PERSPECTIVE ON HEALTH CARE : Let’s Try Aspirin Before We Amputate : There won’t be a total overhaul, which is good. Incremental reforms are possible and make more sense.

Congress has given up on sweeping health-care reforms for this year, reflecting more than political reality--it’s also the will of the people. Americans are simply not ready to give up on the free market and turn the whole health-care system over to federal bureaucrats, even if this means taking a longer time to achieve universal coverage. And they are not ready to dole out unlimited funds to insure every single American without some assurance that their money will be spent wisely.

Instead, Congress will come back from recess to face the not-insignificant task of devising incremental reforms that will help to contain costs and guarantee access to coverage, making the job of expanding coverage less daunting and less expensive in the future. The proposal advocated by the bipartisan “mainstream coalition” in the Senate does this best.

There is also, unfortunately, significant potential for getting even incremental reforms wrong, reversing the trend toward improvement that the market is managing to do for itself, most notably in California. Those who advocate government-run health care, for example, would settle temporarily for a government-run system for some segment of the population, such as children. But even partially government-run health care is likely to be bureaucratic, wasteful and unable to control costs. By forcing doctors and hospitals to accept payments that are far below prevailing rates, it shifts cost to the private sector. Congress should be moving people out of existing public programs and into competitive private-sector health plans, not expanding the public programs.

Or, Congress could succumb to the politically motivated temptation to require health plans to contract with any doctor willing to agree to the terms of the plan, or to pay for services provided outside the plan’s network, all in the name of “guaranteeing choice.” These provisions would prevent managed care from managing either costs or quality of care.

Estimates of the cost of such anti-managed-care provisions range up to 30% over the cost of today’s premiums. Ironically, in the name of choice, Congress would effectively eliminate an individual’s opportunity to choose an efficient managed-care organization--a choice that 50 million (and counting) Americans made this year. In a world where 39 million Americans have no coverage at all because society cannot afford the expense, high-cost mandates of this nature would be irresponsible.

In contrast, the so-called mainstream coalition bill in the Senate, which is supported by moderates of both parties, focuses on solving what are truly the most important problems in the current health-care system. The proposal would:

* Require insurers to accept and keep anyone who applies for coverage and to limit the range within which coverage may be priced. Insurers would not be allowed to deny or limit coverage of pre-existing conditions when people switch health plans. These provisions would protect millions from losing coverage or from having premiums raised unreasonably when they get sick.

* Expand Medicare options for elderly Americans by allowing them to apply their government payment to the private-sector health plan of their choice. By choosing an efficient private plan, beneficiaries could get more value with less paperwork and better benefits, including prescription drug payments.

* Allow states to contract with the most efficient private-sector managed-care organizations for Medicaid patients without requiring these states to jump through endless bureaucratic hoops for special waivers permitting them to do so.

* Require employers to contribute the same amount no matter what health plan an employee chooses. Currently, many employers contribute more on behalf of employees who choose costly fee-for-service plans than for those who choose cost-effective HMOs. This practice destroys the employee’s incentive to choose the economical plan and blocks the market for cost-effective health plans. In combination with rules for standard benefits that will help people compare plans, plus taxes on plans priced far above average, this strongly encourages cost containment.

* Facilitate the collective purchasing of health care by individuals and small businesses, enabling them to benefit from rates now available only to large groups and to choose among a wide variety of health plan options.

* Offer direct subsidies for the poor, starting with the poorest and working up as federal funds become available. This will protect those who need help most without breaking the federal budget.

Congress can afford to make these changes. In fact, it can’t afford not to make them. If it does nothing, costs will continue to increase and the problem will grow harder to solve, increasing the temptation to adopt the radical approach of a government-run and rationed health system.

Incremental reforms, while not perfect, will stem the tide of cash flowing into inefficient health care, give the market a chance to control costs and expand access and give Congress another chance to expand coverage later.