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Arjun Singh 0:00
Arjun from the levers. Reader supported newsroom, this is lever time. I'm Arjun. Singh, after the shooting of a health insurance CEO America has seen an outpouring of anger at the health insurance industry. This sudden explosion of public rage contrasts with the recent election in which both parties made sure healthcare was barely even mentioned on today's episode. The big question isn't why Americans are so angry, angry at an insurance industry whose whole business model is based on standing between you and your medical provider and rationing care. The question we're going to try and explore with an insurance industry insider and a renowned healthcare journalist, is more vexing. Why hasn't this widespread anger translated into the creation of what every other industrialized nation has, a system of universal, guaranteed medical care? You You
Wendell Potter 1:04
know, I was in the industry for about 20 years. Altogether. I joined the first big insurance company in 1989 I think it was, it was humana. I would go from there to the Cigna, where I spent about 15 years and and wound up running the Corporate Communications Department for Cigna. This is
Arjun Singh 1:26
Wendell Potter, and as you could probably tell, he spent a long time working in the health insurance industry. Was
Wendell Potter 1:31
the company's chief spokesman. I handle financial communications. My name was on every one of the company's financial earnings reports for 10 years, I also worked with my peers across the industry to develop and implement public policy strategies and PR strategies to kill any kind of health care reform proposals we didn't like, both in Washington and the state capitals. Over
Arjun Singh 1:58
the course of his career, Potter watched closely as the industry manipulated the government, the public and its own customers.
Wendell Potter 2:04
As you climb up the ladder, it becomes much more apparent what really motivates these companies, and at the end of the day, it is all about shareholders and a handful of financial analysts on Wall Street, these companies are middlemen. They don't make a product, they don't make any pharmaceuticals, they have figured out how to extract so much money out of what we spend as a nation on health care to reward their shareholders. There's no other country in the world that has a system like this that enables middlemen to siphon off so much money from middle class and working class folks that need health care but are not able to get it because of the way these companies have developed their business practices. Potter
Arjun Singh 2:49
blew the whistle on what he saw inside the industry over a decade ago, but in the time since then, Americans view of the health care industry has only worsened. Today. The public's faith in the health care industry, physicians, hospitals, and yes, insurance providers, is the lowest it's been in 24 years, and that's despite the passage of the Affordable Care Act, which some have described as the most significant reform of the healthcare industry in a generation. Here's Joe Biden, for example, when he was vice president, talking about our children
Joe Biden 3:19
and our grandchildren, they're going to grow up knowing that a man named Barack Obama put the final girder in the framework for a social network in this country to provide the single most important element of what people need, and that is access to good Health. Despite
Arjun Singh 3:39
its passage, health care has remained a controversial and expensive thing. Today, one out of every $5 spent in America goes towards health care. And even though more Americans have health insurance today than in previous decades, people are still forced to spend 1000s on health care when they're sick. And last week, that frustration boiled to a fever. Right
News Anchor 4:00
now, the search is on for the suspect. After reviewing this security video showing the very moment United Healthcare boss Brian Thompson was shot and killed in midtown Manhattan early this morning, the
Arjun Singh 4:11
primary suspect is a 26 year old man named Luigi Mangione, and according to recent reports, he had recently suffered from chronic back pain, and in a manifesto published earlier this week, Mangione allegedly justified his decision to murder the CEO of one of the largest health insurance companies because he believes the industry puts people over profits. And he's certainly not alone. This
Wendell Potter 4:33
was certainly an act of violence that I don't think any of us should condone. This murder that occurred in New York. But I will say that these companies do perpetrate violence against Americans every single day in various ways and and that is by refusing to pay for medically necessary care because they thought they can get away with it. And they have, for all these years, they've done business and have, I. The way they do with impunity.
Arjun Singh 5:04
That problem that Potter has identified has been known for a long time. In the last decade, healthcare was front and center in our politics. In 2016 and in 2020 Democratic candidates ran on the platform of Medicare for all, a call for some sort of government sponsored insurance program. The
Bernie Sanders 5:21
strengths of a Medicare for All program are not only its universality and its cost effectiveness. It also ends the complexity of a system which adds enormous stress at a time when people need it the least. Meanwhile,
Arjun Singh 5:39
Republicans like Donald Trump have run on an agenda of leaving health care to the whims of the market, which would crucially enrich the industry, probably at the expense of the sickest and least wealthy individuals. Obamacare
Donald Trump 5:52
was lousy. Health care always was. It's not very good today. And what I said that if we come up with something and we are working on things. We're going to do it and we're going to replace
Harry Truman 6:08
it. At the same time, I shall ask them to act upon other vitally needed measures, such as aid to education, which they say, therefore a national health program, civil rights legislation, which they say they're for.
