Health Care Reform: Suddenly The Status Quo IS An Option

Remember when this round of health care reform began? There was just one thing everyone agreed on: the status quo is no longer an option.

Remember when Pharmaceutical Research & Manufacturers of America CEO Billy Tauzin stood side-by-side with Families USA head Ron Pollack to declare that, past differences between the two groups notwithstanding, they would join forces to urge the Obama Administration to press on with health care reform?

Or America’s Health Insurance Plans CEO Karen Ignagni standing up during the White House health care summit, being called on personally by the president, to say that insurer’s would not repeat their role in blocking reform this time around?

Time and time again, we heard the same theme: in 1993-94, everyone supporting health care reform viewed the status quo as their preference if they couldn’t have reform just their way. This time it was different. The status quo was no longer an acceptable fallback.

The status quo is suddenly very much on the table.

Such is the impact of the unbelievable, unthinkable victory by Republican Scott Brown in the race for the Massachusetts Senate Seat formerly held by the late Ted Kennedy.

Sure, there are plenty of non-healthcare explanations for that outcome. Plenty of folks blame the Democratic candidate, Martha Coakley, for a less than stellar performance. And special elections are always unpredictable. (We drew a comparison before between this race and the kind-of-the-same-but –exactly-the-opposite election of Harris Wofford in Pennsylvania almost 20 years ago.) And Massachusetts already has universal coverage--or as close to it as any federal health care legislation would deliver.

But this is politics and symbols matter. Ted Kennedy passed the mantle to Barack Obama and made health care his legacy issue. There can be no more potent symbol of repudiation for the current reform path than the election of an avowed health care reform opponent from the opposition party to fill his seat.

That silence you hear is the stunned contemplation of all parties to the health care reform debate that the status quo might just be what they end up with after all. All those lobbyists. All those hours. All those hearings, and mark-ups, and legislative drafts, and drafts of drafts. All for nothing?

Now, as President Obama likes to say, let me be clear. As of today, less than 48 hours after it really happened, no one can say for sure what the strategy on health care reform will be. Or, indeed, whether there will even be a strategy—since it is entirely possible that the Obama Administration, House Democrats and Senate Democrats will end up pursuing different ones.

And, as we point out in “The Pink Sheet” DAILY today, there are viable options to move forward, once the dust settles—many of which still seem attractive for biopharma companies.

But whatever happens next, we expect a key element will hinge on whether the stakeholders in the debate really meant what they said a year ago. Is the status quo really not a good outcome?

Because it is suddenly very much an option.