Politics may make strange bedfellows, but
those bedfellows do not necessarily make good policy. The proposal by
Families USA, the Health Insurance Association of America, and the
American Hospital Association to deal with the millions of uninsured
Americans is a prime example. Before this proposal "gets legs," we urge
you to carefully review it.
The proposal contains three elements. First, it would expand Medicaid
to cover all Americans with incomes below 133% of the poverty level
(regardless of their ability to work). Second, it would give States the
option to expand their Medicaid and/or S-CHIP programs to cover adults
whose family income does not exceed 200% of the poverty level. And
third, it provides non-refundable tax credits to employers to make
job-based insurance more affordable for low-income workers.
The goal is laudable; the means are not.
I. The Families USA / HIAA / AHA Proposal Empowers Bureaucrats,
Not Individuals:
By continuing to tie health care of individuals to employers and
government, the Families USA / HIAA / AHA proposal builds upon the
current byzantine and inefficient health care system. Instead of
empowering individuals with the wherewithal to choose the health plan
that best suits their needs, it empowers others -- employers and HCFA
and state governments -- to make these choices for them. We should work
together to give consumers more choices and options. The Families USA /
HIAA / AHA proposal moves us in the exact opposite direction. Isn’t it
time to rethink the current system rather than propping it up?
II. The Families USA / HIAA / AHA Proposal Continues the Push for
Government-Run Health Care:
This Medicaid expansion technique is straight from the playbook of
the "government-run health care" crowd. The Families USA / HIAA / AHA
proposal differs from previous expansion proposals only in its vast
scope. By their own estimate, the proposal would increase the number of
Americans covered by Medicaid by more than 50%, would cost as much as
$25 billion per year and would still leave 20 million or more Americans
without health insurance.
This is consistent with the "government-knows best crowd" that
continually push away the private sector from health insurance. In fact,
the Gore-Lieberman campaign advocated a similar expansion of the S-CHIP
program and have also proposed to allow those between the age of 55 and
65 to buy into Medicare. First, the poor are excluded from the private
insurance market. Then older Americans.
Soon the only ones left with private insurance are the young and the
healthy, who are generally seen as being "good risk." Perhaps that
explains why the HIAA has endorsed this contraction of the private
insurance market. Some insurers would rather avoid risk than manage it.
III. The Governors Will Oppose Medicaid Expansion:
Our Governors will likely oppose this Medicaid expansion. As a
federal-state matching program, expanding covered benefits or
populations drives up the States’ costs. Medicaid’s unchecked growth has
led it to become the second largest expense of most States, behind only
education. As then Arkansas Governor Bill Clinton wrote in 1990, "we
must, however, continue to express our concerns about mandated Medicaid
expansions. States do not have the luxury of operating a budget deficit.
Every mandated dollar that we spend is a real dollar that has to be
taken from another program."
IV. Medicaid and S-CHIP Fails to Cover Millions and Does Not
Necessarily Deliver Highest Quality Care:
Millions eligible for Medicaid or S-CHIP are not enrolled and are
therefore uninsured, largely because of the stigma attached to these
welfare programs. According to the Kaiser Family Foundation, 8 million
children who lack health coverage are eligible for Medicaid or S-CHIP.
Approximately 70% of uninsured children qualify for these programs but
are not participating in them. "Studies show that besides a lack of
knowledge of these programs, families do not apply because it can be
time consuming, confusing and sometimes demeaning to do so." Why would
we then want to extend and perpetuate programs that are not as effective
as other means in reducing the uninsured?
Several studies have shown Medicaid enrollees may face barriers to
obtaining care not affecting those with private insurance. A 1994 study
in the New England Journal of Medicine found Medicaid enrollees wait
longer to get physician office visits. It is not surprising, therefore,
that a 1997 Kaiser Family Foundation/Commonwealth Foundation study found
only 7% of adults with private insurance did not get needed care; the
number for those on Medicaid was 13%.
V. Better Alternative to Helping the Uninsured: Tax Credits for
Individuals
Rather than give bureaucracies (private and public) more power over
our lives, Governor Bush has suggested providing tax credits to
individuals for the purchase of health insurance. This proposal
recognizes the current and shameful inequity in the tax code which
allows those with employer-provided health care to use pre-tax dollars,
but requires those in the individual market, and with the least
bargaining power, to buy health insurance with after tax dollars.
Rather than build on our current archaic and arbitrary structures to
expand access to health care, why don’t we work with George W. Bush to
give individuals the resources to choose the health care that’s best for
them?
Sincerely,
JIM McCRERY
Member of Congress
WILLIAM M. THOMAS
Member of Congress
Grace-Marie Arnett is president of the Galen Institute, a health policy
research organization based in Alexandria, VA. Readers may write her at
galen@galen.org, or P.O. Box 19080,
Alexandria, VA, 22320. ![[Audio Archive]](HPCG_120100_files/radio_on.gif){kind=small}