Healthcare Politics and Policy in America

Kant Patel, Mark E Rushefsky

• Publisher: Routledge
• Year: 2019
• ISBN:
  9780429674419
• Edition: 5
• Topic: Politics & International Relations
• Subtopic: Public Policy
• Index: Politics & International Relations

Health policy in the United States has been shaped by the political, socioeconomic, and ideological environment, with important roles played by public and private actors, as well as institutional and individual entities, in designing the contemporary American healthcare system. Now in a fully updated fifth edition, this book gives expanded attention to pressing issues for our policymakers, including the aging American population, physician shortages, gene therapy, specialty drugs, and the opioid crisis. A new chapter has been added on the Trump administration's failed attempts at repealing and replacing the Affordable Care Act and subsequent attempts at undermining it via executive orders.

Authors Kant Patel and Mark Rushefsky address the key problems of healthcare cost, access, and quality through analyses of Medicare, Medicaid, the Veterans Health Administration, and other programs, and the ethical and cost implications of advances in healthcare technology. Each chapter concludes with discussion questions and a comprehensive reference list. This textbook will be required reading for courses on health and healthcare policy, as well as all those interested in the ways in which American healthcare has evolved over time.

Section II

GOVERNMENT HEALTH PROGRAMS

3

THE AFFORDABLE CARE ACT

Stumbling Toward Universal Health Insurance?

I am not the first president to take up this cause, but I am determined to be the last. It has now been nearly a century since Theodore Roosevelt first called for healthcare reform. And ever since, nearly every president and Congress, whether Democrat or Republican, has attempted to meet this challenge in some way. A bill for comprehensive health reform was first introduced by John Dingell, Sr. in 1943. Sixty-five years later, his son continues to introduce that same bill at the beginning of each session.

Our collective failure to meet this challenge—year after year, decade after decade—has led us to a breaking point.

(—Barack Obama 2009)

The conditions in 2010 created a window for reform, but it was not a big one. To squeeze legislation through that window, Democrats had to work around the many constraints that might otherwise have doomed chances for passing a bill. And working around those constraints helped to shape the central choices they made, including the choices that left the law vulnerable to counterattack.

(—Paul Starr 2013, 16–17)

“What’s past is prologue,” William Shakespeare wrote—and it seems that’s especially true when it comes to healthcare. The history of health reform in American spans a century of false starts, near misses, and historic advances that culminated when President Obama signed the Patient Protection and Affordable Care Act into law on March 23, 2010. It was a day that a lot of people thought would never come and a moment that almost didn’t happen—and the story of how we got there is one of the most important stories in modern politics and public policymaking.

(—John Kerry 2010, 7)

As the above quotes suggest, getting comprehensive healthcare reform enacted was exceptionally difficult and contentious. The process of passage through Congress was treacherous, with land mines placed all over the place. It took some “unorthodox,” though hardly unknown, maneuverings (Sinclair 2012) to finally achieve passage. The law relied heavily on past Republican initiatives, yet it garnered no Republican support. It sought to reform a highly fragmented system, yet left much of it in place. It was less than liberals had hoped for and more than conservatives wanted. And after enactment, it was the subject of challenges in Congress, the courts, and the White House.

This chapter focuses on healthcare reform that was enacted in 2010. We first look at the years preceding passage of the Affordable Care Act (ACA), 2006–2008. We follow that up with describing the process of passing the legislation and the controversies surrounding that passage. This is followed by an examination of threats to the Act, such as court challenges, elections, repeal attempts, White House opposition beginning in 2017, and implementation of the Act. We then look at Republican alternatives to health reform and conclude the chapter with some judgments about the legislation and its implementation and the future of healthcare reform.

THE ROAD TO THE AFFORDABLE CARE ACT (2006–2008)

Kingdon’s Multiple Streams Model

One way of understanding the series of events leading up to the passage of the Patient Protection and Affordable Care Act (PPACA), informally known as the Affordable Care Act (ACA), is to make use of a model of agenda-building known as the multiple streams model (Kingdon 2010).

