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John McDonough on health care's milestone

BY: Michael Jonas
Photographs By: Mark Ostow

John McDonough helped bring guaranteed insurance coverage to all Massachusetts children in the 1990s as House chairman of the Legislature’s health care committee. As director of the advocacy group Health Care for All, he played a key role in the 2006 Massachusetts health reform law that has brought coverage to nearly all state residents.

In early 2008, he was recruited to Washington by Ted Kennedy, who wanted McDonough’s expertise as the Senate Health, Education, Labor and Pensions Committee that he chaired prepared to make a push for national health care reform. Soon after, Kennedy was diagnosed with a terminal brain tumor. But his staff soldiered on, working throughout his illness and after his death last August on the issue Kennedy called the “cause of my life.”

With Republican Scott Brown’s election in January to fill Kennedy’s seat, many pronounced the health reform effort dead. McDonough remained hopeful that a bill would pass. With Sunday’s vote in the House of Representatives, followed by Tuesday’s White House bill-signing by President Obama, his optimism was rewarded.

McDonough, who left his post as senior aide to the Senate committee last month, is now a public policy fellow at Hunter College in New York. CommonWealth executive editor Michael Jonas spoke with him by phone from New York on the morning after the bill-signing.

Jonas: At yesterday’s bill-signing, Joe Biden called the bill a big deal, with a salty adjective added for emphasis. Agree?

'This is the kind of thing that happens less than once in a generation.' McDonough: This is the kind of thing that happens less than once in a generation. It seems like it’s every other generation or every third generation. If you think of Social Security, 1935, Medicare, 1965, 30 years later, and then this, 45 years later. It’s hard to underestimate the importance of it.

Jonas: Working on the health committee chaired by Ted Kennedy, you were in the thick of the work to craft the Senate bill that passed late last year. The prospects for getting a bill passed seemed to plummet in January with Scott Brown’s election to Kennedy’s seat. Some Republicans gleefully pronounced the health reform bill dead. What was your assessment following Brown’s election? Some have said the bill rose Lazarus-like from the dead?

McDonough: The first thing is, my outlook is informed by being centrally involved in the 1988 Dukakis universal health care effort, the 1996 health reform fight in Massachusetts when I was chairman of the health care committee, the 2006 Massachusetts health reform effort, as well as very closely watching the 1993-1994 Clinton health care fiasco. One consistent thing in all those is that they all took so much more time than anyone imagined was possible. Second, to anyone involved, it always felt like a bus careening down a mountain with no guardrail, with the possibility of failing off the cliff at any moment a constant reality. So the reality is the ups and downs and the treacherous paths and times when it feels like it’s all over is actually all par for the course with major health reform efforts. And some do fall off the cliff.

I was still working in the US Senate when the Massachusetts [special Senate] election happened. I rejected the notion that the Brown vote was a vote around health reform. Martha Coakley turned out not to be ready for the white heat of a hotly contested statewide election. And Scott Brown turned out be a much better candidate than people gave him credit for at the start of the race. We had a state and national Democratic Party infrastructure that seemed to be asleep at the wheel. We had a lot of anger at Beacon Hill. Because people are always made when the economy is doing badly. And you had a tax increase and stories about corruption. Then you had "tea partiers" throwing gas on the fire. But over half of Scott Brown voters supported national health reform, and, when asked, Brown said he supported the Massachusetts plan. He just didn’t think we should pay for the rest of the country. Of course, the rest of the country is paying for Massachusetts.

I also looked at the people who were centrally involved in making this happen. I looked at Nancy Pelosi, George Miller, Chris Dodd, Harry Reid, Charlie Rangel, Max Baucus, Steny Hoyer, Tom Harkin, Henry Waxman. These people collectively have something like 200 years of legislative experience. This was a once-in-a-lifetime opportunity that, while it required some redirecting and re-strategizing, simply could not be laid aside. I had a lot of faith and confidence in those people going into the process, and throughout this two-year process, my esteem for them has only grown. They all experienced the 1993-1994 health care catastrophe and had searing memories of that. They all knew that if they failed, their failure would be on the top of the legacy they leave behind.

Emboldened Democrats

Jonas: You told the Boston Globe last month: “No Democrat is going to get rewarded by an opponent for not passing the health care bill.” Do you think that figured in the thinking in the House and helped embolden some wavering Democrats?

McDonough: I think it emboldened a host of Democrats. Everybody, when they see something they don’t like, they assume there are crass interests behind it. When they see something they like, they assume it’s all public-spirited. It’s always a mix of the two. In the case of health care reform, most Democrats believed it was the right thing to do and, ultimately, they believed their political well-being was better off with something passing rather than not passing.

Jonas: There has been a lot of talk about the 2006 Massachusetts law serving as the model for the federal legislation. How important was our law to the federal effort?

'It is hard to imagine how this ever would have happened had Massachusetts not done its reform.' McDonough: It is hard to imagine how this ever would have happened had Massachusetts not done its reform. The new federal law, in terms of the coverage parts of it, is Massachusetts writ national. That’s just what it is. There obviously are differences, but the conceptual structure is identical, the three legs of the stool: deep, systemic insurance market reform, including eliminating denial of coverage because of pre-existing conditions. If you do that you have to have an individual mandate, and if you have a mandate, you have to have deep subsidies to make the insurance affordable.

