Regrets on Obamacare? Sebelius has very few 'I think it was not only well worth it, but a battle worth fighting.'

During the worst days of the Obamacare rollout last year, Kathleen Sebelius kept her spirits up by thinking about … Medicare.

As the Obamacare website was crashing and conservative interest groups were shining the spotlight on canceled health plans, the embattled Health and Human Services secretary flashed back to the fierce battles over the creation of Medicare in the 1960s, when the American Medical Association fought its passage and called it “socialized medicine.” Now, she says, when the AMA speaks out about Medicare, it’s when the doctors are trying to prevent their Medicare payments from being cut.


The lesson for future political leaders who might be thinking about the next ambitious social programs? Don’t shy away from them because of what happened with Obamacare, says Sebelius, who resigned at the end of the first enrollment season. Political battles don’t last — and no matter how loud the critics of Obamacare are now, their perspective will change, even if it takes years.

“I say go for it,” Sebelius, now a speaker and consultant, said in an interview with POLITICO. “I think change is very, very hard, and there is always a default position of, either do nothing or do something very small and get in and out of the battle as quickly as possible.”

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“I think it was not only well worth it, but a battle worth fighting,” Sebelius said. “Millions and millions of people are the beneficiaries of this policy.”

The Affordable Care Act could easily be a chilling lesson for future political leaders: Don’t be too ambitious in creating a new social program, keep it incremental and safe, because government can’t handle anything this complicated. But Sebelius says there’s no reason for up-and-coming lawmakers and policymakers to lower their sights, with plenty of other difficult social challenges to take on — especially long-term care, a big policy headache in itself that the health care law wasn’t able to solve.

Yes, she knows how bad the rollout was, and she wishes it had gone smoothly from day one. Looking back on it, she would have had better coordination between the tech teams and the policy people, and she hopes the federal government finally updates its rules so it can get better contractors. But she still insists that she and other top administration officials didn’t get any clear warnings from the contractors that the website wasn’t ready — the kind that might have given them a reason to delay it.

And even though the website disaster is what everyone remembers, Sebelius says there was a whole series of other rapid-fire implementation actions that did go well — everything from putting early consumer protection provisions in place, including the popular coverage of young adults, to changes in payment incentives and the delivery of medical care.

“There were pieces of this puzzle being put in place along the way that were not insignificant in either money or impact, and actually got up and running in very short order,” Sebelius said.

( Also on POLITICO: Sebelius on Obamacare: Change the name)

There are plenty of Democrats who have had second thoughts about the Affordable Care Act — about the timing of the law’s passage, the decision to move ahead without Republican votes, the unqualified promises that everyone could keep their health care plans, and, of course, the competence of the launch. But for all of the political agony Sebelius went through — first during the bitter congressional debates that led to its passage, then during the botched rollout — she’s not much for second-guessing.

Sebelius does have ideas on what would help future political leaders launch programs that represent a complicated technological undertaking. She says the contracting process needs to be overhauled so the promising start-up gurus can be tapped, not just the same old companies that get the contracts mainly because they’ve worked with the federal government before. And she says the technology teams need to work directly with the officials who know the policy, something that didn’t happen enough before the enrollment launch last year.

But unlike Sen. Chuck Schumer (D-N.Y.), Sebelius has no regrets about turning to health care reform right at the beginning of Barack Obama’s presidency. Schumer argues that the Democrats addressed the “wrong problem” by taking on health care reform in 2009 rather than keeping their focus on the recession. Sebelius, however, sticks to the view Obama and most Democratic leaders held at the time: If health care reform didn’t get done then, with a newly elected president and Democrats at the height of their power, it was never going to happen.

“I certainly would have much preferred a very smooth rollout and robust enrollment from day one. But I also feel very good about the fact that this president was able to get a law passed that 70 years of debate prior to him, of both Republican and Democratic presidents, had failed to do,” Sebelius said.

And unlike Joseph Califano, the former Lyndon B. Johnson adviser who has questioned the decision to move ahead without buy-in from the Republicans, Sebelius doesn’t think it was a mistake to launch a program on Obamacare’s scale once it became clear that Republicans wouldn’t support it. That decision set the stage for years of fights and repeal efforts that are still going on today, nearly five years after its passage — unlike Medicare, which was passed with Republican votes and became accepted by the public far more quickly.

In Sebelius’ view, Democrats did try to get Republicans on board when the bill was being negotiated. Then-Senate Finance Committee Chairman Max Baucus tried for months, she said, and she and other administration officials visited with Republicans on the Hill many times. “But I think at the end of the day, he knew that this was a moment in time, and if it did not happen at this moment, there was no guarantee it would ever happen,” she said. “And it was one of the things that he felt very strongly about, very personally about, and also had promised the American public that he would do.”

