My post today on former Democratic Congressman Jerry Voorhis' The Strange Case of Richard Milhous Nixon
will focus on health care. A while back, progressive blogger Michael
Westmoreland-White said the following about Senator Edward Kennedy and
health care reform:
"[Kennedy] has called the battle for universal
healthcare in this country the 'cause of his life.' He did not live to
see that cause come to fruition and he later regretted walking away from
a Nixon plan in 1974 that was almost identical to the Obama plan, now,
public option in competition with private insurers. Kennedy wanted a
single payer system that expanded Medicare to cover everyone and thought
he could get it–and never realized until much later that the tides were
turning in the other direction." See here.
Voorhis'
book has copyright dates of 1972 and 1973, so it was written before
Senator Kennedy walked away from President Richard Nixon's plan for
health care reform. At the time of Voorhis' writing, the U.S. Congress
was still debating about the merits of the Kennedy plan and the Nixon
plan. I don't know to what extent Nixon altered his plan between 1973
and 1974. My purpose in this post, however, is to talk about Voorhis'
description and analysis of the health care proposals of President Nixon
and Senator Kennedy.
Let's start with Voorhis' discussion
of Nixon's approach to the health care issue. According to Voorhis, in
a time when there was a shortage of physicians, President Nixon
supported reductions in government funding for medical schools and
hospital construction. (Nixon on page 281 of volume 2 of his memoirs
laments that the federal government was still funding hospital
construction, arguing that there was a surplus of hospital beds.) Nixon also supported cutting government funding for medical research.
But
then Nixon turned right around and said that he was all for medical
training and research and helping out areas where there was a scarcity
of medical care. And, indeed, Nixon was for the development of
Health-Maintenance Organizations (HMOs). But Voorhis has at least two
problems with Nixon's approach to HMOs. First, Voorhis does not think
that Nixon's proposals on the amount of money to spend on the
development of HMOs were adequate for the task at hand. And,
second, Nixon "proposed to make federal aid available to promoters of
profit-making HMO's" (page 87). According to Voorhis, the problem with
for-profit HMOs, as opposed to non-profit or cooperative plans, is that
those who promote for-profit HMOs have an incentive (presumably,
profits) "to provide as few and as inexpensive services as they can to
subscribers and to pay professional staffs as little as possible" (page
87).
According to Voorhis, Nixon's health care proposal
would not guarantee a wise use of money and medical services. Nixon
proposed an "indemnity insurance program", would would provide cash to
people after they became sick, and they could either spend that money
for good medical care, or they could end up wasting it within "the
confusion of the prevailing 'no-system'" (page 88). Nixon's plan would
also require employers to provide health insurance to their
employees----"to be paid for, after the first two years, 75% by
employers and 25% by the workers, if indeed those workers chose to be
covered" (page 88). Not only would this "constitute a tremendous
bonanza for the insurance companies", but it would not ensure that
people are buying quality care, nor would it prevent medical providers
from raising its (the insurance policy's?) cost (page 88). Moreover,
Voorhis refers to the words of Nelson Cruikshank of the National Council
of Senior Citizens, who said that Nixon's Health, Education, and
Welfare Secretary said that there would be controls on insurance
carriers, then the Secretary turned right around and proposed that the
states have the responsibility to come up with those controls. And,
according to the American Public Health Association, Nixon's proposal
had a plan to encourage preventative medicine, but it would be
underfunded, and the onus would fall on insurance companies to fund the
endeavor.
For poor families, Nixon proposed a Family Health
Insurance Plan that would replace Medicaid. But Voorhis expresses
several problems with this. First of all, under the FHIP, the federal
government would purchase health insurance policies for the poor.
Whereas Medicaid (on some level) met the needs of the poor, the Nixon
plan would cast poor families adrift, as they sought to "find someone to
care for them and to attempt to spend their insurance cash benefits as
best they could" (page 88). Second, the FHP would limit poor families
to "30 days of coverage in a hospital" (page 88). Third, the FHIP would leave out those poor people who were not part of a family that had children.
Fourth, Senator Kennedy argued that, under Nixon's proposal, "a worker
with a $5,000 hospital expense would be obliged to pay about $1,800 out
of his own pocket or 25% of his entire year's salary" (Kennedy's words,
quoted on page 88). The idea that Nixon's proposal would add costs
onto consumers is also applicable to critiques of his proposal on
Medicare. Voorhis refers to the claim by Ed Murphy of the National
Council of Senior Citizens that, while Nixon's plan would get rid of the
$5.30 monthly charge for Medicare Part B (and, according to Voorhis, Nixon did not specify how he would pay for this), the elderly would end up
paying "a substantial part of the cost of hospital care after only 13
days, plus $50 for doctor's services" (Voorhis on page 89).
That's
Voorhis' description of the Nixon plan for health care. I can't say
that I understood all of it. I notice some similarities to President
Barack Obama's proposal, such as the requirement that employers provide
health insurance to their employees. I'm not sure what exactly the
public option was in Nixon's plan----unless that was added to the plan
after 1973. Perhaps the indemnity insurance program was that public
option (I don't know). In any case, Voorhis argues that President
Nixon's plan would inadequately meet the needs of the poor, would impose
costs on the poor and elderly, and would result in a combination of
stinginess and irresponsibility: stinginess because HMOs would be trying
to increase their profits at the expense of medical care, and also
because the elderly and poor would be less likely to go to the hospital
if they'd get a huge bill; and irresponsibility because there was no
guarantee that people would use their insurance policies effectively, as
opposed to wasting money.
Now for Kennedy's proposal! Voorhis talks about the Kennedy-Griffiths bill.
What would it have done? First of all, the Kennedy-Griffiths bill
would establish a two year period of preparation for "training...medical
personnel", developing prepayment, HMOs, health education, and "other
means of improving the delivery of health care" (Voorhis on page 90). Second,
everyone would be part of a single plan that would provide 70% of the
American people's health care needs, "including personal health
services, prevention and early detection of disease, hospitalization,
and medical rehabilitation" (page 90). 50% of the
funding of this plan would come from "general tax revenues", 30% would
be from a payroll tax that employers would pay, 12% would be from a "1%
tax on workers' wages and unearned income", and 2% would be from "a tax
on the self-employed" (page 90). This money would go into a
Health Security Trust Fund, which would pay providers as they "rendered
services", and "Patients would not be charged for covered services"
(page 91).
While the Nixon Administration argued that the
Kennedy plan would cost too much, the Kennedy plan's proponents argued
that it would allow for money to be spent more efficiently, plus, since
the Health Security Trust Fund would be paying medical providers, it
could perhaps exert control over the cost and quality of health care.
That, Voorhis says, would contrast with Nixon's proposal of indemnity
insurance---which (it seems to me, as I read Voorhis) simply gives
people money when they're sick, without having accountability as to how
they spend it in terms of their health care.
My impression
is that Voorhis is critical of blanket reliance on a fee-for-service
system, and he may believe that Kennedy's plan would save money on
account of its encouragement of preventative care. Voorhis
here is like President Obama and also a number of conservatives, who
hold that it's less costly on the health care system for people to
receive preventative care, than it is for them to wait until they're
really sick and end up in the emergency room. Voorhis also may
think that, if the government were paying for health care, it would have
the leverage to negotiate quality care and lower costs with medical
providers, as a significant consumer. Read this article, which discusses how that works in other countries. Also, see here, where I discuss Mitt Romney's proposal of something similar (albeit on a more limited scale).