State of the Union Unlikely to Reform Health Care

From the WebMD Archives

Jan. 26, 2000 (Washington) -- There is certain to be some drama as President Clinton stands before Congress and the nation to deliver his final State of the Union Address Thursday night. However, the revelations that emerge from the speech aren't likely to have a substantial effect on the direction of the country's major health problems, at least according to insiders familiar with the issues and the way this White House Administration has approached them.

It seems clear that things like a prescription drug benefit for Medicare, Medicare's long-term financial health, expanding insurance to the uninsured, and the pending patient bill of rights legislation will find their way into Clinton's remarks. However, certain other items will be conspicuous for their absence -- for instance, a reprise of his flamboyant gesture to veto any legislation not guaranteeing universal coverage. The White House abandoned all plans to remake the American health care system when Congress rejected the reforms proposed by Bill and Hillary Clinton in 1994.


Instead, it appears that a possible deal between the White House and the pharmaceutical industry over the issue of a Medicare prescription drug benefit will be near the top of the President's health care agenda. The question is, how far has the President gone to allay industry concerns about his relatively modest proposal of last summer?

"The problem is that the industry doesn't trust Medicare as a system, and I don't blame them because everything that Medicare pays for, essentially, eventually becomes ... enveloped in a web of price controls," Robert Calfee, PhD, tells WebMD. Calfee, who is a resident scholar at the American Enterprise Institute, says the greatest bit of suspense in the State of the Union, at least when it comes to health care, will be on this issue, and whether Clinton chooses to attack the drug makers as profiteers or hold out an olive branch.

The industry has already expressed support for a plan backed by a majority of the National Bipartisan Commission on Medicare, which emphasizes marketplace competition and would only cover those with the lowest incomes -- an approach rejected by liberal Democrats.


Another big question is how much emphasis Clinton will place on Medicare reform in general. The federal insurance program has already grown to 39 million beneficiaries, most of them elderly. Unless major changes are made to keep the program solvent, Medicare could go broke by 2015 as baby boomers begin to swamp the system.

Peter Budetti, MD, a former White House and congressional advisor on health policy, believes Clinton will focus on the here and now. "My guess is that he will say something about the need to do something about stabilizing Medicare for the long term, and I'd be flabbergasted if he puts forth any details," Budetti tells WebMD.

However, Budetti says that the pharmaceutical industry and the White House may be inching toward compromise over prescription drugs. "The bottom line will be, [a prescription drug proposal] will be so replete with bones to the industry that they'll actually be extremely well off with it," says Budetti.

It's all but certain that Clinton will make a push for a tough patient bill of rights like the one passed by the House last fall. The measure is in a conference committee now, where members are trying to reconcile it with a much weaker Senate version that doesn't allow patients to sue the HMOs.


"I think both Medicare and the bill of rights are potentially doable, because I think there is bipartisan support," but election year politics could get in the way, Marilyn Moon, PhD, health economist for the Urban Institute, tells WebMD.

Other items likely to see the light during the president's speech are his recently unveiled $110 billion, 10-year initiative to add insurance coverage for another 5 million Americans and, the White House says, expand access to many more by offering another option for families and children under existing state and federal programs. The program would also allow those aged 55-65 to buy into Medicare with the help of a tax credit and help individuals maintain their insurance while changing jobs.

Another Administration proposal would triple the credit for long-term care to $3,000 as part of a major initiative to care for the elderly. The president also wants to beef up the research budget at the National Institutes of Health by another billion dollars.


When the applause from the speech dies down, will Bill Clinton be remembered as a health care president? For some incremental reforms like improving children's insurance, yes, says Peter Budetti, but not for the big issues. "[The Clintons] get the lowest possible failing grade on comprehensive health reform -- no credit for effort, the effort was ridiculous," says Budetti.


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