Arjun Singh 6:26
In the late 1940s after the end of World War Two, Harry Truman inherited the presidency from Franklin D Roosevelt, and when he became president, he himself would call for the formation of a national health program. But right around this time, a private insurance system was also coming into form. Healthcare and medicine had undergone a revolution. New surgeries were being developed, as were treatments, but these were expensive, so one idea was to pool people's resources together into a pot of money, one that could be tapped to pay for the sick when they needed it. In 1929 for example, hospital administrators at Baylor University in Texas created a plan where local teachers could pay 50 cents per month for 21 days of care. And that idea soon expanded to other kinds of employee groups.
Dr. Kildare 7:12
How about the theory that the community can afford with the individual can't? Oh, so you've been bitten by that bug. Have you the people of pockets. Bill would pay, say, 10 cents each a week. They could give them a medical service. That's a very beautiful idea. The
Arjun Singh 7:27
symbol they used for this program was a simple Blue Cross. And today you've probably seen that cross, because it's become a consortium of insurance providers known as Blue Cross, Blue Shield. But this was all private. More than a decade later, Truman would fail in his bid to create a national health insurance program, and it would take another decade before a president took a bite at the
News Reel 7:48
apple. The new bill expands the 30 year old Social Security program to provide hospital care, nursing home care, home nursing service and outpatient treatment for those over 65
Arjun Singh 8:00
in 1965 President Lyndon B Johnson signed a law creating Medicare, but its passage was no easy feat. Johnson faced stiff opposition from forces like the American Medical Association, who had long opposed the idea of a government funded insurance program. Insurers and other companies joined the fight, but the AMA really led the charge against it. To them, the idea of socialized medicine just felt too reminiscent of communism. One of
Ronald Reagan 8:27
the traditional methods of imposing statism or socialism on a people has been by way of medicine. It's very easy to disguise a medical program as a humanitarian project. Most people are a little reluctant to oppose anything that suggests medical care for people who possibly can't afford it, a charge
Arjun Singh 8:46
that was particularly devastating while the US was waging a war against communism abroad. But physicians and doctors were also concerned that it would over regulate them, and in particular, how much they might be able to charge for their services. Still Johnson, the skilled politician that he was, managed to get it passed. And Harry Truman would, in fact, be the first enrollee of Medicare in the 1980s though American health care costs would begin to rise more so than other developed nations. In 1983 Medicare began offering fixed payments to providers, causing doctors and hospitals to find other means to generate revenue by offering new services as well. A lot of states began to lift their own regulations on health care pricing, leaving it to the free market. And that's where our modern system of managed care, arguably the one that Luigi Mangione was angry with, begins. And it was around this period that health insurance companies like UnitedHealth Group became publicly traded companies, meaning they would answer more to Wall Street than to their own customers. Here's Wendell Potter at
Wendell Potter 9:50
the end of the day, it is all about shareholders and a handful of financial analysts on Wall Street I used to help play in Cygnus investor day. It's notable that Ryan Thompson at UnitedHealthcare, who was their CEO, was in New York for that company's annual investor day. It's the most important day in an insurance company's year because you are there to try to persuade shareholders who own your company that you have a plan for profitable growth, and you've got it all figured out, and the future is going to be rosy, and that they will make a lot more money if they stay invested in the company. So I learned all that. And, you know, I initially, like I said, I was a believer in managed care, but I came to understand what happened to that concept as Wall Street got really in control of our health care system.
