US health reform: half-measure scandal


Barack Obama’s vague and inadequate healthcare proposals are a step too far for the right, writes Jim Creegan

The American system of medical care is a scandal among the industrialised nations. The US is the only advanced country that does not provide universal coverage to its citizens. The government insures only those above 65 years old or below the official poverty level.

The rest must rely for healthcare on employers, who have been steadily trimming their coverage in recent years, if not eliminating it altogether, or on private insurance companies, whose premiums cost the average family a good chunk of its income, and who refuse to admit anyone with a “pre-existing condition” (ie, a health problem). Forty-seven million are without insurance at all, often having to pay hundreds of dollars for an office visit to a doctor, or go to a hospital emergency room for routine care.

While it is difficult to understate the plight of the uninsured, that of the insured is often almost as bad. Nearly all health plans – employer-provided or individually purchased – are hemmed around with restrictions. Most privately insured persons are allowed full coverage only for the limited number of doctors and hospitals in the insurer’s ‘network’. Then there are ‘deductibles’ – a certain amount that the patient must pay each year before insurance kicks in, often running to thousands of dollars. These are compounded by numerous ‘exclusions’ – medicines and procedures that are not covered at all.

Moreover, insurers have in their employ legions of claims examiners, whose sole purpose is to deny customers reimbursement for their bills in order to boost profits. One of their favourite tricks is to cancel the policies of clients with high expenses, current or anticipated, citing some newly uncovered inaccuracy in their original membership application. A client who failed to note when signing up that s/he had been treated for acne or visited a psychiatrist as a teenager may be purged from the rolls after a big bill crosses the insurer’s desk.

The media are full of horror stories about families who have been dutifully paying their monthly premiums all along, only to find themselves, after a major illness, with hospital bills totalling hundreds of thousands of dollars that their insurance providers refuse to cover because of some loophole in the contract. Medical expenses are, understandably, the most common reason for bankruptcy filings in the country today.

The system makes a mockery of all notions of ‘free-market efficiency’. The US today spends 11%of GDP on medical care (as opposed to 8.4% in the UK), more than any other country in the world. Yet it is 30th in life expectancy (behind its Puerto Rican colony), 33rd in infant mortality (behind Cuba), and is ranked 37th among the 191 member countries of the World Health Organisation in the overall quality of healthcare (behind Colombia, Costa Rica and Chile).

As these facts become more widely known throughout the country and the world (partly as a result of exposés like Michael Moore’s 2008 film, Sicko), and more and more Americans come out in favour of a government-sponsored health plan (64%, according to a 2007 Gallup poll) it would be peculiar, even in a country as benighted as the United States, if the more enlightened elements of the ruling class did not favour taking at least some minimal steps to correct this long-standing national embarrassment.

Like Bill Clinton 15 years earlier, Barack Obama came into office vowing to reform the healthcare system, and has staked a lot of his political prestige on this effort. Liberals, champing at the bit after eight years of Republican reaction to push through a host of reforms, have been told to restrain their zeal for other causes in the name of the president’s congressional battle over healthcare.

Obama has been deliberately vague about the kind of reform he wants or would accept without a veto, leaving the particulars to Congress. He has specified only two things: first, that he would like to expand medical care to cover most Americans; second, that he would like to meet the legislation’s projected trillion-dollar cost without raising the federal budget deficit. He has also said that he favours some kind of public option – a government-run medical insurance scheme that would not replace private insurers, but contain overall healthcare costs by competing with them at lower prices. Yet Obama has avoided making this public option a condition for his approval of a bill.


Beyond this, he has been clear that he has no intention of engaging in the “bitter confrontation” with the medical industry – hospitals, insurance com-panies and drug manufacturers – that John Edwards, a rival Democratic presidential contender (now in disgrace due to an extra-marital liaison) warned would be required for any serious change in healthcare.

Obama and his congressional allies were clear from the start that a ‘single payer’ system (all-inclusive government cover, which would replace private insurance) was ‘off the table’. The numerous public advocates of such a system were pointedly excluded from testifying at Senate hearings on the subject. Obama even cancelled a White House invitation to his own former personal physician because the latter was an advocate of ‘single payer’.

