Health Care Reform Proposals Draw Interest in Campaigns

April 03, 2008 | Author: Devon Herrick

By Devon Herrick
Chair, NABE Health Care Roundtable
Senior Fellow
National Center for Policy Analysis

At the 2008 Washington Economic Policy Conference, the Health Economics Roundtable sponsoredasession on prominent health care reform proposals, including those of the presidential candidates and reform efforts taking place in many states.  Democrats have embraced a system of individual and employer-mandated health coverage, coupled with insurance regulations requiring insurers to cover all who apply (guaranteed issue) and to charge similar premiums regardless of health status (community rating). Republicans call for various changes in tax law to cover the uninsured, including a standard deduction (or tax credit) offset by proposed new laws that would make employer health benefits taxable. Whichever idea prevails, employers and consumers will likely be in for a big change.

The panel was composed of seasoned Washington-based health policy analysts who have all worked for both think tanks and government. Jeff Lemieux, from America’s Health Insurance Plans, an industry trade group, started off the panel and was followed by Michael Tanner of the Cato Institute and Len Nichols of the New America Foundation.

Lemieux and Nichols supported expanding eligibility for Medicaid and the State Children’s Health Insurance Program (SCHIP) to cover those too poor to afford coverage on their own.  All speakers admitted no proposal—even those that mandated coverage—would likely cover 100 percent of the uninsured.  Democratic presidential candidates Sen. Hillary Clinton (N.Y.) and Sen. Barack Obama (Ill.) have offered different proposals.  Clinton favors an individual mandate, which Obama and presumptive Republican nominee Sen. John McCain (Ariz.) both oppose.  Obama would mandate coverage for children although he is thought to be open to mandating coverage for adults who remain uninsured once affordable policies become available. 

Nichols thought enforcing a mandate would be easier than the other speakers.  In addition, Nichols believes an individual mandate must be accompanied by guaranteed issue and community rating. Lemieux and Tanner were skeptical of added insurance regulations. To varying degrees, the speakers agreed there is a risk that an individual mandate would result in special interest groups lobbying for mandated services that benefit their respective industries. Excessive benefit mandates would drive up the cost to cover workers and boost taxpayer subsidies necessary to assist low-income enrollees.
 
The panelists agreed unhealthy lifestyles are a major factor in rising medical costs—probably second only to the cost of new technology available to aging Baby Boomers. They generally supported efforts by insurers to encourage better lifestyles (including financial rewards or penalties), although penalties might be difficult politically.  Although they all agreed electronic medical records and preventive care are beneficial, the panelists had mixed views about whether either would actually lower costs.