Jonas: The 2006 Massachusetts law was a big moment for Mitt Romney. Yet he and fellow Republicans, including Scott Brown, who voted for the law as a state senator, now seem to want nothing to do with it — or certainly want nothing to do with the idea that the federal law is largely modeled after it.

McDonough: Romney has a whole chapter in his book on health care reform, and half to two-thirds of it is about Massachusetts. He creates some really thin distinctions between the federal law and the Massachusetts reform law. Some people think that unless health care reform fades [as an issue], this is major, major problem for him in 2012 [in seeking the Republican presidential nomination]. And it’s an irony, because he did the right thing, and he thought in 2006 that health care reform was going to be his ticket to national political success.

Jonas: Opponents have described the bill as a federal takeover of health care. Yet I’ve read that even apart from its similarities to the Romney-backed Massachusetts law, the federal bill has a lot of features that have been part of longstanding Republican visions of health care reform. Where would you place the bill on the continuum of health care reform ideas?

McDonough: The broad 75-year view of health reform, to this point, is that Democrats seeking comprehensive national reform have finally moved sufficiently to the center to get something done. Truman was the most far left. LBJ was not as far left, but essentially he was Truman but just for seniors and poor people and the disabled. Richard Nixon was to the right of Truman and LBJ. Clinton was to the right of Truman, LBJ, and Nixon. And Obama is the right of all of those. This has been a 70-year march away from a Canadian style, single-payer system — starting even before there was a Canadian system — to the center.'This has been a 70-year march away from a Canadian style, single-payer system — starting even before there was a Canadian system — to the center.'

Jonas: What are the biggest challenges with the law going forward?

McDonough: This is going to be one of the most difficult, complex, and controversial implementation processes of any law since, I‘d say, the civil rights law in the 1960s. You’re going to have legal challenges in courts that are already in motion. I’m not seriously worried about them, but they’ll get a lot of attention and be a distraction. You’ve got an exchange law that will require 49 states — not Massachusetts — to do a major overhaul of their insurance laws and set up an exchange. I think some states are not going to do it. In some states where they say, “hell no, we won’t go,” you will have a de facto federal takeover of their health care. There will be an immense challenge in writing the regulations, and [the US Department of Health and Human Services] has lost a lot of its talent over the past five to 10 years.

And then there’s this new federal oversight of insurance premium increases, which is not going to be easy or neat. And there’s a downside to it. When WellPoint [insurance] comes in and wants a 39 percent rate increase and regulators chop it to 20 percent, insurers will be mad. And consumers won’t be happy, either, because they’re hit with a 20 percent rate increase.

Jonas: What parts of the law give you pause or do you have the biggest reservations about?

McDonough: The thing I was most worried about in the process was the affordability of the subsidies. This was somewhat improved in the sidecar fixes now being worked on. There are also some concerns about whether the individual mandate penalties will be sufficient to make sure people come forward and buy coverage, but there is time to address this.

Learning from failure

Jonas: You’re a student of politics as well as policy. What sort of political lessons are there to draw from the effort? And what do you make of the Republicans’ political strategizing?

McDonough: It seems to me that the Democrats, at the start of this process, seriously attempted to think through — and I participated in a lot of these conversations — what went wrong in '93-'94 and what are the key lessons to be learned. And they acted on them. Nancy Pelosi brought all three committees together at the start and said, you are one team. That absolutely is a lesson from '94 [when there was squabbling among congressional committees]. The whole notion of, if you like what you have [in your insurance coverage], you can keep it. The notion of letting Capitol Hill write the bill so they absolutely feel ownership of it was absolutely key.

So the Democrats really tired to learn a bunch of things. And for the Republicans, not all of them, but most of them, the reaction was, well, in '93-'94 the Democrats overreached and that was our ticket to power and fame and glory, so let’s do it again, exemplified by [South Carolina] Senator DeMint’s comment that this could be President Obama’s Waterloo.

Jonas: It seems to bring to mind the old adage about the danger of fighting the last war.

McDonough: Democrats were trying to fight a different war, and Republicans seemed to want to replay '93-'94. There’s an important lesson there, that for Democrats, defeat helped inform their win, and for Republicans, a victory, I think, played a significant role in their defeat this time.

Jonas: Do you agree with the widely cited blog post earlier this week by former [George W.] Bush speechwriter David Frum, that this was a crushing defeat for Republicans and largely self-inflicted because of their decision not to play ball and try to work to get a bill they might be able to support?

McDonough: I think he is absolutely right. If the Republicans had seriously wanted to engage on this issue, Democrats were desperate for a bipartisan win and would have given up a lot of the very good stuff in this law to achieve bipartisan support, particularly in the Senate. I have no doubt about it.

Jonas: Has there been any communication among former Kennedy staff members over the last few days?

McDonough: We talk all the time. When Kennedy first got ill in the spring of ‘08, the staff distributed these blue wristbands with the label “Tedstrong” on them. And all of us wore them in solidarity with the senator in terms of fighting his illness. And after he passed away last August, a lot of us decided to continue wearing them until health reform was done. So a lot of us are finally taking them off.

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