America’s healthcare system is a paradox. Everyone knows it needs to be reformed. If you ask most Americans they will tell you that their system, even if it works for them, does not work for everyone.
There are tens of millions of Americans without health insurance.
They have to rely on Medicaid if they are very poor or Medicare if they are old. The working poor are left to scramble to pay medical bills from ever-decreasing family budgets.
Even those who think they are safe often find that insurance companies decide that they are not covered after all. Families with good jobs have been forced to sell their homes to pay for their children’s care or even get divorced to make them eligible for Medicaid.
A survey by the management consulting firm McKinsey estimated the excess bureaucratic costs of managing private insurance policies – scouting for business, processing claims, and hiring “denial management specialists” to tell people why their ailment is not covered by their policy – at about $98bn a year. That, on its own, is significantly more than the $77bn McKinsey calculates it would cost to cover every uninsured American.
The system is a mess. In fact the cost of Medicaid and Medicare per capita is far more than the NHS. America spends more than twice as much per capita on health care as France, and almost two and a half times as much as Britain.
Almost 50 million people are not covered (including 10 million children) yet the American taxpayer is not saving money.
Even the corporate giants in the US, not often seen as being on the side of the poor, are balking at the cost to them of private healthcare and are calling for change. Famously Starbucks spends more on employee healthcare than coffee beans.
There is clearly a desperate need for change.
Democratic administrations dating back to Harry Truman have tried and failed. Bill Clinton, with considerable input from Hillary, tried and failed to overhaul the system in 1994. America’s most respected politician Ted Kennedy has called it the “cause of my life”, but he has been unable to force the Senate to act.
This is the scale of the challenge that now faces Barack Obama. It is easily the most complicated and most difficult domestic policy issue he will face as president.
Despite all that I have written above there are two major factors, among others, which are the roadblocks to reform. The vast healthcare and pharmaceutical lobby which, although supportive of reform in public, want it on their own terms and are prepared to do everything to stall it if necessary in order to get a solution that meets their commercial needs. They hold great sway over not only Republicans but also conservative, co-called “bluedog” Democrats. In a system where members of the House of Representatives are elected every two years and Senate campaigns run into tens of millions of dollars, money talks.
There is also a cultural war going on here. Deep rooted in the American pysche is a fear of socialism, particularly in the form of “socialised medicine” which any reform is labelled by opponents.
It was Ronald Reagan who in 1961, before even becoming governor of California ignited this debate into a Cold War battle. Reagan recorded an LP “Ronald Reagan Speaks Out Against Socialized Medicine.” The American Medical Association sent it to the “ladies’ auxiliary” of the AMA in each county. The “ladies” were instructed to “put on the coffeepot”, play the record for their friends and fellow physicians’ wives, and then get out the stationery so that each of them could write personalised letters to their Senators and Congressmen. In the recording Reagan famously uttered the words: “one of these days you and I are going to spend our sunset years telling our children and our children’s children what it once was like in America when men were free.”
This is latched upon by Republicans, conservative commentators and interest groups to make an emotional if illogical argument. The fact is that the Americans have a form of socialised medicine, it is just deeply flawed and lets down the very people that must be protected in a civilised, democratic society.
President Obama, even with a sweeping mandate for change from the American people – which very much includes support for healthcare reform – is taking on what all his predecessors have failed to do for over 60 years.
Obama is risking a great deal of political capital by taking on this seemingly intractable issue. It will require him to get out there and go to the people, in campaign mode again, to remind legislators that this is what the people want, plenty of good old-fashioned political pressure on wavering Democrats, and that rare commodity in modern discourse – some genuine political courage to see this through regardless of the short term impact it may have on his poll ratings as people see, and dislike, a political scrap.
It is in the interests of the American people and commerce that healthcare is reformed and that the illogical, partisan and desperate attempts of the conservatives to block progress are sliced through with Obama’s political scalpel. With the aid of public support and perhaps most importantly some courage from his Senate colleagues who should be inspired by Ted Kennedy and not their re-election war chests, Obama must use his mandate and prevail.