The Selling of Health Care
The most popular president in modern history that served at least one full term was Dwight D. Eisenhower.
Why? When he came to office, Ike had nothing to prove. He'd already successfully commanded the greatest invading army in history. His accomplishments: ending the Korean War; creating the Interstate Highway System; lighting a firecracker under civil rights when his Supreme Court passed Brown v. Board of Education (1954) and he signed the Civil Rights Act (1957); spending a lot of time working to lower his golf handicap.
With Eisenhower in charge, a high comfort level existed in the country. The president and Congress quietly and competently took care the people’s business so we could do our jobs, feed our families and raise our kids.
Ike’s approval rating never fell below 50 percent. In the end, he handed a peaceful and prosperous country to his successor. Based on presidential approval ratings, it's clear we don't like activist presidents. We're comfortable with chief executives who do what's necessary and no more. With the exception of Gerald Ford, an unelected caretaker CEO, all presidents since Eisenhower have been activists. And a number of activist presidencies imploded—Vietnam, Watergate, Iran Hostage Crisis, Iran-Contra, Lewinsky, subprime catastrophe and bank bailout.
A half century later, our activist president is trying to sell health care reform to the electorate and is suddenly up to his ears in alligators.
The situation might have been avoided if just one of his advisers had a background in marketing.
On Nov. 7, 20007, at Google headquarters in Mountain View, Calif., candidate Barack Obama made a speech that included a reference to Bill and Hillary Clinton’s failed 1994 health care reform initiative. He said:
They made one really big mistake. They took all their people and all their experts into a room and then they closed the door and they tried to design the plan in isolation from the American people. I would do it entirely differently. We are going to have a big table, and everybody's going to be invited. It will be on C-SPAN. It will be streaming over the net.
Breaking the BIG Rule
On Aug. 13, Daniel Henninger wrote in The Wall Street Journal:
... health care arrived in late May as a trillion-pound federal elephant in an Obama house that was looking like a Noah's ark of every known species of federal spending: the $800 billion public-works stimulus, the deficit-busting $3.5 trillion budget (and now Treasury's Tim Geithner wants Congress to lift the debt limit above $12.1 trillion), the grandiose cap-and-trade bill that foundered when Democratic coal states rebelled, the U.S. engulfment of the auto industry, the tax time bombs.
In his zeal to reverse Clinton secrecy and make the health care debate transparent, President Obama announced the rollout of a massive national campaign to reform health care—insisting it be passed by summer, or else it would never be passed.
The capstone of the marketing effort was to take place during the summer congressional vacation. Senators, representatives, cabinet members, advisors and the president himself planned to woo the electorate by fanning out across the country in a series of town hall meetings where they would explain health care reform and answer questions.
Alas the White House discovered it has a legion of enemies:
- An entire country outraged at being ripped off by the Wall Street greed that resulted in the subprime mess, foreclosures, millions of lost jobs and the trillion-dollar bailout, while thousands of bailout recipients are receiving million-dollar bonuses paid for by taxpayers.
- Insurance companies are making a fortune by only insuring healthy people and refusing to insure anybody with a "pre-existing condition." Last week I ran into a guy in his 70s who can't get Medicare Part B or long-term care insurance because he once had a liver scan. The results were negative, but the fact that he had the test at all makes him ineligible for coverage. President Obama has said pre-existing conditions will no longer be an excuse for noncoverage, which will eat deeply into the profits of private insurers.
- "I happen to be a proponent of a single-payer universal health care program," Barack Obama said back in 2003. His insistence on a "public option"—government-backed insurance like Medicare—threatens to deeply wound the 1,300 insurance companies that write private health care policies.
- Medicare is grotesquely shortchanging physicians and hospitals. On Aug. 6 in Houston, 90 physicians showed up at a town meeting with Republican Rep. Kevin Brady to vehemently protest the coming of socialized medicine.
- Trial lawyers don't want health care reform because limits on multimillion-dollar malpractice awards for "pain and suffering" will wreck their practices. These judgments drive up malpractice premiums for doctors in some professions to $200,000-plus a year. The result: $210 billion annually in superfluous tests that are (1) designed protect the doctors from lawsuits and (2) provide income to doctors to help them pay the outlandish malpractice premiums.
