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JOHN KERRY S PLAN TO MAKE HEALTH CARE AFFORDABLE TO EVERY AMERICAN
Stops Spiraling Costs Provides Coverage for 95 Percent of Americans, Covers Nearly all Children, Allows Americans to Access to the same Health Care Plan As Members of Congress
I. Controlling the Spiraling Costs of Health Care
Health insurance has become too expensive. Double-digit increases in health care premiums make it hard for Americans and businesses alike to afford health care. Companies that do the right thing by providing good health insurance for their workers are getting squeezed by rising costs. As a result, more companies are asking workers to contribute a greater share of their health care costs through higher premiums and increased cost sharing and even sometimes reducing their benefits to keep costs down. Skyrocketing costs have also wreaked havoc on state budgets, putting pressure on state health care programs at a time when job losses leave more Americans needing coverage protections.
Some increases in cost are due to advances in health care. However, too many of these rising costs are driven by waste, fraud, and abuse in the system; loopholes that keep prescription drug prices too high; meritless lawsuits; medical errors that undermine quality health care and raise costs; and too much bureaucracy and paperwork that contributes to 25 percent of health care costs today. Many employers and purchasers have worked to make improvements, and their efforts demonstrate that progress is possible. But we need a national commitment to assure system-wide changes that can improve quality and reduce costs and keep health care from becoming too expensive.
John Kerry believes that all parts of the health care system insurers, providers, lawyers, employers and patients -- have a responsibility to help make the health care system more affordable. John Kerry has a five-point plan that will save Americans and purchasers billions in health care costs every year and save the Federal government, conservatively, $150 billion over the next ten years.
(1) CREATING A NEW APPROACH TO CONTROL SPIRALING HEALTH CARE COSTS AND PASSING THE SAVINGS ON TO WORKERS. In 2001, only 4/10 of one percent of private insurance claims was for individuals with health expenses in excess of $50,000. However, these claims accounted for nearly 20 percent of medical expenses for private insurers. John Kerry believes that health care is becoming too expensive. He has a proposal for a new 'premium rebate' pool that will make heath care more affordable for all employers and employees by helping out with certain high cost health cases. Under this proposal the pool would reimburse employee health plans for 75 percent of the catastrophic costs they incur above $50,000 as long as they guarantee such savings are used to reduce the cost of workers premiums. Helping out with catastrophic costs would strengthen the employer-based market by making health care more affordable for purchasers. It will also make health care more affordable for those who buy into the Congressional Health Plan. To be eligible for this 'premium rebate' pool, employers and their insurers would have to:
· Provide Affordable Health Coverage to All of Their Workers. Many companies work to provide quality coverage to all their workers. However, too often large companies have stringent rules that prevent their low-wage workers from obtaining affordable health care. For example, they will require employees to work for many months before even offering coverage, and then subsidize it at a low amount. To join the premium rebate pool, employers would have to provide affordable coverage to all their employees.
· Demonstrate That Workers Will Receive the Savings. By removing catastrophic costs, John Kerry's proposal will make it easier for employers to offer affordable coverage. To be eligible, however, savings from this relief must be directly passed to workers. The premium pool is estimated to save workers as much as 10 percent or $1000 off a Family Plan.
· Encourage Disease Management to Improve Care Quality and Decrease the Costs of Care. Chronic diseases, such as asthma, cancer, cardiovascular diseases, and diabetes make up 78 percent of all medical costs. Disease management and health promotion programs provide an opportunity to improve patient outcomes and limit spending by identifying and monitoring high -risk populations. Some purchasers have worked to implement these approaches and have found good results. For example, a Bank of America health promotion program found that insurance claims were reduced an average of $164 per beneficiary per year while costs increased by $15 per person for the control population.
(2) MAKING PRESCRIPTION DRUG MORE AFFORDABLE Today, prescription drug costs are rising 17 percent a year making it difficult for consumers, states, and businesses to afford health care. John Kerry believes that we should add a prescription drug benefit to Medicare. That would not only help seniors, but it would provide huge relief to states and to employers who are struggling to maintain retiree health benefits and would relieve pressures on the Veterans health system. In addition, John Kerry believes that we need to curb the spiraling costs of prescriptions for all Americans. While he supports good incentives to encourage research into groundbreaking and life-saving medications, John Kerry advocates getting rid of certain loopholes that some drug companies and pharmacy benefit managers use to keep prescription drug prices higher. Reducing prescription drug costs will not only save consumers more money, but will help keep health care from becoming too expensive.
(3) MAKING MALPRACTICE INSURANCE MORE AFFORDABLE John Kerry believes that improvements can and should be made to our medical liability system - improvements that can substantially reduce meritless claims and defenses, enhance opportunities to resolve claims fairly without protracted litigation and make the system fairer for doctors and patients alike. John Kerry, however, strongly opposes capping damages in medical malpractice lawsuits. Capping damages will neither reduce premium costs for doctors, nor lower the cost of health care for Americans. Experience in states that have capped damages demonstrates that reality conclusively. Capping damages affect only the least meritless cases and denies justice to those who suffer life shattering injuries. There are steps that can be taken, however, to reduce litigation that truly is meritless.
(4) IMPROVING CARE AND REDUCING COSTS WITH A NEW QUALITY BONUS A recent Institute of Medicine study found that between 44,000 and 98,000 people die of medical errors every year. There is a one percent error rate each day for a patient in an Intensive Care Unit in this country. Applying that error rate to other professional fields, we would have two unsafe landings per day at Chicago s O Hare airport, 16,000 pieces of mail lost every hour, and 32,000 bank checks deducted from the wrong account every hour. The vast majority of injuries come not from negligent doctors or hospitals, but from outmoded practices, habits, and systems that are poorly designed to protect patients from errors. The gap between best practices and typical practices is extremely wide. Closing this gap for selected chronic diseases (such as diabetes, stroke, congestive heart failure, and arthritis) would dramatically improve health outcomes and reduce costs. Many employers and purchasers are working to make these changes. Efforts like the Leapfrog Group have brought many purchasers together to implement quality improvements and are making significant progress. However, to implement widespread change in the health care system, we need a national commitment.
