It's health care, stupid! - health care as the central issue in the 1998 elections

Healthcare Financial Management, August, 1998 by Jeanne Schulte Scott

"It's the economy, stupid!"

- Clinton campaign adviser James Carville, during the 1992 elections, noting that when the economy is good, people vote for incumbents.

"[T]he feeling is unmistakable that this is one of those issues that plays better to the instincts of the Democrats and their Painfeeler-in-Chief."

- Doug Bailey, a political analyst for the National Journal, commenting on healthcare reform as a rising issue in the 1998 congressional elections.

About this time in 1992, during the Clinton-Bush presidential race, James Carville's media-friendly phrase about the economy caught fire. When the economy is bad, politics knows no other issues. When the economy is good, it is hard to get the public to vote the "ins" out. Labeling the economy "bad," Bill Clinton went on to defeat an incumbent president who, only a few months before, had led in the polls by double-digits. Sic semper mundo politicalis.

Today, the U.S. economy is booming. The Dow-Jones industrial average is breaking record highs. Twenty million new jobs have been created since 1994, and unemployment, which is averaging less than 5 percent, is at an all-time low for the century. Incumbents should be shoo-ins, right?

Behind these figures, however, lurk some signs of foreboding for the nation and its politicians. Most, if not all, of the newly created jobs are in the service sector and come without employment-based health benefits. As welfare reform has moved people off the public dole, many of these people have lost Medicaid benefits. There are more people without healthcare coverage today (an estimated 45 million) than there were in 1992 (an estimated 38 million).(a)

The issue of 1994 that received a resounding defeat - healthcare reform - may yet come back to haunt the public and incumbents - especially Republican incumbents. In addition to their concern about the growing problem of uninsured Americans, a grumpy electorate also is frustrated by the lack of choices and seemingly endless bureaucracy that accompany managed care.

Nor are healthcare costs under control. While not yet back to the double-digit increases of the late 1980s and early 1990s, healthcare costs increased by double the general inflation rate in 1997 (3.8 percent for health care versus 1.9 percent for the overall consumer price index).(b) These increases are hitting the pocketbooks of American voters, who are seeing their share of healthcare costs increasing and their benefits, in many cases, decreasing.

Politicians often are the first to sense the mood of the country. During the 1994 elections, Republicans successfully framed the issues with their "Contract with America" and won a decisive victory. Democrats, initially stunned by their defeat, reacted swiftly. By focusing on their traditional voters, relying on the strength of the economy, and adopting a mantra of "Medicare, Medicaid, education, and the environment," the Democrats took the initiative in framing the issues in the years following their defeat. The "Contract with America" came to be viewed in some circles as a "Contract on America." In 1996, the Democrats reelected the president, despite his well-publicized personal problems, and narrowly lost an opportunity to regain control of the House of Representatives.

Political pundits, some of whom credit President Clinton's first victory in 1992 to three things, "Medicare, Medicare, and Medicare," suggest that health care is THE issue of 1998. As we move toward Election '98, early signs are that the Democrats, by continuing their focus on the bread-and-butter healthcare issue, have gained the initiative on the issue on which the electorate will vote.

A couple of Republican congressmen - both healthcare professionals themselves - from the freshman class of '94 that swept the Democrats from power are leading the way in trying to salvage a leadership role for the GOP on health care. Rep. Charles Norwood (R-Ga.), a dentist, is author of the Patient Access to Responsible Care Act (PARCA), which would permit consumers free choice of physicians by requiring their HMOs to accept "any willing provider" into their systems and the ability to sue their HMOs for malpractice. Rep. Greg Ganske (R-Iowa), a physician, is both a cosponsor of PARCA and a cosponsor of the Consumer Bill of Rights and Responsibilities, which provides for a wide variety of managed care reforms.

But despite these actions and the repeated warnings of their own pollsters, the Republican congressional leadership has been dragging its heels on health care. Whether this recalcitrance proves fatal to Republican hopes for the '98 elections may depend on how well both parties can present tobacco regulation as a health, rather than a taxation, issue, and whether Norwood, Ganske, and other similarly minded Republicans can move the GOP into a position where it is not seen as part of the "HMO problem," but rather as part of the solution. The issue of regulating managed care has all the signs of being a deciding issue in these elections.