Eli Ginzberg and Miriam Ostow. 206 pages. New York: The Free Press; 1994. $22.95.
It's hard not to like Eli Ginzberg and harder not to admire his writing style, now polished and perfected in many publications. But reading this one gave me cold chills.
True, it contains an excellent, succinct, and balanced description of the American health system and how it got that way; Ginzberg does not stack the deck. One presumes that the detached appraisal of system faults and system glories was refined on many lecture platforms—an oven-ready environment for two or three chapters describing the Clinton health reform proposal from the intellectual inside. Ginzberg is too practiced an academic for partisan advocacy and too practiced a consultant to reveal which ideas are his client's or his own. The reader must guess what comes from the old labor economist, what comes from the young politician, and what else was rejected along the way.
Ginzberg believes that the main force driving the President is the need to balance the federal budget, now rendered unbalanceable by Medicare and Medicaid expenditures. Political calculation suggests that it is unacceptable simply to squeeze the federal programs because that might create a two-tier system. Therefore, we must create a universal system first and squeeze the whole thing later. After the country proclaims universal entitlement, we have a health care system in a political box that even a later Republican administration cannot take away.
How could the country ever accept such a thing? According to Ginzberg, Clinton counts on widespread middle-class fear of losing what they now comfortably have. "If the President. misread the anxiety levels of the American Public with respect to future coverage, the odds are his ambitious reform proposal will never get off the ground"
With the advantage of only a few months since this book was written, it is possible to see other ways in which the political calculation is going wrong:
1. The public is disdainful of the claim that subsidized health benefits can be extended to more people and more items of coverage without worsening deficits.
2. The public is bewildered by the claim that mandating employer coverage will create universal access to those who are unemployed, self-employed, or illegal aliens.
3. For somewhat unclear reasons, the left side of Mr. Clinton's party despises managed care to the point of being willing to destroy his plan rather than to accept that component of it. Those to the right side of the aisle see managed care as part of managed trade, managed competition, and a managed economy.
Looking back on this year's headlong reform experience, it is possible to see that Eli Ginzberg shared and promoted the extrapolation fallacy. Having little faith in the nature of systems to self-correct, he sees the day when health care costs will be the whole gross domestic product. Exemplified by Armand Hammer predicting oil at $100 a barrel during the OPEC oil shortage, hysterical extrapolation is the economic equivalent of crying "Fire!" in a crowded theater. What is truly going to happen is that the Medicare Trust Fund will go broke unless its curators correct some of the original design flaws.
With the country perceived to be in such bad shape, it is disconcerting to discover in this book an utter contempt for patient coparticipation in his or her costs by deductibles, balance billing, and benefit exclusions—that is, an unwillingness to acknowledge the central role of excessive insurance in destroying incentives for efficiency and the possibly unwise act of extending insurance coverage still further.
Finally, it is disappointing to see that this scholar of the health system realizes that the tax exemption of employer-based insurance is the engine driving the whole mess. But still he washes his hands of the matter when a politician half his age tells him the tax exemption is politically untouchable.
So it looks to be an interesting year ahead on C-Span. Annals readers nevertheless have plenty of time to read this little book, and they really ought to. I hated it.
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