Hokum on Health Care

September 10, 1992

Two health care economists commissioned by the New England Journal of Medicine have examined the competing reform schemes advocated by George Bush and Bill Clinton. To their unsurprise, they find them deliberately vague when it comes to just who will pay what to finance which benefits for whom. Quite charitably, they attribute this obfuscation to political reality. The subject is too complicated for a sound bite, too explosive for elaboration, too forbidding for distracted voters.

This suggests the winner of the November election will neither be armed nor burdened by a specific mandate to tackle one of the nation's most difficult social and economic problems.

A tin ear to the hustings does disclose that Mr. Bush is more the private-sector incrementalist and Mr. Clinton more the public-sector advocate of fundamental change for a system they both describe as deficient in coverage and breakaway on costs. But closer examination convinces Professors Alain Enthoven of Stanford and Uwe Reinhardt of Princeton that neither candidate is talking turkey with the voters.

Professor Enthoven estimates Mr. Bush's proposal for transferable tax credits, or vouchers, for the poor would cost $20 billion -- a figure implying new taxes that will never pass the president's lips. As for Governor Clinton, the professor finds him preserving his options rather than disclosing if he favors "the decentralized private market system" embraced by conservative Democrats or "the centralized top-down government control" advocated by liberals. On costs, his lips are also sealed.

Professor Reinhardt says earlier drafts of the president's plan reportedly called for financing his voucher scheme by taxing health benefits provided employees by employers. He estimates that would yield $40 billion in added income taxes, but such a proposal is "not permitted during an election year." As for Governor Clinton, the professor finds his ideas "every bit as vague and incomplete" as the president's. He flatly labels the "play or pay" scheme offered by the congressional Democratic leadership and unrebuffed by Mr. Clinton "a highly regressive head tax on employees [that] is apt to harm small, low-wage businesses."

On one issue, Dr. Reinhardt is only half right. Noting that the two candidates spare voters "the troublesome thought that someone must pay for the promised new benefits," he concludes: "Today's electorate expects no more from its politicians, and it deserves no more." True, the electorate expects no more but, in our view, it deserves a lot more. It deserves a complete and candid discussion of needed improvements in the health care system and how they will be financed. This is crucial not only to the physical but to the economic well-being of our citizens but, alas, it is not in the cards.

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