Getting HillaryCare right. Finally.

Everybody knows how much contempt conservatives show for Hillary Clinton whenever she talks about health care. But people tend to forget how much liberals have been deriding her, too. It was just a few months ago that Michael Moore attacked her in Sicko, alleging that campaign contributions from people in the health care business had made her a tool of that industry. Last week, when asked about Clinton and health care, John Edwards made a similar charge, pointedly noting that, "in order to have universal health care, you have to be willing to take on ... insurance companies, drug companies, and their lobbyists." In other words, he would deliver what Hillary could not.By unveiling a new health care plan last week that did, in fact, promise to cover every single American, Clinton put to rest the worst of these suspicions. But, even after last Monday's blockbuster roll-out--which provoked a press frenzy rare for what was, after all, a policy speech--questions remained. It is one thing to put these ideas on paper. But just how serious is she about them, particularly given all her talk about the "scars" she has from 1993 and 1994, the "lessons" she learned from that episode, and the need for "consensus" this time around? If compromise is necessary, then what, specifically, is she willing to compromise away? Enacting universal health care is bound to mean waging some fights. Is she really willing to do that--and which fights will she pick? Those were the questions I hoped to ask Clinton in a telephone interview a few days after the announcement--although, truth be told, I didn't expect many answers. Mine was one of a series of interviews she was doing during the week, leading up to a string of appearances on five Sunday morning talk shows. By the time I talked to her, she had already dispensed plenty of carefully calibrated, almost perfectly anodyne, statements: "I've learned some valuable lessons"; "This is not a government-run health care system"; "I know how important it is to work with the Congress." The start of my interview played out the same way. To a question about when she had first sat down to seriously discuss with her staff what this new plan would look like, she gave the boilerplate version of her health care resume: "I've been committed to universal health care for fifteen years. When we weren't successful after '93 and '94, I kept working to try to expand coverage"- -and so on. But then she shifted gears, and, over the next few minutes, as we discussed both the details of what she had proposed and her ideas about how to make it law, she gave some answers I hadn't expected. In the process, she put to rest many of my lingering doubts while demonstrating what may be her strongest assets as a champion of health care reform: her unrivaled mastery of the subject and her savvy sense of how to move a proposal through Congress. Does this mean Clinton is the best candidate on health care? Not necessarily. But it may help explain why she's running such a strong campaign among Democratic primary voters right now. The assumption going into this race was that Clinton would position herself as the centrist alternative to her chief rivals, Edwards and Barack Obama. But on health care, which has emerged as the campaign's top domestic issue, she's positioned herself as far to the left as they have--offering a plan of similar reach and pledging to push it with similar political will--while managing to stay within the boundaries of what passes for mainstream political debate. You could say this reflects a welcome and politically viable consensus on how Democrats should approach health care in the coming years--or, if you're disappointed in the substance of what she's proposing, you could say it reflects a failure by both Edwards and Obama to stretch the boundaries of debate further. Either way, though, it means she's winning over liberal primary voters even as she positions herself for both the general election and--should she win-- a battle to actually enact health care reform. That's no small feat. It's not hard to see how the 1993-1994 debacle shaped Clinton's thinking on health care--and, in certain critical ways, how it reduced her ambitions. Most notably, she has decided against blowing up the existing health care system, even though there's a pretty good case for doing so on the merits. As she learned the hard way in 1993-1994, starting from scratch would force the majority of Americans to switch coverage, thereby scaring the very large portion of the U.S. population that already has some form of insurance and likes it. So, this time, Clinton is doing her best to reassure those folks. If you have health insurance and you're pleased with it, she says, that's fine-- you get to keep it. But, if you don't have insurance or you don't like the coverage you have, then you could buy new insurance on your own. You would do it through a purchasing pool set up and maintained by the government-- selecting from a choice of plans in much the same way federal workers and employees of large companies do now. You'd get the same sort of benefits these people get: No insurer could deny you coverage or charge you more because of your medical conditions, and the prices would be more affordable because of the relatively low overhead. And, if you were still too poor to afford this coverage, the government would give you financial assistance while continuing to make Medicaid and other safety-net programs available to the very poor. This might like seem like precisely the sort of plan that would disappoint at least some traditional supporters of universal coverage--namely, those who believe the best systems are those run