Will the candidates fix health care?

I'VE BEEN asked to make some comments on the upcoming presidential elections and developing a strategy around them. I'm an expert in health policy, not on political strategy. People in this room have more experience in that than me. But I do want to talk a little about where I see us going in the single-payer movement within the broader political context.

I am paradoxically optimistic about the political situation right now. I say paradoxically because if we look at the actual health policy proposals of Barack Obama and John McCain, they are not good.

Let's start with McCain. He has said that he is going to continue most of the proposals of the Bush administration, with accelerated privatization of Medicare. He doesn't use the word privatization--but he's been very clear that he is going to push for more "competition" and "choice" within Medicare, which are euphemisms for privatization.

He's also very big on consumer-directed health care--on bare-bone health plans with big co-payments and deductibles as a way as a way to save money. He has put forward a fairly desultory proposal about refundable tax credits, whereas he previously had no proposal on his Web site for months and months. About a month ago, he put up a proposal in which he said that he would offer a refundable tax credit of $2,500 for an individual, $5,000 for a family.

What he didn't say on his Web site is how he would fund the tax credit. So we are left wondering. There are a couple of theories about it. Most of us think he is not prepared to give people $2,500 or $5,000 in a refundable tax credit without some way of funding it. That would be a tremendous transfer of wealth out of the tax system to the taxpayers, so we don't really think he's planning that.

If McCain is planning on going with the Bush-style plan, then the tax credits would be funded by caps on the tax-deductibility on employer-based insurance. In fact, several pundits have been talking as if that is McCain's plan.

There's a third point of view, which says, "well if he isn't including any funding, then he isn't particularly serious about doing any of this." If, in fact, he is serious, his proposal is what I call "voucherization" of health care; families would get a fixed tax credit or a fixed amount of tax deductibility of your employer-sponsored plan, and above that tax credit or deductibility, there would be no further government subsidies for health care.

This is essentially a "voucherization" of government's contribution to health coverage. Another way of thinking about it is that McCain would switch health care from a defined benefit system to a defined contribution system.

For those not familiar with this concept, let's back up a little bit and discuss pensions. Retirees used to get pensions with something called a defined benefit--say, 60 percent of your salary for as long as you lived.

But few of us will get such pensions, except for a handful of public workers. Nowadays, we get something called a defined contribution. At my institution, the employer puts 6 percent of my salary into a retirement plan. It turns out 6 percent of my salary summed up over 30 working years is a whole lot less money than what you would need to generate 60 percent of my salary for the rest of my life. So the new pension arrangements, like the Bush-McCain health proposals, are actually a massive cutback disguised as a shift from a defined benefit to a defined contribution.

Needless to say, the concept of switching from defined benefit to defined contribution has been very popular with the Republicans. There's been an effort to move Medicare in that direction, under the moniker of "premium support," where the federal government would pay $6,000 to $8,000, but not guarantee the full future costs of seniors' insurance.

If McCain is serious about his health plan, it probably represents a similar effort within the commercial (non-elderly) health insurance market to push people into defined contribution rather than defined benefit arrangements.

We could spend some time on it, but to be honest, I don't want to focus too much on McCain, because we're not at all sure whether or not he's serious about his health plan. He was under a lot of pressure to come up with something, and similar to what George Bush did with his proposals for tax credits, McCain seems to be putting no political capital at all into actually implementing them.

I don't think any of us in this room ever thought Bush meant what he said about health care tax credits in his State of the Union address. He certainly hasn't given any indication that he's planning on pushing forward his proposed health care tax credits.

AS FOR Obama, his health proposal is not a universal health care proposal. It would include a big expansion of Medicaid and Medicaid-like programs.

Medicaid expansion is of course, better than no Medicaid expansion; those of us who work in the public sector know that. But we also know that Medicaid and Medicaid-like expansions have been tried over and over and over during the last 30 years. This has not moved us towards universal health care.

After Medicaid expansion, we usually see a small drop in the number of uninsured. We are seeing that in Massachusetts right now. As long as we keep pumping money into Medicaid or Medicaid-like programs, we can push down the number of uninsured by a couple of percentage points.

But that's not a viable, long-term strategy because it's not affordable. Obama's plan does have significant money for Medicaid expansion, restoring money to S-CHIP (State Children's Health Insurance Program), subsidized programs for the poor and the near poor.

Obama is also talking about an employer mandate without providing much detail about what it would be like. Certainly, even in a very liberal state like Massachusetts, we were not able to implement any real employer mandate. The employer mandate is in the new law in name only.

In fact, the only mandate Obama is clear about is a mandate that parents have to buy health insurance for their children. Health insurance for children is cheap, and children garner a lot of political sympathy. This mandate would leave tens of millions of American adults uninsured if the Obama plan goes though as he proposes it.

SO MY optimism is not based on Obama's proposal, and it's certainly not based on McCain's proposal. My optimism is based on something taught to me by a nurse in the Boston-area and a long-time single-payer activist. She used to give this speech where she would say, "People say politics is the art of the possible, but they're wrong. Politics is the art of creating the possible. And what is possible is about what people believe is possible."

I believe the biggest impediment to our work over the last 10 years or so has not been lack of a good program, because we know what a good single-payer program would look like. We have HR 676, we can look to Canada and places in northwestern Europe--that's not the problem; we have models and we have a program.

The problem is the lack of hope--the lack of a sense of possibility. People hate the health insurance system, and they know things need to change. But people don't believe anything can change.

So what we really need right now is an infusion of hope. Even if Obama can't deliver on his own plans, when he raises the expectation of the population, people will begin to believe change is possible. And if people truly believe change is possible, they are probably right.

I was only a kid when John F. Kennedy was assassinated, but I am a student of history. The reality is that Kennedy was not all that liberal. He was a tepid liberal, at best. For instance, there was a big debate within his administration about whether he was going to send the troops to protect the civil rights activists in the South. His program was a very moderate one for his day and age.

Yet his election got people thinking that change was possible. Once people thought change was possible, the whole Sixties started to unfold. "Well, if Kennedy is there, maybe the Civil Rights movement can move more quickly, maybe the women's movement can move more quickly, maybe we can actually stop a war through domestic protest."

He raised people's sense of possibility, and that went much further and farther than John Kennedy could have ever envisioned. This is the kind of moment I think we are now at.

The electorate's view of Obama as something really new and exciting, brings a sense of possibility and optimism we have not seen in this country's political culture for a very, very long time.

The question we need to discuss is what do single-payer advocates do at this point? I don't think anyone here wants to attack Obama in anyway that would decrease the possibility of his winning the election, but at the same time, we need to open up the whole health reform discourse.

I feel very strongly that people need to be articulating the single-payer message, so as Obama and Congress struggle to do something early in the administration, there will be a very clear vision out there that there is a single-payer alternative; that there are folks supporting it, and that there is a track record of success on single-payer; that there is not track record on mandates, and there is a negative track record on the Medicaid expansion.

We need to get the single-payer ideas out there for people as hope wells up and people start to look for ways to move forward.