A Moment for Real Reform

The latest buzz on President Obama's health-care plan is that the White House is in űber-pragmatic mode. Their favorite cliché is that we shouldn't let the perfect be the enemy of the good. Something, we're told, is better than nothing.

Well, maybe not. At the very least, that shouldn't be the administration's negotiating position going in. Here the New Deal experience on health care might be instructive.

In 1933, Franklin Roosevelt told his Labor secretary, Frances Perkins, that he believed in "cradle-to-grave coverage" under a public insurance model. But he asked Perkins to wait a couple of years before he introduced Social Security. First, he wanted Perkins to build support for it by traveling around the country.

That turned out to be a sensible strategy. Even though the original 1935 Social Security Act displeased a lot of New Dealers because it didn't cover farmers or domestic servants (essentially excluding blacks), it was a start—and about the best that could make it through Congress at the time.

But on health care, FDR punted. We don't know why, but I have my suspicions. The Roosevelts' first-born son, James, was married at the time to the former Betsey Cushing, one of the legendary Cushing sisters of Boston, famous for their beauty and class (Betsey was later married to Jock Whitney and her sister, Babe, married William Paley). Their father was Harvey Cushing, arguably the most eminent doctor in the United States. Cushing had invented many surgical techniques and enjoyed wide respect.

Like other doctors, he loathed the idea of national health insurance. One day, he went to the White House to dine alone with President Roosevelt, and that was the last anyone heard of health care being included in Social Security. Harry Truman tried it in 1948 and got beat by the AMA. LBJ had partial success with Medicare, but Nixon, Carter and Clinton were all stymied.

A big reform this year is likely, but a half or quarter loaf won't cut it. If Congress rejects a public option—the only real way to control costs—and Obama goes along, a great moment will have been lost. Moving toward universal coverage and ending discrimination against those with preexisting conditions are important, but they will expand costs, not restrict them. "Comparative effectiveness" studies and electronic records are no panacea, as Yale's Theodore Marmor has shown. The problem is the very insurance model FDR pioneered. For all the nice cooperative comments on Monday at the White House, the excessive costs in the system are directly connected to the huge profits of the health-insurance industry and the nation's hospitals, even those that are ostensibly nonprofit.

So reform without a public option isn't terribly meaningful. And the costs of modest reform are high, not just in dollars but in lost opportunity. It will be quite a while before the country has the appetite to confront this issue again. This time, the perfect or near perfect (there is no perfect, not even single payer) should, at least temporarily, be the enemy of the good, because the merely good isn't good enough.

© 2009