Value as Campaign Issue Doubted : Health Insurance Pushed by Dukakis but Not Bush

Clifford and Louise Ray, a Florida couple with three AIDS-infected sons, were so disenchanted with this year’s presidential campaign and so preoccupied with their own problems that they did not plan to vote in next month’s election.

They changed their minds when they watched the first presidential debate. That’s when they heard Democratic candidate Michael S. Dukakis propose that employers be required to provide their workers with health insurance--a proposal that could directly benefit them.

J. Powell Jenkins, who owns a small hardware store in Rocky Mount, N. C., also was watching the debate. He, too, found himself influenced by the discussion of health care. But, for Jenkins, who does not want the government to tell him what to do, the exchange only reinforced his decision to vote for Republican George Bush.

For Jenkins and the Rays and many other Americans, health care--particularly how it is financed--is an issue of critical importance. And it is one on which Dukakis and Bush have philosophies that are nearly 180 degrees apart, reflecting a fundamental difference between the Democratic and Republican parties on the boundaries of federal intervention.

Dukakis, gambling that he can convert many voters like the Rays, is pushing a proposal that would extend the government’s reach deeper into the relationship between employers and employees.

Bush, who is not raising the issue on the stump, is hewing to the traditional Republican position of opposing government involvement in the private sector.

Whether Dukakis’ strategy will pay off politically remains uncertain. Times political analyst William Schneider, a fellow of the American Enterprise Institute, said voters usually think of health care as a fringe benefit provided by their employers, not a public benefit provided by government.

“Health insurance, college tuition, child care, affordable mortgages--I put those in the category of anxieties that people have privately,” Schneider said. “They don’t rate very high in peoples’ minds as problems facing the country. Dukakis is trying to make that connection.”

Family Scarred by Tragedy

He succeeded immediately with the Rays, a Sarasota family whose life has been scarred by tragedy. Their three sons were infected with the AIDS virus through treatments for hemophilia. And a fire set by arsonists last year drove them from their former home in Arcadia, Fla.

With their medical problems, the Rays have had great difficulty in obtaining insurance. Dukakis’ proposal, they believe, at least offers hope.

“I’ve never been into politics, I’ve never really cared, but I thought to myself: ‘Dukakis cares about the little people,’ ” Mrs. Ray said. “If someone’s out to help my kids, I’m going to vote for him.”

Dukakis modeled his national health insurance program on the plan he recently signed into law asgovernor of Massachusetts. Its central element is a requirement that all employers provide health insurance for their workers.

Of the 37 million uninsured Americans, his plan would cover the estimated 22 million who are in families with jobs but no coverage. Dukakis said he would establish a special panel to find ways to provide insurance to those who are either unemployed or not eligible for Medicaid or other forms of federal assistance.

Business complains that the Dukakis proposal would place an unfair economic load on employers, resulting in slower business growth, lost wages, fewer jobs and increased costs for consumers.

“I get tired of politicians thinking they can constantly solve problems on the backs of the business community,” Jenkins, the North Carolina hardware store owner, said.

Jenkins already provides health insurance for his workers and bears the entire cost himself. But his insurance bill went up by more than $400 last month, and he is afraid he will have to pass the increased costs along to his customers or deny his employees a raise next year.

Could Affect Hiring

Jenkins said federally mandated health insurance would probably influence his decisions on whether to hire new workers.

“Also, suppose I’m looking at two very qualified people for the same job and trying to decide which one to hire,” he said. “One candidate has a wife who works for a major corporation. She has insurance that covers the whole family, and the other does not. My decision may come down to not which one can best do the job but which one will be cheaper for me to hire.”

The Bush campaign is in tune with Jenkins’ sentiment. Gail Wilensky, a Washington health care economist who is an unofficial adviser to the Bush campaign, said of the Dukakis proposal: “Its only real appeal is that is sounds simple, is easy to understand and gets insurance out to a large number of uninsured with one fell swoop. But it’s not without its own costs.”

The Dukakis forces argue, however, that, with more workers covered, insurance costs for everyone would eventually decline. No longer, they say, would insurance rates be artificially high to compensate for the often-unpaid medical bills of the uninsured.

Sharing the Burden

“The burden needs to be shared,” Timothy McNeill, the Dukakis campaign’s associate director for issues, said. “Ultimately, we all bear the burden of health care when people are not covered. Unfortunately, not everyone steps up to their responsibility in this area.”

Dukakis advisers say new and untested programs always have critics.

“You have to look back at all social experiments and ask what level of certainty there was whenever the government did something that benefited the American people,” said Dr. David Blumenthal, senior health adviser to the Dukakis campaign.

“The New Deal, Medicare, Medicaid, Social Security--in all these cases there were uncertainties about how these plans would actually work,” Blumenthal said. “There was always room for critics to say: ‘It can’t work. It’s too expensive.’ But visionary people took risks--and it made an enormous difference to the American people.”

Although Dukakis has not spelled out the specifics of his program, a background paper provided by the campaign outlines the basic provisions of employer-based coverage.

Basic Benefits Package

The program would require that a basic benefits package include hospital, physician and diagnostic services, mental health services, preventive care, prenatal and well-child care and protection against catastrophic illnesses.

For small businesses, the government would help find affordable insurance and offer “other protections,” including “phase-ins, different benefit packages and special tax considerations.” The Massachusetts plan provides financial assistance to companies with 50 or fewer workers if the firms are “severely impacted” by the insurance requirement.

“When Dukakis is personally asked whether small businessmen would be exempt, he says, ‘Probably,’ ” Blumenthal said. “He hasn’t defined it yet. He wants the program to be budget neutral and affordable for business. A lot of these variables interact. You need some room to play with details as it goes through the legislative process.”

Compared with Dukakis, Bush has barely injected the subject of health care into his campaign. When pressed during the Sept. 25 debate to describe what he would do for the uninsured, he replied that he would allow them to “buy into Medicaid.” But he has yet to describe exactly what he meant.

“The complicated arena of health care is not an easy sell for a campaign,” Wilensky explained. “It isn’t what sells when you’re trying to get elected.”

Bush Still Working on Plan

A document provided by the Bush campaign outlining the vice president’s positions on health care does not address the problem of the uninsured. David Sandor, a spokesman for the campaign, said that the specifics of Bush’s Medicaid “buy-in” are still being worked out but the goal is to provide support for lower-income workers.

“We’re talking about extending the Medicaid eligibility requirements so that these workers can afford coverage under the government’s assistance program,” Sandor said. “Three-fourths of employed uninsured workers earn less than $10,000--including most young people with their first job--(and) they can’t afford insurance at market prices. We need to enable low-income workers to buy Medicaid coverage at prices they can afford.”

Although some health care specialists have estimated that such an expansion of the government’s Medicaid program would be expensive--costing $10 billion or more--the Bush campaign has estimated a price tag of about $200 million a year.

Urges Aid for Two Groups

Wilensky said that she has advocated a Medicaid buy-in for two groups--”the poorest of workers and people coming off Medicaid into the labor force, those who are just above Medicaid eligibility.”

But most health care specialists believe a Medicaid buy-in would still leave serious gaps in insurance coverage.