The New England Journal of Medicine -- October 19, 2000 -- Vol. 343, No. 16
This week we present statements on health care issues from Vice President Al Gore and Governor George W. Bush, which were received in response to a request from the Editor-in-Chief (reproduced in part below).
Dear Vice President Gore and Governor Bush:
Medical care and issues related to it are of vital interest to all Americans. As we approach the presidential election, physicians across the country are concerned about how the federal government influences their ability to deliver the highest quality of care to their patients. Although much has been said about health care, there are very few specific answers to important questions. As it has done before, (1,2) the Journal would like to publish the views of the Democratic and Republican presidential nominees on health care. We therefore invite each of you to respond to the questions posed below. Our subscribers include over 120,000 physicians in the United States who are concerned about these issues. We realize that there are many important questions about health care and health care delivery and that those asked below are but a fraction of them. Nevertheless, each one addresses an issue that is important to all health care professionals and their patients.
What are your specific plans to provide health insurance to the 40 million uninsured people in the United States? What benefits will you offer? How will you finance your program?
What are your specific plans for Medicare? What will you do to ensure the viability of the Medicare program over the next 50 years? How will you provide affordable access to prescription drugs?
What is your specific position on recourse when medical services are denied by a health plan? How would you ensure that health care providers met the conditions specified?
Quality of Care
What should be the U.S. government's role in the promotion of quality health care and the monitoring of health care in the marketplace? How would you implement this role?
Jeffrey M. Drazen, M.D.
Governor Bush replies:
I believe that all Americans should have access to high-quality, affordable health insurance. This does not mean a one-size-fits-all policy, nor does it mean a one-size-fits-all approach. I believe that all Americans should have the opportunity to choose the health care plan that best fits their financial and health needs. For low-income, working families caught between poverty and prosperity, I have proposed a Family Health Credit that will pay for 90 percent of the cost of a health insurance policy, up to $2,000 a year, for every family making less than $30,000. The $2,000 is fully refundable, as well as advanceable to the insurance company on purchase of a health insurance plan.
I also support medical savings accounts as another way for people to acquire health benefits. A medical savings account can work in combination with a high-deductible, catastrophic health insurance policy, allowing people to build up tax-favored funds to cover out-of-pocket medical expenses. The current law authorizing medical savings accounts expires this year, and it imposes a variety of restrictions.
I will expand and reform the medical-savings-account system by making medical savings accounts permanent in law, lifting the 750,000 cap on the number of accounts, allowing all employers to offer the accounts (separately or as part of a cafeteria plan), lowering the minimal deductible to $1,000 for an individual and $2,000 for family coverage, and permitting both employer and employee contributions to the accounts.
In addition, I will permit employees to carry over $500 from one year to the next in a flexible savings account. This will encourage more efficient use of medical benefits and enable employees to meet their health needs more effectively.
To help those in medically underserved and rural areas, I support allocating $3.6 billion in funding so that 1200 new community health centers can be built across the country. These additional funds will double the number of people the centers can serve. In addition, I will create a "best practices" clearinghouse, so that health centers will have access to information from centers across the country on how to be more efficient.
Another program that helps serve the uninsured population is the State Children's Health Insurance Program (SCHIP). Created in 1997, it was originally intended to provide flexible block grants to the states to assist them in providing health insurance to children, either through Medicaid or through the private sector.
As a governor, however, I have witnessed firsthand how the SCHIP program has been burdened with regulations that restrict the ability of states to create innovative programs for their uninsured populations. For example, states have been restricted in their ability to perform adequate outreach to eligible children. I support returning the SCHIP program to its originally intended form as a flexible block-grant program. In a Bush administration, the federal government will not act as a regulatory roadblock, but will instead work with states so that they have the freedom to make innovations and create programs that reflect the needs of their uninsured populations, especially children. In Texas, I signed legislation providing health insurance to 423,000 Texas children, as well as a parallel program to assist the children of legal immigrants.
Finally, I believe that we must also make health insurance more affordable for small businesses. For many low-income people, the road to the middle class leads through small business. Indeed, small businesses provide 67 percent of workers with their first job.
However, almost 60 percent of all workers without health insurance are employed by firms with fewer than 100 employees or are self-employed. One of the key reasons is that small businesses and sole proprietors have to pay substantially more for health insurance plans than big businesses. Unlike large companies, small businesses do not enjoy the benefits of economies of scale and are unable to spread their risks over large pools of employees.
