“The specter of repeal is going to be around for a while”

The health reform bill hasn't yet become law and Reed Abelsen wonders about the likely effort to repeal it:

Sometimes it ain’t over even when it’s over ...

Few people outside health policy circles may recall it, but two decades ago, after Congress congratulated itself on the passage of another health care bill, a public uproar forced its repeal a mere 16 months later.

That legislation was the Medicare Catastrophic Coverage Act, which President Ronald Reagan signed into law in July 1988. The law’s intent was to give better financial protection to people enrolled in Medicare by limiting their out-of-pocket payments for things like hospital stays and doctors’ fees if they became very sick.

But this was not a free new entitlement, as Medicare beneficiaries were quick to realize. The new benefits would be financed by higher monthly premiums for Medicare enrollees and by a surtax paid by the more affluent enrollees.

What is more, many of the people being asked to pay more did not need the expanded coverage because they already had it through supplemental policies from their former employers. (That was back when companies tended to be more generous with health benefits for retirees.)

“It was a revolt of middle-class old people,” said Elaine Kamarck, a former adviser to Vice President Al Gore who is now a policy expert at the Kennedy School of Government at Harvard. If you were well enough off, she said, “you were getting a benefit you already had and suddenly your premiums were going up.”

The response was swift and ugly. And for a politician, it was a stark lesson in the perils of misreading your constituents. Dan Rostenkowski, a former Democratic congressman from Illinois who was chairman of the House Ways and Means Committee at the time, went home to Chicago — only to find himself surrounded by angry elderly voters protesting the new law. Mr. Rostenkowski, as documented by CBS News, was forced to beat a hasty retreat during one run-in.

Ms. Kamarck considers the entire episode a warning that any sweeping legislation affecting an area as critical as health care can have significant unintended consequences. In the case of the 1988 bill, Congress “didn’t get the consequences right,” she said, despite the legendary prowess of Mr. Rostenkowski. “You had a very skilled politician,” she said, “and it blew up in his face.”

The intensity of the response over the higher premiums persuaded members of Congress to scrap the legislation when they could find no other way to pay for the expanded coverage.

Some health policy experts see parallels to what is going on now in Washington. Because the current health care legislation is complex, with changes yet to come when the House and the Senate meld their bills, many members of the public may have a hard time seeing what is in it for them. But they may not have much trouble grasping the reality of higher insurance premiums or scaled-back Medicare benefits, if those are in the cards.

“What is similar is a lack of understanding,” said Jon Gabel, a health researcher who helped write a post-mortem of the repealed bill for the journal Health Affairs in 1990.

Another similarity, Mr. Gabel said, is in the built-in delay between the legislation’s passage and its effective date.

People were being asked to start paying the higher premiums and taxes before the benefits would be delivered, he said, just as many important aspects of the current legislation, like the creation of new insurance exchanges, would not begin until years after President Obama signed it.

Such delay is “a political risk,” agreed Timothy S. Jost, a law professor at Washington and Lee University who has been closely following the proposals as they move through Congress. He said the legislation might not deliver soon enough to adequately discourage possible repeal, especially given the highly divisive debate around issues like a government-run insurance plan and coverage for abortion.

But Mr. Gabel predicted that enough benefits from the legislation would kick in soon enough — like the ability of people in their 20s to stay on their parents’ policies and the creation of high-risk pools so more people can find insurance — that their popularity would encourage public support for the whole package.

Lessons Learned

Some veterans of the late 1980s experience say its lessons have been well learned by members of Congress and proponents of the legislation, including the need to educate the public about the benefits of the new law.

“I don’t think history will repeat itself,” said John Rother, executive vice president of policy and strategy for AARP, the influential lobbying group for older Americans, many of whom are enrolled in the Medicare program.

He said members of Congress voting for the legislation would be acutely aware of the need to sell it back home, if it is passed. Mr. Rother also pointed to several clear benefits for individuals currently enrolled in Medicare, like more generous prescription drug coverage through a provision that would close the so-called doughnut hole, a gap in Medicare drug coverage that can mean beneficiaries pay thousands of dollars for drugs each year.

The support of groups like AARP is also a critical difference, said Thomas Rice, a health policy expert at the University of California, Los Angeles, who is also one of the authors of the 1990 Health Affairs piece. What is more, Mr. Rice said it was extremely unlikely that Congress could come up with enough votes to override an almost-certain veto by Mr. Obama of any attempt to repeal the law.

Back in 1989, President George Bush allowed the repeal to go through, despite his support of the law when he was vice president. As long as there is a Democrat in the White House, Mr. Rice said, any law that passes is likely to stand.

But Mr. Rice, for one, did not discount the perseverance of the Republican opposition, which could turn all of the energy now being expended to block the passage of a health bill into efforts to overturn it if it passed.

“The specter of repeal is going to be around for a while,” he said.