The next big hurdle for the universal health care bill will likely be retaining support among coalition members.
Opponents of the bill are attempting to make the case that the Obama administration's health care reforms will result in a reduction in the quality of care for senior citizens. Senior citizens, via Medicare, represent the largest federal health care expense, and most health care analysts argue that the nation's total health care bill cannot be reduced without increased efficiencies and cost reductions in Medicare.
The Obama administration argues it can restructure Medicare, emphasize lower cost options, lower reimbursement rates, and eliminate waste to achieve some of the $500 billion in savings it hopes to achieve under the reform package. Opponents of health care reform, including selected Democrats and many Republicans, say the cuts will lower the quality of care for senior citizens.
If opponents can convince senior citizens that health care reform will jeopardize their health or is a net-loss for them, these citizens could put pressure on enough Congressmen -- particularly the 335 members of the House up for re-election in November 2010 -- to oppose the bill, a political factor that could result in the bill's defeat.
In addition to convincing seniors that their interests will be hurt by health care reform, another way bill opponents can chip away at the health care coalition is to try to convince American citizens that the Obama administration's bill represents socialized medicine, or a wholesale takeover of health care services a la European systems.
Many Republicans have opted for the above tactic, arguing that the Obama plan will drive private health insurance providers out of business. Still, despite the opponents' "socialized" critique, there's little in the bill that suggests this federal solution to a problem will differ in shape from others. In other words, the new U.S. health care system that emerges is likely to be a uniquely American system, with both private and public components.
A 90 or 95 percent federal/state government takeover of the health care system would result in dramatically lower salaries for health care employees, including general physicians, specialists and surgeons. The latter three typically have large medical school loans at the end of medical training -- loans that require high salaries to pay back. Hence, a wholesale government takeover of health care would require the federal government to subsidize the cost of medical school by a much larger percentage than it does now, or even pay for it outright. And there is little chance of that happening, which underscores why "socialized" medicine will not occur in the United States.
Economic Analysis: The opponents of health care reform are engaging in the old Washington game of "Let's play chip-a-way." The American system, including its separation of powers and checks and balances, is designed to defeat or delay legislation. A majority of Americans can support an issue for decades, and the legislation will still often go nowhere in Congress. Keep in mind that the Senate, which disproportionately represents rural citizens, frequently does not represent the interests of the majority of Americans. Add large, powerful, status-quo-oriented interests over a contested issue and one can see how change can be easily thwarted. Hence, if health care reform opponents can reduce senior citizen support for the bill and convince enough Americans that it represents a wholesale government takeover of medicine, the bill could stall this fall.
Financial Editor Joseph Lazzaro is writing a book on the U.S. presidency and the U.S. economy.