By Evan Falchuk

Is the health care bill the Senate passed a good thing or a bad thing?

It depends on who you ask. Which ought to be your first clue that it is really an exercise in politics.

I’ve been warning for months that the rushed process and soaring rhetoric veiled the reality of what was happening.  And that is this: no one really can describe what health care reform is about.

There are a lot of reasons for this, but the biggest one is that very few people on either side seem to understand the health care “system.”  In fact, calling it a “system” is part of the problem.  So let me try to help.

Our health care “system” like one of those pictures from an I Spy book.  Here’s one.

The US health care system

What do you see?  There are some coherent things about it.  First, someone put all of those pieces there.  They seem to be set up haphazardly, but they’re actually set up in a way that’s convenient for the publisher of the book.  They also have a general Christmas theme to them.

But that’s about it.

Now, say someone wanted to “reform” this picture.  How would you do it?  You could put everything in some kind of order.  But what order?  Red things on the left, yellow in the middle, blue on the right?  Or the other way around?  Or why not order it by size or shape or type of object?  Why not reform it to make it easier to find the items on that list at the bottom – clear out everything else and just leave behind the thimble, four birds of red, two fuzzy chickens and a gold-trimmed sled?  That would be simple, but it wouldn’t make the game very good.

You could forgive someone who wanted to reform this picture from doing what a lot of people looking at these pictures do – give up and go to sleep.

But would-be health care reformers are cleverer than that.  They decided to change the problem.  Instead of trying to reform the messy health care system, they said let’s reform the health insurance system.  A picture of that looks like a map of the United States.  Now this is a system that can be reformed.

At the federal level it’s a blank slate, so anything you do counts as reform.  And, since we’re in a hurry, you can take a short-cut and just put in place federally something like what the states have been doing for decades.  Presto! Reform.

I poke fun, but what’s so bad about a federalized version of state insurance regulation?

The problem is this: the way states regulate insurance is one of the major reasons why health insurance is so expensive.  Heavily laden with thousands of rules dictating what they have to cover, how much they can charge, who they must accept as insureds, only a few insurers are able to compete.  A cynic might say the rules have become rigged in favor of these few companies.  A kinder person might say that these are the unintended consequences of good intentions.  But whatever the reason the result is the same: a very small number of companies dominate the markets of every state.  Where competition is low, prices are high.

This is the great irony of reform.  The things that have made health insurance so expensive in the states are the very things reformers want to use federally to make it more affordable.

So what do political advocates think about all of this?

Progressives don’t like it because they think it benefits the insurance companies, and they’re probably right.  Conservatives say, no, the insurance companies are getting taken over by the federal government.  They’re probably wrong.  In fact, it’s the machinery of regulation that’s getting taken over by federal government.  And that, should this bill become law, is a bigger deal than most people realize.