The president also indicated his preference that any bill coming out of Congress enjoy ‘bipartisan’ support: ie, that it have the backing of a significant number of Republicans. This was a clear signal to the medical industry that he did not intend seriously to infringe on its prerogatives or profits.

The most comprehensive proposal to date has come out of a committee of the House of Representatives. It closely resembles a scheme adopted several years ago by the State of Massachusetts. Under it everyone would be required by law to have some form of health insurance. Most would continue to be covered by employers. Those not insured at work would be ‘mandated’ to purchase insurance from private companies on pain of a substantial tax penalty. The existing government programme that now covers the poorest people (Medicaid) would be slightly expanded. Those earning up to 400% of the poverty level ($80,000 for a family of four) would receive government subsidies (of an as yet unspecified amount) to help them buy insurance. People would be able to compare various insurance plans on a central registry.

Insurers could no longer deny applications on the basis of ‘pre-existing conditions’, but no limits would be placed on the amounts they could charge their clients, and nothing in the proposed bill would prevent their strenuous – often fraudulent – efforts to deny claims. The House proposal is in essence a scheme to expand coverage by channelling more customers, as well as billions in government subsidies, to private insurers.

But even this corporate giveaway is too radical for the committees now drawing up a healthcare proposal in the Senate. (In the congressional process, legislation moves along parallel tracks in the House and Senate: a bill is first drawn up by the relevant committees in both bodies, then presented for a floor vote in each; the two bills are then ‘reconciled’ to produce a single piece of legislation.) The Republicans, of course, oppose healthcare reform tout court. But the House proposal has also predictably drawn fire from seven ‘blue dog’ (rightwing) Democrats, including Max Baucus of Montana, who heads the Senate finance committee.

There are three sticking points. First, the blue dogs object to the House proposal to fund part of the programme through a modest surtax on the top one percent of income earners. Second, they oppose a penalty tax on employers who refuse to offer medical coverage to employees. But the object of their greatest animus is the public option, which, according to the House proposal, would offer subscription prices and reimbursement schedules pegged to those of Medicare, the existing government programme for those over 65. Despite the fact that Obama urged Congress to pass a bill before its August recess, the objections of the blue dogs, rather than Republican opposition, now make it inevitable that no action will be taken till September at the earliest.

Together with the Republicans, the blue dogs argue that a public option, in addition to costing too much, would subject the insurance companies to ‘unfair competition.’ The Senate finance committee has drafted an alternative bill which would eliminate the public option altogether. For its part, the House has reportedly approved a compromise that would retain the public option, but make sure that it is not significantly less expensive than private plans. Both proposals would eviscerate an already weak piece of legislation. The question now is whether or not Obama and the rest of the Democrats will be satisfied with this travesty of a travesty.

It does not require a high degree of intelligence to find the common denominator behind all the objections to meaningful healthcare reform. The campaign coffers of the blue dog Democrats are brimming with contributions from the medical industry, which now appears resigned to some kind of reform measure, but wants to make sure its bottom line is no way threatened.

The pretensions of Republicans and blue dog Democrats to any motive higher than the protection of industry profits are transparently disingenuous. They say a public plan would raise the federal government deficit to unacceptably high levels – the very same Senators and Congresspersons who voted decade after decade to cut taxes on the rich and corporations, unanimously approved the Iraq war with its giant price tag, and under Bush ran up one of the biggest federal deficits in US history.

They say a government health scheme, even one that does not threaten private insurers, will ‘restrict patient choice’ when the privately insured must now negotiate a veritable labyrinth of restrictions and challenges. Then there is the time-honoured Republican ploy of equating taxes on the rich, such as the one proposed to pay for part of a new health plan, with a general tax hike.

The above duplicities are the polite ones. Behind Republican elected officials are the vipers of the airwaves – Bill O’Reilly, Sean Hannity and Glenn Beck of Rupert Murdoch’s Fox television network; Rush Limbaugh on radio. They say out loud what the congressional Republicans can only broach by innuendo. They routinely compare Obama to Hitler and Pol Pot, and one of them (Beck) has taken to alternating film clips of Obama with footage of the 1934 Nuremberg rallies.

