Extending Health Care Coverage

August 05, 1991

Four powerful groups have urged President Bush to extend health-care coverage to 10 million poor Americans. The 10 million, whose incomes are high enough to keep them off welfare but low enough to keep them miserable, cannot qualify for Medicaid. The official poverty line now rests at $13,360 a year for a family of four. Many people who work earn less than that.

The bill could come to $9 billion a year. Prospects of such an expansion without new taxes are slim. Yet President Bush, elected in 1988 promising "no new taxes," faces re-election next year. So do most members of Congress. Still, Democratic leaders are pushing their own plan and pressure is building on Mr. Bush to come up with his own.

The latest groups to favor extended health-care coverage are the American Medical Association, American Hospital Association, Blue Cross and Blue Shield Association and the Health Insurance Association of America. Meanwhile, a blue-ribbon advisory panel appointed by Health and Human Services Secretary Louis Sullivan noted in a draft report that 33 million people lack health insurance. Its report coincides with the industry groups' call for "universal access to health-care services for all Americans."

Hawaii's experience offers useful lessons. While 14 percent oAmericans (most of them employed by small businesses) lack medical insurance, Hawaii makes employers pay premiums for anyone who works more than 20 hours a week. Those unemployed, seasonal workers and those still without medical benefits are covered by the state. Result: near-universal coverage.

Maryland has had success with an "all-payor" system that absorbs hospital costs of "medically indigent" patients by hiking the bills of other patients. That leaves bigger companies' health plans subsidizing people working for companies with no plans. Hawaii's program, which requires nearly all businesses (and workers) to pay, seems inherently fairer. Yet its average health premiums rank near the bottom in comparison to other states.

A concept akin to Hawaii's has been proposed by the Feinblatt commission in Maryland. Dubbed "play or pay," it would require businesses to pay a payroll tax unless they offer health insurance to workers. The tax revenues would underwrite a "model benefits package" for uninsured workers.

Carefully crafted, a national version along either of these lines would ease the tax burden of extending health insurance to those who have fallen through the cracks in a system that lags every other industrialized nation's. Expanded Medicaid would still be appropriate for those who lack jobs of any kind or, like some Hawaiians, earn so little that health insurance is out of the question.

America's medically disenfranchised ought to be given health-care protections. Other modern democracies found ways to accomplish that long ago.

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