Today's Political Climate for Expanding Health Care Coverage

According to the Kaiser Family Foundation (KFF), the number of Americans lacking health insurance increased by 1.6 million to 40.9 million between 2000 and 2001.

Health care is a major concern for Americans. A recent poll by the KFF found that more Americans are worried about health care than about job loss, loss of savings in the stock market, or terrorism.

When Americans are asked to name the most important health care problem the government should address, Prescription Drug Coverage and Coverage for the Uninsured are tied in first place.

The Alliance for Health Care Reform, a bipartisan, non-profit organization headed by Sen. Jay Rockefellor (D-WV) and Sen. Bill Frist (R-TN) held a briefing ("Providing Health Coverage for the Uninsured") on May 5, 2003.

Five speakers with a variety of views participated. Their comments provide an interesting glimpse into what promises to be an important debate in the upcoming presidential election.

Discussion centered on the "Creating Consensus" proposal from the Commonwealth Fund, co-host of the briefing. References were made to three other approaches:

1. Sen. Kennedy's plan, an example of liberal Democratic thinking.
2. Sen. Breaux's plan, a centrist approach to universal coverage.
3. Health Provisions of the 2002 Trade Adjustment Assistance Act, an example of the incremental changes favored by President Bush, Sen. Grassley, and many other Republicans.

An important consideration is how to increase participation with the least disruption to current system. Different proposals use one or more of the following mechanisms:

1. Individual Mandate - a requirement for each taxpayer to carry health insurance, enforced by the IRS. This is the centerpiece of John Breaux's centrist proposal (coupled with tax credits to assist in affordability); it also has some support in the business community.
2. Employer Mandate - also known as "Play or Pay", would require businesses to offer health insurance benefits or pay into a pool that provided coverage. This is favored by many Democrats and opposed by most Republicans and the business community. This issue was one of the leading stumbling blocks in the health care reform debate of 1993-1994.
3. Portable Tax Credit - a refundable tax credit that would enable individuals to buy health insurance in a competitive marketplace. This approach is favored by Republicans, but is criticized by many Democrats as inadequate.

Special attention is required for groups with special access problems:

1. Older workers - some plans propose allowing buy-in to the Medicare system for those approaching retirement age. This is strongly opposed by most Republicans.
2. Small business and individual insurance market - Some plans suggest that government (federal or state) develop or expand purchasing pools to cover this group. Most Republicans favor allowing trade associations to form purchasing groups.
3. Low-income people - Most Democrats favor expanding the Medicaid program to cover this group, which is strongly opposed by Republicans. Centrists and Republicans favor the use of tax credits to assist in buying insurance in other plans.

Financing is a major stumbling block. Many Democrats see Universal Coverage being financed by rescinding part or all of the Bush tax cuts. Most Republicans and the business community see major health care initiatives as unaffordable given current economic conditions and favor incremental reform. There is almost universal agreement that measures need to be taken to increase the efficiency of the health care system through the use of modern information technology.

This chart (in PowerPoint format) compares the features of the four approaches covered in the briefing as well as three proposals made by Democratic Presidential candidates.

Bypassing Washington gridlock - many in the capital (and more outside!) feel that Washington is part of the problem. The bipartisan Wyden-Hatch legislation would establish a citizen's group that would examine the issue, hold public hearings around the country, and report to Congress. Congress would be required to develop and vote on legislation based on this report.

Stay tuned for further developments in this important debate - the Alliance for Health will hold another briefing to examine additional proposals for covering the uninsured on May 19.