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Despite their numerous variations, the many national health insurance plans which have been proposed over the past 40 years can be classified under the following eight general models,' those which
1. Utilize federal tax credits and federal subsidies to encourage universal acceptance of coverage on a voluntary basis;
2. Utilize the social security system to collect contributions from employers and employees and to pay benefits, with federal general revenues covering the remainder of the population to provide universal coverage;
3. Mandate employers to cover employees and their families under private plans, with federal general revenues covering the remainder of the population to provide universal coverage;
4. Extend Medicare to cover employees and the self-employed under the social security system for major medical insurance coverage (catastrophic) and to provide a federally financed system of medical care coverage for low-income persons, with the residual coverage handled through the voluntary system;
5. Utilize federal-subsidy, financial incentives and requirements so that indi. viduals and employers will choose among a limited number of federally approved private (and public) health insurance plans;
6. Utilize federal tax and subsidy arrangements to require each state to provide health insurance coverage to its citizens, with a variety of options to states and individuals;
7. Broaden the coverage of Medicare on a population-age basis by reducing the age and/or extending coverage to mothers and children and other age groups;
8. Allow individuals and employers voluntarily to be covered under a broadened Medicare plan.
In any of these plans, the following features can be incorporated, separately or in some combination :
1. Private plans (Blue Cross, Blue Shield, and commercial) utilized as fiscal intermediaries of the federal or state government to provide for the payment of benefits on a managerial-fee basis.
2. State agencies utilized as insurance carriers or fiscal intermediaries.
3. Health-maintenance organizations utilized by choice of the employer, employee, or through collective bargaining.
4. Reimbursement of physicians through a variety of methods, such as feefor-service, capitation, salary, per session (time), or some combination of these methods.
5. Establishment of one or more public health insurance plans as a benchmark or standard for comparison. Roles of the Public and Private Sectors in a Plan
Proposals for national health insurance invariably generate from all parts of society extended and critical remarks on the volatile issue of the respective advantages and disadvantages of public and private responsibilities. The issue has been persistent and controversial in many questions of social policy throughout American history. In countless discussions of national health insurance proposals, the problem of public versus private obligations has raised special and often emotional and ideological arguments.
Although political and idealogical factors are frequently discussed in general terms relating to power, authority, and responsibility, many other issues come into play in discussions of national health insurance, such as the merits and demerits of centralization versus decentralization, pluralism, and their implica
tions for financial costs, managerial effectiveness and economy, and adaptability to local circumstances and attitudes.
The basic view of the American Medical Association with respect to national health insurance may be simply stated as being anti-governmental, that is, in favor of as little governmental participation in the program as is feasible. Most physicians—as independent professional-business, self-employed individuals have strongly indicated their belief in the general philosophic contention that "government is best which governs least.” They also firmly believe, as do others
1 For summary of various types of national health insurance proposals introduced from 1939–1961, see The Health Care of the Aged: Background Facts Relating to the Finance ing Problem, Appendix D. pp. 138–159, U.S. Dept. H.E.W., SSA, Division of Program Research, 1962, pp. 159. For a summary of more recent proposals see National Health Insurance Proposals compiled by Saul Waldman, Provisions of Bills Introduced in the 93rd Congress as of February 1974. U.S. Dept. H.E.W., SSA, Office of Research and Statistics, D.H.E.W. Pub. No. (SSA) 11920, 1974.
in other fields, that government is generally more wasteful, inefficient, and expensive than private enterprise. Moreover, they claim that the regulatory function exercised by government results in rules which are rigid and inappropriate in relation to varying and special circumstances. These same views are generally shared by insurance companies, pharmaceutical manufacturing companies, and, to a large extent, by proprietary hospitals and nursing homes. While these views may not be supported by incontrovertible facts pertinent to medical care, they are usually strongly held and have emotional and ideological overtones which find their way into political campaigns, election literature, and are widely accepted as "conventional wisdom” not requiring documentation.