Arjun Singh 10:45
These were the issues that Barack Obama said he wanted to fix when he became president, and it was ostensibly what his signature piece of legislation, the Affordable Care Act, set out to do. But like I said before, the health care industry is still broken. Insurance companies are making huge profits and 1000s are dying from a lack of adequate insurance every year. In my conversation with Wendell Potter, one thing he mentioned was that the ACA has the insurance industry's fingerprints all over it, which raised the question, is it compatible to have an insurance system that is profit driven and fairly provides access to health care? I think
Wendell Potter 11:19
it's possible, because the needs of shareholders are different from the needs of patients, and the way that insurance companies are able to assure shareholders of greater return on their investment is by doing things that makes it more difficult for people to get the care that they need. There's this, this thing called a medical loss ratio in health insurance, and what that means is health insurers consider it a loss when they pay a claim. And one thing the Affordable Care Act did because I testified before Congress about how this works. Increasingly, Wall Street was pressuring these companies to spend less and less and lesser premium dollars on paying our claims, to the point that some insurers were using less than half of our premium dollars paying our claims. Congress, with the passage of the ACA, included a provision that requires them to spend at least 80% or 85% depending on the kind of health plan we're talking about, on health care. But these companies have figured out how to game that, how to work around that in ways that have enabled them to amass even more profits. We now have more than 100 million Americans who have medical debt, and the vast majority of those people have health insurance, but they're not able to get the care that they need and can afford, primarily because one of these other barriers that I've referenced, high out of pocket costs. That was another reason why I left the insurance industry is because of the medical debt that these companies have created for people with insurance by making them pay increasingly high deductibles. I was expected, if I had stayed on with Cigna, to be a leading cheerleader for these kinds of health plans, we were marketing them back in the day as Consumer Driven Health Plans. Euphemistically, we call them that because we wanted people to think that somehow Americans were just chomping at the bit to be more involved in their health care or spend more for their health care, and as a consequence, we have to pay hundreds, if not 1000s, of dollars out of our own pockets every single year.
Arjun Singh 13:32
After the break, we'll hear why the political effort to reform the healthcare industry has often fallen flat. We'll be right back
Jonathan Cohn 13:52
for as long as I've been alive, and certainly as long as I've been sort of paying attention and sent in as like an adult, you know, there's always been our problematic healthcare system, and I know this from as a historian of our healthcare system. Jonathan
Arjun Singh 14:05
Cohn is a senior national correspondent at HuffPost and the author of the book The 10 year war Obamacare and the unfinished crusade for universal coverage.
Jonathan Cohn 14:14
There has been discussion of the problems of our healthcare system, really, since the 1930s which is pretty much when we first got a health care system. And some would say there, we've never really had a health care system where we have health care problems and these sort of solutions to get thrown at it that don't work or don't get enacted. So people have never been happy with it. The two caveats, and maybe this is something we can discuss a little later are that that's a very general statement. There are always certain people for whom it works reasonably well and feel pretty good about it. And that is related to the second part, which is that, however, my unhappy people may be at any one point with the status quo. Now, when you get to the discussion of fixing it, of changing it, of doing something, the enthusiasm for change wanes, and the consensus over what to do breaks down. And that's a big reason why, you know, the problems persist.
Arjun Singh 15:17
I guess I'm sort of confused, Jonathan, from the health insurer or the hospital's perspective, why not let the government basically be a giant and well funded buyer? Because I would imagine that, if you're looking at it from pure monetary standpoint, if you have the government now coming in saying, we're going to create a national program, we're going to pay all the doctors, or we'll pay the insurance company who, who finds that threatening. Is it the insurance companies who are worried that if, if you start charging for a cheaper government plan, where do we fit in the picture? Is it hospitals and providers who, as you said, are worried about autonomy, but possibly the idea that the government becomes a single buyer. Why? Why would they be against, or what is the pushback to a universal program? Yeah,
Jonathan Cohn 16:09
so that's a great question, and the answer is going to vary a lot, depending on, you know, if you can imagine, like a chart, you know, in your head, do a chart, and like the top category is, which proposal are we talking about? You know, which point in history, and then down, you know which interest group. And really, it should be a three dimensional chart, because even within the each group, you know, there's different constituencies. So, like, you know, for example,
