American College of Physicians: Internal Medicine — Doctors for Adults ®

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Health care and election politics:
new proposals vs. past performance

From the October 2000 ACP-ASIM Observer, copyright © 2000 by the American College of Physicians-American Society of Internal Medicine.

By Phyllis Maguire

As the national election in November approaches, the emphasis on health care continues to escalate. At the end of the summer, both Vice President Albert Gore Jr., the Democratic presidential candidate, and his Republican rival, Texas Gov. George W. Bush, released details of their plans for a Medicare drug benefit, making health care a critical part of their campaigns.

Not surprisingly, their proposals follow classic party lines. While Democrats want to rely on the government to provide benefits, Republicans insist that the market is the best route to greater access and affordability. Here is a look at the candidates' health care platforms and how physicians could be affected by their promises.

Medicare drug benefit

The health care cornerstone of both candidates' campaigns is drug coverage for Medicare beneficiaries. It is a particularly important issue for internists because medications represent the fastest-growing cost in medical care and cause compliance problems with older patients who can't afford medicines.

To help remedy that problem, Mr. Gore wants to add a prescription drug benefit to the Medicare program to cover all seniors, at a cost of $253 billion over 10 years. Mr. Bush plans to provide immediate relief to the neediest elderly through state Medicaid agencies. He would then rely on competing insurers to offer an array of plans, which could cover drugs, to the bulk of Medicare beneficiaries. The Bush plan would cost $158 billion over 10 years. (For more details, see "The Medicare drug plans: a comparison," page 15.)

Mr. Gore's critics say that in order to win popularity with elder voters, he is bankrupting Medicare and paying too little attention to the program's long-term financial viability. Many critics also complain that taxpayers should not subsidize drugs for high-income seniors.

Critics of Mr. Bush's plan, on the other hand, point out that the managed care Medicare market is far from the bedrock on which drug coverage should be built. For three years, HMOs have been pulling out of Medicare+Choice markets, and more than 900,000 managed Medicare members are slated to lose coverage next year.

Analysts also point out that many physicians are deeply frustrated by marketplace competition, which hasn't always proven to be in the best interests of patients or the medical profession. In the past, for instance, increased competition has led some insurers to cherry-pick the healthiest consumers, leaving sicker patients with fewer coverage options, according to Alan R. Nelson, MACP, a special advisor to the College.

Dr. Nelson predicted that turning Medicare drug coverage over to competing insurers could mean a morass of new formularies, review processes and prior approval procedures. "Many internists might find the government a less onerous prospect to the degree that it might bring uniformity," he said.


Several forces need to converge before a campaign pledge can become reality.

But what about the prospect of giving Medicare even more control over physicians and their patients' health coverage? While physicians take issue with HCFA's administration of Medicare, Dr. Nelson pointed out that many of their problems have been with local contractors who review Medicare charges. He noted that medical organizations like the College can sometimes help resolve issues with national administrators more effectively than local contractors.

Besides, he said, Mr. Bush's proposal would rely on state Medicaid agencies to cover Medicare's most needy. Internists' experiences with Medicaid agencies, some analysts say, can make Medicare look good.

"Some Medicaid plans pay practically nothing," Dr. Nelson said, pointing to TennCare, the state-run Medicaid program in Tennessee. "Having 50 different jurisdictions administer the program with 50 different formularies and review activities--that gives me pause."

Dr. Nelson emphasized that under either plan, however, physicians can expect formulary restrictions--even if there is just one formulary set up by HCFA--and greater scrutiny of their prescribing habits.

Access

When it comes to expanding access to health care, both candidates take an incremental approach. Mr. Gore wants to expand eligibility to the Children's Health Insurance Program (CHIP) and allow children in families above current income caps to buy into the program. He has also proposed giving tax credits worth 25% of the cost of health care premiums for people without job-based insurance. He would give the same tax credit to small businesses that offer coverage to employees.

Mr. Bush, on the other hand, has proposed an annual tax credit of $1,000 for individuals and $2,000 for families, with certain income restrictions. He also wants to lift restrictions on medical savings accounts and state restrictions on CHIP enrollment, and he wants to budget funds to build new community and migrant health centers to serve the uninsured.

Mr. Gore's proposals would cost the federal government $157 billion over 10 years and cover approximately 12 million people, according to Kenneth E. Thorpe, PhD, professor of health policy at Atlanta's Emory University. States would also have to contribute funds through Medicaid. Mr. Bush's proposal would cost $135 billion for the same period and cover three million people.

Analysts believe both plans are inadequate, arguing that neither a small tax credit to help subsidize health insurance premiums nor a $2,000 family credit would make Íhealth insurance affordable for many families. In a 1999 proposal, for instance, the College included a tax credit as one component to incrementally decrease the number of uninsured. At that time, however, the College advocated a tax credit of $2,400 to $2,800 per adult.

Experts also point out that because the individual insurance market is shaky--in many markets, insurers have been withdrawing individual policies--tax credits encouraging consumers to buy their own coverage may not work. Analysts also worry that offering tax credits to help people buy their own insurance policies might encourage some employers to discontinue job-based coverage, which would boost the number of uninsured.

