Big Push to Pass Health Care Reform this Year

[GG]

http://www.kiplinger.com/businessresource/forecast/archive/Health_Care_Reform_090413.html

The odds are better than even, but employers are balking at demands that they be required to play or pay.

By Martha Lynn Craver, Associate Editor, The Kiplinger Letter

Momentum is building for an overhaul of health care by the end of this year. With a strong push from President Obama, Democratic leaders in both the House and Senate aim to pass bills by the August recess so a conference committee can work out differences in the fall. The fear is that if it drags on much beyond that, politicking for the 2010 congressional elections will make it much harder to get the parties to compromise.

Key stakeholders have been involved in the process for months, including employer groups, labor unions, insurers, drug manufacturers, hospitals, physicians, etc. That in itself is a startling change. They all believe the time has come to act. Adding to the urgency is the growing number of Americans who are losing their jobs and their health care coverage and the soaring costs of coverage that is adding to employers' woes, including their ability to compete globally.

Already consensus is close on key points. A single payer government system is out of the question -- there's too much opposition in Congress and throughout the nation. Instead, look for an expansion that would build on the current system that relies on employer coverage and public programs such as Medicaid and the Children's Health Insurance Program. Small employers are likely to get tax incentives and subsidies to help them cover their workers.

Individuals would be required to have health insurance, just as they are required to have car insurance now. If they don't, they'll be forced to pay a penalty when they file their income tax returns. Those who can't afford to buy coverage, either through employer or individual plans, would be subsidized by the government. An individual mandate would bring the nation closer to universal coverage and expand the pool of beneficiaries, making it possible for insurers to offer coverage, even to those with serious preexisting conditions, at reasonable prices.

Holding down costs will be a prime imperative. To achieve this, more emphasis will be put on prevention and wellness programs and better coordination of care. Changing the way providers are paid, to reward quality care is another popular idea. Finally, a cost-benefit focus on new technology, to encourage what works and discouraging excesses.

But a number of big contentious issues will prove more difficult to resolve:

    * Employers of all sizes are adamantly opposed to a so-called employer mandate where businesses would be required to cover workers or pay into a fund. But the pressure to include this in any reform bill is immense. One possible compromise would be to set a low bar for what must be included in coverage. Employers would still worry, fearing it would be the camel's nose under the tent, with stiffer requirements to come. The penalty for very small firms that opt not to offer coverage would likely be low. For others, it would be a fee large enough to discourage companies from dropping health care.
    * Democrats want to offer a government-run option, a public insurance plan similar to Medicare that individuals could select rather than private plan. The idea is to foster competition, which would keep pressure on private firms to hold down costs and improve service. Republicans and insurers say the competition would be unfair, especially since the government is in a position to negotiate much more favorable pricing. A possible compromise would allow the government to set up a public plan option only if the private plans fail to keep costs in check.
    * How to pay for it? Expanding coverage will be expensive and only partially offset by any savings in health care efficiencies. Much more money will be needed. One option gaining steam would be to count the value of benefits above a cap as income to the employee for tax purposes. In any event, employers would still be able to deduct all health premiums they pay.

Ultimately, President Obama is the key to passage this year. He'll have to muster all his persuasive powers to get the job done. So far, he has let Congress take the lead, and that's yielded real progress. But eventually Obama will need to roll up his sleev

[nathanm]

A single payer government system is out of the question -- there's too much opposition in Congress and throughout the nation.

You know what that means? The biggest source of waste in our health care system will be unaffected by any of this, rendering the 'reform' completely useless.