No answer to the problem

April 29, 1991

The good news is, the Bush administration has recognized that something should be done urgently to provide health insurance for the 34 million Americans, mostly the working poor, who have no insurance coverage. The bad news is, the administration's proposal won't get to first base in resolving that problem.

Secretary of Health Louis Sullivan proposes in effect to levy an income tax on health-care benefits provided to workers for so-called "Cadillac-type coverage." Any benefit valued above, let us say, $1,200 a year would be taxed as if it were income.

Theoretically, that's a reasonable position. Practically, it will never fly. The idea was barely even out of the gate before organized labor denounced the proposal.

We'll never get health-care coverage for the working poor by trading off benefits of the middle class. The only thing that will achieve that result will be a direct appropriation of the $24 billion needed to provide supports and incentives for marginal employers to provide that service for their employees. That's the basic proposal made by the bipartisan Pepper Commission in 1989.

Until we do so, the emergency room will continue to be the family physician for those people who are covered by neither Medicaid nor private health plans. And that's a very expensive and inefficient way to allocate medical resources.

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