Perhaps most striking, analysts say, is how reluctant both candidates have been to offer more ambitious plans. (Only Green Party candidate Ralph Nader calls for universal coverage.) "At a time when we are in the best possible position to deal with the uninsured--having a good economy and paying down the federal budget deficit--both plans fall short," said Alan M. Garber, FACP, director of the Center for Health Policy and professor of medicine at Stanford University School of Medicine.

Analysts point out, however, that the major party candidates are taking their cue from voters. While recent surveys show that the American public is concerned about the uninsured, many polls indicate that voters do not want to spend the national surplus on universal access or fund universal coverage through tax hikes.

Patient rights

On the issue of patient protections, Mr. Gore supports a patient bill of rights that includes guaranteed access to subspecialists, clinical trials and emergency room treatment; prohibitions on gag clauses; and the right to appeal health plan decisions and to sue HMOs. Mr. Gore wants those rights to extend to all 161 million Americans with health insurance. He actively supports a patient protection bill passed last year by the House of Representatives that the College says contains important safeguards for physicians and their patients.

Mr. Bush, on the other hand, has not publicly endorsed either the House of Representatives bill or the Senate's more restrictive version. While Mr. Bush's campaign likes to point out that Texas passed one of the most progressive state patient protection laws during Mr. Bush's tenure, his opponents are quick to point out that Mr. Bush opposed the legislation and let it become law without signing it.


The Medicare drug plans: a comparison
Gore Bush

Coverage
mechanism
Medicare benefit administered by
HCFA.
Subsidized coverage through Medicaid state agencies and insurers.

Cost $253 billion over 10 years. $158 billion over 10 years.

Free drug coverage Enrollees up to
135%of federal poverty level.
Enrollees up to
135% of federal
poverty level.

Premium paid
by government
50% 25%

Personal
spending cap
$4,000 $6,000

Past performance

Mr. Bush's critics point to other past performance indicators that they say do not bode well for health care. Last year, for example, the Bush administration championed a $1.7 billion state tax cut, even though Texas led the nation in the number of uninsured. One in four people in the state lack coverage; the national average is one in six.

Mr. Bush's critics also charge that the governor favored extending CHIP coverage to children with family incomes at 150% of the poverty level, while the Texas legislature passed a more generous 200% cap. Recently, a federal judge ordered improvements in children's Medicaid programs in Texas, finding that the state was not living up to its commitments.

Kim Ross, vice president of public affairs for the Texas Medical Association, admitted that his group sparred repeatedly with Mr. Bush's staff over passage of the patient rights bill. But he also credited the governor with coming a long way on health care issues, even occasionally breaking ranks with long-time supporters who were, Mr. Ross said, "passionately, if not irrationally, against medicine's view."

When it comes to the vice president's recent health care record, opponents like to point out that the Balanced Budget Act (BBA), which they say has left hospitals and medical schools strapped, was passed during the Clinton-Gore administration. (Both candidates want to increase Medicare reimbursements to physicians and hospitals by $40 billion to offset the effects of the BBA.) Critics also note that since Clinton-Gore took office in 1992, the number of uninsured has increased by six million.

Analysts point out that while Mr. Gore has been a passionate environmental advocate, he has been much less vocal about health care. He did not play a major role in either President Clinton's 1994 health reform plan or the passage of CHIP legislation.

However, analysts say that it is difficult to assess a vice president's commitment to specific issues, and that Mr. Gore is no exception. "In all fairness, by the time the President, Mrs. Clinton and Ira Magaziner [a senior advisor] divided up the issue, there wasn't a lot left for Gore to do," Robert J. Blendon, ScD, professor of health policy at the Harvard School of Public Health, said about the Clinton health reform plan.

Dr. Blendon noted, however, that Mr. Gore took away one big lesson from his boss's health care battles: Don't become enamored with the one big fix. "He wants to do a lot of things," Dr. Blendon said, "but they will be incremental steps that won't be too threatening."

The post-election landscape

So what could all this mean after the election? According to internist Norbert I. Goldfield, MD, medical director of 3M Health Information Systems and author of this year's "National Health Reform American Style: Lessons from the Past," several forces need to converge before a campaign pledge can become a reality.

"You need a president willing to take a strong leadership role," Dr. Goldfield said, "but you also need a clear public mandate for change and a Congress willing to enact it." Dr. Goldfield does not see that convergence taking place in the next administration. Neither candidate is particularly passionate about health care, he said, and Republicans--who may continue to control Congress--are much less interested in health care reform now than they were early in President Clinton's administration, when Sen. Robert Dole (R-Kan.) led them.

Experts say that some form of Medicare drug coverage and CHIP expansion is inevitable under either candidate, given those proposals' high profiles. But their final form may be very different from what's being promised now.

That's because neither party is expected to win a sweeping majority in the upcoming election. Even if one party takes the White House, the House and the Senate, experts say that their margin of leadership will be slim. That means that the kind of standoff that has stalled health care initiatives like the patient bill of rights and patient privacy legislation over the past two years may continue--and put the brakes on the health care agenda of any new administration.

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