Alliance for Health Reform & Kaiser Family Foundation’s
Commission on Medicaid and the Uninsured:
“Covering the Uninsured: Options for Reform”
Potential Complications with the
Different Approaches to Health Reform
Bradley Herring, Ph.D.
Johns Hopkins University
email: bherring@jhsph.edu
May 2, 2009
Members of Divided We Fail -- a coalition led by AARP that includes the
Business Roundtable, the National Federation of Independent Businesses and
the Service Employees International Union and seeks to promote health care
reform -- have become “divided over key elements of how to fix health care”
as they “get down to the specifics,” the AP/Boston Globe reports.
According to the AP/Globe, although members “agree that something should
be done to revamp health care in the United States” and have reached a
“consensus on a vague set of general principles that include making coverage
more accessible, affordable and efficient,” they “differ over important details,
including what roles the government and private businesses should play.”
Kaiser Daily Health Policy Report posted February 17, 2009
Potential Complications
• Ideology:
– Private markets vs. government
• Special Interests:
– Insurers, physicians, hospitals, drug companies, business
• Redistribution of Income:
– How much? How complex?
• Consider These Four Options:
– Single payer, McCain, Obama/Baucus, Wyden-Bennett
Single Payer: HR 676
• The Underlying Appeal:
– Elegant
– Universal
– Large reduction in administrative costs
• Potential Complications:
– Who says no?
– Taxes: employer/employee payroll taxes of 4.75% each;
repeal Bush tax cuts; additional 5% tax on top 5% of income
and 10% tax on top 1% of income; 0.25% stock transaction
– Lower reimbursements to medical providers
McCain / Republican Vision
(Tax Reform, Individual Markets, Cross-State Purchasing)
• The Underlying Appeal:
– Tax reform “can” improve efficiency and equity
– Achieve a competitive market for health insurance
• Potential Complications:
–
–
–
–
Reductions in pooling across health status
High risk pools either expensive or underfunded
Reductions in consumer protections
High administrative costs in individual markets
(Candidate) Obama / Baucus
• The Underlying Appeal:
– Built on the current system – least upheaval
• Potential Complications:
–
–
–
–
–
–
Built on the current system – fragmented
Who really pays under an employer mandate?
Does it have an individual mandate? Is it enforceable?
“Crowd out” with expanded Medicaid/SCHIP
Controversy surrounding the public plan option
Is this bipartisan enough to actually pass?
Wyden, Bennett, et al.’s
“Healthy Americans Act”
• The Underlying Appeal:
– Bipartisan support
– Grand compromise: markets w/ regulation, ample subsidies
– CBO/JCT: breaks even after a few years
• Potential Complications:
–
–
–
–
Willingness of high-income people to redistribute?
Vulnerable Medicaid population folded into private plans
Defining the basic benefit package
Hardly anyone’s favorite: third place behind status quo?