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Politics, of course, is the main reason Obama is trying to sound more like Santa and less like the Grinch. Cutting costs ultimately means cutting payments to drugmakers, hospitals, doctors, insurers and other influential health lobbies, so it's understandable that he hasn't dwelled on it. Providers like the Mayo Clinic have demonstrated the promise of high-quality, low-cost care, and mounds of research as well as books like Shannon Brownlee's Overtreated have documented Orszag's less-would-be-better thesis. But to laymen it can still sound like typically empty government promises to weed out waste, fraud and abuse. And the most prominent town-hall angle of attack against Obamacare has been its alleged scheme to let government bureaucrats pull the plug on Grandma, refuse to treat handicapped children and otherwise ration care, so again, it's easy to see why the Administration has soft-pedaled its earlier pleas for fiscal sanity. Instead, Obama is bashing the insurance industry for its own overzealous efforts to cut costs.
But the Republican Party and its tea-party base is going to trash Obama no matter what he does, and clearly they're not going to worry about making sense. They'll keep accusing the President of pushing big-government health plans at the same time they accuse him of squeezing Medicare, the classic big-government health plan; they'll keep blaming him for the national debt while blocking any curve-bending efforts he makes to rein in the debt. Maybe it wouldn't be such terrible politics for Obama to stake out a position as the voice of fiscal responsibility in the face of fiscal catastrophe; it would certainly call the bluff of Blue Dog Democrats who say they're worried about health reform because they're worried about the national debt. It's not easy to build support for immediate action to avert a future emergency, but Obama showed it could be done with the stimulus, although that emergency did feel a bit more imminent.
The Obama political team has concluded that cost inflation is mostly a Beltway issue, that August recess requires reform to be marketed in more personal terms: What does it mean for you? It would be nice if Obama stopped limiting his answer to that question to consumer protections against rapacious insurers. It could be: Your premiums won't double every decade, your economy won't sink and your government won't go broke. Then again, David Axelrod probably deserves the benefit of the doubt when it comes to selling reform.
But reform won't be worth selling if it doesn't include real cost restraints, and the early versions floating around Capitol Hill have been a bit disappointing. Obama has promised that reform will shift medical incentives from quantity to quality, from paying for volume to paying for outcomes. But except for a couple of demonstration projects designed to investigate why care costs so much more in some parts of the country, that hasn't been the focus of congressional legislation. "We've got to get the incentives aligned, or else we'll keep punishing excellent care, and we'll keep encouraging providers to do more procedures and tests and admissions and readmissions," says Jeff Korsmo, executive director of the Mayo Clinic's health-policy center. "We haven't seen a lot of progress on paying for value, and unless we get that the system won't change."
It's one thing not to emphasize cost-cutting because you think it's a political loser. But it's another thing not to do cost-cutting because you think it's a political loser. If reform simply expands a system of unaffordable care, then the town-hall crazies will have a legitimate point. Then Obamacare really will make the crisis worse.