Senate Finance Committee Chair Releases Plan to Require All Americans to Have Health Insurance

Senate Finance Committee Chairman Max Baucus (D-Mont.) on November 12, 2008 released a plan to require all Americans to have health insurance, improve health care quality and value and eliminate waste and fraud. “Requiring all Americans to have health insurance will help end the shifting of costs from the uninsured to the insured,” he said in a plan entitled, “Call to Action: Health Reform 2009.”

Health care coverage would be available to Americans aged 55 to 64 through a Medicare buy-in, according to a summary. The plan also would begin to phase out the current two-year waiting period for Medicare coverage for individuals with disabilities.

In addition, Americans living below the poverty level would have access to Medicaid and all states would use the Children's Health Insurance Program to cover children at or below 250 percent of the federal poverty level.

“It is the duty of the next Congress to reform America's health care system,” Baucus said. “The time is now,” he added at a Capitol Hill press briefing. Baucus said his plan is similar to that of president-elect Barrack Obama's and contains a mix of private and public reforms, not a single-payer system. He added that he expects the Senate to support the plan overwhelmingly with possibly 80 votes.

Baucus' staff hasn't written legislation yet and many of the details still need to be worked out. “The devil is in the details,” he said. He added that the plan would take two or three years to phase in and the savings would be reaped after that.

The Baucus plan would create a nationwide insurance pool called the “health insurance exchange,” where Americans could compare and purchase health plans. Those who already have health coverage could keep what they have.

“Insurance works because policyholders pay into their plans when healthy, and have their medical bills paid when they are sick,” said Baucus. “If a significant portion of Americans does not purchase coverage until sick, then premiums for all enrollees will increase to cover insurer outlays, and the problem of unaffordable coverage will persist,” he said.

In addition, under the plan:

Private insurers offering coverage through the exchange would be precluded from discrimination based on pre-existing conditions.
The number of primary care physicians would increase as well as prevention and wellness efforts.
Premium subsidies would be available to qualifying families and small businesses.
Increased use of health information technology would give providers ready access to better evidence and other clinical decision-support tools.

The employer tax exclusion would be addressed to make the incentive more equitable and reduce spending. One option is to cap the amount of health care premiums that can be excluded from employee wages for income and payroll tax purposes possibly, Baucus said.

Once these reforms are in place and coverage is affordable and accessible to all, individuals would have a responsibility to have health coverage. Baucus said. “This step is necessary for insurance market reforms to function properly and to end the cost shifting that occurs within the system,” he said.

Reaction. Senate Finance Committee ranking member Charles Grassley (R-Iowa) said he looks forward “to working through proposals and figuring out how to pay for reforms that will make the system more accessible, efficient and higher quality for everyone.” But he cautioned that “dramatically expanding government spending and putting additional pressure on employers already struggling to create jobs would have repercussions that need to be carefully considered.”

Chip Kahn, President of the Federation of American Hospitals, said Baucus' plan “recognizes the essential role of today's employer-based coverage system through which the vast majority of Americans under age 65 obtain coverage.”

Karen Ignagni, CEO of America's Health Insurance Plans said the proposal “addresses the key health care challenges facing the nation.”

Source: http://finance.senate.gov/healthreform2009/home.html.

Reprinted with permission. © CCH
(Submitted Nov. 2008)

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