- © 2007 Canadian Medical Association or its licensors
For Americans, the choice is stark: put a Democrat in the White House in next year's presidential election and major health care reform will likely ensue, perhaps even an historic mandate to insure all residents. Elect a Republican and expect minimal focus on universal coverage, as conservative tweaks nudge the system presided over by President George W. Bush further toward the open marketplace.
“We haven't had as stark a choice, possibly in decades,” says Harvard School of Public Health Professor of Health Policy and Political Analysis Robert Blendon. “Political ideology is just enormous in US politics today. There is a huge dispute about the role of government versus the role of marketplaces.”
Washington, District of Columbia–based Brookings Institution Senior Fellow Henry Aaron concurs. At a time when Americans identify health care as their top domestic issue — trumped only by the Iraq War — the differences between Democrats and Republicans are “profound and fundamental.”
On one side of the ideological divide, Democrats look to expand government's role in providing health insurance. On the other side lies the Republicans' trickle-down theory of health, in which the private marketplace and tax changes control spiraling health care costs, thereby covering more people.
In strikingly similar plans costing upward of US$110 billion a year — about the annual cost of the Iraq War — Democratic front runners Senator Hillary Clinton, former senator John Edwards and Senator Barack Obama have laid out ambitious blueprints for covering most, if not all, Americans. None of the 8 Republican contenders have called for new spending on health care or suggested how many uninsured Americans might be helped by their plans.
Clinton and Obama both back the creation of a national health plan to compete with private insurers, with Clinton and Edwards mandating universal coverage. All 3 would require large businesses to provide insurance for their workers or contribute to the cost, preventing giants like Wal-Mart from skimping on health benefits. All would also prohibit insurers from refusing people coverage or charging more because of illness.
The Republican candidates disavow a national health plan. They want to steer more Americans toward private insurers and away from employer-based insurance, which they believe contributes to the country's enormous health bill by shielding people from the true cost of care. Nor would they limit the ability of insurers to decide whom to cover and at what cost.
Ironically, Blendon believes Republican Mitt Romney set the benchmark on health care reform for the Democrats, when, as governor of Massachusetts, he signed a landmark 2006 law requiring all state residents to have health insurance. A new state “Connector” agency now offers a choice of portable plans, with subsidies on a sliding scale for low-income earners. Employers who don't provide coverage pay a “fair share” assessment.
“The Massachusetts thing created pressure for Democrats to have something even better,” Blendon says. Otherwise Democrats would not have made universal coverage an issue. “The political environment hasn't changed enough to be sure the country wants a new health plan.”
Sure enough, when Edwards launched his plan last February calling for mandatory universal coverage by 2012, it looked a lot like the Massachusetts plan. He proposed expanding government programs to cover the poorest, with portable plans available to others through regional government-run pools, or “health markets,” which would include at least 1 public plan. Private insurers participating in pools would be required to spend at least 85% of premiums on patient benefits. Premium costs for the working poor would be subsidized.
Some 3 months later, Obama followed suit, although he stopped short of mandating compulsory coverage, except for children. Through a national exchange, Obama would enable small businesses or those without insurance to enroll in approved private plans or in a new national plan with benefits similar to those offered federal employees. Income-related subsidies would help lower earners buy insurance. Employers would be required to provide “meaningful” coverage to workers or contribute a percentage of payroll to the cost of the new program.
Clinton waited until September to roll out her plan, a strategy that allowed her to match — or trump — her rivals. After her much-ballyhooed failure in the early 1990s to spearhead health reform for her husband's administration, she emphasizes choice, and keeps private insurers in the picture.
“The lesson of 1992 for politicians was that trying to do it in 1 big explosive charge is impossible,” said Blendon.
Clinton's plan allows Americans to keep their coverage, if they're satisfied, enroll in a new national program or choose from the same private health plans offered federal employees. Tax credits would kick in for lower-wage earners to limit the cost of premiums to a certain percentage of family income. Subsidies would be provided for those who can't afford coverage. Small businesses would get tax breaks to encourage them to provide insurance.
Clinton aims to have all Americans covered by the end of her second term. Edwards responded by moving up his own deadline, saying he would cut off health insurance for the President, Congress and all political appointees, if they fail to pass a universal health care plan by mid 2009.
The 3 other Democratic candidates, New Mexico Governor Bill Richardson, Senator Joe Biden and Senator Chris Dodd, all back the same “Big Plan” mix of private and expanded public coverage. Congressman Dennis Kucinich alone proposes a single universal not-for-profit system. Former Senator Mike Gravel favors a program that issues every American an annual health care voucher based on projected need.
The Democrats generally plan to pay for their programs by ending Bush's tax cuts for the wealthy, streamlining health care administration and repealing a law that bans government programs from negotiating prices for prescription drugs.
The various Democratic proposals could have the effect of wiping out existing employer-based plans, if employers bail on the responsibility and workers flock to the public plans, warns Boston University Economics Professor Lawrence Kotlikoff, who proposed Gravel's voucher approach. “That could happen, and I think it will happen.”