Arjun Singh 16:33
this could be like an AP Calculus, probably good. I mean, you know, I mean, truly,
Jonathan Cohn 16:37
I mean, you know how you know, in the 1993 for debate over President Bill Clinton's health care plan, how you know the insurance industry felt you'd get a different answer if you were talking to a small insurance company rather than a big insurance company, for example, or a non profit versus a for profit, and the same for physicians. And you know where in the country. So I mean, for all of these debates, that is different, just in a very broad, somewhat simplistic sense, I think you could say there's a combination of things going on. There is always a concern about autonomy. Do, how much is my financial operational existence within my own control, and how much am I at the mercy of a political system that I may or may not be able to control? And there's these very basic less money, right? I mean, it's gonna cut my income, even if it doesn't cut my income right away down the road. And there is an ideological component here, a philosophical component. This comes up a lot in the context of business. You know, CEOs of corporations that may have nothing to do with healthcare. You know, per se, they're not healthcare companies. They're factories that make widgets, but they do have to administer their health benefits for their employees or pay for them. And number one, they want full control over that. But also, let's say I'm a tech company, right? I employ a bunch of programmers. I'm not really worried that, like, the end of the day, you know, the government runs healthcare, sure. I mean, I don't need to be in the healthcare business, and they want to run my benefits, fine, maybe it cost me a little more money. I don't care. I'm rolling in money. I'm Apple, I'm Google. I don't, you know whatever you know what, though, I don't want government telling me how to run my tech business. And you know, it's habit forming, right? You know, government starts to reach into my health insurance, maybe they're gonna feel more emboldened to reach into what you know, how I my privacy rules, or my whatever. And that sounds a little paranoid, maybe, but there are corporations out there that maybe they care about health care. Maybe they can, you know, look at a health care system. Say, actually, the government could run it better, but I just don't want the government having that kind of power generally, because once they start regulating things, going to regulate more. Or, you know, I sit on corporate boards, right? Or I sit on the local board of my local hospital. Hospitals are an interesting group in this, because they're frequently thought of as, you know, they don't get the kind of anger you see at the insurance industry or the drug industry sometimes, yeah. But like, and, you know, there's lots of great hospitals, and obviously, you know, I mean, they do incredible work. But like, you know, hospital lobbyists pretty powerful.
Arjun Singh 19:21
Yeah, actually expand on that a little bit, if you could, because I do see the role of hospitals come up. And it feels like a third rail sometimes, because we know hospitals in our community. I mean, before we started our conversation, we were talking about, you know, I was in Boston for the last 11 years. And, I mean, in Boston, hospitals are like, like the church, maybe second of the Catholic Church, because they represent institutions in the community. It's where people go to get care. But tell me more about the role hospitals play, you know, in in this, I guess you could call it the medical cost inflation that we've seen happen. And over the
Jonathan Cohn 20:00
decades, hospitals are a wonderful window into this, as long as you like complexity, because, I mean, that really captures it. Yeah, and Boston is a great city for it, so I lived there for a long time. Also still a huge Red Sox fan. My older son was born at Brigham and Women's Hospital, which is one of the great teaching hospitals, not just in Boston, but in America. I mean, they are world famous, you know, Massachusetts General, they don't know, if you know the nickname, mgh man's greatest hospital. I mean, these are, you know, these are, these are cutting edges to when you think about what, I think even critics of American healthcare would say, what is the best parts of American Healthcare is that the cutting edge, it's incredible, right? The hospitals of Boston, a lot of stuff's going on there, the research. I mean, you know, if you you know, the specialist care, it's amazing. And hospitals in Boston have enormous power over health care pricing, and in part because, you know, as the market has evolved, they have consolidated into these, like, you know, these small handful of very large hospital networks, and they have enormous power to set prices. So hospitals have are a big part of our cost problem as our doctors and drug makers, you know, because they're all pushing, I mean, in a funny way, one of the weird things about this, and this is why people like me in the last couple days have been like trying to sort of spotlight what's going what insurance companies do and their role, and understanding why people angry at them, and also pointing out that it's a little more complicated, and it seems like when it comes to like right now in our system, like pushing back on doctors and hospitals and drug makers Over high prices, like insurance companies do some of that, and are, you know, the ones trying to push back down, maybe not in ways we like, maybe in ways that could be better, and we can talk about that. So that's the role of hospitals. And I didn't even mention the lobbying power of hospitals, which is a whole other story. I want to