They are now peddling the notion that Obama’s proposals represent a conspiracy to promote abortions and save government money by euthanising the elderly (a conclusion drawn from government attempts to encourage citizens to keep a living will). In addition to the ‘deathers’ there are the ‘birthers’, who claim that Obama is not legitimately president because he was really born in Kenya, not Hawaii, as his birth certificate states (the US constitution requires that the president be a ‘natural born citizen’). And, locking their jaws like pitbulls around Obama’s remark that white policeman “acted stupidly” in arresting prominent black Harvard professor Louis Henry Gates in his own home on a false burglary report, all of these unofficial Republican spokesman are now attempting to brand Obama as an anti-white racist – white mother notwithstanding.

It is an abiding and much pondered mystery to Marxists and others of materialist mindset how even a fraction of the people of a country with all the gifts technology can bestow remain susceptible to demagogy barely refined enough for Russian muzhiks circa 1900. Yet susceptible a goodly number remain. The unrelenting rightwing media barrage, combined with Democratic dithering, seems to be having an effect, as the latest polls record growing public unease concerning healthcare reform. The August Congressional recess gives the right several more weeks to hone and spread their calumnies.

One Republican congressman probably spoke for the entire party when he vowed to make healthcare reform Obama’s Waterloo. Given the amount of political capital he has invested in this gambit, Obama would be immeasurably weakened by a complete defeat. This is why the Democrats will probably agree in the end on a bill that, no matter how toothless, will at least spare their president a total humiliation at Republican hands.

How long, O lord!

The television talk-show host and stand-up comic, Bill Maher, opined thus on his weekly show:

“Every time Obama tries to take on a progressive cause, there’s a major political party standing in his way: the Democrats. We don’t have a right and a left party in this country any more; we have a centre-right party … and a crazy party.

“… over the last 30-odd years, the Democrats have moved to the right, and the right has moved into a mental hospital. So what we have is one perfectly good party for hedge-fund managers, credit-card companies, banks, defence contractors, big agriculture and the pharmaceutical lobby – that’s the Democrats. And they sit across the aisle from a small group of religious lunatics, flat earthers and Civil War re-enactors … who actually worry that Obama is a socialist. Socialist! He’s not even a liberal! … Democrats are the new Republicans” (Real time with Bill Maher June 19).

The Republican lunacy that Maher mocks has a valuable function for the ruling class. It continues to drive ‘progressives’ into the arms of the Democrats, who may be reactionary but are at least not deranged.

Left-liberals and union bureaucrats in the Democratic camp demand only trifles for their adhesion, and Obama has shown enough political savvy to toss them a bone or two. He has, for instance, dropped the ban on abortion counselling as a condition for US aid to the World Health Organisation and loosened (though not completely abolished) the restrictions on stem cell research that Bush put in place to appease the right-to-lifers. His labour secretary, Hilda Solis, enjoys a union-friendly reputation, deserved or not, and his Supreme Court nominee, a female Puerto Rican-American judge named Sonya Sotomayor, is a legal centrist, not a rightwing fanatic like those selected by Bush and Reagan.

So despite Obama’s proven loyalty to the powers that be, the Democrats can still present themselves at election time as ‘not as bad’ as the Republicans. How long will the majority of Americans, to whom the status quo is increasingly unkind, continue to oscillate between horrendous and ‘not as bad’?

They have done so for what seems like an eternity. Did not Bill Clinton’s failure to pass health reform in 1992-93 only result in a Republican congressional sweep the following year? And did not ‘progressives’ continue to vote Democrat in overwhelming numbers despite Clinton’s abolition of government assistance to the indigent and his strengthening of the death penalty? These are, however, different times.

During the better part of Clinton’s eight years in office, the economy was humming along, however precariously. Today we are in a recession – the worst in 70 years – that shows no signs of early letup. It comes on top of a decline in American living standards in progress since the 1970s. The inevitable cyclical upturn will register as a fluctuation in the steeper downward curve defined by US imperialism’s declining global economic position.

More than ever before in living memory, American society is acquiring the feel of a hardened class order, in which the increasingly urgent demands of large groups collide with bipartisan intransigence at the top. The ruling class sees no need to give anything away as long as the Democratic Party has things so well in hand.

We know from history that hard times do not automatically mean left turns. But the election of Obama represented at least a partial repudiation of diversionary Republican gimmicks, and the desire for more than cosmetic change. Perhaps Obama’s failure to deliver will present an opening for those of us who argue that ‘not as bad’ is not good enough.


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