Second business group attacks health proposal

February 04, 1994|By John Fairhall | John Fairhall,Washington Bureau of The Sun

WASHINGTON -- The business community dealt President Clinton's health care reform efforts another setback yesterday as the nation's largest corporate group denounced his plan and urged Congress to reject it.

The statement from the U.S. Chamber of Commerce came a day after the Business Roundtable, made up of 200 of the largest U.S. companies, endorsed a rival bill that falls short of the president's goal of guaranteed universal insurance coverage.

A chamber official, Robert E. Patricelli, told the House Ways and Means Committee that the Clinton plan should not "even be used as a starting point" for discussion. But he did not endorse any other plan.

White House officials played down these developments, saying that numerous individual corporations back the Clinton reform approach. But the business groups' criticism highlights the growing perception that the president's plan lacks support and gives a boost to the rival bill sponsored by Rep. Jim Cooper, a Tennessee Democrat.

Mr. Clinton dismissed the business criticism, which defied intensive White House efforts to head off corporate support of the Cooper bill. "I don't want to make too much of it," he said, adding that Roundtable members whom he spoke with this week told him their position was only a "negotiating strategy."

Lawmakers were cautious in assessing what effect the business criticism of the Clinton plan might have in Congress. Sen. Daniel Patrick Moynihan, a New York Democrat who chairs the powerful Finance Committee, said the Roundtable's decision would "have an influence but not a decisive one."

Congress is just beginning serious health reform discussions. Many lawmakers say they hope to develop a new bill from the best of the Clinton and Cooper plans and other proposals.

"The principle that Clinton is trying to accomplish" -- universal coverage -- "is much more important than the specifics of his bill," said Rep. Benjamin L. Cardin, a Maryland Democrat who supports universal coverage but is critical of some elements of the president's plan.

The major obstacle to universal coverage is cost. Mr. Clinton's plan would guarantee all Americans a comprehensive set of benefits and fund them largely with a requirement that employers pay 80 percent of the cost of insurance for workers and their dependents, with workers paying 20 percent.

Mr. Cooper asserts that such a requirement would devastate many businesses. He proposes a more modest plan that would cover some, but not all, of the 38 million uninsured Americans. His plan would be funded by taxing people who buy, or receive from an employer, more than a basic package of health benefits.

The president and Mr. Cooper also clash on the issue of cost controls. Mr. Clinton would require virtually all Americans to join insurance purchasing groups called "alliances" and give government the authority to limit insurance premiums. Mr. Cooper favors only voluntary purchasing organizations that presumably would give businesses and individuals more bargaining power in negotiating with insurers.

In an attempt to compromise on cost, congressional backers of universal coverage say they are willing to delay the timetable for achieving it past 1998 -- the president's deadline -- and to water down his proposed benefits package. One idea being discussed is a dual system of benefits: covering some with a comparatively inexpensive plan that would pay only for "catastrophic" health expenses and covering others with a more expensive version providing comprehensive care.

Mr. Patricelli, the chamber official, said of the Clinton plan: "While that bill has some good elements, it proposes . . . a burden of high employer premium contributions, rich benefits, and counterproductive regulation and new federal and health alliance bureaucracy."

The statement surprised many people because the chamber in 1993 had taken a historic step by accepting for the first time the idea of an employer insurance requirement. Mr. Patricelli said his organization is "re-examining" alternatives to an employer requirement.

But the chamber appears to be divided, White House officials said. The chamber earlier yesterday had submitted less critical testimony to the committee. Mr. Patricelli, chairman of the chamber's health and employee benefits committee, retracted that testimony, which he said "was not reviewed by me," and substituted it with a statement denouncing the president's plan.

Other business groups have taken tentative steps toward endorsing alternatives to the Clinton bill. The National Association of Manufacturers joined four other organizations Wednesday in encouraging Mr. Cooper and Sen. John H. Chafee, a Rhode Island Republican sponsoring a plan without an employer insurance requirement, to negotiate a "mainstream centrist approach."

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