Will Past Failure Improve Odds for Major Health Care Reform?

It was like revisiting a bad dream. During a Capitol Hill conference sponsored by the Alliance for Health Reform last month, four health policy experts who were intimately involved in the development and eventual demise of the 1993-94 Clinton administration health system reform plan, known as the Health Security Act, recalled the high hopes that accompanied that effort and the devastation they experienced when it collapsed.

(The plan, developed by a health care task force headed by then First Lady Hillary Clinton, was presented to Congress by the president in November 1993.)

None of the participants are household names, but they were key players in the famous (or, depending on your point of view, infamous) health care task force, on the White House staff, and on the staffs of key Congressional leaders. And for all of them, the seminal memories of that year—such as when President Clinton waved a pen during his State of the Union Address and promised to veto any legislation that didn't guarantee 100 percent coverage of Americans—were bittersweet to recall.

Said Dean Rosen, then an attorney working for Sen. Dave Durenberger (R-Minn.), who was on two Senate Committees that had jurisdiction over health system issues, “I remember even as a young staff person thinking, [Clinton] can't be serious about this. If he's actually serious, and that's the standard by which he's going to sign legislation, then this is really over.”

Indeed, by August 1994, a year and a half after Clinton's inauguration, it was over, and the health care reform initiative was dead.

Several Lessons Learned

Last month the four policy mavens gathered to mull over the failures of that time—too much complexity, too much secrecy associated with the task force, too little negotiation with Congress up front, and a failure to appreciate the way major legislation gets passed in Washington—and to think about lessons for the future.

They were speaking to an audience of mostly young Capitol Hill staffers—plus a smattering of press types—many of whom were barely politically aware at the time the Health Security Act was proposed, but who may be involved in the next great effort at reform following the presidential election in November.

Despite the bad taste that the 1990s health care reform effort left in the mouths of many of those involved, it was roundly agreed that the prospects for reform in the coming years are good. Moreover, all agree that this time around, mental health will be a component of system reform.

“I think the world has changed in terms of how it views mental health and the synergy between physical and mental health,” said Christine Ferguson, then counsel and deputy chief of staff to the late Sen. John Chafee (R-R.I.). “I think that there's a big difference now. It's a big problem because we don't have enough appropriate providers, and there's all kinds of delivery system issues....[I]n terms of something that would actually pass Congress, it would have to be in there.”

Parity Data Convincing

Chris Jennings, a policy expert who worked on the task force headed by Hillary Clinton, said that the experience of parity coverage in the Federal Employees Health Benefits Program (FEHBP) has clearly shown that mental health coverage can be included in a cost-efficient manner.

“In the aftermath of President Clinton's applying the parity provisions to FEHBP, and the actual experience, the cost did not have a substantial impact,” Jennings said. “In fact, it was neutral. There's much greater confidence, and I think that since a lot of the Democrats are talking about FEHBP-type models, you already start the debate in a much better place.”

Rosen emphasized the advances that have occurred in the last 15 years in the scientific understanding of the biological nature of mental illness.“ I think we certainly know a lot more, and I think that pharmaceutical treatments have become a much more important part of treatment,” he said.

He added that the issue of mental health and illness raises a concern, which, he said, was never fully debated under the Clinton administration—namely, exactly what should and should not be covered under a standard health insurance plan. This time around, he seemed to suggest, there would be no question that mental health would be part of any standard package.

“Mental health parity [clearly has] broader bipartisan support now than it did then for scientific and other reasons,” he concluded.

Also on the panel was Brian Biles, M.D., who had been deputy assistant secretary for health at the Department of Health and Human Services.

In outlining the mistakes that were made in 1993-94, the veterans of the Clinton health reform wars seemed to delineate a strategy for the next president to meet with success:

The Clinton Health Security Act was anything but simple—a 1,000-plus page document describing universal coverage guaranteed through a federal entitlement and an individual mandate; subsidies for families to buy insurance; a set of standard benefits; privatization of the Medicaid program; and cost containment that was to be ensured through “managed competition,” that is, private market competition regulated by health alliances established by the states.

The complexity of the plan was, in part, a function of the fact that the Clinton administration was determined to do health care reform in a framework of deficit reduction, and without new taxes.

Thus, “Clinton's team devised a plan so loaded with elaborate regulations to control costs that it inevitably aroused the ire of the foes of big government,” wrote Arnold Relman, M.D., then editor of the New England Journal of Medicine, in a 1996 book review of Theda Skocpol's story of the demise of the Clinton plan (Boomerang: Clinton's Health Security Effort and the Turn Against Government in U.S. Politics, W.W. Norton, 1995).

Perhaps as important as the bill's complexity was that it was devised in total, down to the last detail, by White House–selected policy experts who were widely viewed as secretive, despite the fact that congressional committees had developed several reform measures of their own.

Biles emphasized the importance of working with Congress from the beginning and within the Congressional calendar. “It's not enough for a president or a secretary to have an idea,” he said. “The real success of the president or cabinet secretary is the legislation adopted by Congress.”

He noted that the Founding Fathers, distrusting government, made it difficult to pass sweeping changes.

“The Constitution imposes a two-year cycle, which is really a one-year cycle,” he said. “Within the two years, in the first year of the cycle immediately after the election, the political momentum looks back to the previous election. That lasts for about a year, up until November or December. The failure [of the Clinton administration] to make use of the one-year cycle where [it] had political momentum and clout was a real error.” ▪