Comparison of Major Proposals for Health Care Reform: Introduction
Debbie LeVeen, Professor Emerita, SFSU. April 20, 2009
The matrix comparing major proposals analyses two types of approaches:
A single payer approach replaces private insurance with a new public insurance plan, like Medicare. It offers greater cost-effectiveness than any other approach because it eliminates the enormous administrative costs of a fragmented insurance system (estimated to take about 30% of current health care spending) and can provide research, planning, budgeting, risk pooling, and price negotiations available only within a large integrated system. It thus offers unique opportunities for increasing the quality and reducing the costs of care.
A hybrid approach incorporates both private and public health care plans; it is advocated by those who believe we can structure a hybrid approach so as to achieve high quality and cost-effective coverage for everyone and that building on our existing system is politically more feasible and will be easier to implement than replacing the existing system.
The central components of a hybrid approach are:
1) A new health insurance exchange which offers a new public plan, like Medicare,
and approved private plans, to those without employer-sponsored insurance and to
businesses (small, medium, or all) who choose to cover their employees through the
exchange. Including the new public plan is both critical and highly controversial.
To be approved for participation in the exchange, plans will have to meet specified
standards regarding benefits, cost-sharing, premium-rating, and coverage (e.g. guaranteed
eligibility, inclusion of pre-existing conditions, etc).
2) Employer requirement to “play or pay:” play by offering coverage or “pay” by
paying into the new exchange. Subsidies or exemptions may be provided to small
businesses.
3) Compulsory participation: the requirement that all individuals participate in the new
system, by purchasing insurance, or contributing through the tax system (payroll, like
Social Security, or income). (The Obama proposal requires coverage only for children)
The specific proposals reviewed in the matrix are:
Single payer: SB 810, California Universal Healthcare Act. Mark Leno, author.
(formerly SB 840 and SB 921, Sheila Kuehl author.) 45 co-authors
SB 840 was passed twice by the California legislature, in 2006 and 2008;
it was vetoed by Governor Schwarzenegger.
HR 676, United States National Health Care Act, or Expanded and Improved Medicare for All. Congressman John Conyers. 74 co-sponsors, 4/17/09
Similar in general concept to SB 840; not summarized in matrix.
S 703, American Health Security Act of 2009. Senator Bernie Sanders.
Just introduced last month.
“Hybrid” proposals
For purposes of presentation, I have grouped the hybrid proposals into two columns:
Obama/Baucus and Hacker/Stark; full citations are provided in the footnotes to the matrix.
While there are differences, and some important ones, between the two proposals included in each column, there are enough similarities to allow summarizing them together. Where one proposal includes something significantly different than the other,
the point in the matrix is preceded by an initial which indicates the author of the proposal containing that particular point.
O: The Obama Plan. Presented during Presidential campaign.
PO: President Obama: The core principles for health reform
articulated by President Obama in his first budget message.
B: Senator Max Baucus, Chair of Senate Finance Committee.
Issued his “Call to Action” in November 2008.
CF: Commonwealth Fund. A private foundation supporting research into
“a high performance health care system.” A major source and supporter
of a hybrid approach to reform which it calls “The Building Blocks
approach.” Has developed detailed proposals and hired the Lewin
Group—the nation’s foremost health policy consulting firm—to develop cost estimates for its proposal as well as for other proposals and proposed legislation. It is not really summarized in this matrix, but its recent publications about options for health reform are an invaluable source of information.
H: Jacob Hacker. A political scientist at Berkeley who is also a major source
and supporter of hybrid legislation. His 2007 proposal, titled Health Care for America, was supported by the Economic Policy Institute and analyzed by the Lewin Group. Hacker has done subsequent analyses of the structuring of a public option as part of the hybrid approach; these are supported by the Institute for America’s Future.
S: Congressman Pete Stark, Chair of the Subcommittee on Health of the House
Ways and Means Committee. Author of HR 193, The Americare Health Care Act of 2009. (3 co-sponsors) Unlike other hybrid proposals, HR 193 does not provide a new exchange which offers private plans along with a new public plan but rather a new public plan, closely modeled on Medicare but offering expanded benefits, and offering private plans in the same way that Medicare offers private plans (Medicare Advantage plans).
A few acronyms (in order of appearance)
HIE: Health Insurance Exchange
ESI: Employer-Sponsored insurance
HCA: Health Care for America. Jacob Hacker’s proposal.
FEHBP: Federal Employees Health Benefits Program
Rx: prescription drugs; MCH: maternal child health (includes women’s, reproductive)
FPL: Federal Poverty Level (about $22,000 for a 4-person family, 2008)