Small businesses often have to pass some of their costs on to their employees, many of whom may opt to remain uninsured. In fact, 7.3 million currently uninsured persons were offered employer-sponsored insurance but declined, citing cost as the main reason. To help such people and their employers purchase more affordable health insurance, I will allow small businesses to band together, across state lines, to purchase insurance from bona fide trade associations, such as the Chamber of Commerce and the National Federation of Independent Business. Association health plans will enjoy the benefits of economies of scale and a larger risk pool, thus reducing the cost of health insurance for millions of small businesses and their employees.
The best way to ensure that seniors have adequate prescription-drug coverage -- as well as access to preventive care and new forms of medical technology -- is through fundamental Medicare reform. I will work to enact bipartisan legislation to modernize Medicare, based on six principles: Medicare's current guarantee of access to seniors must be preserved; every Medicare recipient must have a choice of health plans, including the option of purchasing a plan that covers prescription drugs; Medicare must cover expenses for low-income seniors; reform must provide streamlined access to the latest medical technology; Medicare payroll taxes must not be increased; and an accurate measure of the solvency of Medicare must be established.
In line with these principles, I propose a new plan, MediCARxES (Medicare Choice and Access to Prescription Drugs for Every Senior), for comprehensive Medicare modernization. This plan is modeled on the proven 40-year track record of the Federal Employees Health Benefits Program (FEHBP).
Today, the FEHBP successfully provides health benefits to 9 million federal employees -- including members of Congress -- and retirees. The FEHBP provides federal employees with a wide range of choices in health plans. Each year, federal employees receive a book that lists all qualified health plans and compares the benefits available under them. Federal employees can then choose the benefits package that best suits their particular health care needs. This program for federal employees has one of the highest levels of satisfaction of any health care system in the country. I believe America's seniors should have a similar choice of plans, providing coverage and care consistent with the best of modern medicine.
To modernize Medicare, I will set aside $110 billion for comprehensive reform. Reform, however, will not jeopardize the benefits seniors are currently receiving. Seniors will be entitled to keep their current benefits if they wish. I will give Medicare recipients a choice of modern health plans, including coverage for prescription drugs. Seniors with the lowest incomes will also get the most help in paying for prescription drugs. Through my new MediCARxES proposal, the full cost of Medicare premiums for seniors with incomes at or below 135 percent of the poverty level will be covered. Seniors with incomes between 136 percent and 175 percent of the poverty level will have their prescription-drug costs subsidized. For all seniors with incomes above 175 percent of the poverty level, my plan will pay 25 percent of premium costs for prescription-drug coverage.
To ensure that low-income seniors do not have to wait for overall reform to have prescription-drug coverage, I will establish the Immediate Helping Hand program, which will provide $48 billion of direct support to states for four years to cover prescription-drug costs in excess of $6,000 annually for any senior. This funding will also cover all prescription-drug costs for seniors with incomes at or below 135 percent of the poverty level and a part of the cost for seniors with incomes between 136 percent and 175 percent of the poverty level.
This coverage can be provided much more quickly through the existing state programs than through any modification to Medicare, which will take more time. Working through the states will help approximately 9 million seniors now. If a state already has a prescription-drug program, as 23 states currently do, the state could use the federal funds to increase its benefit package or broaden eligibility, or it could spend the funds in other ways to address the state's health care needs.
To create effective, bipartisan solutions to the problems facing Medicare, I will create a White House Task Force on Bipartisan Medicare Modernization. I will also include a provision ensuring expedited congressional consideration of the bill the task force will present. The task force will be required to present its proposed bill to the President and Congress by September 1, 2001, and it will be voted on by the end of 2001.
The task force will be directed to prepare a formal legislative proposal for comprehensive modernization of Medicare. Building on the extensive work already done by the 1997 National Bipartisan Commission on the Future of Medicare, the task force will evaluate the MediCARxES plan and other proposed improvements.
I believe patients need access to a speedy and impartial forum to resolve disputes over their health care plans. During my tenure in office, Texas enacted one of the most comprehensive patient-protection laws in the nation. Our law gives patients the right to seek legal action if they have been harmed. I allowed it to become law because there was a strong, independent review process, previously enacted tort reform, and other protections designed to encourage a quick resolution instead of costly litigation. Our law also ensures that employers are shielded from frivolous lawsuits. I believe in protecting patients, not enriching trial lawyers.
