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‘The Passage of Power’ and the Passage of Medicare

Fifty years ago this month, surrounded by thousands of elderly New Yorkers, John F. Kennedy stepped to the front of a crowded stage and began one of the highest-profile moments of his young presidency: a nationally televised stump speech on Medicare.

“We’re all going to be in a hospital, 9 out of 10 of us, before we finally pass away,” Kennedy reminded a packed audience at Madison Square Garden. “This is a campaign to help people meet their [financial] responsibilities.”

Kennedy urged the 20,000 attendees — and the 30 million viewers at home — to support his controversial proposal to fund seniors’ hospital care. He exhorted the nation’s physicians to break with the American Medical Association, which had helped block the bill in Congress. Other administration officials led similar rallies in nearly 50 cities.

It was the culmination of Kennedy’s months-long Medicare campaign.

It failed.

JFK’s Legacy or LBJ’s Triumph?

The road to health reform, from Harry Truman’s misfires to Barack Obama’s own proposals, has been full of potholes. Even the path to the now-beloved Medicare program was long and bumpy, as Kennedy’s fraught experience illustrates.

JFK’s 1962 Medicare defeat — and Lyndon Johnson’s 1965 Medicare victory — are back in the news again this week, thanks to the publication of Robert Caro’s new book, “The Passage of Power.”

Published on Tuesday, the highly anticipated biography traces Johnson’s journey between 1960 and 1964: A titan of Congress reduced to unpopular vice president, stewing in the shadow of “Camelot,” until JFK’s assassination thrust LBJ into the Oval Office, too.

Does the fight for Medicare hold any takeaways for today? The two policy battles are staggeringly different, but here are four lessons from across the years.

Lesson #1: This Has All Happened Before … Sort Of

As many have noted, the mid-1960s Medicare battle laid the seeds, and themes, that would come to define future health reform debates and the Affordable Care Act itself.

By choosing to focus only on health insurance for the aged, Democrats created a piecemeal approach to coverage that left the door ajar for future reforms like CHIP and the ACA. By battling on issues like “personal responsibility” and “government control,” the AMA and other Medicare opponents helped frame the battleground that persists today.

But after the bill was passed, Medicare was greeted with a markedly warmer reception than the ACA. Republicans didn’t mount a concerted campaign against the law, as opposed to today’s partisan rancor, partly because of LBJ’s overwhelming mandate; some GOP legislators had been convinced to vote for the bill, too. Even the AMA, which had weighed a boycott of Medicare, ultimately accepted the law.

Lesson #2: Pursuing Incremental Wins Can Pay Off

Former Obama Chief of Staff Rahm Emanuel was one of the loudest voices urging Obama not to overreach with the ACA. Emanuel often referenced President Clinton’s experiences, but he could have pointed to the Medicare fight, too.

Early supporters of Medicare — trying to overcome accusations of socialism and questions about government funding — worked to narrow the gap by incrementally adding support between the 1950s and 1960s, as Yale University professor Ted Marmor illustrates in his classic book, “The Politics of Medicare.”

One element of this “accretionist” strategy: Frame a contentious issue like government-sponsored health insurance so it becomes difficult to attack. (In Medicare’s case, by appealing to public sympathy for the elderly, rather than trying to win health coverage for all.)

Another element: Steadily build legislative consensus and public support for the program. Target the relevant congressional committee bottlenecks, too.

So while Kennedy was joking when he told reporters that his early Medicare failures were all part of the plan –“it’s an 18-month delivery,” he kidded at a press conference in November 1963 — there was some truth that his Medicare campaign represented a necessary building block.

“After all, the first Medicare proposal was made in 1951 and the first legislation introduced in 1957,” University of North Carolina professor Jonathan Oberlander told California Healthline. “So [it was] a long time between conception and passage” in 1965.

Lesson #3: Medicare’s Structure, Identity Helped Protect It

With the ACA in legal limbo, even some supporters of the law say that Obama mangled the message; specifically that the White House could’ve done a better job of explaining why its health reforms were necessary, or who would most benefit.

But as Oberlander points out, the ACA “lacks Medicare’s programmatic identity,” which makes it harder to articulate a defense. Rather than focus on a single patient population, the ACA offers a bushel of delivery-system reforms in addition to a massive coverage expansion — a complex package that’s tough to summarize in quick sound bites.

