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Bill George

Harvard Business School Professor, former Medtronic CEO

Obama’s Health Care Conundrum

            Yesterday’s shocking news from the Massachusetts Senate race throws a wrench into President Obama’s #1 legislative priority: providing health care insurance for all Americans.

Without 60 Democratic votes, Senator Reid cannot force through the comprehensive—and somewhat convoluted—bill that is currently in the House-Senate conference committee.  This is just as well.  The bargaining and compromises made in both chambers have produced a bill that has as many unintended negative consequences as positive benefits.  For example, how can one justify protecting union workers from a modest tax on health benefits over $24,000 per family while taxing non-union workers earning exactly the same amount of money?  Is this democracy?

Now the President is facing some rather stark choices:

  1. Try to round up 220 Democratic votes in the House to accept the more conservative Senate bill as it is currently written so that it can be passed by a simple majority vote and signed into law.
  2. Eliminate the most objectionable provisions of the bill in order to build a bill with enough moderate support (from Republicans like Senator Susan Collins or Senator Olympia Snowe) to gain 60 votes.
  3. Change the Senate rules (a la the “nuclear option”) to eliminate the filibuster, and steamroll the moderates with a more forceful bill along the lines of the House version.
  4. Start anew and assemble a “bare bones” bill that will include the most important insurance provisions such as portability and no exclusion for pre-existing conditions, and the expansion of community health centers and insurance cooperatives.
  5. Shift his focus entirely and work on higher-priority issues like creating jobs for the 25 million Americans who cannot find full-time work.

At this stage either of the first three alternatives seems rather remote.  With the forces in his own party moving in different directions, it will be very difficult to keep everyone together on a comprehensive bill, or to hive off one of the moderate Republican Senators.

Perhaps the President would do well to heed the advice of Senator Jim Webb (D – VA), who declared on Tuesday night, “It is vital that we restore the respect of the American people in our system of government and in our leaders. To that end, I believe it would only be fair and prudent that we suspend further votes on health care legislation until Senator-elect Brown is seated.”

A cooling off process would give the President and members of Congress time to reflect on the real messages from the Massachusetts election.  In the meantime, they could tackle the more urgent issue of job creation.  By next November’s election, jobs will be the issue that will influence votes. (By some measures, it already is.)  Failing progress on this issue, the Democrats will likely face major losses in the election.

The President needs wins right now.  By assembling a credible package that creates sustainable jobs, Obama could go into the spring with the wind at his back, and greater willingness among the more liberal Democrats for a healthcare bill while they still have a large Senate majority.  A rethought health care proposal that expands access and addresses preventative care and other cost-controlling measures, would likely find a more willing audience at that point. 

It’s surprising just how fast the political winds can shift, but adept politicians learn how to read the signals.  In this environment, Obama cannot afford to face a headwind.