PERSPECTIVE ON HEALTH CARE : Boosting Workers’ Security : Those disabled or on welfare will be employable; all will be free to change jobs.

One aspect of President Clinton’s health security program has hardly received adequate attention: For millions of people, it is a ticket to economic freedom.

Today’s health-insurance system keeps many Americans from becoming fully productive citizens. Three out of 10 people, according to public opinion surveys, say that they or someone in their family have had to give up a better job opportunity because of a pre-existing medical condition.

And just as the system produces “job lock,” so it also produces “welfare lock.” Many people stay on welfare primarily to qualify for Medicaid because the jobs available to them don’t carry health benefits.

The same is true for many people with disabilities: Often, government health benefits are available only if they do not work, and jobs with health benefits are hard to find because prospective employers may face steep premium increases if they hire someone at risk of high medical bills.

By prohibiting exclusions of pre-existing conditions and requiring all employers to provide health coverage, the President’s program will eliminate both job lock and welfare lock.

And because employers will join large pools called “health alliances” and pay a percentage of average premiums, they will no longer fear high insurance rates as a result of hiring people with a history of serious illness or disability. That will reduce barriers to employment.

Indeed, one little-mentioned provision of the President’s program goes even further: People with disabilities will receive a tax credit for personal-assistance services worth 50% of earnings--a major incentive to take a job.

In addition, the new benefit offering home- and community-based long-term care will open up opportunities to go to work for many people--primarily women--who are now at home caring for an elderly parent or disabled member of their family.

All these positive effects on work and employment need to be remembered amid the noisyclaims of opponents that the President’s program will hurt small business and jobs.

In fact, small businesses that now provide insurance stand to gain dramatically. Small business pays the highest administrative overhead on health insurance--40 cents on the premium dollar for businesses with fewer than five employees. By purchasing coverage through the new health alliances, small business will get immediate relief from high administrative costs.

Moreover, discounts for small businesses will enable them to purchase coverage for no more than a flat percentage of payroll--as low as 3.5% for firms with fewer than 50 workers and average wages below $12,000. Firms with wages averaging $24,000 and over will pay their share of premiums or 7.9% of payroll, whichever is less.

Larger firms will also benefit from the requirement that all employers participate. When employers pay for insurance, they typically pay for an entire family, including the employee’s working spouse. Under reform, the costs of families will be more equitably spread, reducing the cost to each firm for workers with families by about one-third.

Employers who now pay for health insurance also indirectly pay for the uninsured, who leave unpaid bills at hospitals. After reform, that burden will be lifted.

For all these reasons, firms that now insure, whether they are big or small, will see their health insurance costs go down, counteracting the effects on firms that have to pay for health insurance for the first time.

Reform will also help overcome one of the major obstacles to starting a new small business. Employees at big firms who would like to set up a small business often can’t get health insurance at a reasonable price, especially if they have a pre-existing condition. Even if they are healthy, they face the risk of starting a business and then becoming sick and uninsurable. Guaranteed coverage at affordable rates through the health alliances removes that risk.

As the health-care system has become more costly and inequitable, it has imposed enormous hidden costs on Americans with all kinds of desires and dreams--starting a business, taking a better job, getting off welfare, making a new start after suffering a disabling injury. Health-care reform will not just offer them security. It will give them back their freedom.