Arjun Singh 21:54
get back to, kind of the question of the political will to try and reform the system. So the last major bite at the apple was the Affordable Care Act. Now I understand that that was a landmark bill to have been passed, even in the way that it is. I also heard quite a bit of public frustration with it. You know, Wendell, who we heard earlier in the show, said that it did end up being a massive boost for insurance industry profits. You know, they had their lobbying fingerprints all over that. But you you deeply researched the fight over, over that bill. What exactly happened? I know this is actually a very complex you wrote a giant book about it, but you know, at its core, what was the the the goal of the Affordable Care Act, what were some of the big ticket items that were changed, and how is that legacy viewed currently? Of the AC
Jonathan Cohn 22:51
great question. And, yeah, very complex, but I think I can boil down pretty quickly because of what we've been talking about in part, which is that so you have this impulse to get to a universal healthcare system again, back from the very beginning, right, progressive era, Roosevelt, Harry Truman, and from that point forward, the people who want to do universal health care, they're like, we're not going to give up. This is an important thing. We think this is the basic moral test of the society everyone should have health care. We're gonna figure out a way to do this. And what they then do is they proceed to kind of say, what did we do wrong last time? How do we fix for those errors? How do we come up with a model that we can actually get through Congress? Because Truman failed. So it is out of the sort of ruins of the Truman plan that Medicare emerges, and it's a the simple version of this is that the Truman people, the veterans, are like, Well, this was too hard to do, but what if we just did the elderly, because they're super sympathetic, and actually, insurance companies don't really want to insure them, because they're a bad risk. So we'll just do the over 65 population, and, you know, under almost perfect political conditions, with, you know, Johnson winning a landslide, vast majorities, democratic majorities in Congress, they're able to push this through, although even then, they have to make all kinds of compromises to kind of subdue the opponents. So, for example, the private insurance industry actually writes the bills. Is the middleman for the even traditional Medicare like the claims processing goes to the insurance companies, and there's all kinds of compromises like that. So that's how they get Medicare. And so once they've done with Medicare that, okay, we took care, we addressed, we didn't fully take care of, but, you know, we've got a program now for the over 65 population. We'll continue to work on improving that. What do we do for everyone else? And they had a Medicaid program they created the same time, which is for poor people, but it's very limited. It's run by states only certain people qualify. So, you know, there's this, okay, what did, you know? How do we get to the next step? And there's a couple of efforts. Big one under Bill Clinton, he, you know, and people forget. You know, it's been forever. I'm old, so it feels like yesterday. But you know, when he got elected, you know, he was gonna do a National Health Insurance Program. He gave this incredible speech before Congress. Classic Bill Clinton speech, and people Paul, this looks great, and then, like, a year later, fell apart, and it was a disaster. And it was like a total political like, the whole thing felt really came apart the summer of 94 right before the 94 midterms, which are like when Newt Gingrich, ah, the contract of America. So partly gets blamed, you know, for that. And basically, like everyone in the Democratic Party is like, I don't want to go near healthcare ever again. Like, this is, like, it's like, burn my hands. We lose all our seats. Just let's tinker around the edges. And
Arjun Singh 25:29
because the Democrats got such a shellacking in that midterms that and that's the reason they feel so they blamed it on kind of the healthcare push, and that's why they think Contract with America and the Republicans took over. Yeah, I mean,
Jonathan Cohn 25:40
big, obviously, a lot of other stuff going on, but, you know, big part of it, right? Sure, but you still have that core of people for whom this is their life's work, you know, and this is what they care about. They're like, Okay, we are going to figure out a way to get there. What did we do wrong? So they sit and they look at the Clinton plan, they're like, what did we get wrong here? And probably the biggest lesson that came out of that particular the funny was the Clinton plan, it wasn't like the Clinton people were trying to fix the errors from before also. So their theory was, instead of having the government take over health insurance, people are down on government. This is the post Reagan era, right? You know, you can't do a big, giant government. You know, if you try to do Medicare for all, it's gonna spook everybody. So let's have national health insurance, but do it through private insurers. Government will finance it, but private insurers will do it, and it still didn't work. And so the next wave of reform is like, wow, what did we get wrong this time? Because we thought we were making and they said, you know, we did wrong. They said the problem was we were going to put everybody into