On the Frontlines of the Healthcare Reform Battle

Over the past week, the Obama administration has continued its tireless and tenacious campaign to persuade politicians, business leaders and the American public that healthcare reform is vital to the nation’s stability and security. Citing this ambitious initiative as a “moral imperative” in his speech before a joint session of Congress last week, President Barack Obama clearly outlined planks of the $900 billion, 10-year plan, including health insurance mandates for employers and individuals; subsidies to make coverage affordable for the uninsured and poverty-stricken; and a financing proposal in which he says deficit spending would be avoided through payments by private insurers and more efficient management of government services. Moreover, he has undertaken a whirlwind schedule to sell the plan: meeting with cabinet members; holding discussions with congressional leaders; traveling to town hall sessions; and reinforcing his message with millions as part of the weekly radio/Internet address.

Although Obama asserted that “the time for bickering is over,” his speech has done little to quell the contentiousness of the healthcare debate thus far. When he maintained in his address that his plan would not provide free coverage to illegal immigrants, the statement was met by an outburst from Rep. Joe Wilson (R-South Carolina): “You lie!” (Wilson apologized for his eruption and was subsequently reprimanded by the House.) And on Saturday, tens of thousands gathered on Capitol Hill as part of the Tea Party Express rally to protest big government and programs like healthcare reform.

As this political firestorm rages, Health and Human Services Secretary Kathleen Sebelius has been charged as one of the administration officials to carry Obama’s message and marshal forces on the frontlines of healthcare reform. With oversight of 11 agencies and a budget of $879 billion, Sebelius, 61, deals with issues ranging from management of healthcare services across the country to containment of such pandemics as the H1N1 virus, better known as the “Swine Flu.” Her job has gained more urgency with the recent release of the U.S. Census Bureau’s report on income, poverty and health insurance. The survey revealed that the recession has pushed an additional 2.6 million people into poverty — the nation’s poverty rate rose from 12.5% in 2007 to 13.2% in 2008, the highest level in 11 years — and expanded the number of individuals without private health insurance from $45.7 million in 2007 to $46.3 million in 2008. In part one of a two-part interview, Sebelius talked with Black Enterprise Editor-In-Chief Derek T. Dingle about the political battle over healthcare reform.

Black Enterprise: In his recent speech, the president said that healthcare reform is a moral imperative. Having made that assertion, what areas of healthcare legislation are open to negotiation and what’s nonnegotiable?
Kathleen Sebelius: I think the details

of a lot of the legislation are probably negotiable. But the principles around which the legislation will be written are nonnegotiable. I think the president believes strongly that we need to aim for available, affordable insurance for all Americans. So a fraction of the population being insured won’t really cut it as far as he’s concerned. Costs need to come down so we need to have a program which really focuses on higher quality, lower cost, and right now that’s available in some places but not every place. I think changing the rules, once and for all, so insurance companies no longer get to pick and choose who gets coverage and who doesn’t or drop people when they get sick or refuse to reinsure someone who has a pre-existing condition; that is non-negotiable. And I think at the end of the day the notion that we won’t add to the deficit and that the program needs to be paid for is nonnegotiable.

The president said healthcare reform would cost $900 billion over 10 years. There have been some estimates from others that it will cost more than $1 trillion. How do you pay for this program? How do you create efficiencies in the system? How do you get more money from the insurance companies?
Well, about $600 billion has been identified by the president actually in the budget this year that he

put forward in sort of a reserve fund that is money we’re currently spending in the system. So two-thirds of that $900 billion is money that’s spent right now and paying for things that don’t really add to the health or well-being of Americans. Cut out [federal] subsidies for private insurers who want to compete with Medicare and currently are being paid more money than the fee for service but aren’t delivering more benefits. Lowering the overall cost of prescription drugs for Medicare beneficiaries to the tune of about $100 billion is part of this. Competitive bidding for durable medical equipment and some of the prescription prices will lower costs. And then the president is open to having a tax on the insurance companies who sell Cadillac plans, plans worth more than $25,000 or $30,000 which again discourages those plans and brings in some revenue.

The administration wants to create a competitive exchange, and one aspect of that proposal is a public health plan. If it would serve as a powerful tool to lower insurers’ rates then why would that be an optional aspect of the plan?
I’m not sure it’s optional in terms of having some competitors to private insurers or some target that they have to meet in terms of keeping costs down. The president has said pretty much from the beginning that the goal is choice for

consumers. He believes strongly that competition holds down costs so there needs to be some kind of competitive strategy in this new marketplace. As for a public option, there’s some members of Congress who think you can do the same thing with a not-for-profit co-op. You have others who are suggesting a trigger so if insurance companies don’t have affordable plans you kick in a public option. But I think there will be definitely a mechanism for lower costs, competition and choice.

Public option, co-op, trigger. Which do you favor?
Well I think the public option is the best idea that I’ve seen to get to those principles. But when the Senate Finance Committee comes out with its specific draft and they have a co-op that’s robust and can provide that kind of competitive option, it may work just as well. But I don’t rely on the private insurance companies to just, on their own, lower costs for Americans.

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Further Reading
— Obama Outlines Healthcare Goals Before Congress

— How Healthcare Reform Affects You

— Finding Compromise in a Tough Healthcare Reform Debate

Resources

— www.healthreform.gov

— Senate Finance Committee Proposal

— Republican Reform Plan

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In part two, Black Enterprise and Health and Human Services Secretary Kathleen Sebelius discuss how reform would affect small business and healthcare disparities in African American communities.