, medication, or lab errors or delays in the past two years, 2016

• United States: 19%

• Sweden: 17%

• Canada: 15%

• Switzerland: 14%

• France: 12%

• Germany: 11%

• Netherlands: 11%

• Australia: 10%

• United Kingdom: 8%

• Comparable Country Average: 7%

Age standardized hospital admission rate per 100,000 population for asthma, congestive heart failure, hypertension, and diabetes, ages 15 and over, 2015 or nearest year

• Data for Australia, Belgium, and the US are from 2014. Diabetes admission rates for Austria are also from 2014.

Cost (Millions $)

• Graph of Total continuing care cost,Total physician & outpatient cost, Total acute care cost,Total cost

Percentage of U.S. Adults Without Health Insurance, 2008-2018

• Graph of % Uninsured

Percent that used emergency department for a condition that could have been treated by a regular doctor or place of care in the past 2 years, ages 18 and older, 2016

• Canada: 17%

• United States: 16%

• Sweden: 12%

• Switzerland: 9%

• France: 7%

• United Kingdom: 7%

• Netherlands: 6%

• Australia: 6%

• Germany: 5%

Cumulative growth in per enrollee spending by private insurance, Medicare, and Medicaid, 2008-2018

• Graph of Total

• Private Health Insurance

• Medicare

• Medicaid

“Deaths of Despair” (recent indicator)

• 2015 paper by Angus and Deaton shows that from the 1990s through 2010s, mortality rates were rising especially among white middle-aged Americans in rural places due to alcohol, drug, and suicides, which they called “deaths of despair”.

• Gained a lot of media coverage, and was linked to downward mobility of white working-class people especially, and was used to explain Trump’s 2016 victory.

A History of Health Care Proposals

• FDR (D), 1935-Public-funded health care, Social Security.

• Truman (D) (1945) National healthcare plan.

• Johnson, 1965, SS expansion (Medicare and Medicaid).

• Senator Ted Kennedy (D) Bipartisan Universal Health care bill (becomes Carter (D)’s watered-down version (70-79).

• Nixon (R), 1974- Comprehensive healthcare reform (with employer mandate).

• George W. Bush (R) 2003- Medicare Modernization Act, aka ”Medicare Part D”.

• Mitt Romney (R) 2006- Massachusetts Health Care, aka “Romneycare”.

• Obama (D) 2010- Affordable Care Act (ACA).

• Medicare for All (versions reintroduced in Congress every 2 years since 2003 by John Conyers, Pramila Jayapal, or Bernie Sanders).

Healthcare policy success!

• Social Security (FDR)

  • Old Age Insurance- Monthly pensions paid via payroll tax after 66 or 67 years old

  • Aid to Dependent Children

  • Unemployment Benefits

Medicare/ Medicaid

• 1965 (Johnson- D)

• Medicaid- low-income insurance

• Medicare- elder insurance (65 plus)

• Expansions over time

  • Medicare: Pregnant women, those with disabilities, in long-term care (state dependent)

  • Medicare Pard D (Bush-R) adds drug benefits

Industry Pushback

• American Medical Association (AMA) criticized Medicare as the beginning of socialized medicine.

Failed Healthcare Reforms

• Truman (D)

• Nixon (R)

• Carter (D)

• Clinton (D)

Clinton Healthcare Proposal

• Campaigned for universal coverage.

• Health Security Act

  • Goal of universal coverage

  • Employee and Individual mandates (fine to not enroll or offer insurance)

  • Subsidies to cover costs

  • Regional Health Alliances (similar to ACA “marketplace”)

Result

• Republicans take back Congress 1994, Contract with America

• Parts of plan are passed under Clinton

  • CHIP (Children’s Health Insurance)- covers kids in families with too much income for Medicaid

  • HIPAA- improving coverage after losing a job, portability of insurance between jobs

Clinton Healthcare proposal Why was it unsuccessful?

• Popular explanation: secretive, elite process, and lack of public engagement

• Failure of policy persuasion or to mobilize stakeholders

• Strength of opposition (and failure to coopt/ compromise)

• Budgetary concerns & deficits

• Complication of the plan

Secretive/ Complex Process

• Health Reform Task Force composed of first lady Hilary Clinton & friend liberal activist/ business consultant Ira Magaziner

• Public details are not released during the process, lack of public awareness

• Key stakeholders not included in process (IE healthcare, insurance, labor)

Skocpol

• Why does what looks like a clear sense of public crisis and urgency turn into a failure and the launching of an era of government cuts under the new GOP control led by Newt Gingrich in the 1994 midterms?

Skocpol- Boomerang Previous explanations for failure of Clinton healthcare

• Public opinion on healthcare is based on confused opinions (dissatisfaction of current system, combined with fear of big government and fear of losing current coverage)

• “Out of touch” liberal policymakers designed a too big gov. policy the public would hate (First Lady Hilary Clinton and business consultant Ira Magaziner)

Skcopol’s Explanation

• “This was no liberal scheme. This was a carefully constructed compromise between previously available liberal proposals and more conservative, market-oriented ideas about health care reform.”

• In trying to appease deficit hawks and avoid the appearance of “big government” expansion, the administration designed a complicated plan with unclear effects, that was critiqued from both left and right.

• Overall, she argues that structural factors including the large deficit left by Ronald Reagan, and the low trust in government explain this failure.

Advocacy groups

• Diverse groups of opponents

  • Healthcare industry: AMA, ADA, AAFP

  • Planned Parenthood: wanted abortion and prenatal coverage

  • Pharmaceutical companies: price caps could hinder innovation

  • Insurers: HIAA

• Lack of coordination among potential supporters:

  • AARP: supported elements, but no endorsement

  • Unions (AFL-CIO), League of Women Voters

What common factors explain which healthcare reforms have succeeded or failed over time in the US?

Why did ACA succeed and earlier bills fail?

Policy Design of ACA

• Incremental:

  • Friendly reforms like EHRs

  • Redistributive funding (i.e. less middle-class tax increases)

  • Less extreme than some wanted: no public option/”Medicare-for-all”

• Coordination:

  • House Democrats unified around proposals

  • PhRMA, AHA, insurance industry

  • Labor organizations

  • AARP

Comparison to past healthcare reform

• Contrasts with Clinton efforts:

  • Released broad policy proposals, then worked out details in Congress

  • Brought in industry and interest groups from the start

  • Facilitated interest group cooperation on specifics

• Similarities to Romneycare:

  • Process

  • Individual mandate

  • Marketplace

  • Subsidies and penalties

Oberlander

• Obama admin applied lessons learned from Clinton failure

  • Working with health insurance, pharma interest groups

  • Small businesses exempt; those with private insurance can keep their plans

  • Democratic coordination (tri-committee bill)

  • No price controls

  • Compromise and Pragmatism

Cohn 2010

• Others critique the bill and process of compromised; Democrats didn’t push hard enough, made too many compromises.

• “What's most important to remember about the Democratic leaders is that they took on health care reform when the conventional wisdom said it was too politically risky-and then stuck with it when the conventional wisdom said it was time to give up.”