Efficiency and Equity. The proponents of public-sector responsibility in a national health insurance plan believe, on the other hand, that only through the public sector can equity to all participating individuals be assured. Equity in this context means assurance of similar treatment of individuals in similar crcumstances with respect to financing costs, access to the delivery system, adjudication of grievances, and similar matters. Private plans cannot meet this objective.
To simplify the issue, we can say that there is a significant difference in approach and in values between those who emphasize efficiency and those who emphasize equity in the implementation of a national health insurance plan. Neither group excludes the consideration of the other's values, but there is an important difference in the weight each group gives to the two concepts of efficiency and equity.
Recourse to history, an examination of foreign experience and domestic programs, reference to “human nature," and the implications these have for the future-all are open to various interpretation and thus make objective evaluation of the two concepts imprecise. Moreover, since personal values are so much a part of this and any evaluation, it is difficult to avoid emotional discussion of the respective merits of the various elements in any national health insurance proposal. Efficiency and equity mean different things to different people. Neither concept, however, is pushed by its adherents to an ultimate conclusion. Stated differently, there appears to be limitations or exceptions which the adherents of each concept make with respect to the given elements in a proposal.
Thus, those who may strongly support a national health insurance proposal which they argue will cost less because it will be handled by nongovernmental agencies do not carry their argument to its logical conclusion by advocating a single agency for the collection of premiums in order to save millions of dollars in administrative costs. Nor do those who believe that a governmental plan should insure equitable treatment of patients or contributors necessarily accept the providers' conception of equity as applied to them. Do uniform or differential payments to providers, for instance, meet the test of equity?
Managerial Tasks. Irrespective of the overall role of government in any national health insurance plan, there are separately identifiable managerial tasks which could be handled by nongovernmental agencies under any plan, for example:
1. Check writing and mailing.
The Phased-In Schedule in Implementing a Plan. My own experiences in implementing health, education, and welfare programs, especially during the 1960's has led me to the strong conviction that efforts to put into effect a largescale program in one fell swoop can lead to major administrative difficulties and extensive disappointment: Unforeseen problems develop; errors of judgment occur; personnel and facilities do not work out as intended; unforeseen delays occur; costs rise; and local, state, and individual problems develop which require time for solution. It is therefore more effective and realistic to plan for a step
by-step implementation which takes into account the realities of human limitations. Table 2 presents an outline of one possible step-by-step method of implementing a comprehensive national health insurance program under existing conditions. A shorter or longer period is possible to defend, and different steps are possible in different sequence. Table 2A presents the probable sequence of events in Congressional consideration of a major national health insurance plan.
TABLE 2.–Outline of a possible step-by-step development of major provisions of
national health insurance legislation with due regard to administrative feasibility
months from Provision Congressional deliberations from time of reporting bill out by the House committee
-10 1. Enactment of the National Health Insurance Law-
0 2. Selection and appointment of members of the National Health Insurance Board, Senate hearings, confirmation -
1-3 3. New board members assume office; appropriation requests, congressional hearings, and action on appropriations---
4 4. Broaden membership on Health Insurance Benefits Advisory Council; consultation with it on major policy matters.
5-8 5. Broaden medicare coverage; use of State or regional fee schedules for
payments to physicians; prospective reimbursement for institutional providers; and strengthening of State agencies for a more effective role
6 6. Begin health education program
6 7. Extension of home health services and outpatient services to entire population
9 8. Coverage of major maintenance-prescription drugs for medicare; reduce medicare age to 60_.
12 9. First annual report to Congress; congressional review
17-22 10. Coverage of physicians' services for entire population; no coinsurance or deductibles for maternity and children -
18 11. Coverage of hospital services for entire population.-.