The model starts with three streams. The problems stream focuses on the problem-identification stage of the policy process (see Rushefsky 2017). In this stream, there is debate over whether a problem exists and, if so, what is the nature of the problem. Additionally, there is debate over whether a government response is necessary to address that problem. Different people and groups will have various perceptions about the nature of the problem and what to do about it. Further, there are often ideological differences that play a role in these perceptions. These ideological differences also play a strong role in perceptions about the Affordable Care Act.

The second stream is the policies stream. Here policy advocates or entrepreneurs push favored public policies and seek opportunities to get those policies adopted. As Kingdon (2010, 116) notes, policy solutions may stew in a “primeval soup,” sometimes for decades, with some solutions emerging and others being cast aside.

The third stream is the politics stream. Here changes such as the results of elections or interest group activity provide an opportunity to seek innovative public policies.

An important aspect of this model is that these streams do not necessarily flow together. Problems can fester for years, or decades in the case of healthcare. Policy entrepreneurs may have spent years finding the right time for their proposed solutions. Political change is independent of the other two streams.

But there are certain times when the three streams come together, with the political stream being the most important. When all three streams are in sync, there is what is called a window of opportunity. Some big policy issues, such as healthcare reform, will assume a prominent place on the government agenda, and there is a real opportunity, though a brief one, for action (Kingdon 2010).

The Problems Stream

Cost

We have spent much of this book addressing the problems facing the American healthcare system. One problem that underlies all the rest is the cost of healthcare (see Chapter 8). We spend considerably more money on healthcare than any other industrialized nation. Healthcare costs increase faster than inflation and faster than the growth of the economy, so that more and more of our economic activity is taken up in paying for healthcare. The two large government programs, Medicaid (Chapter 4) and Medicare (Chapter 5), have seen continual increases in costs and pressure put on state and federal budgets. Employers face ongoing increases in the cost of healthcare for their employees and have begun placing more of those costs on them. As Kingdon (2010) points out, this puts American companies, especially manufacturers, at a disadvantage with much of their foreign competition. In other Western industrialized countries, the government pays for healthcare rather than the companies and, thus, the products of companies such as Toyota and Honda cost less than if they had to pay for their workers’ health insurance costs. According to some estimates, health insurance premiums account for as much as $2,000 of the cost of a domestically produced car (Johnson 2012). Insurance premiums continue their dramatic rise. Individuals have problems paying for the cost of their healthcare, especially if they lack insurance or adequate coverage. Healthcare costs are an important cause of individual bankruptcy (National Patient Advocate Foundation 2012).

Even individuals with health insurance face problems. Some insurance policies have lifetime caps on how much they will pay out, and catastrophic healthcare could exceed those limits. Insurance companies, especially in the small business and individual markets, engaged in practices that left subscribers exposed to the full cost of their medical expenses (see Potter 2010). Companies would deny coverage for a claim because of an alleged pre-existing condition, a practice known as rescission (Potter 2010). These practices became so contentious that it led, in the late 1990s and early 2000s, to consideration of what was called “patient’s bill of rights” legislation at both the state and federal level. While Congress did not enact such legislation (until 2010), many states did (Patel and Rushefsky 2006).

Access

The second major problem is one of access (Chapter 7). An estimated 47–50 million people lacked health insurance in 2008 (though some have disputed the numbers). There are ethnic/racial dimensions to the access issue. Minorities, such as Hispanics and African-Americans, are less likely to have health insurance than whites. Higher-income individuals and families are more likely to be covered than lower-income individuals and families. Lack of access to healthcare can also be a function of geography. People in rural areas and inner cities tend to have less access than people in suburbs. Employment-based insurance, the prime mechanism for insurance coverage in the United States, decreased throughout the twenty-first century. Lack of access to the healthcare system has health consequences (see Chapter 7; Patel and Rushefsky 2008).