- The pharmaceutical industry is angry and scared that the government will legislate lower drug prices. I'm for that. My daily intake of a Nexium and Uroxatal pills cost me $1 each; $2 a day; $730 a year. And my Part D Medicare payments don't cover this.
- Medicare and Medicaid are allegedly riddled with inefficiencies and fraud. Huge cuts are threatened. A number of doctors are refusing Medicare patients. Seniors (myself included) are worried, especially since many doctors are opting out of Medicare.
- Small businesses that are hanging on by their fingernails will be forced to spend more on health insurance for employees.
- Business owners and consumers alike are watching their health insurance premiums double every 10 years.
- High earners—already heavily taxed—are threatened with new taxes to pay for health reform.
- Republicans have their knickers in a twist over the shellacking they took in the 2006 and 2008 elections, and want retribution.
The result: Many of these angry, scared people are showing up at town hall meetings—and sending surrogates (some of them armed)—to raise hell, shout down speakers they disagree with, make threats and derail the entire scheme, ultimately turning Norman Rockwell's iconic "Freedom of Speech" painting into a mockery.
Hence the term "Astroturfing" (phony grassroots actions).
President Obama's Hard Lesson in Marketing 101
All professional marketers—and especially direct marketers—have hardwired the following rule into our DNA:
Never roll out a national campaign without first testing it down to the gnat's eyebrow.
Because the president took his plan directly to the people sans testing, he's precipitated a PR catastrophe that's being played out in town meetings, media coverage, millions of dollars of competing broadcast and print advertising, and bombast by conservative commentators such as Glenn Beck ("Obama is a racist") and Rush Limbaugh ("Adolf Hitler, like Barack Obama, ruled by dictate").
What should the Obama White House have done?
- A series of quiet coast-to-coast focus groups not open to the media.
- Professional, noncommittal facilitators to work with individual groups—consumers (employees, seniors and uninsured), physicians, employers, insurers and politicians—to get a fix on what aspects of the plan they're in favor of, what they fear and what language they're comfortable with. With the information gained, a more acceptable plan could have been crafted.
- As well as hammering out solutions with the many constituencies whose oxen were about to be gored, these focus groups would have identified the toxic issues and hot-button phrases before they were loosed on the American people to totally pre-empt civilized debate. Far more precise and soothing language could have been incorporated into the plan.
- For example, the end-of-life counseling option turned seniors ballistic, generating a series of brilliant shibboleths, such as, "Obama wants to kill your grandma," and former Alaska Gov. Sarah Palin's Facebook blog that nearly turned the health care debate into a train wreck:
The America I know and love is not one in which my parents or my baby with Down Syndrome will have to stand in front of Obama's 'death panel' so his bureaucrats can decide, based on a subjective judgment of their 'level of productivity in society,' whether they are worthy of health care. Such a system is downright evil.
The Business Model
"The consumer isn’t a moron; she is your wife," wrote advertising legend David Ogilvy. "You insult her intelligence if you assume that a mere slogan and a few vapid adjectives will persuade her to buy anything. She wants all the information we can give her."
Most agree that health care reform is essential. But so far, it's been botched. Just this past weekend—after vicious acrimony—the end-of-life provision has apparently been scrapped, and the Obama team is sending mixed signals about the public option.
When you're asking for $1 trillion to launch what is in effect a brand-new business, you can't be wrangling over what the new business is in the middle of the sales pitch and expect success.
Last Friday, Nobel Laureate Paul Krugman wrote in a New York Times op-ed:
At this point, all that stands in the way of universal health care in America are the greed of the medical-industrial complex, the lies of the right-wing propaganda machine, and the gullibility of voters who believe those lies.
The medical-industrial beast can be tamed, and the anti-reform health care propaganda machine can be countered.
Needed: professional marketers and PR practitioners.
P.S. Apparently Team Obama got the message. This past Saturday, Bloomberg News announced that two of the presidential campaign ad agencies have been retained to help sell health care overhaul.
Are they locking the barn door after the horse was stolen?