Is the Sky About to Fall?

In October 1994, as The Council convened its 80th consecutive annual meeting, then-Legislative Committee Chairman Steve Dunlap ordered early morning Bloody Marys for the crowd of brokers and raised a toast to the demise of the Health Security Act.

Senate Majority Leader George Mitchell had declared “Hillarycare” dead only a week earlier—and just weeks after that, Democrats found their congressional majorities wiped out, losing 54 seats in the House and eight in the Senate.

Needless to say, we disdained Hillarycare, with its massive proposed usurpation of private health insurance markets in favor of health insurance purchasing cooperatives (HIPCs). But our victory was temporary and the fight is not over yet.

Fast-forward 16 years and I received a visit at The Council offices from Rick Scott, who had previously headed Columbia/HCA, the nation’s largest for-profit hospital system. He had formed an activist group called Conservatives for Patient Rights, aiming to do to the Affordable Care Act what was done to Hillarycare before. Scott was asking us to solicit millions of dollars from our members to help derail the “Obamacare” legislation, which substituted healthcare exchanges for HIPCs. Being a modest little trade association, we politely demurred.

President Barack Obama signed the ACA into law in March 2010. While Scott lost that fight, he hasn’t done badly for himself as a two-term Florida governor who is now in his second six-year term in the U.S. Senate.

No congressional Republican voted for either Hillarycare or Obamacare, and likewise there is no GOP support for the healthcare battles to come—whether the fight is over the “mainstream” Democratic priority of supporting a public option to compete with the private markets in the exchanges or for the ultimate progressive dream of Medicare for All. Both ideas are terrible. (But, a decade into the Trump era, there still is no substantial plan for how to reform the system.)

For all our warnings, Obamacare hasn’t been the end of the universe for insurance brokerages. And, honestly, there’s something to be said for the fact that every time lawmakers in Washington try to fix healthcare, they just make it more bureaucratic—which means people need good brokers to navigate the complexity. So I don’t want to say the sky is falling here.

But if you believe that pendulums swing in Washington, and that Democrats will again ascend in this year’s elections, their rhetoric is not comforting. Senate Minority Leader Chuck Schumer (D-N.Y.) has always supported a public health insurance option that would compete with private insurers, offering coverage at lower prices funded by tax dollars and based on Medicare pricing.

House Minority Leader Hakeem Jeffries (D-N.Y.), poised to be the next speaker, has been more measured; but he still has expressed his preference for a multipayer system where government-subsidized plans compete with—rather than replace— private insurers.

Schumer and Jeffries, though, face pressure from the progressive left, whose candidates have won some key victories in Democratic primaries this year. This political grouping is all in on replacing private insurance with a government-run program. (Ask our U.K. members how their National Health Service is going these days, with its deep problems across staffing, funding, and access.)

Can employer-provided group health plans peacefully coexist in exchanges that offer government subsidies as providers are forced to accept lower reimbursement rates? The Council sides firmly with critics who say that such an “option” isn’t that—it would erode private coverage and reduce access to care. The consulting firm McKinsey, in a wide-ranging study of the benefits landscape in partnership with The Council, found alarming numbers of employers that are fed up with double-digit health inflation and willing to consider any and all options to bend their healthcare spend. It is not only likely but inevitable that a cheaper public option would lead to an exodus of millions from employer-sponsored coverage.

Ancillary benefits will always exist and maybe even thrive in either a public option or Medicare-for-All environment. But either option will ultimately leave fewer healthcare choices for families. A one-size-fits-all government health insurance system would betray Obama’s promise that “if you like your insurance you get to keep it.” Pendulums swing, yes, and health insurers are mighty unpopular these days. But as P.J. O’Rourke once said, “If you think healthcare is expensive now, wait until you see what it costs when it’s free.”