THE MANAGED care bill the House passed Thursday likely would have less effect on the quality and cost of health care than either side in the heated debate suggested. The measure would place some restraints on how far managed care companies can go in pursuit of lower costs. Our sense is that most of the provisions would increase confidence in the quality of care if not the quality itself, but that the broadened right to sue in the bill could affect the willingness of employers who provide most insurance in this country to continue to face the cost. The goal in conference with the Senate should be to preserve the first of these effects while minimizing the second, lest insurance become even less accessible.
But the conference will be flinty ground. The Senate Republican leadership, hearkening to the arguments of business groups and the insurance industry, opposes heightened regulation of managed care; it wants only token legislation of the sort it convoyed through the Senate earlier this year. House Republican leaders are likewise resistant, and though they lost on Thursday, they managed to complicate the outcome by adding to the managed care bill a series of tax breaks mainly for the better-off and already insured. The worst of these would help healthy people who could afford the risk opt out of the broader insurance pool, thereby increasing rates for the sicker and less well-off left behind. The president rightly called them poison pills in that they could lead otherwise supportive Democrats to oppose the bill; they ought to be dropped.
The opposition to the underlying bill rests as much on the direction in which it points as on the particular steps it takes. The regulation of private health insurance used to be a state preserve. Congress only recently entered it in earnest as a way of acting on health care without engaging in a full restructuring, such as cost the Democrats so dearly in 1994. Regulation is a politically pleasant exercise, in that it lets the members -- and president -- say yes to care without having to pay the cost. But cost is the great rationer of health care in this country, the principal reason a sixth of the population now lacks health insurance. And managed care, like it or not, is the principal device in the society for containing cost. The need is to keep the managed care companies and those who employ them from overreaching while leaving them with the ability, where justified, to say no. We would try a strong appeals system before exposing still more of the practice of medicine to the crapshoot of the courts, as the bill's mostly Democratic sponsors would too blithely do.
The House Republican leadership could have adopted and fought for such a position -- meaningful regulation without resort to the courts -- from the outset, and perhaps prevailed. Instead, the leaders began by trying to pass a porous bill that sounded strong but would have done very little. They misread the strength and merits of the issue even within their own caucus and lost the opportunity to make serious policy. The tax breaks they reflexively offer instead, in the name of increasing access to care, mock the problem they purport to solve. They would do far less to reduce the number of uninsured than to defray the costs of those already comfortably covered. The affordability of health care is in fact the basic problem, to which the subject always returns. Solving it will cost real money -- a greater redistribution of resources than either party is prepared to discuss at the moment. They argue instead at the margin of the issue. That's where this managed care bill is.