WHERE THEY STAND

November 25, 1999

The debate over health care reform is heating up in the presidential campaign. This week, the two Democratic candidates, Former Senator Bill Bradley and Vice President Al Gore, launched campaign ads on the subject in Iowa and New Hampshire. First, a report from Susan Dentzer of our health unit, a partnership with the Henry J. Kaiser Family Foundation. Then, a discussion I recorded earlier this week with representatives of the two campaigns.

MARGARET WARNER: For more on the Democratic candidates' competing plans to expand the number of Americans with health insurance, we turn to representatives of the two campaigns. Elaine Kamarck, the director of a research program at Harvard University called "Visions of Governance for the 21st Century." A former aide to Vice President Gore, she's now a policy advisor to his campaign. And Thomas Higgins, president of an electric utility company subsidiary and former editor of "Healthweek," a national newspaper covering health issues. He's an advisor to Senator Bradley's campaign. Welcome to you both. Tom Higgins, starting with you, we've just heard a description of the two plans. Sum up for us what you think is the essence of Senator Bradley's approach and how that is different for Vice President Gore's? THOMAS HIGGINS: Thank you, I'd be glad to. The principal difference, of course, is that Senator Bradley stands in a tradition of Democratic candidates for the presidency that go back to Roosevelt. He believes that it's a fundamental matter of social justice that all Americans have access to affordable health care. That's been a part of every Democratic platform up to 1996. It's who we are. It basically defines as Democrats. We have a national crisis that's getting worse in this country, as your introduction pointed out. Some 16 percent of Americans now don't have adequate health care coverage, and that number translates into about 45 million people. It's getting worse, because the system can't protect those people. Senator Bradley takes a comprehensive approach to that and proposes to offer access to affordable health care coverage for every American. That is different than the approach that the vice president favors, and I might say different than the approach that the vice president favored as recently as five years ago. His approach is an incremental approach which attempts to tweak the system in various places-- put a patch here, a patch there-- but fundamentally leaves these people, millions of millions of whom are hardworking people, without affordable protection. MARGARET WARNER: And so what would you say is the difference in the number of the uninsured that Senator Bradley's plan would bring in to coverage versus Vice President Gore's? THOMAS HIGGINS: Under Senator Bradley's plan, some 30 million-plus people who currently don't have health insurance coverage would have it. Millions of more people who have health insurance but who struggle to pay the premiums would be able to afford it. Under Vice President Gore's approach, only a small percentage of those people would be covered. MARGARET WARNER: Okay, Elaine Kamarck, how would you sum up again the essential difference of, first of all, your own candidate's plan, and then how you see the essential difference between his and Senator Bradley's. ELAINE KAMARCK: Well, vice president Gore's plan begins with the elderly. It has as its bedrock the very, very important mission of preserving Medicare into the next century. The number of elderly people will double in the next century, and the most important thing we can do is preserve Medicare. Secondly, he would expand the children's health program to cover all children up to $41,000 a year in family income, and expand that program to cover the parents of those children. That's a significant expansion in health insurance. And thirdly, he would provide aid to people who are currently working, but whose employers do not offer them health insurance. And he would provide tax credits and incentives to the millions of small business around the country who are currently not now offering health insurance to their employers. MARGARET WARNER: So of the 44 million that are now not covered, how many would be brought into coverage under Vice President Gore's plan? ELAINE KAMARCK: We anticipate that 90 to 92 percent of Americans would be covered under al Gore's plan, and we think that this is a very targeted and very careful way to increase coverage. We also disagree strongly with the notion that Senator Bradley's plan would cover nearly as many people as he say it's covering. After all, there are no mandates in Senator Bradley's plan. Therefore, I think that is unrealistic to say that there would be 95 percent coverage, as they have said. MARGARET WARNER: Tom Higgins, a big difference also is between the costs of the two plans. Why $1 trillion over ten years? This is what, of course, Elaine Kamarck's referring to when she says that Vice President Gore wants to save extra money for Medicare, and $1 trillion is about the limit of the non- Social Security surplus for the next ten years. Why put it all into this plan? THOMAS HIGGINS: Well, in this year's dollars, the actual price tag is about $65 billion a year over ten years. But the truth of the matter is with the number of people who don't have health insurance climbing, as a result of changes in our economy and frankly as the result of policies of this administration, it does cost money, and Senator Bradley has not attempted to hide that, to address this pressing social problem. We are the only developed nation in the world that does not provide access to affordable health care for all of its citizens. And we are in that respect, I think, at least in a shameful position. So we're not attempting to disguise the cost of this, but let me just say that the cost of not doing it is equally high. It means as a practical matter that poor people wait longer to get their health care. They get it in emergency rooms, and other settings that are not appropriate for it. They spend countless days and hours worrying about how they are going to pay for it. It's a dreadful situation, it leads to more waste, and it leads to a cost-shifting phenomenon that ultimately is paid for by everybody. MARGARET WARNER: Now what's wrong with that critique, Ms. Kamarck? ELAINE KAMARCK: Well, the problem... look, the problem is not the money. The problem is the way that that Bradley's people would spend that money, in fact, not only doesn't solve the problems they say they're going to solve, it creates new problems. First of all, it leaves Medicare