Comprehensive Health Care Doesn't Mean More Taxes

March 29, 1992|By BENJAMIN L. CARDIN

In this election year, America is embroiled in a critical debate. How do we maintain the quality of our health-care system while expanding coverage and reducing costs? How do we protect workers who lose their medical coverage when they change jobs because of pre-existing conditions? How do we provide health care for the millions of Americans who have no coverage?

The bottom line is: Americans are afraid. They are afraid of changing jobs for fear of losing their health insurance. They are afraid of getting seriously ill with no medical coverage, cut adrift to shoulder astronomically high medical bills.

For a nation that spends $800 billion a year on health care and has the most sophisticated medical technology in the world, we have tremendous gaps that are hard to fathom. Consider these facts: We spend more in health care than any other industrialized nation, yet 35 million Americans have no insurance coverage, and an additional 60 million have no insurance coverage at some point during a two-year period.

How to reform our health-care system is one of the most difficult problems facing us this year. Should we scrap our entire health-care system and go to a Canadian-style program with total coverage for every American? Or should we do what President Bush has called for and preserve our current system with only small modifications that will help expand coverage?

The common political belief is that we cannot possibly afford quality health care for all Americans without driving federal spending to new stratospheric heights. That may be true of the single payer or pay-or-play plans that have captured the headlines, but it does not have to be the case if we carefully target our health-care expansion to people who are not being served.

The fact is we do not need any major new taxes to provide greater access to health care in this country. The $800 billion we spend a year for health care is more than enough to ensure all Americans a decent level of medical care.

We must create a totally American health-care plan that blends the best aspects of comprehensive, national plans with the diversity of our present free-market system. I have proposed such a plan. It is the Flexible Medical Access Act (FLEX MED), which would provide affordable, quality health-care while preserving a large degree of flexibility and choice for Americans in fashioning their own health-care coverage.

FLEX MED would require employers to phase in a basic health-care plan for all employees and dependents over a five-year period. Coupled with this would be reform of the private insurance market to guarantee availability, renewability and portability of coverage.

To ensure affordability of premium costs for small employers, the mandates for coverage would not be implemented until the cost containment provisions of FLEX MED are in place. This will ensure that premium costs for small businesses will be affordable and that rate increases will remain reasonable.

To further help small employers, the self-employed and individuals not eligible for other plans, FLEX MED would offer two options: tax incentives and the right to purchase a government insurance plan that would be administered as a separate program under Medicare.

To address the needs of the poor and the near-poor not in the work force, Medicaid would be abolished and replaced with a new, government-sponsored plan administered as a separate program under Medicare. This public plan would pay the same reimbursement rates as all other insurance plans to ensure there would be no cost shifting by the government to private insurance plans and to encourage more doctors to treat poor patients.

All insurance plans -- public and private -- would be required to provide basic core coverage, similar to what Medicare provides, with a new emphasis on preventive care. There also would be a single deductible and limited out-of-pocket expenses. Employers would be required to pay at least 80 percent of the cost of a basic, core plan. Employers and individuals would be allowed to purchase additional coverage if they so desire.

FLEX MED's strength is in directing coverage to the uninsured while establishing strong cost containment and local control provisions. Cost containment -- a key to FLEX MED's success -- would be structured on a two-tier level. The first tier would be the federal government, which would set national spending limits to reduce the rate of growth of health-care expenditure.

The second tier would be at the state level. States would be required to establish rate-setting commissions. State commissions would set maximum rates for growth of different health services, including hospital charges, physician charges, lab fees. States would also ensure compliance with federal expenditure limits and would ensure rates apply equally to all payers (Medicare, private insurers) and to all covered services.

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