(5) CUTTING ADMINISTRATIVE COSTS IN HALF WITH A NEW TECHNOLOGY BONUS The annual cost of health care today is $1.4 trillion. At least 25 percent, or almost $350 billion, is spent on non-medical costs principally the costs of the paper work burden, including those costs associated with the preparation, submission, calculation and payment of bills. This is orders of magnitude more than for any other industry. Where as settling a single transaction in health care can cost as much as $12 to $25, banks have cut their costs to less than a penny per transaction by using modern information technology. The Veterans Administration has found that through improved technology, doctors can pull entire medical records (that previously cost $9) instantaneously and without cost and other purchasers have similar results. John Kerry believes that by applying modern information technology to the health care system at large, we can cut administrative costs in half, saving $175 billion a year.
GENERATING SAVINGS THROUGH A HEALTHIER AMERICA · Reducing Uncompensated Care Costs and Investing in the Safety Net. A recent study by the Kaiser Family Foundation reports that Americans spent $35 billion for uncompensated care in 2001, with 85 percent of the costs paid for by federal, state, and local governments. With his proposal to cover nearly 95 percent of all Americans, John Kerry s plan would reduce the cost of uncompensated care to the Federal government by up to $10 billion annually and would target these savings to investments in safety net institutions. Community, migrant, homeless, and school-based health centers and public hospitals are the backbone of this nation s health care safety net and John Kerry is committed to strengthening them by investing in their needs for capital improvements and service expansions. · Supporting Disease Prevention and Health Promotion Programs. In the United States, obesity has risen at an epidemic rate during the past 20 years, leading to heart disease, diabetes and other chronic illnesses. These kinds of poor health trends cost the system money. John Kerry s plan would disseminate best practices in disease prevention and health promotion, encourage exercise, and invest in preventive care models. To reduce health care costs, Americans also need to be more responsible.
II JOHN KERRY S NEW DEAL TO COVER MILLIONS OF AMERICANS, INCLUDING COVERING ALL KIDS, AND BOOST THE ECONOMY John Kerry s plan would strike a new compact with the states: the Federal government will pick up the full cost of more than 20 million children enrolled in Medicaid if states agree to: (1) expand children s coverage to 300 percent of poverty and enroll these kids; (2) expand coverage to families up to 200 of poverty; and (3) assure childless adults below poverty have health care coverage. Under this plan, children would be automatically enrolled in health care coverage, assuring for the first time that virtually every child has affordable health insurance. States receive significant fiscal relief in the first three years and more than 18 million uninsured children and adults would gain coverage.
A NEW COMPACT FOR AMERICA S FAMILIES
INSURE EVERY CHILD. John Kerry believes that we have a moral obligation to cover America s children. Today, there are millions of uninsured children who are eligible for health care coverage under Medicaid or SCHIP but are not enrolled. John Kerry s plan would assure that nearly 99 percent of all children have health care coverage.
EXPAND COVERAGE FOR WORKING PARENTS. Today, nearly seven million working parents whose children are already eligible for state-based health care are uninsured. Under the Kerry plan, states would expand coverage to these parents (up to 200 percent of poverty) at an enhanced state-matching rate in exchange for the swap of full federal payments for children.
EXPAND HEALTH INSURANCE TO SINGLE AND CHILDLESS ADULTS. There are approximately six million adults who are uninsured and live below poverty. Once states get back on course to a more secure financial footing, they would cover single adults and childless couples at or below the poverty level.
III JOHN KERRY S PLAN TO MAKE HEALTH CARE AFFORDABLE FOR EVERY AMERICAN Allows Americans to Get the Same Plan As Members of Congress Many Americans are uninsured because they are not offered health insurance through work, either because they are self-employed or because they work in businesses, particularly small businesses, that cannot afford to offer health care coverage. Those who seek coverage in the individual market often face exorbitant premiums and limited coverage. John Kerry believes that every American should have an affordable place to buy health care, with group protections and affordable premiums. His plan would allow Americans to buy into the Federal Employees Health Plan (in a separate pool) and provide reinsurance to assure coverage is affordable. By focusing on cost containment and helping to cover catastrophic costs, the Kerry plan strengthens the employer-based market and ensures the ability of larger businesses to continue offering coverage to their workers.
(1) ALLOW EVERY AMERICAN ACCESS TO THE SAME HEALTH PLAN MEMBERS OF CONGRESS GET TODAY. Today, nine million Federal employees and their dependents get health care through the Federal Employees Health Benefits Program (FEHBP), which offers a wide choice of affordable health plans with group protections and good benefits. John Kerry believes that all Americans should have access to the same affordable coverage policies that Members of Congress get today.
John Kerry s plan would allow all Americans to join FEHBP by adding a new pool for small and large businesses, as well as individuals and families who need affordable health insurance. A new premium rebate program will provide subsidies to help stabilize insurance rates and keep coverage affordable by removing the burden of high cost cases from the insurance pool. These premium rebates have the potential of saving Americans up to 10 percent (or $1000 for a family) on their current health care costs. John Kerry will also sign an Executive Order to ensure participants will be guaranteed the right to family health benefits for their domestic partners.
COST: John Kerry's health plan would cost an average of $72 billion annually for the first five years and would provide health care coverage to nearly 27 million Americans who were previously uninsured, while making health care more affordable for millions of others.
Long as this post is, I have not included everything... Download a PDF version of the plan
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