Study Criticizes Modest Health Reform

Hoping to turn up the heat on uncommitted lawmakers, President Clinton’s allies on Capitol Hill released a study Monday indicating that middle-class people who have health insurance will pay higher premiums if Congress passes a health reform measure that falls short of guaranteeing universal coverage.

In framing universal coverage as a middle-class issue, they hope to take some of the momentum out of several incremental measures that are gaining favor in both houses of Congress.

At a news conference, Sen. Patty Murray (D-Wash.) urged fellow members of Congress to “remind ourselves what it is that we are trying to achieve and who we are trying to benefit.”

“We want to put all the pressure we can on wavering senators,” added Sen. John D. (Jay) Rockefeller IV (D-W.Va.), one of the Clinton plan’s most ardent supporters. He contended that the modest measure that many lawmakers view as an “easy step” would be “a fatal blow to their constituents who are working middle-class Americans.”

The more modest approach, which is being touted in various forms by lawmakers of both parties, would encourage more competition among health providers and eliminate many widely criticized insurance industry practices, such as those that make it difficult for people with known illnesses to buy coverage. The various alternatives also would provide government subsidies to help those at or near the poverty line afford health insurance.

Such proposals would not meet Clinton’s bottom-line goal of assuring that everyone has health insurance.

The study by the Virginia consulting firm Lewin-VHI Inc., was commissioned by the Catholic Health Assn. of the United States.

It indicated that the incremental approach would be more expensive for insured families earning between $20,000 and $75,000 a year. The firm concluded that, absent a requirement that everyone buy coverage, new policy-holders would in general be sicker than the population as a whole, and, therefore, more expensive to cover.

By comparison, it concluded, a bill guaranteeing universal coverage would lower the health costs of middle-class people who now have health insurance, if it were combined with government-imposed cost constraint, such as that envisioned in the Clinton plan.

For a family earning between $30,000 and $40,000, for instance, health costs would rise about $344 in 1998 under the incremental approach; its spending would decline $165 in a system under which everyone was required to have coverage.