Meanwhile, Medicare was fully implemented within a year, helping providers quickly understand that the program wouldn’t devastate their bottom lines. For example, “the worst fears that Medicare patients would crowd [hospitals] beyond their capacity were nowhere realized” in 1966, Marmor writes. (Instead, the most serious problems were on the government’s side, which had failed to specify exact payment for procedures; as a result, many doctors and hospitals began inflating their fees.)

In contrast, ACA’s staggered implementation leaves it more exposed to legal challenges and fearmongering.

Lesson #4: Many Analysts Draw the Wrong Lessons

As LBJ’s legacy builds — especially with another heavily publicized biography — credit for Medicare increasingly accrues only to Johnson, and perhaps incorrectly.

Writing in JAMA in 2008, James Morone and David Blumenthal suggest that LBJ essentially fast-tracked Medicare through Congress and into law. Johnson was “brilliant at maneuvering Medicare … [he] managed to make it happen,” Morone gushed to NPR in 2009.

But that’s not actually what happened. As Maggie Mahar observes, “Johnson inherited a Medicare campaign that was not dead, only dormant” — the incremental approach had essentially teed up the law for passage. “Even before the election of 1964 … it was becoming clear that Medicare was an idea whose time had come,” Peter Corning writes in The Evolution of Medicare.

And the legislative picture in the mid-1960s was significantly different, too. After the 1964 election, LBJ enjoyed enormous congressional majorities that quickly put Medicare over the top. For comparison’s sake, “if Obama had those majorities in 2010, the ACA passes much easier than it did,” according to Oberlander.

National Roundup

“Road to Reform” is eagerly awaiting Robert Caro’s next book on Johnson, which promises an exhaustive look at LBJ’s Medicare fight … and which won’t be published for several more years. In the meantime, here’s what else is happening around the nation.

Administration Actions

  • On Tuesday, CMS suspended an incentive payment program for insurance agents and brokers who directed clients to the temporary high-risk insurance pools under the federal health reform law’s Pre-Existing Condition Insurance Plan. The program was established to help boost participation in the PCIP program. One likely concern was that coverage costs for PCIP participants are higher than expected (Bristol, CQ HealthBeat, 4/30).

Effects on Employers

  • More than a dozen of the companies on the President’s Council on Jobs and Competitiveness — which a new House GOP staff report cited as potentially facing higher health care costs because of the federal health reform law — received more than $150 million though the overhaul’s Early Retiree Reinsurance Program. ERRP was to help cover health costs for retirees older than age 55 who do not yet qualify for Medicare. The law allocated $5 billion to ERRP through 2014, but HHS ended the program in 2011 because overwhelming demand from employers depleted its funds (Baker, “Healthwatch,” The Hill, 4/27).

Eye on the Courts

  • As observers and stakeholders wait for the U.S. Supreme Court‘s decision on the federal health reform law, rumors and speculation are circulating on the justices’ ruling. Some observers also have begun wagering on the outcome. Meanwhile, the media has been receiving tips from potential sources who claim they have information regarding the outcome of the case or when the decision will be revealed. However, experienced lawyers say that no one can accurately predict what the justices will decide (Biskupic, Reuters, 4/26).

Inside the Industry

On the Hill

  • During a House Ways and Means Subcommittee on Oversight hearing last week, Republicans and Democrats argued over a provision in the federal health reform law that prohibits U.S. residents from using health saving accounts to purchase over-the-counter medications tax free. The provision — which is expected to save the federal government an estimated $5 billion over the next decade — took effect Jan 1, 2011. The hearing featured testimony from five stakeholders, with most favoring repealing the provision (Attias, CQ HealthBeat, 4/25).

Rolling Out Reform

  • On Monday, CMS released new data showing that Medicare beneficiaries in the first quarter of 2012 spent an average of $837 less on prescription drugs because of the federal health reform law. In total, beneficiaries have spent $3.4 billion less on prescription drugs since the overhaul was enacted in March 2010 (Baker, “Healthwatch,” The Hill, 4/30). The law seeks to gradually close a coverage gap — known as the “doughnut hole” — by providing beneficiaries with rebates and discounts until 2020 (Winfield Cunningham, Washington Times, 4/30).

Related Topics

Medicare Road to Reform The Health Law