Health care bill does not fix health care system

By Peter Shapiro for

Passage of President Obama’s health care reform in late March made for great political theater. Here was House Speaker Nancy Pelosi, skillfully maneuvering the bill through Congress after many had given it up for lost. Here was House minority leader and Republican point man John Boehner, reduced to ranting about ‘Armageddon’ and predicting the end of civilization as we know it if the bill passed. Here were Republican legislators egging on the mob of teabaggers who massed outside the Capitol, hurling racist and homophobic slurs at Representatives John Lewis and Barney Frank as they went inside.

I’ll admit the scene worked on my emotions. The Republicans’ tactics were ugly and cynical and I was happy to see them fail.

Now that the dust has settled, however, a hard look at the legislation that prompted all the fuss suggests that, far from ‘fixing our broken health care system,’ it merely reproduces some of its worst features.

The bill does nothing to lessen the grip of the private insurance industry on our health care system. It won’t bring exploding health care costs under control. It does little to change the shameful disparities in access to treatment in a society that treats medical care as a commodity to be bought and sold, rather than as something all of us need and deserve.

What it will do is require everybody to buy health insurance, with federal subsidies for those who can’t afford the premiums on their own. The price tag of these subsidies is $447 billion over the next ten years. That’s money that could have gone to pay directly for medical treatment but which will, instead, wind up in the pockets of the insurance industry – one more corporate bailout at taxpayers’ expense.

To help pay for it, public hospitals that treat the uninsured will have their federal funding slashed by $36 billion. Eight years down the road, union health plans and other job-based health insurance will be slapped with a 40% ‘excise tax.’ Protests from organized labor succeeded in getting this tax modified somewhat, but not eliminated from the bill.

The bill does expand eligibility for Medicaid, the federal health care program for the poor. And it is supposed to make it harder for insurance companies to deny legitimate claims or refuse to cover ‘high-risk’ patients. Insurance industry lobbyists, who actually helped draft the bill, swallowed these reforms in part because they’ll get 30 million new customers out of the deal, and in part because over the years the industry has proved adept at evading every government attempt at regulation.

Physicians for a National Health Program, which has led the fight for a single payer system comparable to what other developed countries have, likens the bill to morphine for a cancer patient. It lessens the pain for a while, but it doesn’t stop the cancer from spreading. Health care in the U.S. costs twice as much as in most other countries, mainly because the administrative costs of maintaining a private insurance system soak up nearly one in every three dollars we spend on it. And a big chunk of that money goes to buy politicians. The health care industry spent a record $266.8 million last year making sure nothing got into the bill that would seriously threaten its profits.

I’ve heard some interesting arguments over whether we’re better or worse off with this law on the books, but it’s really beside the point. The battle for universal, equal access to care still lies ahead, and it won’t be won until those of us who are victimized by the health care system have more political clout than those who profit from it.

The law’s shortcomings will provide ample organizing opportunities in the fight for true reform. Here are a few:

1. Medicaid. It’s financed with matching state and federal funds, and while the federal government may have the money to pay for expanded eligibility, most states don’t. Oregon, where I live, already has a very liberal program of health care for the poor, but the state is so strapped for cash that it actually has to hold a lottery to determine which eligible people get benefits. And because an underfunded Medicaid program compensates doctors so poorly, many doctors are already reluctant to take Medicaid patients. The new law promises to make it easier for poor people to get care; we should be prepared to hold politicians’ feet to the flames if it doesn’t happen.

2. Rate hikes. Since everyone will now be required to buy insurance or pay a fine, insurers are likely to take advantage of their captive market by jacking premiums up even more. There should be organized, angry protests every time it happens.

3. Underinsurance. Before the law passed, a woman with ‘pre-existing’ breast cancer was apt to be refused coverage. Now she can’t be denied coverage – but she may find that her new policy won’t pay for the extra round of chemotherapy or surgery she needs. Nothing in the law spells out what benefits must be offered for insurance plans to qualify for the government-run ‘health insurance exchanges’ that will be set up in 2014. The requirement that everybody buy insurance will mean a proliferation of cut-rate policies that are of no use when you most need them. When policies like that go on the market, we should read the fine print and expose them for what they are.

4. Inadequate regulation. Supporters of the new law boast that it outlaws ‘rescissions,’ the practice of canceling a policy as soon as a policyholder files a claim. But rescissions were already illegal! State regulators simply didn’t enforce the law. We need to keep a close eye on them and demand that they do their job.

5. Employer mandates. “If you like the coverage you have, you can keep it,” says Obama. But it’s really your boss’s decision, not yours. The penalties for employers who cancel their coverage are too small to discourage them from canceling or cutting back on increasingly costly employee benefits. Unions can expect continued brutal fights over health insurance at contract time. Whenever it happens, they shouldn’t hesitate to point out that health benefits shouldn’t even be on the bargaining table – the government should be picking up the tab for everybody, regardless of where they work or how much they make. Only by advocating for health care for all can unions win public sympathy when their own coverage is under attack.

6. Penalizing the uninsured. A lot of people who can’t afford to buy coverage, even with federal subsidies, will get stuck with stiff fines for remaining uninsured. They need to become organized and visible and demand relief.

7. Discrimination. Denying coverage to immigrants is a particularly ugly and pointless feature of the new law. Preventing sick people from going to the doctor doesn’t ‘secure our borders’ or discourage people from coming here, as anti-immigrant propagandists claim. It just means more needless and untreated illness and more pressure on overburdened hospital emergency rooms. Full access to health care is a key component in the battle for immigrant rights.

