section break

As I noted in a past post, Bill Kristol wrote his famous memo to rightwing allies telling them they had to kill health care reform at all costs, since its passage would give progressives a lock on the middle class vote for the next generation. Business and rightwing interests will threaten and bribe the forty-one Senate votes needed to block health care reform not just because they won't want to pay their share of health care costs, but because they will want to block the political realignment that will follow passage of health care reform.

So look to the states: Here's why the states can pass health care reform. Unlike the federal government, with its Senate oligarchy and filibusters, the states are actually run as democracies, where legislators are elected on a one-person, one-vote basis. Which is why states have passed minimum wage laws (many still higher than the finally enacted federal version), global warming legislation and a range of other laws that have been blocked or watered down by Senate filibusters.

Why shouldn't state governments be able to pass health care to cover all their residents? Many of them have far larger populations than European countries with national health care. California is larger than all but a handful and it's economy is larger than all but seven other countries in the world.

Ezra tells a story of miserable state failure after an initial burst of early reforms of the 1990s, but he ignores the hard numbers. Back in 1991, just 28.3 million people received their primary health care from state-run program like Medicaid. Now, with expansions in eligibility for Medicaid enacted since then and childrens health care programs extending to middle class families, 49.8 million people are covered by state-run health programs by 2006. Note that more people are now in those state-run programs than in Medicare, despite the far more rapidly growing elderly population.

In fact, even before the more recent explosion of state health reform plans, when supposedly "nothing" was happening in health care, states had added more than 20 million people to state-funded health care programs since the early 90s.

The New State Plans: And all that was largely before the new reforms. On expanding coverage for kids, Illinois led the charge with its Cover All Kids initiative and New York just approved a budget to extend cover to kids of families making up to 400% of the poverty line (ie. up to about $80,000 per year). A large number of states have approved coverage for kids up to 300% of the poverty line ($60,000 family incomes).

And then you have the more serious state plans looking to cover everyone. No one more than state health care advocates recognize the limits of the Massachusetts health care plan, which is why few of them are modelled on it. The reality is that despite the scorn of DC folks like Ezra Klein, the states have been stepping up to cover tens of millions of additional people under state programs. The problem is that private employers are rapidly cutting their coverage and contributions to health care costs, which is what most of the state plans are aimed at fixing.

Unlike Massachusetts, which had only a $295 per year fee for employers who fail to provide health care for their employees, California legislative leaders are promoting a plan that would require any employer not providing health care to pay a fee equivalent to 7.5% of payrolls to the state to help fund their statewide health care plan. (Ezra hates employer health care mandates, so he somehow failed to even mention the existence of that funding source in his article.)

Healthy Wisconsin as Model: But let's talk about a state where a legislative chamber has already PASSED a bill providing health care for ALL its people. Last week, the Wisconsin Senate approved Healthy Wisconsin, a plan that would provide comprehensive coverage and preserve freedom of choice of doctors for all residents who are under age 65 and don't qualify for expanded Medicaid programs. Under the plan, there would be no monthly premiums and only minimal co-pays and low annual deductibles.

Healthy Wisconsin would be financed with a simple payroll tax paid by employees (2-4% of social security wages) and employers (9-12% of wages). Similarly, sole proprietors would pay 10% of Social Security wages and unemployed individuals not eligible for public programs would pay 10% of the adjusted gross income. To ensure affordability for non-working low-income residents, Healthy Wisconsin expands BadgerCare, the state's Medicaid program, to 300% of income for families and to 200% for childless adults.

Rather than busting the state budget, Healthy Wisconsin is estimated to save state and local governments $1.3 billion per year, which the Senate leaders pledged to use to reduce property taxes. The Lewin Group, a national health care analyst group, estimates the program will save the state $13.8 billion over the next ten years. Just today, Families USA issues a report, Healthy Wisconsin: Good Medicine for Wisconsin's Economy, which notes that the plan would generate more than $1 billion in new business activity and create nearly 13,000 new jobs.

The conservative-controlled Wisconsin Assembly refused to approve Healthy Wisconsin, but the Senate leaders are working to make health care a major campaign issue for next year. All it will take is one election next year to make enactment of health care for all Wisconsins a reality. Contrast that with the federal government where no reasonable scenario will result in the sixty Senate votes for universal health care.

Any reasonable analyst has to admit that serious health care reform is far closer in the states than at the federal level.

The Feds Have a Role: That said, the path to national health care is not an either-or question, federal OR states. Progressives should have a far more dynamic view of federalism, not merely a "laboratories of democracy" rhetoric that reduces states to child-like sandboxes to be muscled aside by federal programs, but a view that understands where progressives can achieve progressive gains at each level of government, and mutually reinforce success at higher or lower-levels.

For example, while structural reforms in policy are slow and often impossible at the federal level due to the Senate filibuster, the gederal government has greater ability to spend money. Due to the 1974 Budget Act, the use of the filibuster against spending appropriations is far more limited, so progressives at the federal level should concentrate on expanding funding going to the states to support these programs. Federal progressives are unlikely to enact a health care for all plan on their own, but they can make it dramatically easier for states to move forward.

In fact, the SCHIP program is a perfect example of this dynamic. Back in the mid-1990s, the feds began expanding funding for child health care programs and the states ran with it. Even more conservative states were happy to expand health care with federal dollars available. But note that even expanding SCHIP-- a wildly popular program -- runs into some Senate filibuster problems, so anyone who thinks enacting a more serious federal health plan is on the horizon is truly ignoring both present reality and past history.

The States Will Lead: As we noted at Progressive States in a recent report, states are where progressives are taking action and winning. They are not baby bills, but serious changes in policy that are reshaping the contours of the economy. The rightwing has always recognized that they could govern the nation from the statehouses, and DC progressives should stop looking down at the efforts of state-based activists and recognize that real health care reform can and will be driven from the state level. DC-based progressives can help make that happen, but that will require a bit more humility and recognition that states may lead and DC folks may have to learn to follow.

UPDATE: Ezra kind of responds here but just repeats the false statement that "states have, over and over again, proven incapable of sustaining these [past] plans" for expanding health care. Since as I noted, state programs have added 20 million people since 1991, his repeating of the failure of the states doesn't sustain his argument. Yes, states did not always achieve as much as they hoped but what else is new in politics. The point is that they achieved some real gains, extending coverage to 20 million people even as federal politics has been largely frozen on the issue.

Even the "failures" he cites in the original article are illustrative. Hawaii failed to achieve universal coverage (true) and "only" reached 9% uninsured, still one of the highest rates of coverage in the country. A conservative successor to Michael Dukakis repealed part of his universal health care plan, but left a chunk of the state funding in place, leaving that state with one of the lowest uninsured rates in the country.

Yes, success is sometimes about two steps forward, one steps back. It's not like federal programs like housing funding and so on didn't see rollbacks when the GOP took over at the federal level. That's politics.

But the point is that the states have made real progress (unlike the Feds) and the new efforts are making even more -- and have the real potential of more serious success. Ezra looks at the state and all he sees is a half-empty glass; twenty million people who gained health care under state programs, on the other hand, see a critically half-full glass.