this new system, and you got all these people out there who have insurance already through their employers, and they may be unhappy with that insurance. This gets back to something we talked about the very top of the putt. The very top of the podcast. So you know, they may have their complaints that, including some of the same complaints we're seeing now about HMOs and all that stuff, you know, managed care, but the end of the day, like they have coverage and they're gonna freak out get or they'll be spooked by opponents if we try to change that. So let's just, let's try to get everyone insurance simply by plugging the holes. Let's if people have insurance, let them keep it. Don't mess with what people have. So if you got Medicare, we're not going to touch it, except we're going to actually add some help make the drug benefit better. You got employer coverage, we're not going to mess with that. We're really going to focus on the people who don't have insurance because they don't have an employer policy, and because of that, they have to buy on their own, and either they don't have enough money or they have a pre existing condition, and they and when you buy on your own, this is really important. If you're with an employer, you know, because it's a big group, it doesn't matter what your health conditions are. You can get onto the plan. But if you are buying a policy on your own, back then, if you had a pre existing condition, you had a history of cancer, you were diabetes, whatever. Insurance company wouldn't cover you, or they charge you extra money, you know, so on. So the Obamacare, as it came to be known, the whole premise was basically just plug the holes. And as they said, We're going to take the Medicaid program, which covers low income people, but it very every state has different criteria. And you have to like, in law states, you have to be like, either a child or a pregnant woman or, you know, instead, just expand it so it covers everybody who has income below the poverty line or just above, and that'll that'll take care of a lot of the uninsured. And then there's this gap of people who will be make too much money to qualify for Medicaid, but they still can't get coverage because it's expensive. You know, you're making $30,000 a year. That's not quite poor enough to qualify for Medicaid even under the new standard. But yeah, you know, insurance is expensive, or maybe you're one of these people with pre existing conditions. So they created, you know, what most people now associate with Obama? Can? They created these markets where they just these insurance companies would have to sell to anybody. Didn't matter if you had a pre existing condition, the policies had to meet certain standards. And depending on your income, you'd get extra money from the government, you know, as a tax credit. And this idea was kicking around. It really got kick started when we're gonna come back to Massachusetts again and in 2000 when Mitt Romney, very important. Yes, Romney is the governor, and, you know, he gets together with the Democratic legislature, and they pass a version of this. And I really think this is important about the political situation, which is, you know, I'm always been fascinated with Romney. You know, Romney, very conservative guy. You know, I live in Michigan. So he grew up in Michigan. His dad was George, you know, moderate govern, Republican governor of Michigan, Rob mint, more conservative than his father. He's a genuine conservative. He's a business guy, you know, whatever, but he's very analytic. He's a problem solver. He's conservative, but not an ideological you know, it's different. I mean, his views are conservative, but he's not an ideological crusade. He's a problem solver, right? And, you know, in Massachusetts and when you're a governor, this is always true with governors, not always, but usually governor's, like, kind of have to deal with whatever's on their plate. They don't get to, you know, run around because, you know, buck stops. It really does, in a way that sometimes it doesn't, you know, for the President. So Romney is like, you know, we're losing we're spending tons of money on on health care. This is a really screwed up system. And also, there was a whole issue on the outside with, like, federal. Funding they were going to lose. So he ends up actually teaming up with, of all people, Ted Kennedy, who's, like, liberal Ted Kennedy, who he had run against for Senate years before, and like, the icon of, like, you know, Democratic Party, that's patron saint of universal health care. And basically, they get together and they're like, look, we're different ideologically, but we both were practical, and Ken Ted Kennedy was always very practical legislator, like, we can get this done. This can get through. It won't upset the apple cart too much. It can get buy in from the left and the right. And they do it at Massachusetts, and it's like, not a panacea, right? I mean, still, people in Massachusetts don't have health insurance, and people have health insurance, the out of pocket costs are high, but they do, like, get to almost universal coverage, and there's lots of evidence that people are better off. And it happens in messages that it worked. And so the Obama people come in and like this, you know? And actually, this started in the 2008 campaign. Hillary Clinton ran on the exact same plan. When they were in the primaries. They both were like, this is the way to go. This is the way. What's the, what's the, what's the what's the Star Wars thing. This is the way the
Arjun Singh 31:03
this is the way the man.