8. Federal deficits. As costs keep rising, subsidizing insurance premiums will inevitably add to an already huge federal deficit. There will be intense pressure to cut necessary social programs, including Medicare, to pay for it. In defending those programs, we should be prepared to raise the issue of single payer – pointing out that a universal government-funded health care system would save the taxpayers billions and make those cuts unnecessary.

It’s common for politicians like President Obama to say they support single payer ‘on principle’ but don’t consider it ‘realistic.’ The truth is that it’s the only realistic solution. Nothing else will solve our health care crisis. We have to keep the heat on until we get it.

Peter Shapiro co-chairs the Health Care Committee of Portland Jobs with Justice.


  1. Barbara on April 15, 2010 at 11:05 am

    Thank you. This is an excellent summary of the major faults and some action that can be taken. I would like to add that as long as we continue to use the approach of institutionalized welfare with its ‘government subsidies,’ instead of elevating what constitutes basic survival needs, including health care, to the level of human rights and with this, dedicate our legislative and economic infrastructures to securing these rights, for every individual, as the bottom line in what it means to be human, what it means to be humane, and what it means to be ‘We the People,’ we reinforce, not weaken, class and classism in this country. Misplaced, in the name of our humanity, our present ways bring us to cement in such tragic and nearly insurmountable conditions as generational and communal poverty. With institutionalized welfare, instead of a rights-based approach, we ‘normalize’ such conditions. As is said, “With this kind of help, we don’t need enemies.’ It is enough. My best regards and thanks to you all. Your work is crucial.

  2. Nick on April 20, 2010 at 1:45 pm

    I hope you will not hate me for asking this, but I genuinely would like to know: as a proponent of single payer, and with so many criticisms of how this bill has counter-productive measures abound… do you feel it is good to have this remain active? That is to say, do you feel having all of these things active will prevent your vision from becoming a reality? Do you support repeal, perhaps if there was an alternate reform on the table?

  3. Chris Hagel on April 20, 2010 at 2:15 pm

    Thanks to everyone who have contributed so much to grow this movement.

    I just have some points to make:

    *Congresswomen Carolyn McCarthy’s and other’s opposition to HR 676 was that (paraphrasing): “People can not be forced to give up their insurance to be in a Medicare for all system”.
    (If these people were actually informed on how much better off they would be from many different standpoints more of them (the middle class) would be cool with it. Also remember, when any law was passed there was never 100 % for it. The civil rights law, labor laws etc. )
    To the main point, conversely however, what this Bill has done is force the uninsured people to buy over-priced, low quality, low quantity health insurance subsidized with taxes; a give-a-way to the health insurance industry. They don’t even have to market and sell their shoddy product, it’s fallen right in their lap. (This is corporate welfare big time.)
    They wouldn’t force the people with good health care policies into HR 676 but this Bill ultimately forces the blue collar and poor to buy their shoddy products; these policies will not be like the ones the others with good policies have. This is all about making it appear that change and justice has been carried forward, when in reality the uninsured and underinsured have been totally taken advantage of; it’s an attempt to appease us.

    *So now our economy and people are burdened even more with a very expensive, fragmented, and bureaucratic health care non-system.

    *Also, generally speaking, this is all about the extremely class conscious mega rich elites (and upper middle class people) in this country who are simply repulsed by the concept of national health insurance for working class/blue collar people. Obama and his cohorts have courted these people during this fake health care reform.
    Playing that class card you say, well it’s all about class, it’s always been; you don’t have to play the class card.
    But when you watch TV, it makes it seem like we’re just one big happy family of Americans.
    American style fascism is on the march.

    *So now, with this Bill, what the 47 million uninsured are stuck with is musical chairs in health care. Who’s going to get the health care? Do we really know when the music stops who’s going to get a seat? And the uninsured have to fill out all kinds of forms and paper work and maneuver through all the channels just to get health care. All of this so Obama and his cohorts can protect their buddies in the health insurance industry and Big Pharma.
    With HR 676 we just show our national health insurance card and get treated. No hoops to jump through or fences to climb over.
    It’s a win-win for our country, economically, morally, and spiritually.

    *We should go on strike for one day and see what would happen. No taxis, no buses, no waitresses or waiters, no construction, no store clerks etc. Let’s see what would happen.
    We deserve the dignity of getting our ailments and injuries checked out without being reduced to health care beggars!!!

    *All those congressmembers screaming and turning red in the face about a big Government take over of health care are such phonies and bullies. Yeah, big government, give us a break, it’s just small enough to work in and get their A-Z health care, most of it paid for with tax payer money.
    This Bill is a corporate consolidation by the health insurance industry of our health care, with our tax payer dollars to subsidize the over priced low quality/quantity policies of those who can’t afford the policies.
    This is not socialized medicine. This is not socialized medicine. This is not socialized medicine. This is not socialized medicine. This is not socialized medicine.
    Is it getting through to them. Do they get it?

    *So now what we have more than ever is a government of, by, and for the health insurance industry and big pharma not of, by, and for the people.

    *Yeah, it’s alright for people to get rich (not how it’s been done in the past scandals and everyone deserves a living wage) but we are the only industrialized country to still have health care in the commodity and privilege column instead of the public necessity/service and human rights column, and that, fellow Americans, is barbaric and evil.