directly by the government, or so-called "single-payer" systems. That's because the new Clinton scheme assumes most working-age people will continue to get private health insurance. (To many single-payer advocates, this was precisely the problem with the old Clinton scheme, too: It relied on private insurers, not the government, to deliver coverage for most people.) But there's another wrinkle in Clinton's proposal. Among the insurance options she'd make available to people would be a plan run by the government, perhaps using the basic Medicare model. The idea would be to let this public program operate alongside the private ones--in effect, competing with them for business. If the public program were as efficient and popular as advocates of public insurance believe it will be--and, for the record, I'm one of those advocates--then, over time, it would attract more and more people, naturally evolving into a single-payer system. None of this makes Clinton unique among her rivals. Both Edwards, who unveiled his plan in February, and Obama, who introduced his in May, offer essentially the same deal to the insured-- allowing them to keep their coverage while the government constructs and oversees a new system for everyone else. Both Edwards and Obama also have public insurance options that open a door to single-payer--a model that bears the intellectual fingerprints of Yale professor and sometime tnr contributor Jacob Hacker, who has met with all three campaigns. Clinton's plan does have one key difference with Obama's: She would require everyone to get some kind of coverage, a requirement known as an "individual mandate." Obama decided against calling for a mandate initially, preferring to wait and see whether it was really necessary for achieving universal coverage--and until he knew for sure that insurance would be affordable for everyone required to buy it. But, while that's not a minor difference, in the grand scheme of things it's not a colossal one, either. Meanwhile, the differences between what Clinton proposed and what Edwards proposed are downright miniscule. In fact, the plans are virtually identical. The lack of huge substantive differences in these plans makes it all the more important to figure out which candidates will push their proposals with maximum determination. And, here, Edwards has set a pretty high standard. Not only was he the first major candidate to put forward a serious plan to cover every American; he has also made clear it's his top priority by, among other things, pledging that he would pursue universal coverage even if it meant postponing some progress on deficit-reduction. Obama, too, has cautioned that health care expansions may have to come before complete budget balance. But, it turns out, Clinton pretty much shares this view. While she told me she is determined to make some progress on reducing the deficit--she very deliberately did not use all of the savings from President Bush's expiring tax cuts to pay for her plan--she agrees that establishing universal health care may have to precede balancing the budget outright, if only because you can't do the latter until you get medical costs (which drive up the price of government programs) under control. "I think we've got to begin making a down payment on fiscal responsibility, but it has to come over time," Clinton said. "If you don't get . .. quality, affordable care to everybody, you can't realize a lot of the savings that will help you with deficit-reduction, with Medicare, Medicaid, and other programs." Although Clinton constantly invokes the need for having an open mind while dealing with former adversaries in Congress, she also says that universal coverage is a core principle with which she's not prepared to part. "We have to remain committed to the goal of quality affordable care for everybody," she told me. "That has to be one of those principles that we'd take into whatever the negotiations are." Similarly, for all of Clinton's talk about consensus, she's not particularly tolerant of the insurance industry--or, at least, the way it practices business now. "Remember," she said, "this is an industry that spends $50 billion a year excluding people, either altogether, by denying them coverage, or by denying them care that they need." Clinton leaves open the possibility that the industry could retool itself so that insurers compete on cost and quality rather than on their ability to pick out the most healthy beneficiaries (the way they typically do now). This was, she explained during the interview, a new "business opportunity" just waiting for smart companies to take advantage of it. But she also seemed to recognize that doing so runs against the nature of many insurers today--noting that even some of the industry's erstwhile allies in the corporate world are getting fed up. "I think there's an awareness," she said, speaking of CEOs she's met, "that the health insurance industry is not working in a way that makes economic sense for the rest of the economy--and I think that's a revelation for them." That's a clever rhetorical construction: It pits the interests of the business community against the interests of the insurance industry, effectively splitting the traditional opposition to universal coverage. And it may hint at the political strategy Clinton intends to pursue if she gets elected. While she isn't signaling compromise on universal coverage or going soft on insurers, she is embracing business--constantly invoking the wisdom of CEOs, talking up the need to establish partnerships with them, and tailoring her proposal with their companies' needs in mind. Clinton would require all larger firms to contribute toward their workers' health