Apparently doomed health plan being touted as national model

FEDERAL WORKERS

June 09, 1993|By Carol Emert | Carol Emert,States News Service

WASHINGTON -- At the same time the administration i planning to do away with federal employees' health insurance program, one of Washington's most influential think tanks is touting it as a model health care system.

The President's Task Force on National Health Care Reform, which is crafting a national health insurance strategy, is likely to propose dissolving the Federal Employees Health Benefits Plan and folding its 9 million participants into the new system, says task force spokesman Robert Boorstin.

Although a final decision has not been made, "I can say we're leaning toward [dissolving FEHBP], absolutely," Mr. Boorstin says. "We feel federal employees will be able to maintain the kind of choice that they now have, and it's important that federal employees be part of that system."

The administration is wary of pitching a proposal that excludes political appointees, members of Congress, and civil servants, for fear that exempting such "elites" would damage the plan's credibility with the public, according to recent press accounts.

Federal workers' unions have voiced opposition to the plan, saying that their premiums could go up, their benefits could be reduced, or both.

John Sturdivant, president of the American Federation of Government Employees, says his union backs the concept of a national health care system and is willing to participate in it. "But we won't support any plan that ends up with federal employees paying more for less health care," he says.

The source of Mr. Sturdivant's concern is a task force consideration to let large companies that provide their own insurance programs opt out of the national plan. Federal workers would then be left in a smaller insurance pool with people needing expensive care, such as Medicaid recipients and the unemployed, Mr. Sturdivant says.

Mr. Boorstin denies that exempting big businesses from the plan would have a deleterious effect on others. "Your federal workers would wind up with everybody else -- all small businesses, all self-employed people. . . . These charges of somebody is out to ghettoize the federal health care recipients is just absurd. We want them to have the same good choices that they have now."

Nevertheless, Mr. Boorstin says he would not guarantee that civil servants' premiums would not be raised or their benefits reduced. "I can't make those kinds of guarantees across the board. The cost of it depends largely on which plan you choose."

The task force will not decide for at least another week whether large employers will be allowed to opt out of the national plan, Mr. Boorstin says. The plan will be completed and released sometime this summer, probably in mid- to late July, he says.

A couple of miles from the White House, down Pennsylvania Avenue, Washington's pre-eminent conservative think tank, the Heritage Foundation, is using FEHBP as a model for its proposed national health insurance strategy.

"FEHBP provides a prototype for health care reform that uses market competition and consumer choice to hold down prices," says a full-page advertisement that the Heritage Foundation is planning to run in major newspapers over the next few months.

With FEHBP, "competition among health care providers holds down costs, with a minimum of 'management' interference and overhead," says the ad, which features endorsements of Heritage's plan by 26 syndicated columnists and newspaper editorials.

FEHBP also proves that people are capable of choosing their own health insurance plans, says Ed Haislmaier, a senior policy analyst for the Heritage Foundation. Federal workers choose from among several carriers -- sometimes more than 20 -- and may switch to a new plan during annual "open seasons."

"A lot of people are not used to choosing their own health insurance plan," says Mr. Haislmaier. "We point out that 9 million Americans already do, so this is not completely untried."

The Heritage plan would remove responsibility for insurance from employers and eliminate the tax breaks that businesses receive as compensation for providing health insurance. The government would use that money to give medical tax credits to all Americans.

Each person could choose the policy that best fits his or her needs, says Mr. Haislmaier. Employers would be required to add the money they previously had spent on health insurance to their workers' salaries, which also could be used to purchase insurance.

Heritage analysts offered to discuss their plan with the president's health care task force, but the group was not interested, Mr. Haislmaier says. "We got a polite thanks but no thanks."

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