Timing error: politicians just can't keep up with health care markets.

• Author: Lynch, Michael W.

"Without reform, spending on health care will reach 19 percent of GDP by the year 2000," the White House warned ominously in an October 1993 press release. "If we do nothing, almost one in every five dollars spent by Americans will go to health care by the end of the decade, robbing workers of wages, straining state budgets and adding tens of billions of dollars to the national debt."

Well, we did nothing, at least nothing resembling the proposed ClintonCare system that promised to push every American into a government-managed health alliance. The decade is nearly ended, and American workers are again getting raises, state budgets are in the black and the central question facing Washington's budget writers is what to do with the purported surplus.

So what went right? Americans said "No" to ClintonCare and left the medical marketplace relatively free to evolve. In fact, by the time Hillary Clinton's task force got around to unveiling its notoriously bureaucratic solution, the central problem it aimed to solve - double-digit health inflation - was already a thing of the past. In 1993, total health spending increased 8.6 percent. By 1994, the private sector health market was deflating, with insurance premiums dropping 1.1 percent, according to the well-respected Mercer/Foster Higgins National Survey of Employer Sponsored Health Plans. Total health care spending as a share of GDP has held constant at 13.6 percent since 1993.

America's move to managed care put the lid on health costs. But there was a trade-off: Patients, doctors, and nurses, long accustomed to blank-check insurance, suddenly found themselves dealing with firms that limited choice. Patients found their choice of doctors restricted; doctors found their choice of medical procedures questioned by the companies paying for those procedures. This situation led today's health care problem: the "crisis" in managed care.

Just as Washington wanted to solve the cost crisis in 1993 and 1994, it now wants to deploy its regulatory wisdom to remake managed care. Sen. Thomas Daschle (DS.D.) and Rep. John Dingell (D-Mich.) are sponsoring the Patient Bill of Rights to implement the recommendations of the President's Advisory Commission on Health Care. On the other side of the aisle, Sen. Alfonse D'Amato (R-N.Y.) and Rep. Charles Norwood (R-Ga.) are sponsoring the Patients Access to Responsible Care Act (PARCA). (See "Clinton Care Lite," February.)

These bills differ in degree, but not in their...