In addition, the Texas law ensures that health plans do not use any financial incentives to induce providers to limit medically necessary services, that patients have access to emergency rooms, and that health plans refer patients to out-of-network providers when medically necessary covered services are not available from network providers. I support similar protections at the federal level, provided they do not supersede state patient-protection laws. These reforms will empower patients and give them recourse if a health care provider does not meet their needs. As a result, health care providers will be forced to meet certain conditions.
Quality of Care
The federal government should promote high-quality health care because when people need health care, they want to know that they are getting the best care possible. One key way to boost the quality of health care is to let people control and customize their own care. Patients' needs must be paramount, and innovative providers should not face a false choice between patient care and the bottom line.
A fundamental method of improving the quality of health care is to reduce the rate of medical errors. I support scientific research that provides information about why these errors occur and what can be done to prevent them. We must open the free flow of information concerning medical errors, both to protect patients and to reduce the cost of modern medicine. A key step is reforming malpractice law. In its current form, it leads health care providers to conceal even innocent mistakes, lest they be subject to vilifying publicity through the trial lawyers' system of jackpot justice. That is why a cloak of secrecy envelops operating rooms.
Giving patients greater options will spark innovation and reforms that favor the patient. As governor of Texas, I signed one of the most comprehensive patient-protection laws in the nation. I support giving patients in all health care plans protections similar to those already enacted in Texas, and I oppose legislation that would supersede reforms already enacted by states.
George W. Bush
Vice President Gore replies:
For more than 50 years, America has struggled to provide the kind of health care a great nation owes its people. We have led the world in pathbreaking research, treatment, and discoveries -- many introduced to the world in these pages.
Those advances are allowing people to live longer, healthier lives. Now, we must meet the challenge laid out so articulately by President John F. Kennedy in the fight for what would become Medicare: "Whenever the miracles of modern medicine are beyond the reach of any group of Americans, for whatever reason -- economic, geographic, occupational or other -- we must find a way to meet their needs and fulfill their hopes. For one true measure of a nation is its success in fulfilling the promise of a better life for each of its members." To do this, we must move beyond a sterile debate about labels and abstractions and ask how we can now take concrete, specific, realistic steps to improve health coverage for all the American people.
As President, I will propose a series of steps to do just that.
I intend to expand coverage significantly by covering all children; expanding coverage to the parents of children who are eligible for Medicaid or the State Children's Health Insurance Program (SCHIP); providing affordable health care options for Americans between the ages of 55 and 65, the fastest-growing population of uninsured people today; making health insurance more affordable and accessible for small businesses; and providing tax relief for people purchasing their own health insurance.
The more than 11 million children who are uninsured are less likely than others to be immunized, less likely to get regular checkups, and more likely to fall behind in school. In 1997, President Bill Clinton and I fought for and enacted SCHIP -- the largest investment in children's health in a generation -- to expand coverage to children in families with incomes too high for Medicaid but too low to afford private insurance.
My plan builds on this initiative and will ensure that all American children have access to affordable health insurance by 2005. I will expand SCHIP to provide coverage for children in families earning up to 250 percent of the poverty level (i.e., about $41,000 for a family of four), thus increasing the number of uninsured children eligible for the program. Right now, there are nearly 1 million uninsured children in families with incomes between 200 and 250 percent of the poverty level. In addition, my plan will allow families earning above 250 percent of the poverty level who do not have coverage to buy into SCHIP or Medicaid for their children. This will provide a new option for the 2 million uninsured children in families not eligible for SCHIP, Medicaid, or employer-based insurance. Families will pay the full premium, but the premium itself will be more affordable than most individual insurance options. In addition, families will be able to use a new 25 percent tax credit (described below) toward this coverage. I will also develop more aggressive and effective strategies for enrollment, so that eligible children become enrolled children.
A logical step, building on the enrollment of children, is to extend coverage to their parents, 85 percent of whom do not have insurance themselves. To help the 7 million uninsured parents of children who are eligible for Medicaid or SCHIP, I will expand SCHIP to provide coverage for parents. States will have access to higher federal matching payments to cover the parents of children enrolling in Medicaid and SCHIP. This will efficiently and effectively offer a large proportion of the uninsured an affordable health insurance option and will help create a health care system that rewards families. States will be able to set the income limits for eligibility where they wish but will have to cover all parents whose incomes are below those limits. In other words, states will not be allowed to favor higher- over lower-income parents. This proposal will also help guarantee that more uninsured children are enrolled, because families are more likely to take advantage of new health care programs if coverage is available for every family member.
