Sebelius Watch, Part II

Will Madame Secretary rule with moral suasion?

Health and Human Services Secretary Kathleen Sebelius has emerged as the person to watch as the Obama administration scrambles to implement health reform. The health care czarina’s words and silences offer clues about the way health reform will play out for millions of Americans. The rules, the regulations, and the compromises with health care stakeholders will determine the ultimate value of the reforms. What Sebelius said during the long reform debate usually signaled what was likely to happen; when she equivocated early on about the public plan, we knew Obama was prepared to junk that option. Campaign Desk will be watching what the secretary says, with an eye toward encouraging the press to do the same. The entire series is archived here.

Kathleen Sebelius came to talk to health care journalists the other day during what the Association of Health Care Journalists called a “Newsmaker Briefing” at its annual conference. From that billing, one might have thought she would “make news”—that is, utter something monumental. Her advance man showed up, and someone asked if she could be expected to do so. “Our goal is always to make news,” he replied.

But she didn’t—at least not in the traditional sense. Sebelius’s remarks didn’t get much coverage; even the AP didn’t send out a story, though AP reporters were in the audience. It was another blah-blah speech like the one that Kent Hoover, Washington bureau chief for Bizjournals, picked up on a couple weeks ago. The Secretary looked tired and seemed halting and hesitant in her delivery. She started off by telling journalists that it had been an incredibly busy year. (Yes, every health journalist knows that.) She then recited some of the past year’s highlights—the expansion of the CHIP program for kids and the $1 billion tucked into the stimulus package for investments in health and wellness. All well and good.

Then Sebelius moved on to the baby she must nurture to adulthood. Reform doubles the nursing corps; money to community health services doubles, too; the investment in research is transformative; HHS will become America’s help desk (she said that in her last speech); journalists play an important role. No kidding. She told the assembled that “some parts [of the debate] were covered thoroughly—perhaps too closely,” though it was not clear whether she was talking about the public plan, death panels, or none of the above.

Sebelius wanted health reporters to get the word out about the new law, which about half of the electorate does not support. “It’s important people understand more about the framework of the debate,” she said. “We can’t underestimate how much misinformation there is about what this legislation does and doesn’t do.”

But tucked among the insipid stuff was some meat and potatoes. It seems that in learning to read Sebelius, reporters must listen very closely to her answers, particularly in the Q-and-A, where she tends to leave the scripted remarks.

The biggest take-away: she plans to make insurance companies behave by using moral suasion—“hand-to-hand combat,” she called it. We don’t know yet whether it will be the tough kind employed by JFK to force steelmakers, including industry giant U.S. Steel, to hold the line on price increases, which he called a “wholly unjustifiable and irresponsible defiance of the public interest.” During the briefing, Sebelius described how she brought into line insurers who insisted they didn’t have to cover pre-existing conditions for kids, a point picked up by Joanne Kenen in a blog post for the New America Foundation. The Secretary also mentioned reports last week that WellPoint apparently was dumping policyholders with breast cancer. “We will reach out to those companies,” she vowed—and she did, sending a letter of reprimand.

She didn’t mention, however, the letter she sent to Anthem Blue Cross, a WellPoint subsidiary, after it hiked premiums an average of 35 percent in California. With WellPoint agreeing to postpone the increases until May 1, the briefing would have been a good time for follow-up from the Secretary. But she didn’t offer any, nor did any reporter ask.

Sebelius did say that the administration’s approach to enforcement is “state friendly.” In other words, it will be up to the states to carry out most of the activities specified in the law. Another way to look at it might be business as usual for the insurance companies that hold sway in many state capitals. Or it might be that the administration is fashioning new talking points to deflect the movement for repeal. “This is not a federal take-over,” she told journalists. “It’s a state-friendly approach. This is much better done on the ground in the states.”

Indeed, there were hints that repeal is on the minds of Sebelius and her crew. During the Q-and-A, when fellow Kansan Jim McLean asked about the likelihood that will happen, Sebelius was candid. “It will depend on how the early stages of implementation go and how well people understand it,” she said, noting again that dispelling misinformation is critical to creating buy-in.

She also elaborated on one of the early initiatives—the $5 billion the feds have set aside to bring more people into the states’ high-risk pools. This was the first time I had seen honesty from a politico about this flimsy stop-gap measure to help sick people secure insurance in the individual market. Sebelius admitted that the pools were simply a bridge to the newer market in 2014, and that premiums for folks would be expensive even with the federal dollars that will be available.

“People will pay 100 percent [of the price] of a market rate product out of their own pocket,” she said. “It won’t be an effective strategy for a lot of people.” That’s a quote to keep in mind when the expanded high risk pools debut and some newsmaker tells you how helpful they will be.

What was her biggest disappointment, someone asked? She regretted that the provision that would have sent more money to doctors for end-of-life counseling didn’t make it into the final bill. In other words, she wished the death panel dust-up had not happened. The focus of her disappointment wasn’t the public plan that advocates and much of the public had fervently hoped for. Remember all those hints Sebelius dropped last summer? At least you can say that Madame Secretary is consistent.

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Trudy Lieberman is a longtime contributing editor to the Columbia Journalism Review. She is the lead writer for The Second Opinion, CJR's healthcare desk, which is part of our United States Project on the coverage of politics and policy. She also blogs for Health News Review. Follow her on Twitter @Trudy_Lieberman.