These problems, cost and access, were captured on film, in books, and in articles. Three examples stand out. The first was Michael Moore’s 2007 documentary Sicko. The documentary began by stating that it was not going to explore the problem of the uninsured, but rather the problems that affect those with inadequate insurance (the underinsured). For example, one of his cases focused on a man who damaged two of his fingers in an accident. His insurance company said it would pay to fix only one of his fingers, so he had to choose which finger to keep. After looking at these kinds of cases and the American healthcare system, Moore examined other healthcare systems and noted that the problems he describes would be taken care of by other healthcare systems at little or no cost.

Jonathan Cohn’s (2007) similarly titled Sick also critically examined the American healthcare system. He provided case studies of people struggling with the healthcare system and argued that the system is unraveling.

Wendell Potter (2010) worked in the health insurance industry for a quarter of a century. His book, Deadly Spin, uncovered practices such as rescissions that are undercutting the country’s healthcare system.

Of course, these critiques came from the left. The right also saw problems with the healthcare system, but rather than seeking a national health insurance policy, they have sought market reforms. For example, Herzlinger (2007, 1) casts her net widely in search of villains: “the health insurers, hospitals, government and doctors.” Her solution is to have consumers take charge of their own healthcare through solutions like high-deductible health plans and health savings accounts (see below and Chapter 11).

The Policies Stream

Types of healthcare systems

There is no dearth of policy alternatives or solutions for the healthcare system’s problems. One source is the healthcare systems of other Western industrialized countries. Reid (2010) provides a useful typology of different healthcare systems as well as indicating a major problem with the US healthcare system.

Reid (2010) distinguishes among four types of healthcare system. The first and oldest is the Bismarck model, developed in the late nineteenth century under Prussian and then German chancellor Otto von Bismarck. This model keeps much of the healthcare system private but utilizes a series of health insurance plans financed by workers and their employers. The plans are non-profit, and costs and services are tightly regulated.

The second type is the Beveridge model, adopted in the United Kingdom after World War II. This model approximates what has been called in the United States socialized medicine. The government owns the facilities (such as hospitals), and the workers are government employees, though doctors can take private paying patients.

The third type is the national health insurance model, typified by the Canadian system. The facilities and workers are private, but there is a single payer, the government, which collects taxes (premiums) and pays the providers.

The final type is what Reid (2010) calls the out-of-pocket model, which has virtually no public system and patients pay for their own healthcare if they can afford to.

So, we have these four models that can be drawn upon. One of Reid’s (2010) most critical points is that there are elements of all four models in the United States. Employer-based health insurance represents the Bismarck model. Veterans and military personnel are in a Beveridge-type system (such as the VHA hospitals that we discuss in Chapter 6). Those on Medicare are in a national health insurance model. And those without health insurance are in the out-of-pocket model.

Looking at healthcare in the United States this way provides an insight as to why it has been and is so difficult to reform the system: we have these different sets of systems. American healthcare is highly fragmented. The politics of healthcare in America suggests that we are very unlikely to adopt any of these systems as the one system. But looking at other healthcare systems does give us a picture of possibilities. Other countries have faced many of the same problems that the United States has, but went in different directions. Despite the models of what other countries have done, the United States chose none of the above.

Policy Proposals

Policy proposals have been floating in Kingdon’s (2010) primeval soup for decades. In general, liberals/Democrats have favored some type of national health insurance plan or public-sector program. At a minimum, they have advocated expansion of current programs, such as the Children’s Health Insurance Program (CHIP) and Medicaid. Conservatives/Republicans have, in general, opposed the comprehensive plans and resisted expansion of current programs, though this is not entirely the case; Richard Nixon proposed the Comprehensive Health Insurance Plan (CHIP), and President Bush proposed, and Congress enacted, an expansion of Medicare to cove...