Why Clinton’s Health Plan Was Unsuccessful

Clinton’s Health Plan, which was officially referred to as Health Security Act was healthcare reform legislation, which was proposed by President Bill Clinton. It was closely associated Hillary Clinton, the First Lady, who chaired the task force tasked with the responsibility of developing the plan. During his 1992 presidential campaign, Bill Clinton had used healthcare reform as one of the campaign tools. Upon ascending into office, Clinton created a taskforce in to develop a plan on how to undertake healthcare reform. However, the processes of the taskforce were controversial. They attracted litigation from various parties. The primary goal of the taskforce was to devise a plan that would ensure there is provision of universal healthcare to Americans, which would act as the major achievement of Clinton’s first term in office. One of the major features of the plan was to ensure that all employers provide health insurance to their employees.

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However, the plan was faced opposition from various parties who included conservatives, libertarians, and various players in the health insurance industry. To elicit public support against the plan, the health insurance industry created an ad – ‘Harry and Louise’ – that was very effective. The plan also faced resistance from Democrats, the President’s party. Democrats offered various plans as an alternative to Clinton’s plan. Democrats created a compromise plan, which ultimately failed in 1994. However, Democrats ultimately reformed healthcare through the Patient Protection and Affordable Care Act ‘Obamacare’, after decades of failure. This paper will discuss the features of Clinton’s Health Plan and why it ultimately failed.

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Formulation of the Plan

The Clinton healthcare plan was unveiled on October 27, 1993. It was referred to as the Health Security Act. Hillary Clinton and Ira Magaziner, a presidential aide were the major people that helped in the development of the plan. They based the plan on ‘managed competition’ a concept that was considered a combination of open market forces and government regulation. The architects of the plan hoped that there would be competition among doctors and hospitals for business, which would be based on price and quality of services they can offer.

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Universal coverage was one of the major components of the plan that ultimately led to its failure. The component would have necessitated all American citizens to purchase healthcare insurance cover. It would also have necessitated all businesses regardless of their size to purchase to provide health insurance to their employees. This would have increased the financial burden of Americans. Therefore, they viewed it as an additional tax burden. The bill was significantly different from the Canadian style single-payer system, in which the government is the sole payer of healthcare insurance. However, various parties still claimed that the bill was socialist oriented (Garson & Engelhard, 2007).

Recession also posed a major challenge to the bill. During Clinton’s first term in office, the U.S. economy was facing various economic problems. During recession, any significant government spending is highly scrutinized. Therefore, recession increased resistance to the bill as the passage of the bill would increase government spending. On the other hand, the opposition to the bill was well financed by the insurance and pharmaceutical industry. They run the ‘Harry and Louise’ ad, which successfully increased public support on opposition against the bill.

Read also United States Department of Labor Case Study – Health Plans and Benefits

Failure to Explain the Bill Efficiently

The complexity of the bill and public fear and confusion was one of the major factors that led to the ultimate failure of the bill. Despite the fact that the bill covered more than 1,300 pages, the taskforce did not explain the bill to the public efficiently. They relied on moral rhetoric to gain support of the bill among the public who were generally confused. Hillary Clinton acknowledged the fact that the bill was highly misunderstood. She believed that the results of the bill would enable it to gain public support. Public misunderstanding was due to lack of one voice in the Clinton administration on the costs and regulations of the bill. Failure of the Clinton administration to explain the policies brought about by the bill provided opponents of the bill with a chance to define the health reform in their own terms. The Harry and Louise’ ad, which was an antireform ad portrayed the bill as an attack on an individual’s right of choice.

Lack of clear explanation of the bill made accuracy of information or debate on the bill become irrelevant. Misunderstanding of the bill had significant negative impact on the public. It made various parties to oppose the bill despite the fact that they could not explain the reasons for their position. A clear explanation of the bill may have made the parties support the bill (Shi & Singh, 2009).

Arrogance of the Clintons

Lack of humility and outreach among the Clintons led to the ultimate failure of the bill. They decided to shape the bill according to their own perceptions. They even failed to disclose the names of people who played a critical role in the formulation of the bill. In fact, the formulation of the bill was a closed-door affair. Despite the fact that Hillary’s taskforce called various people to seek their opinion, they did not use it.

