Academic journal article Journal of Accountancy

Clinton Senior Adviser Speaks to AICPA Health Care Industry Conference

Academic journal article Journal of Accountancy

Clinton Senior Adviser Speaks to AICPA Health Care Industry Conference

Article excerpt

Addressing the American Institute of CPAs Health Care Industry Conference in Las Vegas, Ira Magaziner, senior adviser to President Clinton for policy development, called on CPAs to examine health care reform bills closely as they are introduced and to "try to work with us to make them as good as possible."

Magaziner, the architect of the Clinton health care reform plan, stressed the basic principles that would have to be a part of any plan the president would accept. "First and foremost," said Magaziner, "we have got to get everybody insured in this country."

Magaziner stopped short of defining "everybody" as 100% of the population. "As is the case with Social Security and compulsory education," he said, "some people slip betwen the cracks, so you in fact will wind up with approximately 98% coverage."

The price of reform. To finance the White House plan, Magaziner called for a "system of shared responsibility" in which both employers and individuals would contribute to the costs of health insurance. Magaziner did not go into detail on a proposed employer mandate, but one formula outlined in bills approved by the House Ways and Means Committee, the House Education and Labor Committee and the Senate Labor and Human Resources Committee would require employers to pay at least 80% of the cost of employees' health insurance.

Another key to financing universal coverage, Magaziner said, was cost containment. He told the conference the key to containing costs was findig a middle ground between a pure market and a bureaucratic system of price control. "That middle ground is a captitation system of payment," Magaziner said, arguing such a system would change the incentives for physicians and make consumers more cost conscious.

The president's plan calls for a system of caps on premiums aimed at poorer areas of the country. "In some areas, competition isn't going to make much sense because you'll be lucky to have one integrated health care network," Magaziner said. "In those areas, we think having some kind of cap on the rate of growth of premiums will be useful."

The senior adviser admitted cost containment was an area "where our ideology sometimes gets in the way of practicality," but he emphasized its essential role in health care reform. …

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