The uninsured: Still no real champion

Politicians are talking a good game, but do they really mean it?

Wayne J. Guglielmo
Senior Editor

Washington is oozing compassion for the uninsured—or so it seems.

As of mid-June, more than 50 bills addressing the issue were still alive in the 107th Congress, including a trade bill and others with provisions boosting COBRA.

The show of concern isn't hard to fathom. According to Families USA, a health advocacy group, 2.2 million displaced workers lost their health coverage during last year's Sept. 11th-aided recession—the largest annual increase since 1992. Many were middle-class workers who brought a new and more “legitimate” face to the issue. At the same time, rising health insurance premiums have been making it harder for small businesses to cover their employees. In an election year, even one dominated thus far by other news, lawmakers must at least appear sympathetic.

But none of the bills to date has gained any traction.

Why the lack of progress? A tight budget and looming deficits are one reason. A second is the still dicey Mideast-picture and the possibility of more terrorism, either at home or abroad. That pushes health care off the front pages. Third is the ideological gap dividing Democrats and Republicans in their search for a solution.

Simply put, Democrats favor expanding government programs like Medicaid and SCHIP (State Children's Health Insurance Program). The President, along with key GOP congressional leaders, wants to leverage the private health care system, using $89 billion in health care tax credits to “mainstream” uninsured Americans.

Doctors are also divided. Despite its squabbles with Republicans over health-plan liability and antitrust relief, the AMA fully endorses the GOP's tax credit approach, and has for many years. In contrast, the American Academy of Family Physicians called upon Washington lawmakers last year to create a guaranteed basic benefits program, overseen by a public-private board, and funded perhaps through a sales tax, health-insurance premium surcharge, or some other form of broad-based national tax.

To help bridge the gap, in late April the American College of Physicians-American Society of Internal Medicine rolled out its own proposal—one that had something for nearly everyone. Is the internists' plan likely to be taken up by Congress this session? Indeed, is any plan for achieving universal coverage more than a long shot this election year?

What's in the package designed to please?

The ACP-ASIM plan, designed to phase in over seven years, takes a page from each of the party's playbooks.

As a nod to Democrats, it increases government coverage for all people with incomes up to 200 percent of the federal poverty level (currently $8,860 for a single person in the 48 contiguous states). Many of these people—those with income up to 100 percent of the poverty level—would automatically be covered through an expanded Medicaid program. The rest would receive a premium subsidy. This could be used either to “buy in” to Medicaid or SCHIP, or to defray the cost of individual or employer insurance. The plan would also convert SCHIP into an entitlement program, like Medicaid, and raise the federal contribution to Medicaid.

There are some goodies for Republicans, as well. Depending on how Congress votes, the program's premium subsidy might take the form of either a refundable individual tax credit or a direct dollar contribution. A similar mechanism would be used to subsidize private health coverage for uninsured people whose incomes exceed 200 percent of the poverty level. A state demonstrating equal or better coverage than the national program could opt-out of that program, with equivalent federal funds redirected to achieving state health care goals.

Intentionally excluded from the ACP-ASIM blueprint is a financing mechanism. “Until there's general agreement on the need to provide universal coverage and the framework for achieving it, discussing financing methods is premature and maybe even counterproductive,” says Robert Doherty, ACP-ASIM's senior vice president of governmental affairs and public policy. Still, the plan suggests some methods that merit consideration, such as an employer tax, a payroll tax pegged to income, and taxes on tobacco and other harmful products.

Does any proposal stand a chance?

Clearly, the internists' something-for-everyone approach is an exercise in consensus building. If successful, it could not only break the current stalemate over the uninsured, but lead to bipartisan solutions to other longstanding health care problems—the high cost of prescription drugs, better funding for Medicare, patient protection, and the like.

Of course, such a scenario depends on a relatively stable world and the re-emergence of health care as a first-rung issue. And even in that unlikely event, there would still be wrangling over how to pay for programs like universal coverage. “In a world of tax cuts and military priorities, that wouldn't be easy,” says Robert Blendon, a health-policy analyst and pollster at Harvard University.

Still, “it's a lot easier to raise money when there's a consensus than when lawmakers are engaged in civil war over basic approaches,” says Blendon. If politicians see a consensus developing, “political entrepreneurism takes over” and things get done.

Whether that will be the scenario this year remains to be seen. Meanwhile, the issue of the uninsured lurks just below the radar screen, present but not quite fully visible.

 

Wayne Guglielmo. The uninsured: Still no real champion. Medical Economics 2002;13.