Problems with the implementation of the reform plans emerged when the reform plans were still sketchy. On may 5, 1993, when the healthcare reform was at an early stage, Ira Magaziner provided a sketch of the blueprint of the health reform in a speech to Families USA. Magazine claimed that the reform may provide a minimum benefits package and care guidelines for all U.S. citizens but give the states the responsibility of determining how they would meet the national standards. The speech highlighted the secret nature of the elements of the plan. On May 3, 1993, Hillary Clinton also hosted approximately 52 Democrat and Republican senators in an effort to show that the Clinton administration was willing to consult with Republicans in the formation of the plan. However, during the meeting, Magaziner sketched the proposals of the plan again. This compromised the transparency and the efforts of the Clinton administration to include Republicans in the formation of the plan. Clinton and Magaziner did not provide additional details of the plan when asked to do so a month later. This highlighted the secrecy of the plan. If the Clinton administration wanted to include the Republicans, they should have provided more details of the plan. This would have enabled the Republicans to provide proposals on how to change certain elements. This would have created a compromise between them and the Democrats. However, the Clinton administration thought that there plan was perfect. Therefore, it was not open for debate (McKenzie, Pinger & Kotecki, 2011).

The imperial attitude of the Clintons and the lack of involvement of congress in the formation of the bill led to its ultimate collapse. Ira Magaziner who played a key role in the formation of the bill alienated members of  Congress in the formation of the bill since he was too sure of himself. This is despite the fact that the bill was very long and highly complex. The secrecy of the Clinton administration and the aloofness of Magaziner made various parties have the perception that the bill was not open for debate or compromise. Therefore, it was not open for debate. However, nothing could be further from the truth. In any democracy, various parties of the political divide must debate a bill exhaustively prior to its passing. After the failure of the bill, Hillary Clinton claimed that the bill was simply a starting point in the debate on healthcare reform. However, it is a fact that the Clinton administration compromised very little or they compromised when it was already too late. The inflexibility of the administration made them lose the momentum of the reform agenda. It also made them lose the support of moderates and a united support of their base (Shi & Singh, 2009).

Failure to Maintain Focus on the Plan

Hillary Clinton was the face of Clinton’s healthcare reform. He traversed the country seeking the support of the bill and led the fight for the support of the bill in Washington, DC. She strived to portray herself as not one of the players in the legislative process. Instead, she strived to portray herself as a campaigner of the bill against the wicked insurance industry. She emphasized the notion that the bill portrayed that universal coverage was the right thing that every American – and the not the smart ones – should do.

The approach changed the debate from that of policy to one that focused on a certain character. Failure of Hillary Clinton to listen to the opinions of insurance and pharmaceutical industries led to the ultimate collapse of the bill. This is due to fact that the cooperation of the pharmaceutical and insurance industries was critical in passing the bill. Instead, Clinton renounced the industries as villains. Using character attacks to garner support for the bill instead of using policy rebuttals created fear among various parties that passage of the bill would have negative impact on business and the economy in general McKenzie, Pinger & Kotecki, 2011).

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Reform opponents countered the strategy use by Hillary Clinton to garner support for the bill by demonizing her. Their efforts were successful as the bill was not passed. After the failure of the bill, instead of admitting their mistakes, the Clinton administration claimed that corruption and power of the insurance industry had successfully blocked a bill that would have benefited Americans. On the other hand, opponents of the bill highlighted the Whitewater scandal and claimed that Hillary Clinton sought personal gratification as she had bet against healthcare stock in effort to undermine her credibility. Focusing on the players instead of the plan created distractions to the reform debate. This led to the crippling of the reform debate. Focus on the players instead of the plan led to the polarization of the debate on healthcare reform. It shifted the terms of the arguments to morals instead of merits of the healthcare reform. This made the side the side which had a better marketing campaign – the opponents of the debate – to win.

Libertarianism and Compulsion

Clinton’s healthcare reform would have led to managed competition. This made Republicans face a complex political challenge. If they accepted the implementation of the health reform, there had to be an alternative reputable financing vehicle. They could not accept the Democrat strategy of a plan that would be funded by the employer. This is due to the fact that the healthcare plan would have placed the burden of funding the health reform on business owners. The business owners provided a major constituency to the Republican Party. In fact, during the 1980s, Republicans fought all legislations that increased costs on employers. This included increase in minimum wage and mandated employee leave. They claimed that these measures were disguised tax increases. Therefore, they claimed that the health reform employer mandate was a payroll tax, which would be collected and controlled by the federal government (Longest, 2010).

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Democrats have fought for healthcare reform for decades. They ultimately manage to reform the healthcare industry with the passing of the Patient Protection and Affordable Care Act. In so doing, President Obama managed to achieve what Clinton, one of the most popular Democratic presidents, could not achieve. Clinton’s health plan highlights the politics involved in passing any piece of legislation. This necessitates an administration to use efficient strategies to ensure that a piece of legislation is passed. Clinton’s administration did not provide a good explanation of the plan. In addition, they did not involve other major stakeholder in the formulation of the plan. The arrogance of the Clintons also played a critical role in the ultimate failure of the plan.

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