Edwards is among those who would interpret that as support for a single-payer system, with his regional health markets serving as a test. “Over time, the system may evolve toward a single-payer approach if individuals and businesses prefer the public plan,” states the Edwards plan.
Among Republicans, former Arkansas governor Mike Huckabee was the first to weigh in with a formal plan, calling for a “complete overhaul” of the US health care system. Huckabee, who shed 110 pounds while in office after being diagnosed with diabetes, would focus on prevention. He wants insurers to pay for preventive care, with people paying more out of pocket for treatment, encouraging them to stay healthy.
Aiming to uncouple insurance from employers — “jobs don't need health insurance, people do” — Huckabee wants portable private insurance portable and cost-conscious consumers.
Romney and ex–New York City mayor Rudy Giuliani unveiled their plans in mid-summer, standing firmly behind the conservative precepts of limiting government involvement and providing tax incentives to draw more people into the market. Both want to end the long-standing tax exemption that favours employer-provided insurance over insurance bought by individuals.
In an effort to make the system more sensitive to market forces, Giuliani proposes to move health care dollars directly into people's hands. He'd give families a generous US$15 000 tax deduction — $7500 for a single person — if they buy private insurance. When tax benefits exceed the cost of job-based insurance, employers are likely to offer higher wages to entice their workers to switch to private plans. But that's a short-term panacea for workers: health care premiums are rising much faster than wages or inflation.
Surprisingly, Romney has backed away from extolling his Massachusetts solution as a national one, although he touted mandatory insurance as a “conservative idea,” when trying to sell it as governor. Now, as he courts conservative Republicans in the primaries, Romney sings a different tune. “I don't want the guys who ran the Katrina clean-up running my health care system,” he tells interviewers.
But would he stick to his born-again principles, if elected president with a Democratic Congress? Or would he make a deal, as he did with Massachusetts Democrats, to push through reform? Indeed, whoever wins the Republican nomination will likely migrate to the political centre on health care, or risk ceding ground to the Democrats.
Senator John McCain released a plan in October aimed at making individual health insurance cheaper. He would allow Americans to buy insurance nationwide, instead of limiting them to in-state companies, and award tax credits of $2500 to individuals and $5000 to families, not nearly enough to cover premiums. Like Giuliani and Romney, he would end employer tax exemptions for health insurance, forcing workers to pay tax on their health benefits.
None of the 5 remaining Republican candidates have released formal plans. Actor and former senator Fred Thompson supports tax incentives to encourage people to buy health insurance. Congressman Tom Tancredo would permit professional associations to offer health plans to their small business members. Like McCain, Congressman Duncan Hunter would allow people to buy insurance across state lines. Congressman Dr. Ron Paul, a practising physician for almost 30 years, opposes governmental involvement in health care but would make all health care costs tax deductible. Alan Keyes favours tax-deductible medical savings accounts combined with catastrophic insurance to cover astronomical medical costs.
Americans so far strongly prefer Democratic solutions to the nation's health care woes, according to a recent Bloomberg/Los Angeles Times poll. A Gallup poll in October found that, among Democrats, Clinton's health care views have the most resonance. That there is a mood for change is also self-evident, leading many to believe that the current confluence of middle-class anger, corporate dissatisfaction over health care costs and the tight presidential race will finally drive reform of the costly and inefficient health care system (CMAJ 2007;177[10]:1170-71).
Yet, voters haven't parsed differences in plans — most never read them, says Blendon. Instead, they back who ever they believe has the best chance of enacting reform. Aaron, meanwhile, warns that public opinion won't count for much until a new president actually proposes a specific health care bill.
For starters, there's that ideological split to overcome. And people can agree the health care system needs reform, but be unwilling to back changes, if they're happy with their own plan. “It's sort of like people saying the education system is a mess, but they like their kids' teachers,” Aaron says.
There is also the tiny reality that the US political system appears calibrated to resist change, absent a substantial Congressional majority. “It's the same set of conditions that have killed health care in the past,” says Aaron. “The stars may be aligned this time. I hope so. I'm just not holding my breath.”
America's uninsured: as many as 1 in 3
The United States is the only industrialized nation in the world without universal health care. While spending more per capita on health care than any other country, the United States ranked a dismal 37th in health care performance in 2000 among 191 member nations of the World Health Organization.
About 47 million Americans — or 15.8% — are uninsured, according to the US Census Bureau. The number may be higher: A recent study carried out for Families USA, a nonpartisan health care advocacy group, found that 1 out of 3 Americans were uninsured for some or all of the past 2 years. Most uninsured Americans work for employers who do not provide health insurance.
Just under 60% of Americans are insured through their jobs, although that number is declining as insurance costs escalate. Workers contribute to premiums, and generally also pay deductibles and copayments. The average American family spends 20% of its income on health care. Medical bills are overwhelmingly the most common reason for personal bankruptcy.
Governments accounted for more than 44% of US health care spending in 2004, with the uninsured receiving an estimated US$40.7 billion in uncompensated care. About 27% of Americans are insured through government programs, directed at the elderly, disabled, children, veterans and the poor. Only 9% of Americans buy insurance individually.