• Interior shaping

    From page 378 of The Social Transformation of American Medicine Paul Starr writes about the passage of Medicare. Very similar words could be written about the ACA, for which “AMA” would be a stand in for other powerful interest groups long opposed to increased government involvement in health care.

    As the case of Medicare illustrates, the power of doctors and hospitals to withhold cooperation from a government program helped them to secure long-run advantages. The AMA may have lost its long campaign against government insurance at a rare moment of liberal political success. But the superior political organization of the AMA and the hospitals enabled them to shape what might be called the “interior” of reform. The AMA’s dread predictions that Medicare would be a disaster made it especially important for the administration to demonstrate quickly to the public that services would be available when they wanted them. An administration more concerned with the budgetary consequences of concessions than with smooth take-off would not have yielded as much. The government and liberal reformers would pay a price for this choice later on. So would the doctors and the rest of the health care industry, for the concessions they won in public money would hurt them later in public confidence.

    The only sense in which I don’t agree with applying the tone of these words to the ACA is that I do not think the Administration or the Democrats had a choice between more attention to budgetary consequences and more concessions to interest groups. I think they had a choice between comprehensive health reform or not. Choosing the former required the concessions and relatively less attention to cost control.

    The same might not be true of Medicare. As Jon Oberlander expressed in his book The Political Life of Medicare, the Johnson Administration may have been able to extract more from their political circumstances than they did. More Medicare cost control from the start may have been possible.

    Nevertheless, what Starr suggests of Medicare, that the concessions to the health care industry ultimately hurt them later, may also be true of the ACA. Political expediency may be necessary, but it may not do anyone any long-term favors. However, if I’m correct that the politics dictated the outcome–that there was little wiggle room–then the cost is unavoidable. It’s the price of progress (or regress, if that’s your view).

    Meanwhile, the battle over the “interior” of reform is still being waged, and will be for years. So much is not yet pinned down or can be undone, through federal regulation or at the state level. Part of the calculus by interest groups was to concede a little in the federal law in order to protect themselves from a worse outcome in statute. Leadership of all such groups knew they could continue to fight for favorable regulations and/or rollback some less favorable provisions later. That inside game is being played right now.

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