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Health Plan Used by U.S. Congress Is Debated by Candidates as a Model

Reed Abelson | October 20

NYT - It makes for a compelling stump speech. And the leading Democratic candidates for president are all saying pretty much the same thing: adapt the health care program that covers Congress and offer it to the 47 million Americans currently without insurance.

“The American people should have access to the same array of health care choices and benefits as the senators and representatives they elect,” Senator Hillary Rodham Clinton said as she introduced her health care plan last month.

Mrs. Clinton’s main rivals for the Democratic nomination, Senator Barack Obama and former Senator John Edwards, have made similar proposals to expand the Federal Employees Health Benefits Program.

The program gives members of Congress, along with about four million other active and retired government workers, a wide array of private insurance offerings with fairly generous benefits. But if this would be health care reform, it is reform with a small “r,” according to many nonpartisan experts.

While health policy experts acknowledge that the federal employees’ program could be a workable way to reach some of the uninsured, they also say there is nothing about it that would help address what they see as an underlying reason for the growing numbers of uninsured: the nation’s runaway medical costs. And without major changes, they say, the model would be sharply limited in achieving the goal of universal coverage for all Americans.

“It would be a very expensive system that would not necessarily be on the cutting edge,” said Peter V. Lee, the chief executive of the Pacific Business Group on Health, a California group of employers that offer insurance to their workers.

“You don’t control costs by being big,” Mr. Lee said. True health reform is not a matter of simply covering more people, he said. Instead, it would require more fundamental changes in how care is delivered, he said, like making sure every diabetic gets the appropriate treatment.

To begin with, not everyone makes the $165,000 a year or so that members of Congress do. In fact, at least 100,000 federal workers — at least 5 percent of the active work force — do not have health insurance. In many cases, according to the union that represents the workers, they consider even the cheapest options within the federal plan unaffordable. The lowest-priced family coverage offered by Blue Cross, for example, costs the employee about $2,400 a year.

And despite the program’s federal imprimatur, the government currently plays only a limited role, preferring to let commercial insurers take the lead. Under an expansion of the program, the government’s main contribution might be the billions of dollars in subsidies necessary to pay for additional coverage.

“This is a private-based solution, with all of its foibles,” said Jonathan Gruber, a professor of economics at Massachusetts Institute of Technology who is advising various Democrats about the federal program as a possible model. It would probably have higher administrative costs and pose more of a risk of private insurers trying to enroll only the healthiest people, Mr. Gruber said, than if the government were to provide the insurance directly.

But a market-based solution is much more palatable politically than a government-run program, he said. Any government-run program proposed by a Democratic presidential candidate might be quickly tarred by conservatives as “socialized medicine.”

Still, for all its limitations, policy experts say, using a model like the federal employees system would probably give many people better and more affordable insurance than they could find on their own. While many individuals currently cannot get coverage because of their medical status, under the Democrats’ proposals insurers would not be allowed to turn anyone down.

“It’s a good option for the individual, the self-employed and small business,” said Karen Davis, the president of the Commonwealth Fund, a nonprofit group in New York that specializes in health care policy issues. Individuals and small businesses would benefit from the creation of large insurance pools in which the risks of paying for expensive medical care could be spread over a large population of both the sick and the healthy, she said.

Under the program, the government negotiates with insurers to offer its employees a wide range of health plans. While there is no set benefits package, the government has the final say over whether the coverage is adequate and priced fairly. In most cases, the insurers are limited in how much profit they can make under the program; anything above those amounts is put in reserves used to keep average premium increases lower than they would otherwise be.

As with a big employer like General Electric or Intel, the government relies on Blue Cross and other brand-name insurers to handle claims and determine how much to pay hospitals and doctors.

And the officials running the federal program emphasize that theirs is not a government-run plan like Medicare, in which the government is the main buyer of health care and can effect broad changes in public health.

“We want to behave like another employer — that’s by design,” said Nancy H. Kichak, associate director at the United States Office of Personnel Management, which oversees the program. “We’re not in the public health arena.” The program is as innovative as those typically offered by corporations, she said.

Neera Tanden, the policy director for Mrs. Clinton’s campaign, acknowledges that adapting the federal employees’ program would not be a cure-all for the nation’s health care system. She stressed that the proposal was only one of several aimed at overhauling health care. Others, she said, included offering people younger than 65 a Medicare-like option in addition to private insurance plans. Mrs. Clinton’s plan would also require insurers to cover more preventive medical care.


quiet Bill October 21, 2007 - 5:21am
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( categories: News | Business | Health Issues | USA: Campaign 2008 | USA: Congress | USA: Domestic Issues )

open mouth, insert foot :D

McConnell: Gov’t-run health care for me, not you.

