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Relaunching Reform


Pharmaceutical Executive

Pharmaceutical ExecutivePharmaceutical Executive-06-01-2008
Volume 0
Issue 0

This time, powerful interest groups (like pharma) that sank the Clinton healthcare bill are on the side of change

Will the next president be more successful in passing legislation to reform the nation's healthcare system than Bill Clinton was in 1994? The answer depends, obviously, on who wins the White House in November. Many other factors, from which party holds the majority in Congress to the new president's own popularity and political skills, will also play a role. The fate of any effort at reform will also depend on the support or opposition of powerful interest groups.

Humphrey Taylor

A major reason the Clinton bill went down in flames was the size of the opposition, including large and (especially) small businesses, most physicians, the health insurance industry (sponsors of the "Harry and Louise" ads), and, of course, the pharmaceutical industry. All of these interests used their communication skills, lobbying power, and financial resources to persuade the public and Congress that the Clinton bill should be defeated. A majority of the public initially backed the Clinton bill, but this support eroded dramatically in the face of anti-reform messages that claimed the bill would increase taxes, reduce choices and quality of care, increase unemployment, lead to "rationing," and put big government in charge. If Sen. Barack Obama (D-IL) wins the election, all of these arguments are likely to be deployed again by opponents of his proposed reforms.

Yet there is considerable evidence that the same interest groups are not likely to oppose reform with the same force as in 1994. The health insurance industry, led by American's Health Insurance Plans (AHIP), has become a strong critic of the current system and advocates substantial reforms. With proposals including a big role for private sector health insurance, AHIP may find much to support in new legislation.

According to Harris Interactive data, physicians are much more unhappy with the system today than they were in 1994, and are likely to be much more receptive to reform than they were 14 years ago.

The position of the pharmaceutical industry will probably depend the details of the final bill. Pharma would benefit from a large increase in coverage, but can be expected to fight hard against repeal of the non-interference clause, large scale drug importation, or anything else that looks like price control.

The most strenuous opposition to a major expansion of coverage is likely to come from small businesses, many of which provide no insurance to their employees. Larger employers will likely be more ambivalent; like almost everyone else, they are very concerned about the rising cost of health insurance.

A 2007 Harris Interactive survey found that only 14 percent of corporate employees think this country's healthcare system "works pretty well and that only minor changes are necessary to fix it." The majority (70 percent) believe that "fundamental change is needed," while 16 percent go even further believing that we need "to completely rebuild" the system.

These strong negatives do not mean that corporate leaders agree on what to do. They are sharply divided on who should be "primarily responsible" for universal healthcare. About a third (37 percent) say it's the federal government's job; about a quarter (28 percent) says it's the responsibility of individuals and families; 15 percent assign it to state governments. Perhaps not surprisingly, a mere 4 percent think this is mainly a job for employers—so most of them are likely to strongly oppose employer mandates. Once again, the hardest resistance will come from small businesses.

Virtually all corporate employers who provide health insurance to their employees think it is important that they continue to do so. While a majority of employers recognize that health care is not one of their core competencies, only 18 percent would "welcome an opportunity to transfer the responsibility to the government." Furthermore, 85 percent believe that "employers can effectively manage their employees' healthcare."

Democratic leaders have studied the reasons for the failure of the 1994 bill, and will likely do a better job of muting—or at least dividing—the opposition this time around. For one thing, they are proposing to continue to give employers and private sector health insurance major roles in the reformed system.

As a result, opposition from corporations, insurers, and physicians is likely to be considerably weaker than it was when the Clintons last nailed their colors to the mast of healthcare reform. That does not make major reform a strong probability—many barriers remain—but it is a very realistic possibility. On one condition: that Democratic president is elected with clear Democratic majorities in both Houses of Congress.

Humphrey Taylor is chairman of the Harris Poll, Harris Interactive. He can be reached at htaylor@harrisinteractive.com