“You hear echoes of that debate in immigration. Would people like a bipartisan, comprehensive approach to immigration? You bet,” Sebelius said. But “the only way to move forward is really executive authority right now, because there isn’t a bipartisan approach.”

So what lessons should be learned from the implementation of the law? Sebelius says there’s a clear need for more up-to-date contracting rules for information technology projects like HealthCare.gov, which was billed as an innovative marketplace for health insurance and then had to be frantically repaired after the main contractor, CGI Federal, built an error-ridden website that crashed under even the lightest traffic loads. Obama has said the federal government needs to update its procurement rules in the wake of the disaster, but no sweeping overhaul has taken place since then.

“People kept saying, well, why don’t you have, you know, the best new startups? … Well, that’s not how you get into government contracting,” Sebelius said. The contracting rules “required kind of pre-qualifications, it required some substantial history with contracting, I mean a whole set of rules and protections that are in place I think to make sure you get the best and most solid proposals, but I’m not sure they work particularly well in the technology area.”

She also says it’s important to make sure the technical experts talk to the policy experts — the ones who would have known, in this case, what kind of information people need to be able to search easily to find the best health insurance plan for them. “Clearly, there were lots of lessons about making sure that the policy side, the [regulations] being written, what people wanted to have happen as you used technology was really intimately integrated with what they were building, and I don’t know that that happened to the extent that it should have or could have,” she said.

Ultimately, though, Sebelius still blames a lot of the problems on the contractors and their failure to give clear warnings that the federal enrollment website would be ready in time. At the time, Obama said the administration wouldn’t have launched the website if it had known about all the problems. But given the lack of warnings, Sebelius said, it’s not clear that it would have helped to delay the rollout.

“I think if I had been given information, and if [Medicare chief] Marilyn Tavenner had been given accurate information, that this was going to be a catastrophe, we certainly would have revisited the Oct. 1 launch. That is not the information that was given,” Sebelius said.

“If you had moved the deadline, let’s say six months out, moved it two months, would we just have run into the same issue two months later? Does moving a deadline create fixes that are needed, or was it just kind of shoddy work that was masking what the problems were and we didn’t have enough testing time?” Sebelius asked.

One big lesson for the future of the law, Sebelius said, is to revisit the benefits that are required under the law on a regular basis. The law’s critics, especially Republicans, have questioned the need for all of the categories of benefits that are required — including services like maternity and infant care — because they add costs and not all consumers want them or need them. But they’ve also raised criticisms from the other side — that some plans require people to pay too much out of pocket or limit their choices of doctors, both of which are ways to lower the cost of a health plan.

“My real fear was that we would not have enough companies selling policies to really have a competitive market,” Sebelius said. “We were constantly trying to balance, walk that tightrope between consumer protections, which were very important and critical, and overregulating a marketplace which was fragile to begin with, and knowing that what insurers could just do is say, ‘well, that’s a really interesting idea, but we’re just not going to sell in these states.’”

“I think at every point along the way, there were those kinds of competing issues, and they need to be revisited,” she said. “And in four or five years, when the market is stable and balanced and robust, ‘are there enough consumer protections, are the deductibles too high, is there enough network protection,’ can all be back on the table and should be.”

Sebelius says she’s surprised that the political fight over Obamacare has lasted this long, but she takes pride in the fact that the law’s first enrollment season recovered and ended in a big signup surge. There are also fewer crises to keep Obamacare in the news these days. Health insurers are generally offering more Obamacare plans, not fewer ones. And the second enrollment season, which is underway now, has gone far more smoothly, with 2.5 million people selecting health plans in the first month — and none of the kinds of technological breakdowns that plagued the launch.

“I have the great opportunity, and it happens to me basically every day, that somebody approaches me in the grocery store or in an airport or on a plane and says, ‘Aren’t you that health lady? Aren’t you the one?’” Sebelius said. “And then they proceed to tell me a story about their own situation, that they have insurance for the first time, about their mother, about their child, about the fact that this has made a difference in their lives, this is the most significant thing that ever happened. This has saved them money, lots of money. This has been a lifesaver in terms of treatment and support.”

For now, Sebelius says she’s spending half of her time in Washington, D.C., and half in Kansas, where her husband, Magistrate Judge K. Gary Sebelius, still lives. She’s consulting, giving speeches, and will probably serve on some boards — “taking this a step at a time,” as she puts it.

And that’s just how Sebelius says she wants it: “It’s really good not to have a schedule that’s overcommitted.”