^{Posted on December 5, 2007}

The Mainstream Democratic Candidates' Proposals for Universal Health Care

or “They have seen the enemy — and surrendered” — Barbara Ehrenreich

By Len Rodberg, PhD

The mainstream Democratic candidates for President — John Edwards, Barack Obama, Hillary Clinton — have each put forward their proposals for “affordable quality health coverage for all.” The three Democrats’ proposals, while purporting to provide “universal health care”, will not actually achieve this goal:

None of these plans offers a realistic way of containing the rising cost of health care.

All will add additional funds to an already too-costly system.

None will truly provide universal access to care.

Only a single payer national health insurance program can actually achieve affordable, workable universal access to health care.

The three proposals share a set of common elements:

The private insurance system would remain in place, with no fundamental change in the way it operates. Those who currently have insurance would not experience any change in how they are insured or the coverage they have.

Large employers would be required to provide insurance for their employees or (in the case of Edwards and Obama) pay into a fund to subsidize insurance for their employees.

Everyone (for Edwards and Clinton) or children (for Obama) would be required to have insurance, either through their employer or purchased on their own (an “individual mandate”). Income-related subsidies would be provided through the tax system.

Insurers would be required to offer coverage to everyone (“guaranteed issue”) without limits on pre-existing conditions, and without “large premium differences based on age, gender, or occupation” (from Clinton’s plan).

All would make available a “choice” of private insurance plans, as well as a public insurance option modeled on Medicare. (They use the language of the insurance industry — and Hillary Clinton uses it in the name of her plan itself, the “American Health Choices Plan” — suggesting that what consumers want is a choice of plan.)

All claim to achieve cost savings through expanded use of information technology, an emphasis on prevention, and better chronic care management.

What is missing from these plans?

Since multiple payers would remain (even if one of them might be a public payer), few of the savings and simplifications that are possible with a singe payer can be achieved.

Consumers must purchase insurance, but no limits are proposed on what insurers can charge them.

No regulations are proposed that would assure the adequacy of benefits or that would affect either the restrictions that insurers now impose on the choice of doctor and hospital or the way they handle, and deny, claims.

There is no simplification of the complex and wasteful private insurance system with its copays, deductibles, exclusions, and claim denials.

There is no assurance of a “level playing field” between the public insurance plan and the private ones. Insurance company advertising and targeted marketing will still be used to promote private plans over public and to avoid the poor and the sick. At the same time, the private insurers will surely insist on the additional subsidies they already enjoy in the Medicare Advantage program.

Nothing is proposed that would control the rising cost of health care. (The measures they suggest to achieve savings may well increase costs rather than reduce them. In any case, the possibility for savings is speculative at this point.)

Are these plans politically “realistic”?

The insurance companies will resist guaranteed issue and community rating, as well as other requirements in some of the plans (e.g., Edwards would require that they spend at least 85% of their revenue on medical care).

Business will resist a mandate that they purchase insurance. (In Massachusetts, they were unwilling to pay more than $295 per employee, and even objected to that small fee.)

None of these plans improves the situation of those who currently have insurance. Thus they are unlikely to generate strong popular support.

The proposed subsidies — amounting to about $2,400 per uninsured individual — are about half the cost of purchasing group insurance today. Millions will continue to find insurance unaffordable. (The attempt to impose an individual mandate in Massachusetts is already showing that, as long as the program continues to rely on private insurers, very large subsidies will be needed if coverage is to be both affordable and comprehensive; without such subsidies, either coverage will be limited, or it will be unaffordable.)

Millions of Americans who are currently underinsured, and threatened with bankruptcy in the event of serious illness, will continue to be underinsured and insecure.

These plans would add significantly to our overall spending on health care, already the highest in the world, with much of the additional spending going to insurance company administrative costs and profits.

Conclusion: These Plans Will Not Work!

None of these plans will truly provide universal access to care. They do not overcome the very significant deficiencies of private insurance. None assures the American people of comprehensive coverage, none offers a realistic way of containing the rising cost of health care, and all would add additional funds to an already too-costly system.

They are at best a diversion from the direction we should be going, toward the creation of a single national, publicly-funded insurance pool that can provide comprehensive, continuous, cost-effective coverage along with the budgetary tools needed to begin containing costs.

Prepared by Len Rodberg, Research Director, New York Metro Chapter, Physicians for a National Health Program, September 25, 2007.