24 12. Implementation of experimental arrangements for long-term care, in
cluding skilled nursing care, intermediate care, and family home care-13. Second annual report to Congress; congressional review--
29–34 14. Conversion of medicaid to a federally administered low-income program
30 15. Coverage of dental care for children under age 6_
32 16. Extension of major maintenance-prescription drugs to entire population
36 17. Revision of long-term care programs with adoption of new approaches. 40 18. Third annual report to Congress; congressional review
41-46 19. Coverage of dental care for children under age 18_
42 20. Coverage of dental care for adults----
Essential elements in an effective national health program There are four broad lines which medical care in the United States may take. First, there is a continuation of the present system as it is; next, there is the transformation of the present system into a full-time salaried service with practitioners becoming employees of_a governmental enterprise - a system usually called “socialized medicine.” The third approach is one of “mandated" private plans with government regulation, such as the proposal advocated by the AMA and other provider and insuring groups.
I do not favor any of these three approaches. I favor a fourth approachone that is pragmatic because it builds upon the last forty years of experience in the United States with social security, Medicare, and the best aspects of private plans. Within the next five years, the establishment of a national health insurance plan is probably inevitable during the next few years. The plan I propose would cover everyone in the nation from birth to death : the rich and the poor; the young and the old; the middle-income earner and the middleaged; the black and the white; everyone living or working in the United States
in urban and rural areas; whether at home or working in large corporations or small businesses; whether in domestic service or migratory labor. The coverage should be universal and to the extent feasible should eliminate costly eligibility determinations and delay in providing services. TABLE 2A.–Schedule of possible congressional consideration of comprehensive national health insurance legislation
Months 1. Beginning of House subcommittee consideration of specific legislation. 0 2. Report of House subcommittee_
2 3. Action by full House committee 4. Action by Rules Committee--5. Action by House of Representatives-6. Hearings by Senate Finance Committee.7. Action by Senate Finance Committee..
8 8. Action by Senate --
9 9. Conference committee action.--
10 10. Presidential action---
10 The National Health Insurance Plan which I propose, and which I believe is both responsible and responsive, would be based upon the following general principles :
1. Break the barrier between paying for health care and eligibility for service. One of the key purposes of a national health plan is, as far as possible, to arrange the prepayment of health costs when an individual is working so that basic financial considerations would not be a major problem during illness. No complicated procedures would be necessary during unemployment or nonemployment.
2. Require the employee and the self-employed to pay part of the costs. This requirement would assure the individual of a statutory and political right to benefits without a means test. By having large numbers of people pay small amounts over a long period of time, all individuals could be assured of coverage for comprehensive medical care protection. Such a plan would, as Sir Winston Churchill said, “bring the magic of the averages to the rescue of the millions." A national health insurance plan should involve the employee and the patient in the financing and administration of the plan.
3. Require the employer to pay a substantial part of the costs so that the immediate financial burden for the individual is not too great. The employer's contributions are deductible from federal and state taxes as a business expense, while the employee's contributions are only partially deductible. The employer can and should, therefore, pay substantially more than the employee. Moreover, the employer should be involved in the planning of community health services and be concerned about adequate access to health services for his employees and their families and for health services at the employing unit.
4. Require the gowernment to contribute a significant part of the cost in order that individuals without incomes or with low income would receive equal access to health services on the same basis as those with more adequate incomes. The stigma of proverty and welfare would thus be removed from the medical care system. Medicaid could at the same time be substantially reduced and eventually eliminated.
5. Require that employee and employer contributions to the plan be handled as part of soical security contributions. Such a requirement would greatly reduce the cost of collecting contributions (collection now takes place through hundreds of separate and costly administrative arrangements). A single federal system of collecting contributions through social security would be more economical than the present system, and it would reduce the administrative costs of universal coverage by about one billion dollars a year. The use of private, insurance agencies to collect contributions is unnecessary, costly, inefficient and wasteful.
6. Provide for universal coverage and eligibility to services by federal law solely and simply by wirtue of legal residence in the United States. Universal coverage would simplify the eligibility process, reduce accounting, and keep administrative costs to a minimum. One eligibility card and one reimbursement form for physicians and other providers would be both feasible and desirable. No individual would lose eligibility by virtue of any change in employment or by unemployment or nonemployment.
