HEALTH REFORM IN THE 2004 ELECTION Candidates’ Health Policy Agendas Moderator : Jeanne Lambrew, George Washington University AcademyHealth National Health Policy Conference 2004 January 28, 2003 Clark :Mila Kofman Edwards : Peter Harbage Kerry :Sarah Bianchi Lieberman : Michelle McMurray

2 Cost Growth Highest in Decades IS THIS THE YEAR FOR A NATIONAL DEBATE? Cost Growth Highest in Decades Sources: Levit et al., Health Spending Rebound Continues in 2002, Health Affairs (January/February 2003).

3 Health Insurance Premiums Are Increasing Rapidly Health Insurance Premiums Are Increasing Rapidly Annual Rate Increases Sources: Kaiser/HRET Health Benefit Survey 2003; Office of Personnel Management.

4 Medicaid/CHIP Costs Rising Although Less So As States Cut Back Source of growth: Seniors and persons with disabilities –Account for nearly 60% of expenditure growth between Enrollment growth rapid as well from –17 percent more children –22 percent more adults Source: Holahan and Bruen, Medicaid Spending, Kaiser Commission on Medicaid and the Uninsured, November 2003

5 Uninsured Problem Is Growing Uninsured rose by nearly 4 million between Problem expanding –Workers in large firms –People with higher income, education States are cutting back on public coverage –1 to 2 million low-income people may lose Medicaid Sources: Census Bureau. Note: methodology changed over The period so that rates are not necessarily comparable. Rate of Uninsured Americans

6 PRESIDENT’S PLAN “Americans know economic security can vanish in an instant without health security.” (1/29/02) Policies: –$1,000 tax credit for individual market –Premium deductibility for Health Savings Accounts –Authorization for Association Health Plan –Nationwide caps on medical malpractice damages –+$50 million for information technology Cost: –~$100 billion over 10 years Likely Number of Uninsured Covered: –4-6 million of 44 million uninsured Note: Details of these policies are in the budget to be released on 2/2/04. Estimates here are not official.

7 DEMOCRATIC PRIMARY CANDIDATES Clark : “It's time we gave our families the same kind of care the Army gives its soldiers, and the government gives our elected officials.” 1/23/04 Dean : “I believe this plan is sensible and that it can pass Congress -- but most importantly, I believe that it is the right thing to do.” Campaign website Edwards : “When it comes to universal coverage, my view is simple: children first.” 7/28/03 Kerry : “In my first 100 days as President, I'll offer America a real deal on health care that starts with cutting costs and stopping skyrocketing premiums.” 12/14/03 Kucinich : "My plan is called Enhanced Medicare for All -- a universal, single-payer system of national health insurance, carefully phased in over 10 years.” Campaign website Lieberman : “The plan I am proud to release today will make American health care work better for the American people — starting by providing affordable coverage to 31 million currently uninsured Americans.” 9/2/03

8 SIMILARITIES IN PLANS Extent To Which They Cover The Uninsured Estimated Uninsured Covered (millions) Estimates from K. Thorpe, except for Kucinich (from campaign)

9 Where The Uninsured Get Covered Kucinich New Group Health Option Employer-Sponsored Insurance Individual Insurance Medicaid/ CHIP Medicare Most Use Combination of Existing Options & New Group Option Dean, Kerry, Clark, Lieberman Edwards

10 Ways of Making Coverage Affordable Percent of premiums, usually phased out by income limits –65-75% of COBRA premium: All but Bush, Kucinich Amount that exceeds a percent of income spent on premiums –Amount >7.5% of income: Dean, Lieberman for new group option Tax credits to employers –50% of small business costs: Edwards, Kerry Reinsurance –75% of group health plans claims above $50,000: Kerry Medicaid/CHIP –Different upper income limits –Different ways of financing state costs Medicare buy-in –Edwards Medikids –Lieberman Tax Credits to Individuals Subsidies to Employers/Insurers Subsidies through Public Programs

11 Addressing Value & Costs Infor- mation on Value for Purchasers Focus on Pre- vention Chronic Disease Manage- ment Elect- ronic Medical Record Rx Cost Contain - ment Med. Mal- practice Kerry  Dean  Clark  Lieberman  Edwards  Note: Kucinich’s cost savings would come from administrative simplification and ending for-profit insurance.

12 Estimated Federal Cost of the Plans (10-Years, Dollars in Billions) Note: Kucinich campaign states plan costs $5 trillion. Clark plan separately has $125 billion / 10 in savings from Federal health programs. All plans’ estimates from K. Thorpe. See Council on Health Care Economics and Policy, Policy Brief January Estimates of Clinton and Gore from CBO and campaign, adjusted for national health expenditure growth to make comparable to plans.

13 COMPARING & CONTRASTING PLANS Build on Public Programs and Private Group Health Insurance Emphasize and invest in coverage No mandates – individual or employer No universal coverage Builds exclusively on private insurance using tax subsidies Emphasizes cost over coverage Puts focus on individual needs Similarities* How President’s Plan Differs * Excluding Kucinich plan