Strategies needed to reform healthcare system

December 1, 2008

Ambitious new efforts to expand healthcare coverage may be ruled out in the near future.

WASHINGTON, D.C. - Policy makers on Capitol Hill are staking out positions for the anticipated debate on overhauling the nation's healthcare system.

A number of powerful legislators involved in steering reform legislation through Congress are crafting strategies for gaining consensus-and also filling the void while the new administration lines up its healthy policy and administrative staff. The economic crisis and soaring budget deficits, however, may rule out ambitious new initiatives to expand coverage for the near future.

A more practical strategy, as suggested by leaders of the House, is a piecemeal approach to health reform. House Ways & Means Health Subcommittee Chairman Pete Stark (D-Calif.) is urging quick action on legislation to reauthorize or expand the State Children's Health Insurance Program (SCHIP) and to bolster state Medicaid programs.

SENATE MANEUVERS

Senate leaders appear more open to broader reform initiatives, as seen in the comprehensive "Health Reform 2009" proposal unveiled by Senate Finance Committee chairman Max Baucus (D-Mont.) in November. Sen. Ted Kennedy (D-Mass.), head of the Senate Health, Education, Labor & Pensions (HELP) Committee, has been meeting with key stakeholders electronically with an eye on proposing a "one bill" legislative strategy.

"We want 80 votes for healthcare reform in the Senate," says a Baucus aide, emphasizing the importance of crafting bipartisan legislation based on a consensus approach. That will require support for any Democratic reform initiative from Republican leaders on health policy: Senators Mike Enzi of the HELP Committee, and Charles Grassley and Orrin Hatch on Finance.

Baucus's proposal aims to achieve universal coverage by mandating that all Americans have health insurance, a marked difference from reform proposals articulated by President-elect Barack Obama. Otherwise, the Baucus plan echoes many Obama concepts, such as expanding public safety-net programs and reforming the insurance market to improve coverage options for those without employer-based benefits.

Companies that want to sell through a Health Insurance Exchange to individuals and small businesses would have to meet minimum benefit standards, compete with a new public plan option and comply with guaranteed issue and community rating policies.

While Baucus retains the employer-based healthcare system, his plan acknowledges the need to revise existing tax incentives related to health benefits. Instead of eliminating the tax exclusion for employer-based health insurance premiums, as proposed by Sen. John McCain, the plan proposes more targeted reforms of the system, such as capping the amount of premiums that can be excluded from wages, based on the value of the benefits or individual income.