A Tortured Fiction Is Swept From the Table : Health reform: With the White House forced to reflect its plan in the federal budget, we’re free to look at real costs and benefits of other solutions.

Outside Washington, the testimony of the head of the Congressional Budget Office is rarely the stuff of high drama. Yet, last week, when CBO head Robert Reischauer told Congress that health insurance premiums required of businesses and the costs of the White House health-reform program would have to be accounted for in the federal budget, just like other taxes and spending, official Washington and the national press corps were all over the story. They judged immediately that Reischauer had presented President Clinton with big new political problems. But let’s look at it from another viewpoint. The fellow actually told an unvarnished truth: Things equal to the same thing are equal to each other. In doing so, he has potentially transformed the nation’s debate over national health reform--and in a positive direction.

The President initially dismissed the budget office’s realism as the work of Washington policy insiders. But it was more nearly the opposite--the rejection of a fiscal fiction that continued to treat such payments as “private health policy premiums.” Reischauer was that rare breed of high government official, one who told truth to power when power didn’t like it.

The possible consequences of Reischauer’s truth, however, are not those we’ve heard from most of the media commentators. Rather than seriously damaging prospects for the Clinton plan (or health reform generally), it should free us from the silly straitjacket of budgetary fabrication that has hampered serious reform discussion and led reformers down paths of mind-numbing complexity and obfuscation to keep up the pretense of “private health insurance for all.”

Suppose were to start asking what the total cost of various health-reform plans might be, instead of what part of that cost showed up in public budgets?

Suddenly, all manner of simpler expansions of health care come into view. These are the plans previously ruled “off the radar screen” by the political constraint that no significant amount of new dollars could appear in public budgets, no matter what the actual cost of the proposed reforms might be. This is where Reischauer’s realism comes in.

Now, for example, we could talk about an expanded Medicare program for all (that is, a universal Medicare with prescription drug insurance, long-term care and other coverage for the chronically ill). What about a Canadian-style system of cooperative federalism with a single payer in each state? What about an individual instead of an employer mandate with subsidies via the tax system for an approved basic insurance package?

Why mention these possibilities? For a very straightforward reason: They are all administratively simpler schemes. They require little in the way of new bureaucratic institutions and fewer immediate changes in the way medicine is practiced. They are consistent with basic principles for a satisfactory health-insurance system; that is, they can easily accommodate our desires for universal, comprehensive and portable coverage. They present directions for reform that, unlike the Clinton plan or its major competitors, such as the proposal of Rep. Jim Cooper (D-Tenn.), would limit administrative costs and substantially increase the likelihood that total costs will be kept under control and fairly distributed. Perhaps most astonishingly, they could be explained to the American people.

We should also note that these ideas--from a tax-based individual mandate to the Canadian approach--run across the ideological spectrum. They are associated with proponents as unlike each other as Sen. Paul Wellstone (D-Minn.) and former President George Bush, the American College of Surgeons and the Communications Workers of America. In short, the fixation on whether something was counted in the federal budget has made it impossible for good ideas of both the reasonable right and the reasonable left to get a sensible hearing.

The constraints of the health-reform debate thus far have impoverished our range of possibilities in the name of protecting the federal budget. But, as Reischauer made clear in his testimony to the House Ways and Means Committee, the simple fact is that what is in and what is out of the federal budget is a matter of arcane formal rules. These rules tell us little or nothing about what a particular means of arranging health insurance will really cost and who in the end pays for it.

If we could follow and extend Reischauer’s example, if we could talk about the real costs and real benefits of alternative means of achieving universal health insurance, we might actually get to a system that would be far better than any that official Washington currently views as possible. We could fire Rube Goldberg as our chief health finance architect and look seriously for simpler and more workable designs.