The Alfred E. Newman Corollary

There's an old joke in fundraising circles: "Nothing is easier for two people to agree on than how a third person should spend his money."

In health care reform, the EASY part is to agree in principle on what the desired outcomes are: coverage for everybody; freedom of choice in providers; an excellent and inclusive benefits plan; Higher quality and lower costs.

How those things get paid for, and who pays...those are not so easy.

Princeton health economist Uwe Reinhart has been a leading voice for reasonable health reform for over 25 years. A brilliant academic who's also an exceptionally engaging speaker, Reinhart includes in many of his presentations a slide which summarizes the difficulty entailed in controlling health care costs. He refers to it as "The Alfred E. Newman Corollary." (For those too young to remember, Alfred E. Newman was the gap-toothed "cover boy" for Mad Magazine, which was THE source of juvenile, stupid humor in the 1950's and '60's.)

Here's what the slide says:

"One dollar of health care savings = one dollar of income someone isn't going to get."

There are many large and influential stakeholders in the health care debate...hospitals, physicians and other service providers, insurers, pharmaceutical companies, nursing homes, equipment makers, and many others...who have a place at the health care trough, and have a hand in a "health care industrial complex" which comprises 16% of the nation's GDP.

How likely is it that all these powerful interests will "take one for the team" and agree to see their revenues cut...or even the expected increase in their revenues cut...in order to "do what's right" to reform health care.

If you guessed "not bloody likely," you'd be right...

Insurers will say that hospitals, doctors, and drugmakers should take the cut, and people with insurance should expect to pay more. Providers say insurers charge too much, and that Medicare and Medicaid pay them too little already.

Every stakeholder in the debate can be expected to fight like wounded tigers to protect their place at the trough, and to pass the cost of health care reform onto the other stakeholders.

What could concern small businesspeople is that there's no one representing their interests in the debate. And there's certainly no one involved in the debate who understands how different the small business market is from the big business market.

So it's very appropriate to be concerned that when all the parties meet, they could very easily agree that business, especially small business, ought to pay for the cost of health care reform.