7. Assure that access to service for all persons throughout the nation would be determined by nationwide rules. Uniform, nationwide contributions to the health security system should be accompanied by uniform, nationwide standards of access to services. Interpretation of these standards could be delegated to
state, local, federal or health agency personnel but an individual would be assured of a fair hearing on matters in dispute before a federal agency and of an appeal for judicial review on matters of law by federal courts. Due process and equal treatment would be guaranteed to every individual, irrespective of his color, age, sex, education, or background.
8. Provide for a broad range of medical services with specific arrangements for extending services over a reasonable period of time. Although comprehensive and complete medical service is a desirable objective, the immediate attainment of that goal as part of eligibility under a national health program is simply not feasible. Any national health program should therefore include specific provi.. sions for a step-by-step expansion of such services as out-of-hospital prescription drugs, nursing-home care, dental services, and other similar services which require planning and organization for their universal availability. Such planning must, of course, be coordinated with plans for training health personnel, building appropriate facilities, recruiting and redeploying personnel and developing health-maintenance organizations.
9. Provide for new, innovative, economical and efficient methods of organizing and delivering medical care. Financial incentives should be provided for the expansion of ambulatory and outpatient care, improved emergency services, health-maintenance organizations, salary and capitation payments, multiphasic. screening, periodic examinations, and community-sponsored, coordinated plans for health education, family planning, nutrition, and environmental concerns. Nurses and other health personnel should be encouraged to take a more effective leadership role in community health education programs.
10. Encouragee and accelerate plans to increase personnel in the health fields. Financial incentives should be provided for expanding training facilities to. produce more physicians, nurses, dentists, and other health personnel, including physicians' assistants, aides, technicians, and allied health workers. Particular attention should be given to training more black persons and those from other minority groups for employment in the health fields and to provide more women the opportunity to participate in the health care system. Medical, nursing, and other health schools which train health personnel must establish incentives and arrangements to assist in the more rational distribution of personnel and services.
11. Provide opportunities for the consumer as taxpayer and patient to play a significant role in policy formulation and administration of the health system. Health care is too important a service to be the sole province of any one professional or bureaucratic group, no matter how well trained or well intentioned that group may be. Many questions relating to his health care are of critical concern to the consumer : how effectively is the money he contributes to health service being spent? Is the administration of health care efficient? Is he assured dignity and privacy by those who provide his care? How are priorities determined ?-and a host of other questions besides those relating to the diagnosis and treatment of disease or disability. A more effective partnership among the professional, the consumer, and the bureaucrat must be developed so that the public can receive the quality of medical care it needs and deserves.
12. Assure health personnel reasonable compensation and opportunities for professional practice, advancement, and the exercise of humanitarian and social responsibility. The various components in a national health program should be designed so as to provide the highest quality of medical care, with individual and group responsibility for using initiative, working for professional advancement, and dispensing health care with a creative sense of social responsibility. Individuals who provide services should receive fair and reasonable compensation in relation to their ability, responsibility, and productivity, and they should be able to choose the method of their remuneration; compensation ot them should be adjusted periodically in relation to changes in costs and productivity. Various incentives should be provided those who offer medical care to encourage the establishment of such groups as health-maintenance organizations.
13. Encourage effective professional participation in the formulation of ouidelines, standards, rules, regulations, form, procedures, and organization. There should be widespread participation by all health personnel in the formulation of policy at the highest levels and at every rank of administration. A sense of cooperative participation among personnel should be fostered to overcome hierarchal considerations and invidious distinctions based on income, education, or prestige. The nursing profession should be encouraged to take a leadership role in relating health services to individual family and community needs.
14. Require state and area health agencies to take affirmative leadership in providing for effective delivery of medical services. A nationwide health plan should utilize state and area health agencies to stimulate the availability and"