Jonathan Cohn 31:04
Thank you, my happy I dropped a Mandalorian reference into this, and this is the way. And, you know, they knew that, among other things, they had a bunch of pieces, like, some of the DNA of the plan is like something the Heritage Foundation, the conservative Heritage Foundation, you know, had done that back in the 90s, and it was business friendly, and they really much more than the Clinton people had from day one. They basically went to all the special interests, they went to the insurers, they went to the drug makers. They said, Look, we want to get this done. And we think, you guys, I know you're making money off the status quo, but you can see this is not a sustainable system. At some point it's going to break down. That's not good for anybody. And so the mode was, make friends with a special interest. Don't mess with people's existing insurance if they have it. And frankly, the hard part of health care isn't giving people insurance, it's paying for that and trying to really aggressively cut costs. And the Obama people were serious about that. And I think speaking as an observer, there's not a philosophical judgment. Nothing short of remarkable. They were able to come in with a program that at least scored by the CBO as reducing the deficit, which nobody believes they actually, I mean, doesn't. CBO could have, you know, has said it a million times, and people like, no, that's not real. No, I really did. They actually had a plan that would reduce the paid for itself. But, you know, there's lots it didn't do even from the get go, they knew there were still going to be people without health insurance. There were going to be people with health insurance who have high deductibles. They weren't going to fix all the practices of the insurance industry that people hated. And by the way, on top of all that, like all new programs, for the first few years, it was really rocky. They had lots of problems. Most famously, they all the website they created the first year, it was like a freaking disaster.
Arjun Singh 32:42
Oh yeah, yeah, healthcare, yeah. Like,
Jonathan Cohn 32:45
actually, ironically, you know, that's, there's a whole, there's a great political story. I to this day, people say, what's the closest this thing ever came to falling apart? I think that's when it was. I actually think the Republicans missed it. Who Hated the affordable character? You know? I think they that was their chance to kill it, and they could have, if they hadn't quite approached it the way they did.
Arjun Singh 33:03
Yeah, I mean, so what it sounds like is, it's kind of like you, you take the metaphor of saying that you you have a home, or you have a kitchen in a home, and over the years, the owner of the house has kind of done their own form of wiring, and so they took it on their own, and they connected the wires from the kitchen light switch, the one in the living room, to that goes to the TV. And it's like if you even try and bring a professional electrician in, the first thing they'll say is this hodgepodge is there's so many different aspects of it. I don't know where to just do one fix. I can't just come in and fix your light switch in the living room without basically having to, like, dismantle the entire system. And so, you know, then the solution is, how do you kind of address all the other problems with going on so, but it sounds like what you're you're saying is that, over the decades, we have different components of our healthcare system that are really sucking up costs and any one effort to try and reform all of it is, you're going to have such powerful special interest for for people who hope for some more political reform, whether it's a Medicare for all, whether it's insurance reform, I should mention whether it could be a public option politically is, is there a will for for some sort of reform, you know, in the wake of what's happened here, is there a will to tackle the special interests? And I guess the one that people have asked me about is the public option. Is that still on the table? Why hasn't a public option come out yet? Yeah,
Jonathan Cohn 34:35
so I say two things. First of all, I just want to say your analogy about the wiring and the house is fantastic. I've been and like, there's a whole analogy about a starter house that gets used in these debates because it came from, like, Obama and people I love that. I'm going to use it partly because my house happens to be one of those houses. But quite apart from that, just like, it's perfect, and it really works at the level, also, of because you would say, like, the you know, you will, you. Just tear down the house then and start over, which you could do right? Then you don't have, do you have another house to go in while you do? No. And so that's part of the problem. And you have to wait for the house to be built, right, and who knows what problems gonna be in that house. So I mean, your question about the public option. So, you know, I have learned not to be overly definitive in my political predictions. And I thought that even before we ever heard of Donald Trump? I will say this. My lesson that I take from the history, including recent history, is that change of any kind, but especially big change, and especially big change to healthcare, does not happen in a flash. It happens after years of work every major healthcare reform we have had has happened because there was groundwork laid outside advocacy and inside Congress. You know, just to take one example, the prescription drug reforms of the inflation Reduction Act, which, like everything, like Obama, you know, very modest reform in the grand scheme of things. Now, every other country, they negotiate all their drug prices. We finally right