I will also allow people with disabilities to return to work without losing their eligibility for health insurance.
Americans between the ages of 55 and 65 are the fastest-growing group of uninsured people in the country; more than 3 million currently have no health insurance, and over 60 percent of them are women. Many of these uninsured Americans have been dropped by their employers or had coverage through a spouse and have difficulty buying coverage in the individual insurance market because of poor health. I support and will continue to advocate the Clinton-Gore administration's proposal to allow vulnerable Americans 55 to 65 years old the affordable health care option of buying into Medicare.
I will make health insurance more affordable and more accessible for employees of small businesses. The proportion of small businesses offering insurance actually declined from 59 percent to 54 percent between 1996 and 1998. It is no surprise; small businesses typically pay higher premiums for benefits, and administrative costs may consume as much as 40 percent of premium dollars. I am proposing a 25 percent tax credit for the premium costs for each employee of a small business that decides to join a purchasing coalition. To encourage the development of such coalitions, my proposal will allow foundations to make charitable contributions for their start-up and will provide states with seed money to establish them. This plan will provide more affordable, private health insurance to the working uninsured in firms with fewer than 50 employees and will be available to employers who currently provide insurance as well as to those who do not.
Finally, I will provide a new tax credit for individual health insurance. Although people who have health insurance through their employers receive tax breaks, those without access to job-based health insurance receive no tax benefits. To address this inequity, I have proposed a 25 percent refundable tax credit for people without access to employer-based health insurance who purchase coverage on the individual market.
I believe these steps, taken together, will put us on the path toward
universal coverage and will put millions more Americans under the umbrella
of coverage that protects health, wealth, and peace of mind.
Back in 1993, the Medicare trust fund was projected to run out in 1999. Because of important changes that I fought for in the 1993 budget and the Balanced Budget Act of 1997, Medicare will now be solvent until 2025 -- as long a period of solvency as any in its history. And Medicare is now running substantial surpluses.
Even so, Medicare faces unprecedented challenges. With the baby boomers' retirement just ahead and Americans living longer, the number of Americans on Medicare will double from 40 million to 80 million by 2035. Medicare still needs additional resources to remain strong for the future.
Under current budget rules, Medicare's surplus is counted as part of the "on-budget surplus" and is available to pay for tax cuts or spending. The Medicare surplus was $21.5 billion in 1999. The total Medicare surplus from 2001 to 2010, as projected by the administration's February budget, is $224 billion, and in March, the Congressional Budget Office projected a surplus of $247 billion. Given the latest data from the Department of the Treasury's Monthly Treasury Statement, it appears likely that the Medicare surplus could rise to $300 billion or more.
I propose that we take the next step in fiscal discipline to ensure that we use today's prosperity to help meet the challenges of the future. I propose that the entire Medicare Part A be taken off-budget. Essentially, I want to do for Medicare what we have done for Social Security, by putting the Medicare trust fund in an ironclad lockbox. Doing so will prevent any Congress from raiding Medicare or taking it away, and will keep Medicare strong for decades to come.
We have the opportunity today to take advantage of our historic Medicare surplus not only to save Medicare, but also to strengthen the program for the future. We can start by strengthening Medicare through competition. My plan will inject true price competition among managed-care plans into the system, without coercing seniors to give up traditional coverage. Managed-care plans will be paid for covering Medicare's defined benefits, including a new drug benefit, and will compete to attract seniors on the basis of quality and copayment costs. Such competition will make it easier for seniors to change coverage if they wish, and it will help strengthen Medicare's solvency. Beneficiaries will be able to stay in traditional fee-for-service plans if they wish.
We can also strengthen Medicare through cost savings. My plan will give traditional Medicare new purchasing authority to foster competitive pricing within the Medicare program, provide incentives for beneficiaries to use high-quality physicians who charge reasonable prices, coordinate care for beneficiaries with chronic illnesses, and make use of other best-practice purchasing mechanisms.
