How health industry helped pass reform

John Dimsdale Mar 22, 2010

How health industry helped pass reform

John Dimsdale Mar 22, 2010


Kai Ryssdal: It’s the 22nd of March today, which makes it by my count day 200-some odd of the great American health care debate. Just one day after the House passed what has to be called historic health reform, we got an indication of what the health care industry thinks of it: They like it a whole bunch. A lot of health care company shares took off today.

Part of that is just relief over uncertainty going away. But investors and traders apparently think the legislation, which the president by the way is scheduled to sign tomorrow, will be good for the business of health care. Funnily enough, that’s just what health care companies had in mind way back at the beginning of the debate last spring, when they decided to take a seat at the negotiating table.

Our Washington bureau chief John Dimsdale reports.

JOHN DIMSDALE: President Bill Clinton’s effort to reform health care was met by a wall of business opposition. And it failed. Oh what a difference 15 years can make.

Judy Feder, who was a senior health adviser to the Clinton administration, says President Obama’s reform got a jumpstart from health care providers themselves.

JUDY FEDER: The Obama administration benefited from the fact that the industry came to them and were willing to talk and that was not the case 15 years ago.

This time, reform advocates include doctors, hospitals and even insurance companies that will gain 20 to 30 million new paying customers. Pharmaceutical makers will also benefit from longer patents for brand-name drugs.

Uwe Reinhardt is a health economist at Princeton.

UWE REINHARDT: The cold calculus on the people who used to oppose it for income reasons, their calculus now is for income reasons they should support it.

And while many business groups opposed reform’s tax increases and government intrusions, lots of companies were looking for relief from insurance premiums that Reinhardt says have doubled since the Clinton reform effort.

REINHARDT: The level of financial desperation in the business community had reached levels that it hadn’t in the 1990s.

That means U.S. businesses are feeling the competitive pressure, no matter what their size, says John Arensmeyer with the Small Business Majority.

JOHN ARENSMEYER: There was a realization that we really had to do something about this. And there were a large number of small businesses and large businesses that pulled together to say we’ve gotta fix this system.

The lesson to be learned from the decades-long struggle for health care reform, says Professor Reinhardt, is if businesses don’t see their self-interest, they’ll fight you all the way.

In Washington, I’m John Dimsdale for Marketplace.

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