benefits. But she would let these firms provide workers with coverage directly (rather than simply pay a tax) if that's the company's preference--because, she notes, even CEOs frustrated with rising benefit costs "still want to have control." Firms with fewer than 25 employees would be exempt from the requirement to pay for health insurance, although, if these firms did offer their workers insurance, they would get a tax credit. That last part seems to be a unique feature of Clinton's plan; neither Edwards nor Obama have indicated they would let firms with so many employees off the hook (although they would give those firms access to much cheaper insurance than they can get now). And, substantively speaking, that's a serious concession. According to Professor Jonathan Gruber of MIT, such a large exemption concedes about two-thirds of the total available revenue from employers. In other words, Clinton gives up a large pot of money--money necessary to finance the subsidies for low-income people--that she then must find elsewhere. (She finds most of it through efficiency gains.) Clinton's advisers say the difference isn't as stark as it seems, since most other proposals would end up easing at least some of the burden on small businesses-- generally by exempting or subsidizing the very smallest employers. Whatever the impact in terms of dollars, though, the decision to avoid slapping small- business owners with a requirement to pay for health care seems to be primarily political. The small-business lobby played a pivotal role in bringing down the old Clinton plan. And, while some of this opposition reflected nothing more than ideology, much of it stemmed from that plan's small-business mandate. In one of the most memorable episodes of that fight, the U.S. Chamber of Commerce effectively reversed itself--backing out of a planned endorsement of a mandate on business--because a rival organization, the National Federation of Independent Business, was winning over members who wanted no part of such a requirement. Taken together, these moves suggest a divide-and-conquer strategy, in which Clinton would try to pry the business community from the ranks of the determined opposition. And this may reflect the influence of Clinton's uniquely experienced advisers. All three Democrats have turned to the same informal network of health-care experts for ongoing counsel--people like Gruber and Hacker and the New America Foundation's Len Nichols. And all three candidates have smart people working exclusively for them. But it was Clinton who inherited the senior staff from her husband's White House, including Chris Jennings and Gene Sperling, who spent years figuring out how to navigate legislation through a hostile Congress. (Whether that experience is helpful today depends, admittedly, on just how good you feel about the old Clinton era.) Of course, the degree to which Hillary relies on these and other advisers is open to question. "A lot of people ask me, who is Senator Clinton's closest health adviser," says Nichols, who was first called to brief her about two years ago. "The truth is, Senator Clinton does not really need a lot of health advising. ... She has what we health policy wonks do for a living down cold." Make no mistake, Clinton still carries into the fight on health care plenty of political liabilities, starting with her lack of sheer oratorical talent. She can't exude passion and empathy the way Edwards (or her husband) can; she can't convincingly offer soaring, transformational rhetoric like Obama. Those are no small things, given the necessity of rallying public support to overcome hostile special interests. Moreover, Clinton starts with a greater reservoir of ill will than either one of her rivals. Consider a recent Zogby poll commissioned by Forbes Small Business. The poll asked small-business owners about their attitudes on health care reform and discovered a discernible turn to the left. Not only was the cost of health care their top political concern, but a plurality, 34 percent, said they thought the best solution was to have the government step in and somehow make sure everybody got insurance. "Small- business owners normally fear and loathe the government," John Zogby, whose polls have tracked small business owners since 2000, told the magazine. "But, in this instance, we could be at a tipping point caused by health care insecurity." That's good news for fans of universal health care, but not, as it turns out, for Clinton--because, when Zogby asked about presidential candidates, she finished first in both the "least favorite candidate" and the "least likely to do something for small business" categories. And which Democrat did they feel was most likely to help small business? Edwards. Obama, meanwhile, fared better than not only all other Democrats but also the leading Republicans in the favorability category. Then again, Clinton has already proven capable of winning over fans in surprising quarters. On The New York Times op-ed page last week, the accolades for her health care plan from David Brooks were no less strong than those from Paul Krugman. E.J. Dionne had only good things to say about her in The Washington Post, which perhaps isn't so surprising. But Brit Hume was also praising her on Fox News, which most certainly is. The rap on Hillary Clinton has always been that she lacks her husband's political dexterity. But, too often during the 1990s, Bill's trademark triangulation succeeded only in angering both sides of the political divide. With her health care roll-out, Hillary has done the opposite: generated serious enthusiasm from observers across the ideological spectrum. If she can keep that up, she'll go very far indeed.