Consensus Seen Developing on Methods for Improving US Health-Care System

Article excerpt

THE growing prominence of the ways business and government budgets are straining to support the health-care system is heightening the urgency of calls for a program to control its costs.

A sense of crisis may be necessary to forge the difficult consensus needed to act on overhauling the health-care system, according to Gregory Schmid, a senior research fellow at the California-based Institute for the Future, which forecasts long-term policy shifts.

Signs indicate that such a consensus is beginning - crudely - to form.

The Clinton transition team for health-care issues has met with key senators and representatives and confirmed ambitious plans to submit a comprehensive health-care reform plan to Congress within 100 days of President-elect Clinton's Jan. 20 inauguration, and to pass it into law by the end of this year.

The impetus to control costs, however, appears to be outpacing the will to expand access to health care to the 37 million Americans currently either without health insurance at all or with policies that do not provide enough coverage.

The Clinton team does not plan to overhaul the health system without offering everyone access to it - a principle of the Clinton health-care platform was that everyone has a right to it. But access costs money.

The way in which the overhaul is eventually phased in, if it becomes law, can give priority either to the economic discipline of controlling costs or to the social goal of expanding coverage.

The consensus thus far centers around the concept of managed competition, which builds on the job-based health-insurance system now in place. Little consensus has formed, however, on how managed competition should work.

One way is to limit the amount employers or employees can deduct from their taxes for health-care costs. The theory is that this could introduce some market pressure on health-services prices now insulated by tax deductions. A common objection among the many opponents of this approach, however, is that it raises taxes on the middle class.

Even strong supporters of managed competition, such as the Clinton campaign, are not sure that it will work to hold down costs.

The transition team has a "healthy skepticism about its prospects," says Jack Hadley, co-director of the Center for Health Policy Studies at Georgetown University. The other co-director is the Clinton transition director of health issues, Judith Feder.

"Managed competition is untried, untested," a Senate aide says. …