IS THIS THE YEAR FOR A
NATIONAL DEBATE?
HEALTH REFORM IN
THE 2004 ELECTION
Cost Growth Highest in Decades
Candidates’ Health
Policy Agendas
Real National Health Expenditure Growth
8.1%
6.3%
6.2%
Clark:
Mila Kofman
Kerry:
Sarah Bianchi
Edwards: Peter Harbage Lieberman: Michelle McMurray
4.6%
3.2%
Moderator: Jeanne Lambrew, George Washington University
AcademyHealth National Health Policy Conference 2004
1988
January 28, 2003
1993
1997
2000
2002
2
Sources: Levit et al., Health Spending Rebound Continues in 2002, Health Affairs (January/February 2003).
Health Insurance Premiums
Are Increasing Rapidly
Medicaid/CHIP Costs Rising
Although Less So As States Cut Back
Annual Rate Increases
13.9%
Average Annual Growth
Rate of Medicaid Spending
12.0%
12.8%
8.5%
8.3%
9.7%
• Source of growth: Seniors
and persons with
disabilities
9.3%
9.0%
5.4%
• Enrollment growth rapid
as well from 2000-2002
3.2%
– 17 percent more children
– 22 percent more adults
0.8%
1988
1993
1996
2000
2003
3
Sources: Kaiser/HRET Health Benefit Survey 2003; Office of Personnel Management.
• Problem expanding
– Workers in large firms
– People with higher income,
education
15.3%
16.1%
14.2%
15.2%
2002
2003
4
“Americans know economic security can
vanish in an instant without
health security.” (1/29/02)
• Policies:
–
–
–
–
–
$1,000 tax credit for individual market
Premium deductibility for Health Savings Accounts
Authorization for Association Health Plan
Nationwide caps on medical malpractice damages
+$50 million for information technology
• Cost:
• States are cutting back on
public coverage
– 1 to 2 million low-income
people may lose Medicaid
199901
PRESIDENT’S PLAN
Rate of Uninsured Americans
13.4%
1992- 1995- 199795
96
99
Source: Holahan and Bruen, Medicaid Spending, Kaiser Commission on Medicaid and the Uninsured, November 2003
Uninsured Problem Is
Growing
• Uninsured rose by nearly 4
million between 2000-2002
– Account for nearly 60% of
expenditure growth
between 2000-2002
– ~$100 billion over 10 years
1988
1993
1997
2000
2002
Sources: Census Bureau. Note: methodology changed over
The period so that rates are not necessarily comparable.
5
• Likely Number of Uninsured Covered:
– 4-6 million of 44 million uninsured
6
Note: Details of these policies are in the budget to be released on 2/2/04. Estimates here are not official.
1
SIMILARITIES IN PLANS
DEMOCRATIC PRIMARY
CANDIDATES
•
Clark: “It's time we gave our
families the same kind of care
the Army gives its soldiers, and
the government gives our
elected officials.” 1/23/04
•
Dean: “I believe this plan is
sensible and that it can pass
Congress -- but most
importantly, I believe that it is
the right thing to do.” Campaign
website
•
Edwards: “When it comes to
universal coverage, my view is
simple: children first.” 7/28/03
•
Kerry: “In my first 100 days as
President, I'll offer America a
real deal on health care that
starts with cutting costs and
stopping skyrocketing
premiums.” 12/14/03
•
Kucinich: "My plan is called
Enhanced Medicare for All -- a
universal, single-payer system
of national health insurance,
carefully phased in over 10
years.” Campaign website
•
Extent To Which They Cover
The Uninsured
43.6
Estimated Uninsured Covered (millions)
31.8
21.7
5
Kucinich
Clark
Kucinich
Edwards
Medicare
Medicaid/
CHIP
9
Addressing Value & Costs
Purchasers
Kerry
Rx
Med.
ElectFocus Chronic
Cost
Malronic
on Pre- Disease
vention Manage- Medical Contain- practice
ment
Record
ment
a
a
a
a
a
a
a
a
a
a
a
Clark
a
a
a
a
a
a
Lieberman
a
a
a
a
a
a
a
Dean
Edwards
a
11
Note: Kucinich’s cost savings would come from administrative simplification and ending for-profit insurance.
Kerry
Edwards
CHIP Goal
8
Subsidies through
Public Programs
Dean, Kerry, Clark, Lieberman
Information on
Value for
Dean
Ways of Making
Coverage Affordable
Most Use Combination of
Existing Options & New Group Option
Employer-Sponsored
Insurance
Lieberman
Estimates from K. Thorpe, except for Kucinich (from campaign)
Where The Uninsured
Get Covered
New Group
Health Option
30.2
26.7
Lieberman: “The plan I am
proud to release today will
make American health care
work better for the American
people — starting by providing
affordable coverage to 31
million currently uninsured
7
Americans.” 9/2/03
Individual
Insurance
31.6
Tax Credits to
Individuals
Subsidies to
Employers/Insurers
• Percent of premiums, • Tax credits to
• Medicaid/CHIP
– Different upper usually phased out by employers
income limits
– 50% of small
income limits
– 65-75% of COBRA
business costs:
premium: All but
Edwards, Kerry
– Different ways of
Bush, Kucinich
financing state
• Reinsurance
costs
• Amount that exceeds a – 75% of group
percent of income
health plans
• Medicare buy-in
spent on premiums
claims above
– Edwards
– Amount >7.5% of
$50,000: Kerry
income: Dean,
Lieberman
for
new
• Medikids
group option
– Lieberman
10
Estimated Federal Cost
of the Plans
$1.7 trillion
(10
-
$932
Years, Dollars in Billions)
$895
$772
$747
$590
$340
Clinton Plan
1994
Dean
Kerry
Clark
Lieberman
Edwards
Gore 2000
Note: Kucinich campaign states plan costs $5 trillion. Clark plan separately has $125 billion / 10 in savings from Federal health
12 program
All plans’ estimates from K. Thorpe. See Council on Health Care Economics and Policy, Policy Brief January 2004.
Estimates of Clinton and Gore from CBO and campaign, adjusted for national health expenditure growth to make comparable to plans.
2
COMPARING &
CONTRASTING PLANS
Similarities*
• Build on Public
Programs and Private
Group Health Insurance
• Emphasize and invest
in coverage
• No mandates –
individual or employer
• No universal coverage
How President’s
Plan Differs
• Builds exclusively on
private insurance using
tax subsidies
• Emphasizes cost over
coverage
• Puts focus on individual
needs
13
* Excluding Kucinich plan
3