Shoring Up U.S. Health Care

An agenda of four major health-care programs is taking shape in Congress, with good prospects for passage this year. Each would make a major and significant contribution to cost-effective approaches to serious problems.

Two legislative proposals would improve Medicare protections for those 65 and older, providing catastrophic protection for in-hospital care--although not for the more devastating costs associated with long-term nursing-home care--and some protection against spousal impoverishment associated with the costs of nursing-home care.

A third proposal would mandate that all employers provide minimum-standard health insurance, offering protection to a majority of the 37 million Americans now without any form of public or private health insurance.

The fourth proposal would provide increased federal funding for prenatal, maternal and child care, increasing the availability of these essential services to reduce the costly consequences of neglect. There probably is no more cost-effective investment in health care than adequate services to pregnant women and to their children in their first months.

The four proposals together represent a major step with which the United States can catch up with the basic health services already available in other industrialized nations.

Congressional leaders are confident of early action to approve the improvement of Medicare to protect older Americans from the high costs of extended acute care in a hospital. President Reagan is on record supporting the proposal, which grew out of a task-force study under the leadership of Dr. Otis R. Bowen, secretary of health and human services. There remain two disputes to be resolved, however. Bowen and the President proposed a $2,000 ceiling on annual hospital expenses, but most congressional leaders are working on formulas that would lower that ceiling. That seems a wise idea.

There are also differences concerning how to fund the new protection. The Administration favors self-funding by charging a premium, beginning at $4.92 a month. Some in Congress are weighing the option of a higher premium that would cover other expenses as well--such as out-patient prescription drugs, psychiatric and dental care. Within the House Ways and Means Committee, some leaders are advocating funding through taxing the value of the insurance as income--in effect funding the entire program by increased taxing of the more affluent Medicare recipients.

There appears little likelihood of action this year on the more serious Medicare gap--the absence of protection for long-term nursing care that can cost as much as $22,000 a year and is required at one time or another by 20% of those covered by Medicare. But a helpful move is under way to limit the problem of so-called spousal impoverishment. Under present law, thousands of older Americans have had to exhaust their life savings, when faced with long-term care, before they were eligible for the Medicaid (Medi-Cal in California) nursing-home care that is available only to the poor. Legislation that is now before Congress would protect at least the savings of the spouse of the Medicare patient, changing the eligibility standards for Medicaid.

The most controversial and the most important legislation that will come before Congress at this session deals with access to health insurance. It is proposed to require all employers to provide health insurance for all their workers. The proposal is being strongly resisted by the small businesses of the nation, which argue that it would be devastating to them at a time when the nation critically needs their contribution to the economy. This is an argument that cannot be ignored. It must be kept in mind as the program is designed. Of particular importance will be the provision for health insurance for small businesses at prices competitive with what large enterprises pay through state or regional pools. The plan must respect both the special problems faced by small businesses in today’s economic climate and the critical need to assure millions of American workers, now unable to obtain affordable health insurance, this basic protection.

Improved financing of prenatal, maternal and child care would raise direct budget challenges, but sponsors of the legislation are confident that funds can be found as the budget is reconciled. It would be shortsighted to postpone the new funding, because there is conclusive evidence that each dollar spent in prenatal care saves many more dollars by avoiding the extreme costs associated with premature births, underweight babies and neglect of health in early childhood.

Vigorous leadership in both the Senate and the House, and strong Administration backing on acute-care protections under Medicare, are moving these important proposals ahead, raising the likelihood that at least some of the more flagrant failures of the U.S. health-care system will be remedied this year. Everyone would benefit, directly or indirectly.