very vulnerable to cuts in the future. MARGARET WARNER: You mean because it doesn't leave any money... ELAINE KAMARCK: It doesn't leave any surplus to take care of Medicare. Secondly, it gets rid of the Medicaid program, and it replaces it with essentially an $1,800 voucher. Now, a quarter of the people on Medicaid right now are AIDS patients, and they're elderly people or disabled people. I don't know of an insurance company in the country that would sell an AIDS patient a policy that would be adequate to their needs for $1,800. Nor do I know of an insurance company that would sell a family with an disabled child a health insurance policy for that amount of money. This program doesn't work. Getting rid of Medicaid is very, very dangerous. Medicaid is the social safety net for Americans in this country when it comes to health insurance and health care. And while it's not an ideal program, getting rid of it and replacing it with this voucher idea is particularly dangerous, and I believe that if the senator actually ever got his way, what would happen is that in two years they'd have to create the Medicaid program all over again. Our problem with Bradley's plan is not so much its cost, but all the things that it does not do for that amount of money. MARGARET WARNER: Tom Higgins, why get rid of the Medicaid program? THOMAS HIGGINS: Well, because it's a program that doesn't work very well. And these kinds of arguments that Elaine is making, I think, are absolutely shameful. This is not an abstract argument, to me. I've run health care programs for the poor in the inner city, clinics, and others. To suggest that somehow the Medicaid program is a good program that works well for them is simply out of touch with reality. Senator Bradley proposes to replace the Medicaid program with a better program that is far more adequate to their needs and covers far more people. If you take the position that somehow a program which is, in effect, segregated health care is a good idea then you are taking the position that it is not somehow also unequal. And the truth of the matter is under Medicaid, millions and millions of people don't qualify who are otherwise poor. Half of the poor people in this country are not currently covered by Medicaid. What Senator Bradley proposes to do is replace it with a program that mainstreams health care for just as we do for all federal employees, gives them access to affordable coverage and gives them access to providers. Most providers, two-thirds of the providers in this country today, according to the AMA, do not accept Medicaid. They'd rather have a root canal than have a Medicaid patient. And to leave out half of the poor people in this country is, I think, a scandal. And Senator Bradley's approach is nothing more than replacing that, mainstreaming these poor people, giving them the same access to health care that, say, the vice president himself enjoys. MARGARET WARNER: What about that basic equity argument, Elaine Kamarck? ELAINE KAMARCK: Well, here's the problem, is that in order to make this fit within any realistic amount of money that the surplus might have, Senator Bradley has put an $1,800 cap on the vouchers that they would give to Medicaid patients. Now, the average insurance policy for the federal health care system is $2,800. What he is doing is asking very poor people to pay $1,000 over and above the voucher the government would give them in order to buy into this system. The fact of the matter is that for the people who would qualify, this is a tenth of their total income. They're not going to do this. This won't work. We're not saying that this current system is perfect. We're saying that this program is seriously, seriously flawed in its thoughtfulness, and that Senator Bradley will know... and we know this because every sort of two weeks there's another refinement on this program. This program doesn't work. AIDS patients, disabled people will not be able to buy health care policies for the amount of money in this plan. MARGARET WARNER: Mr. Higgins, most analysts I've read or analyses of the current federal employees health care programs do say that, that $1,800 just doesn't buy you the kind of policy that particularly if you have a disabled child or someone with a severe illness that will cover them. THOMAS HIGGINS: No, I think that's a fundamental misreading of the proposal, and I know it's misreading of insurance principles. The truth of the matter is that almost half of the people who are on Medicaid today in the states are receiving their benefits through a privatized HMO-like arrangement. The premium that Medicaid pays today under this administration is less than the premium support that the Bradley proposal comes forward with. And in the FEHBP -- in this Federal Employees Health care Benefit Program-- the cost of several of the options that are offered are also less than that. When we... when people underwrite insurance premiums, when insurance companies underwrite insurance premiums, they don't do it on an individual basis. They do it on a group basis. So it's absolutely misleading to suggest that somehow each of these are done on an individual basis. That's not how group insurance works, and it's not how it works today in the Medicaid program. MARGARET WARNER: Let me ask you both a very brief final question. To what degree do you think this issue is going to be determinative in the Democratic primary? Ms. Kamarck? ELAINE KAMARCK: I think this issue is very important, because what it shows is that al Gore has a very serious plan to expand health insurance and to keep expanding it until everyone in America is covered. That is his goal. He also, however, has a very realistic way of getting there. And the odds are that he will, in fact, be able to do this. And I think that that's what a lot of people are beginning to see as they look at the two plans. This is a realistic plan. MARGARET WARNER: Okay, Mr. Higgins, do you think this is going to be a determinative issue for a lot of voters? THOMAS HIGGINS: It absolutely will be. And it will be for two reasons. First of all, because I think they'll see in the difference between these two candidates, that the vice president is unfortunately resulting to these scare tactics, which basically drain away the consensus that has been a part of our parties platform for over half a century. One candidate stands for addressing this terrible scandal of people without health insurance. The other candidate is satisfied with the status quo and seeks to tweak it here and there. That's not adequate. MARGARET WARNER: All right, thank you both very much.