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Clinton-era health aides push to save Obama’s plan

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Shock and awe. That’s what survivors of the Clinton-era health care collapse are feeling as President Barack Obama’s overhaul legislation wobbles in Congress.

Aides who shaped Bill and Hillary Rodham Clinton’s 1990s plan to cover all Americans, then labored in vain to pass it into law, are adamant that the Democrats can’t afford another health care disaster. But they’re divided on whether scaling down Obama’s plan would be an acceptable solution.

The Clintonistas — now in think tanks, universities, serving in the Obama administration or lobbying — are a potent voice in the furious debate within the Democratic Party over how to salvage health care. Listened to because they’re the veterans of the last health care policy war, they carry the scars of intense striving reduced to utter futility.

“If Bill Clinton couldn’t get it done, and Barack Obama can’t do it, no Democrat will ever try again,” said economist Len Nichols, health policy director at the New America Foundation. A Clinton White House health budget aide, Nichols has been operating as an unofficial adviser to lawmakers and administration officials wrestling with details of the current legislation.

“History is written by the victors, not the vanquished,” said Chris Jennings, congressional liaison for then-first lady Hillary Clinton during the 1990s debate. “Failure would serve as the ultimate judgment as to whether this effort was worth doing.” Jennings, now a lobbyist, replaced Ira Magaziner, principal architect of the Clinton plan, as White House health policy adviser.

The former first lady, now secretary of state, says “it’s really hard” watching the travails of Obama’s plan. Hillary Clinton has been giving advice, as requested, to lawmakers in Congress and administration officials, and says she’s still hopeful. “I’m not sure that this last chapter has been written,” she told CNN’s “State of the Union” on Sunday.

For most of last year, the health care debate was among Democrats. Republicans were left heckling from the sidelines. That changed when Republican Scott Brown pulled off a Senate upset in Massachusetts, winning the seat held by the late Sen. Edward M. Kennedy and depriving Democrats of the 60-vote majority they were counting on in the final push.

“Many of us thought we were really at the 1-inch line, then literally it was like being hit by a freight train with about 10 seconds’ warning,” said Ken Thorpe, a senior Health and Human Services official during the Clinton-era debate. Now a health policy professor at Emory University in Atlanta, Thorpe has proposed a scaled-back alternative in case Obama’s plan can’t get unstuck.

The mere mention of settling for less is causing consternation among former Clinton aides. Obama’s health care plan — denounced as a government power grab by critics — is already scaled back from the ambition of the Clinton years.

Clinton would have changed how people covered by large employers got health insurance; Obama does not. Clinton required all employers to contribute significantly to the cost of coverage; Obama exempts small businesses. Clinton aimed at insuring all; Obama’s plan reaches around 95 percent of eligible Americans. Today’s Senate bill — supported by Obama — resembles a plan drafted by a moderate Republican senator in the Clinton years.

“It takes too much work to figure out what ‘scaled back’ means,” said Judy Feder, a former colleague of Thorpe’s at human services, now a health policy professor at Georgetown University in Washington. “You can’t do insurance reforms alone without expanding coverage, and the expansion costs money. I don’t see the politics coming together for scaling back.”

The Obama plan focuses on those who have the most trouble getting and keeping health insurance, small businesses and people who buy their own coverage. They would be able to buy private coverage in a new kind of regulated marketplace, with government subsidies for many. Insurers would be prohibited from turning down people with medical problems. Most Americans would be required to carry health insurance.

“We are using the private insurance market and private incentives, as opposed to command-and-control,” said Nichols. “As a policy matter, we are in the middle.”

Thorpe’s proposal for scaling down Obama’s plan would keep the new insurance marketplace and the ban on excluding people with health problems. It would chop the cost from $1 trillion to $500 billion over 10 years, covering about one-third fewer people than Obama.

Thorpe said he hopes if the Democrats can’t get Obama’s bill, “we don’t do like 1994 — all or nothing.”

Obama has sent mixed signals. Early after the Massachusetts defeat, he raised the possibility of scaling back. Then he insisted he still wants a comprehensive approach. Last Thursday, Obama publicly raised the prospect that Congress might not act at all. Sunday, he invited GOP and Democratic leaders to discuss possible compromises in a televised gathering later this month.

The Democrats’ reversal “is like a big body blow,” said Jennings. “You either stammer and fall down, or you stammer and regain your balance. What Americans respect are those people who can take a punch and come back.”

© 2010 Associated Press. Displayed by permission. All rights reserved.

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