Sen. Mitch McConnell (R-KY) has said he opposes SCHIP because it would impose “government-run health care for everyone.” But as the Kentucky Herald-Leader notes today, McConnell — like President Bush — is a recipient of government-run health care:

[A]s a U.S. senator, McConnell gets government-run, taxpayer-subsidized insurance through the Federal Employee Health Benefit Program, including free outpatient treatment by doctors at the National Naval Medical Center in Bethesda, Md., and Walter Reed Army Medical Center in Washington. When McConnell needed triple bypass heart surgery in 2003, he checked into the Naval Medical Center and was treated by the hospital’s clinical chief of cardiothoracic surgery. […]

McConnell’s office did not return repeated calls seeking comment for this story. In a written statement, his spokesman Don Stewart denied that McConnell’s warnings about “government-run health care” are hypocritical because the senator and his aides receive government-run, taxpayer-subsidized health insurance.

Link

Tina October 21, 2007 - 5:28am
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What Health Plan Will You Elect?

By LAURIE MCGINLEY
October 21, 2007

WSJ

With polls showing health care as a top concern of voters, presidential candidates are scrambling to come up with plans to improve care, hold down costs and cover the uninsured. For consumers, that's a challenge and opportunity.

The challenge: None of the plans is detailed enough to show exactly how consumers' wallets -- or quality of care -- would be affected. The opportunity: Because the difference between the two parties is stark, voters have a clear choice of approach.

While Democrats and Republicans both support beefed-up prevention efforts and greater use of health information technology, they disagree on almost everything else. "The philosophical gap is huge," says Robert Laszewski, president of Health Policy & Strategy Associates, a health-care consulting firm.

'Universal' or Not?

For Democrats, the mantra is universal coverage -- extending insurance to all 47 million Americans who are uninsured. Candidates would shore up employer-based coverage and expand government programs for those who aren't provided insurance through work or can't afford it. The exception is Ohio Rep. Dennis Kucinich, who is pushing a single-payer "Medicare-for-all" program, but is far back in the Democratic field.

Leading Republicans haven't set universal coverage as a goal. They're worried it would be too expensive and would lead to government control of the nation's health-care system. And they're not much interested in reinforcing the employer-based system, which they say isn't suited for the 21st century, with people changing jobs frequently. Instead, they're looking to make it easier and more affordable for people to buy individual policies, an approach they say would increase competition and choices for consumers.

Gail Shearer, a health-policy expert at Consumers Union's Washington office, says individual workers need the protection -- and negotiating clout -- that comes with being part of a big employer pool or in a government program. Individual policies, she says, are expensive and hard to get for people who aren't young and healthy. Encouraging huge numbers of people to move to individual policies "could be disastrous," unless insurers are more tightly regulated, she says.

Grace-Marie Turner, president of the Galen Institute, an Alexandria, Va.-based think tank that prefers private-market solutions to government ones, disagrees. She says the individual-insurance market doesn't deserve its "bad rap," and would become "even healthier and better" if millions of uninsured people had the means to buy individual policies. She says the choice facing voters is between "more government control or a private system that works properly."

Here's a consumer's guide to the plans unveiled so far.

The Democrats

Sen. Hillary Rodham Clinton of New York and former Sen. John Edwards of North Carolina have developed the most comprehensive and expensive of the plans. Both would require all Americans to have insurance; mandate that most employers provide coverage to workers or pay into a government fund for the uninsured; provide subsidies for insurance for low-income people; and create a new public insurance program for people who can't, or don't want to, get private insurance.

Sen. Clinton, attacked by small businesses for her health-reform efforts of the early 1990s, also would provide tax credits to small firms to help pay for insurance. Their proposals don't come cheap: She has estimated her plan would cost up to $110 billion a year; Mr. Edwards estimates his proposal at up to $120 billion a year.

Illinois Sen. Barack Obama, who also calls for universal coverage, includes many of the elements of his two rivals' proposals, including requiring insurers to cover people regardless of medical history. However, he wouldn't require adults to have insurance, leading some analysts to question whether he'd achieve universal coverage. His cost estimate: up to $65 billion a year.

All three leading Democrats would pay for the plans in part by repealing the Bush tax cuts for the most affluent Americans. As part of his plan, New Mexico Gov. Bill Richardson would let people aged 55 to 64 buy Medicare coverage.

The Republicans

The Republicans would make it easier for Americans to afford individual insurance; to finance that, some would change or eliminate the current tax break under which the value of employer-provided coverage is excluded from employees' income.

Former New York Mayor Rudy Giuliani favors a new tax deduction -- $15,000 for families and $7,500 for individuals -- for people without employer-based coverage to buy individual policies. He would provide a refundable tax credit to low-income individuals that could be paired with Medicaid coverage and employer contributions. Like other Republicans, he wouldn't require people to have insurance or employers to provide it.