We must make sure that providers who serve Medicare beneficiaries are not punished for doing so. I have long believed that flaws in the Balanced Budget Act of 1997 led to excessive payment reductions for many providers. Last year, I fought for the Balanced Budget Refinement Act of 1999 to help address the unintended consequences of the 1997 act. I believe that we still need additional resources to ensure that nursing homes, hospitals, home health care agencies, academic health centers, and others who serve Medicare patients are strong for the future.
Most important, we must update Medicare by providing all seniors with a long-overdue prescription-drug benefit. Every day in America, we are making scientific and medical breakthroughs that would have been unimaginable just a few years ago -- from the discovery of a new gene associated with Alzheimer's disease, to new treatments for osteoporosis, to new prescription drugs that fight everything from high blood pressure and arthritis to cancer and multiple sclerosis.
But still, today, the best of modern medicine is too often beyond the reach of too many Americans. More than three in five seniors do not have prescription-drug benefits. I have met many of them. They skip doses, they cut their pills in half, they choose between their prescriptions and food or heat. They rely on samples or, if they are lucky, spend down their savings. Their stories are harrowing. At a time when prescription drugs are at the critical forefront of modern medicine, we need to treat them as a medical necessity, not an optional luxury.
Under my plan, Medicare will cover 50 percent of prescription-drug costs, up to $5,000 annually. I have also proposed a new catastrophic prescription-drug benefit that covers all costs for beneficiaries after they pay $4,000 out of pocket. There will be no additional premium for the catastrophic plan.
Comprehensive and catastrophic prescription-drug coverage will allow every senior in America to embrace the advances of modern medicine, which will then be available for all our people, rather than passing millions by.
I have always believed that physicians' training and judgment should be used for the benefit of their patients. Yet, too often, insurance-company intermediaries get in the way. It is shocking that nearly 40 percent of physicians admit to having deceived insurance companies to help patients get needed care.
I will lead the fight for the reform of health maintenance organizations (HMOs) in this country by passing a real, enforceable patients' bill of rights to ensure that people in HMOs get the health care they need, when they need it. Strong patients'-rights legislation must include critical protections, such as guaranteed access to needed health care specialists; access to emergency room services when and where the need arises; continuity-of-care protections so that patients will not face an abrupt transition in care if their providers are dropped from their plans; access to a fair, unbiased, and timely internal and independent external appeals process to address grievances; and an enforcement mechanism that ensures recourse for patients who have been harmed as a result of a health plan's actions. Only a strong patients' bill of rights will put medical decisions back where they belong -- in the hands of patients and doctors, not HMO accountants.
Last fall, over 60 Republicans joined virtually every Democrat in the House of Representatives in voting for the Norwood-Dingell Patients' Bill of Rights. I will stand strong for that bill, and not for the bill of goods that is being offered as an alternative.
Quality of Care
The first thing the U.S. government can do to ensure high-quality health care is to continue the fight for a strong, enforceable patients' bill of rights. The recent Supreme Court decision confirmed the need for legislation to ensure that patients can hold health plans accountable for decisions that cause injury or death. I will continue to fight for a patients' bill of rights that covers all patients in all health plans and guarantees critical protections.
I will also fight for strong guarantees of medical privacy so that medical information is secure and confidential. With the completion of the Human Genome Project, a truly historic achievement, it is increasingly important to be certain that genetic information is used to improve health rather than to discriminate against people. I will fight for legislation to ensure that health insurers and employers cannot discriminate on the basis of genetic information.
In addition to protecting patients, we need to invest in our public health safety net to ensure that all our citizens are well cared for. As President, I will strengthen community health centers, public hospitals, and other safety-net providers that treat millions of Americans and fill the service gaps that exist in many communities, especially in primary health care, prenatal care, and mental health and substance-abuse services. We must provide greater access to preventive care that stops health problems before they start. As President, I will continue to look for ways to eliminate barriers and increase incentives for individuals, plans, and providers to pursue preventive care.
We have worked hard and made tough decisions to reach this time of remarkable prosperity. We know that prosperity alone will not meet the challenges that we face in American health care. As Harry Truman reminded us 55 years ago, in a time of prosperity "we can afford many things. But ill-health which can be prevented or cured is one thing we cannot afford."
We must use our prosperity now to make real progress in the years to
come, building on the advances of today to make our families healthier
and more hopeful in the new century ahead.