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Obama Heads into the AMA Lion’s Den


When President Obama went into the lion’s den of the American Medical Association today, he carried in some red meat: He said he would side with doctors, rather than with the trial lawyers that support his party, by advocating malpractice reform, a hot-button issue with physicians whose premiums can soar to six figures.

Mr. Obama is trying in public appearances to build support for his increasingly problematic health-reform plan, and his advisors see addressing medical liability as a “credibility builder” that might keep doctors in the game.

But the promise is hollow because lawyers simply have too much sway with Democrats. Mr.Obama backed down before he left the AMA podium, saying he would not support a cap on punitive damages — the very policy that has dramatically reduced premiums in Texas and other states. 

And the promise also is not likely to counteract doctors’ fears about the juggernaut of a new government-health plan that many fear would dramatically cut into their earnings and even their ability to keep their office doors open. 

In his speech, Mr. Obama brushed aside fears that a public plan could be a gateway toward a single-payer system.

“What are not legitimate concerns are those being put forward claiming a public option is somehow a Trojan horse for a single-payer system,” he said. “I’ll be honest. There are countries where a single-payer system may be working. But I believe — and I’ve even taken some flak from members of my own party for this belief — that it is important for us to build on our traditions here in the United States. So, when you hear the naysayers claim that I’m trying to bring about government-run health care, know this — they are not telling the truth.”

But the evidence simply contracts his claim. Countless economists and other experts have shown that there is no way the government can be a fair player if a public plan were created. The Lewin Group showed that nearly 120 million Americans would lose their private health insurance if the public plan were made available and paid doctors at Medicare rates. 

The American Medical Association put out a statement last week that said: “The introduction of a new public plan threatens to restrict patient choice by driving out private insurers, which currently provide coverage for nearly 70 percent of Americans.” Medicare generally pays doctors and hospitals at least 15 percent less than their costs of providing care. 

The AMA later backed down some from its strong-arm rejection, no doubt following White House pressure. In “clarifying” its earlier statement, it said, “The AMA opposes any public plan that forces physicians to participate, expands the fiscally challenged Medicare program or pays Medicare rates, but the AMA is willing to consider other variations of a public plan that are currently under discussion in Congress.” 

Reports says the AMA’s retraction of its perceived opposition to a public-insurance option did not sit well with many of its members. While members were generally polite to the president during his speech, the public plan was the hot topic in the hallways and meeting rooms after he left. 

Members of Congress are trying to find ways to make the public plan palatable. The Senate Finance Committee plans to present its health-reform bill this week, and it is expected to include a revised public plan in the form of government-organized insurance “co-operatives.”

Finance chairman Max Baucus is trying to appease moderates with the idea. “It’s got to be written in a way that accomplishes the objective of the public option, even though it itself is not public,” he said in a revealing moment.   

The idea is also designed to appease conservative Democrats. They want to make sure that Medicare payment rates are not used as the basis for reimbursement, that the plan is self-sustaining and does not rely on taxpayer dollars, and that it would have to follow the same rules and regulations as the private plans, including establishing a reserve fund. Should subsidies be provided for the purchase of health insurance, they must be available for the purchase of public and private plans equally.

Why, then, would we need a public plan if it is required to follow exactly the same rules as private plans? Many believe that the co-op idea is simply anther Trojan Horse that would quickly morph into a new government entitlement in the hands of Obama administration regulation writers. 

Mr. Obama also has trouble with the Left. New York senator Charles Schumer insists that the co-op must meet certain conditions. “It has to have a significant infusion of federal dollars right from the start, so it has the clout to compete against the insurance companies.”  

House Speaker Nancy Pelosi said House Democrats strongly want a government-run insurance plan to be part of any health-care overhaul and called for a “level playing field” for public and private health-care providers. (See above comment by Schumer. How can it be a level playing field when there is a “significant infusion of federal dollars right from the start”?)

Congress makes these laws and it can change them at will. It’s absolutely vital to be careful and deliberative with this legislation because it will have consequences for millions of Americans for decades to come. Hasty action to rush these bills through this summer could lead to catastrophic mistakes.

— Grace-Marie Turner is president of the Galen Institute


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