White House Calls for Speeding Up Universal Health : Insurance: Officials see ‘vast majority’ of Americans covered by 1996, if reform plan is adopted. But initial cost could increase by tens of billions of dollars.

Sharply accelerating its timetable for achieving universal health coverage, the White House said Thursday that “the vast majority” of Americans will have guaranteed insurance by 1996 and everyone else will be covered by December, 1997, if President Clinton’s reform plan is approved.

The goal of expediting coverage to the nation’s estimated 37 million uninsured may prove politically popular on its face but it also may sharply raise the initial price tag for health care reform, perhaps by tens of billions of dollars.

Only two weeks ago, Ira Magaziner, the President’s senior health policy analyst, told reporters that universal coverage is not likely to be achieved until the year 2003--a pace that would give small businesses time to adjust to a federal mandate requiring all employers to provide insurance to employees.

The chief rationale for the seven- to nine-year delay was to allow savings to accrue from other reforms in the system so that they could be converted into federal subsidies that would help small businesses, low-wage earners and the unemployed buy insurance.

“But the President needs the damned thing (universal coverage) to be at least on the horizon when he runs for reelection. Otherwise you won’t see this fully implemented until Jack Kemp’s second term,” said a leading health policy analyst, referring to the former New York congressman and housing secretary, a potential candidate for the GOP presidential nomination in 1996.

The White House timetable is based on the belief that after reform legislation is passed by Congress, perhaps in 1994, some states still would need two years or more to set up insurance-purchasing alliances for the uninsured, many of whom are small-business employees. Gradually, their employers would be required to provide them with health insurance.

The President and his top aides spent much of the day Thursday refining his overhaul proposals, which are to be released later this month. White House aides said that they expect Clinton to finish making his “tentative” decisions sometime this weekend and then to consult Congress, industry and consumer groups next week. They emphasized that his weekend decisions are highly subject to change as a result of those meetings.

Among the decisions Clinton still must make, for example, is how high a “sin” tax to seek on cigarettes. For some time, Administration officials have suggested that a cigarette levy of $1 or more was likely to be the only tax the President would seek as a general revenue raiser for health care reform.

But this week the President is said by White House sources to be taking a hard second look at the issue--in part because of a letter from Rep. H. Martin Lancaster (D-N.C.) threatening to “do everything in my power to defeat a health care reform package which singles out tobacco.”

Lancaster is a long-term health reform advocate whose district grows more tobacco than any other congressional district.

Since his letter, Administration health analysts have hinted that some alcoholic beverages may be taxed as well, with such proceeds to be earmarked primarily for long-term home care.

One White House source said Thursday night that a higher cigarette tax is still likely but the range was said to be down to between 50 cents and 75 cents above the current 24-cent federal tax.

Working behind the scenes, the Administration also is trying to arrange a series of high-profile joint appearances between prominent Republican members of Congress and First Lady Hillary Rodham Clinton, who chaired the White House Task Force on Health Care Reform and is to play a key role in leading the campaign for health reform.

Sources said that the Administration hopes to arrange for these town hall-style events to be televised live from major metropolitan areas around the country.

Clinton on Thursday also said that he will not seek price controls on the health care industry, adding that he is willing to let the industry deliver on its promise to voluntarily keep price increases in line with the general rate of inflation.

“I think they should be given the opportunity to adhere to the commitment that they’ve made,” Clinton said in answer to a question during a Rose Garden photo session with Russian Prime Minister Viktor S. Chernomyrdin.

Last spring, many top Administration officials, including Vice President Al Gore, delivered thinly veiled threats of stringent price controls on medical providers as a part of overall health care reform. But senior Clinton health advisers have let it be known in recent weeks that there will be no heavy-handed attempts to impose price controls. The President said Thursday that he has been against the idea all along.

“I’ve never been particularly hot on price controls,” he said.

But Clinton also said that the projected cost increases for Medicaid and Medicare are “still going up way too much and we’re going to bring it down. But I don’t think we have to have a bureaucratic system of price controls to do it.”

The President did not elaborate on the alternatives but one White House official said that Clinton’s inclination is to set up a nationwide information-gathering network and then “point out profiteering when we see it,” relying simply on public opinion.

“We expect it’s possible that, before the system begins to phase in, a few firms will seek to make excessive profits in the short term at the expense of people who need health care,” a White House statement said. “This will be monitored and prohibited.”

Clinton defended his plan from criticism by some Republicans and small business owners who have said that it will cause widespread job loss.

“I believe that this will be a job generator if we implement it sensibly and gradually and over time we slow the rate of growth of health care costs,” the President said during another photo session, this time with Nobel Prize winners.

On its timetable for covering all Americans, the White House statement said: “We expect the new system will be up and running in a number of states by 1995. The vast majority of the American people will have guaranteed coverage by 1996. There will be a firm deadline of December, 1997, for any remaining states that are not yet a part of the system.”

As the foundation for universal coverage, the President intends to require all businesses to pay at least 80% of every full-time worker’s insurance premiums, with the employee paying the rest. But there will be a limit on how much companies and workers must pay--about 7% of payroll for businesses and 2% of wages for individuals. The government will subsidize discounts for low-wage earners and small businesses that hire them, as well as for the unemployed.

Clinton’s proposals will call for most Americans to be pooled into large insurance-purchasing alliances that shop among provider networks for low prices and high quality.

In addition, the agenda is expected to grant states considerable flexibility in setting up such alliances and to force insurance companies to take all applicants and to charge them group rates regardless of age or medical condition.