for one set of drugs in one program the government can negotiate. But, you know, that's how you build on these things, right? I mean, that's the sort of first step, yeah, that passed in 2022 it would not have passed in 2022 if not for the fact that, you know, frankly, starting around, like, a couple years after the Affordable Care Act passed, there was a group of Democrats in Congress, and it was Democrats, not Republicans, although there are Republicans who certainly care, you know, talk and care about prescription. No, these reforms were mostly democratic reforms. And I remember at the time it was a big fight in the Democratic caucus. And, you know, the, you know, the the more liberal members wanted to do something, the more conservative members didn't, and they went back and forth. It was a really bitter fight. I remember at one point someone saying, like, why are they bothering? Because it was very clear the Senate wasn't going to Mitch McConnell made clear he was not going to bring up anything in the Republican Senate. And Trump was kind of, Trump is actually on drug issues kind of weird, and all over the map, but, you know, so and I remember people saying, Why are they bothering? And I remember saying at the time, I will say, I got this right. I said, because at some point down the road, if Democrats get full control of Congress in the White House, they will have laid the groundwork to do this. And that's exactly what happened when they got full control. After Biden gets elected, they're able to take that bill, and it has to go through the whole process again, left in a new conference, but they are able to get it through. So you were asking about the public option, which just for your listeners, you know, it's like, the idea is, have you have a government program that kind of operates inside the affordable care act as an option. It's like a little mini Medicare, and it was something that the ACA was originally supposed to have. It was something Obama talked about and feel that passionately about it, but he supported it. There were definitely members of Congress who were whole. They they had to drop it because they were basically one vote short, well more than one. There are a bunch of bunch of Democrats in the Senate, did Joe Lieberman? Yeah. I mean, Joe Lieberman kind of wielded the knife. But there were like five to 10 Democrats behind him quietly saying
Arjun Singh 38:03
it was sort of a rotating villain, kind of idea that they could stand behind him and he'll take
Jonathan Cohn 38:07
the blows, because he was happy to be in that role. And he was in the democratic, you know. And the other ones were like, yeah, yeah, Joe, go, go, go, you know.
Arjun Singh 38:17
So always a joke really, is right.
Jonathan Cohn 38:21
So, you know, not to speak ill of the departed. You know, the cautionary note there I give you is that number one, I haven't heard a lot. It's not something people are really focusing on right now, so you'd have to kind of rebuild that sort of momentum support. Number two, like, I think a public option, yeah, you can make a really strong case for it, whether the public option would actually address the problems people are perceiving right now is a whole other question. Like, I can imagine a public option becoming law in a world where Democrats had a majority, I mean, they would need to end there's no way Republicans would go anywhere near that. It's just more government in a way they just philosophically, fundamentally oppose. You know, is there a world where Democrats could endorse something like that. Yes, you know, if they had the Congress and they had the president, but we're at least four ways, years away from that at this point. And even then, like, you know, I'm, you know, why did the public option die? Mean, obviously it had some conservative either was philosophical opposition. But let's get back to what you were talking about, the hospitals. Hospitals hated that idea, because they're like, it's going to drive down our payments more and so if you imagine a world where you're trying to do the public option, you got to imagine the hospitals doing the same thing they did before, and we didn't talk about this, but like hospitals, I'm not trying to single out hospitals any more than I want to single out insurers, but hospitals are super powerful, in part because in every congressional district in America, they're the biggest employer. They're on maybe not every single one, but most of them, and they have enormous power. And the minute you talk about cutting money to them, they will start saying, Well, we're just gonna have to start laying people off and our emergency room, you're gonna have to wait three days for whatever. That is politically toxic for a member of Congress. And so it's a tough, tough fight. Doesn't mean you shouldn't do. It, obviously. But, like, I think, you know, if you're looking for ways, you know, to sort of improve health care reform, there are, you know, where you know whether that is the best place to put your political capital is an open question. Yeah, we'll leave it. You know, I would leave that, yeah.
Arjun Singh 40:15
Well, Jonathan, this is a fascinating conversation. Glad we got to talk, and thanks for taking the time to
Jonathan Cohn 40:21
come. Yeah, no, this was great. And little little reliving history and a little Boston talk too, which I always love to
Arjun Singh 40:25
do. Yeah, absolutely.
Arjun Singh 40:33
Thanks for listening to another episode of lever time. This episode was produced by me, Arjun Singh, with help from Chris Walker and editing support from Joel Warner and Lucy Dean Stockton. Our theme music was composed by Nick Campbell. We'll be back next week with another episode of lever. Time you