Arizona Sen. John McCain would provide refundable tax credits -- of $5,000 for families and $2,500 for individuals -- to help pay for coverage. Sen. McCain, who says a top priority is to control costs, also is pushing for the greater use of generic drugs and the importation of drugs from Canada. Like other Republicans, he wants to increase competition in the individual market by allowing people to buy insurance across state lines.

Mitt Romney, who championed a universal-coverage plan while governor of Massachusetts, says he doesn't want to try to implement the blueprint nationally. Instead, he's calling on the states to conduct their own experiments. He would also ease insurance regulations, including those requiring that certain items be covered by insurance.

Former Tennessee Sen. Fred Thompson wants to give Americans access to "affordable and portable" insurance, and would provide "tax incentives" to encourage the purchase of individual policies. Former Arkansas Gov. Mike Huckabee has made similar comments.

More information is available at health08.org1, a new Web site by the Kaiser Family Foundation.

Write to Laurie McGinley at laurie.mcginley@wsj.com2
URL for this article:
http://online.wsj.com/article/SB119292772900066111.html

Hyperlinks in this Article:
(1) http://www.health08.org
(2) mailto:laurie.mcginley@wsj.com

quiet Bill October 21, 2007 - 5:44am
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Comparing the Plans

What the candidates are proposing on health care:

WSJ

quiet Bill October 21, 2007 - 5:46am
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FACTBOX-Health care plans of presidential candidates

Sun Oct 21, 2007 8:46pm EDT

(Reuters) - With 47 million people in the United States without health insurance, the U.S. presidential candidates' plans to close that gap are coming under scrutiny by voters before the November 2008 election. Following are some health care proposals from leading candidates.

DEMOCRATS

* New York Sen. Hillary Clinton

Her plan, estimated to cost about $110 billion per year, would require all Americans to get health insurance. Under a public-private partnership, they would keep existing coverage or choose from private insurance options members of Congress receive. Individuals may also choose a public plan similar to Medicare.

Creates new federal subsidies for those who can't afford coverage and imposes new mandates on large employers to provide health insurance or help pay for it. Small business will receive tax breaks to provide health coverage.

Forces insurance companies to give coverage to everyone, ending discrimination based on pre-existing conditions. Drug companies would also be required to offer fair prices.

* Former North Carolina Sen. John Edwards

Proposal also requires health insurance for all and is estimated to cost about $120 billion per year. It forces private companies, government and individuals to share responsibility for obtaining coverage. Creates new tax credits, expands Medicaid and the federal-state children's health insurance plan, and takes steps to contain health care costs.

Creates regional Health Care Markets, or purchasing pools to give Americans the option of buying into a health care plan, increases choices among insurance plans and cuts costs for businesses offering insurance to employees.

* Illinois Sen. Barack Obama

His plan provides health coverage for almost all Americans. Creates national public insurance program to allow individuals and small businesses to buy affordable health care similar to that available to federal employees. No one will be turned way or charged more due to illness and everyone who needs it will receive a subsidy for their premiums.

Requires all employers to contribute toward health coverage for their employees or toward the cost of the public plan. Creates a national health insurance exchange to reform the private insurance market.

Mandates that all children have health care coverage.

* New Mexico Gov. Bill Richardson

Plan calls for coverage for every American. Working families and small businesses will be able to purchase coverage through the same plan as members of Congress. It guarantees all Americans can choose to keep current coverage or obtain coverage through an existing program.

It will be paid for without raising taxes. Everyone who needs coverage will get an advance refundable tax credit based on income. All Americans will have to have health coverage and employers will pay their share of employee health-care costs.

Eliminates high interest rates for medical expenses. Invests in prevention and healthy lifestyles.

REPUBLICANS

* Former New York Mayor Rudy Giuliani

Proposes income exclusion of up to $15,000 for those without employer coverage to make insurance more affordable. Proposes health insurance credit to low-income Americans to help make coverage more affordable to the uninsured.

Calls for reforms to medical liability legal system to end frivolous lawsuits.

Encourages states to improve health care quality and make insurance more affordable by offering block grants.

Expands access to health savings accounts. Implements incentives in insurance markets to promote preventive care.

* Former Massachusetts Gov. Mitt Romney

Plan expands and deregulates private insurance market to decrease costs and give more Americans access to affordable care.

Offers tax breaks and other incentives to those without insurance. Proposes tax breaks for individuals who buy their own health insurance with a high deductible. Allows tax deductions for out-of-pocket medical expenses and co-payments for services.

Allows states to direct money spent treating the uninsured to instead help them purchase private health insurance.

* Arizona Sen. John McCain

Besides offering a refundable $2,500 tax credit, $5,000 for families, his plan would promote open health care markets by letting providers practice nationwide, rather than restricting them regionally.

This would allow families to purchase health insurance across state lines and through any willing sponsor.

quiet Bill October 21, 2007 - 8:58pm
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