Kerry, Edwards Offer Different Prescriptions

More than 60 people had filled almost every seat in the waiting area at the Clinica Monsenor Oscar A. Romero in Los Angeles’ Pico-Union district one rainy afternoon this week, but to Grace Floutsis the room didn’t look crowded at all.

“It’s actually pretty roomy in there,” said Floutsis, the clinic’s medical director, as she looked over the mostly Latino families sitting quietly in neat rows of chairs. “Most days, it’s standing-room only.”

The uninsured low-income families who fill the public clinic for 12 hours almost every day silently testify to the growing strain on the nation’s healthcare system as medical costs rise and access to health insurance erodes.

These pressures have inspired this year’s Democratic presidential candidates to place healthcare at the center of their domestic agendas -- and to offer the most ambitious reform plans since President Clinton’s crusade for universal coverage crashed a decade ago.

Sens. John F. Kerry of Massachusetts and John Edwards of North Carolina have each proposed more sweeping plans than Al Gore in 2000 to expand coverage to the nearly 44 million Americans who lack health insurance.

Kerry and Edwards seek to reach the uninsured primarily through the same means: expanding the existing public programs for low-income families without coverage.

Yet healthcare remains one of the most important distinctions between the two major contenders for the nomination. Kerry has offered a plan that is more ambitious, comprehensive and expensive than Edwards’.

In one of his few policy challenges to Kerry, Edwards has argued that the country can’t afford his rival’s plan. In turn, Kerry insists Edwards’ approach would do too little to reduce the ranks of the uninsured or to restrain the rise in premiums for those who have insurance.

California has as much at stake as any other state in this debate -- and the coming argument over healthcare between the eventual Democratic nominee and President Bush. Many of the trends battering the nation’s healthcare system have reached a peak here.

The state’s fiscal crisis prompted Democratic Gov. Gray Davis, and now Republican Gov. Arnold Schwarzenegger, to seek cuts in the public programs providing health insurance to the most needy families. Rising healthcare costs were at the root of the lengthy Southern California grocery strike tentatively settled this week. And Census Bureau figures show that nearly one in five Californians lacks health insurance -- a ratio exceeded only in Texas and New Mexico.

Healthcare is central to the agendas of all the Democratic contenders.

Rep. Dennis J. Kucinich of Ohio and the Rev. Al Sharpton of New York, the two long-shots in the contest, have embraced the long-term liberal goal of a single-payer, government-run health care system that would expand Medicare to cover all Americans. But that idea has not entered the mainstream debate in Washington, partly because of its enormous cost: about $600 billion annually.

The heart of Edwards’ proposal is a new requirement that all parents contribute to insurance for their children. Families whose children are already covered through their employer would receive tax breaks to help offset their existing premium costs.

Families whose children are not covered would receive a subsidy to help them buy insurance, either from their employer or through the Children’s Health Insurance Program, a state-federal partnership that provides care for children in working-poor families. The subsidy would cover all the cost for the poorest families, but other parents would have to contribute -- from about $10 a month for lower-middle class families to as much as $80 a month for those earning at least $75,000 annually.

Edwards would enforce his mandate by establishing automatic enrollment for lower-income children at birth or when they register for school, and by requiring parents to show proof of insurance on their tax returns. The IRS would bill those who couldn’t demonstrate insurance and enroll their children in a health care plan.

Through these measures, experts say Edwards would ensure coverage for virtually all people through age 21. But to keep down the plan’s cost, Edwards offers relatively modest subsidies to help uninsured low-income adults buy coverage or small businesses provide it.

The result is that Edwards’ plan would cost the least and cover fewer of the uninsured than Kerry’s.

Kenneth E. Thorpe, a professor of health policy and management at Emory University in Atlanta said Edwards’ plan would cost about $590 billion over the next decade and provide coverage for nearly 22 million people -- about half of the uninsured.

The heart of Kerry’s proposal is a massive trade between state and federal governments. He proposes that Washington assume all the cost of providing health care for the roughly 20 million children who receive coverage under Medicaid, the joint state-federal program for the poorest families.

In return, states would agree to share with Washington the cost of expanding coverage to all children in families earning up to three times the poverty level (about $55,000 for a family of four) and all parents earning up to twice the poverty level (about $37,000). Eventually, he’d ask states to also contribute toward covering low-income single adults without insurance.

Kerry sees several advantages to the swap. It would mean big savings for states in the next few years: California would save nearly $1 billion annually, Thorpe calculated. Kerry also argues that it would insulate from budget cuts the Medicaid program, which is a frequent target for governors during tough times because its clients -- the poorest families -- have little political support.

Most importantly, Kerry would require states to automatically enroll all children eligible under Medicaid or CHIPs.

“Today, the states do a very haphazard sporadic enrollment of children,” he said in an interview. “They don’t really reach out, so the kids don’t get covered.”

Several California healthcare experts seconded Kerry’s analysis, and praised his proposal. “He’s absolutely right,” said Bruce G. Bodaken, chairman and president of Blue Shield of California. “The Medicaid programs are the most vulnerable when the states have a budget crisis.”

Also under Kerry’s plan, Washington would assume from private insurers much of the cost for the most expensive cases. Once a patient generates $50,000 a year in bills, Washington would pay three-quarters of any additional costs -- as long as the insurer passed the savings onto companies and workers.

Shifting these costs to the government would reduce premiums for private health insurance plans by about 10% annually, Thorpe calculated. Kerry argues that would not only ease the burden on workers facing rising payments, but encourage more businesses to insure their workers.

Finally, Kerry would go further than Edwards in subsidizing small employers to insure their workers and helping individuals buy insurance on their own. The result, by Thorpe’s estimates, is that Kerry’s plan would cover about 5 million more adults than Edwards, reaching nearly 27 million of the uninsured.

Because so many of California’s uninsured are working adults, Kerry’s plan would meet the state’s needs more directly than Edwards’, said E. Richard Brown, director of UCLA’s Center for Health Policy Research. Brown also thinks it’s a better idea than the tax credits President Bush has proposed to help those without insurance purchase it.

Bush has urged tax credits of up to $3,000 a year for uninsured families, and $1,000 for individuals -- far below the cost of private coverage in most markets. “The tax credits aren’t really big enough to help people buy the coverage ... whereas the Kerry approach has multiple ways it provides support to the adult working population,” Brown said.

Yet because Kerry’s approach is more comprehensive than Edwards’ plan, it is also more expensive. Thorpe estimated the Kerry plan’s 10-year cost at $895 billion.

Edwards has seized on that higher price tag to argue that his plan is more “affordable and doable” than Kerry’s. From her ground-level view on Alvarado Street, Floutsis said the question wasn’t whether the Democratic plans go too far, but whether they go far enough in expanding coverage to communities like Pico-Union.

“If they can do something that will help us in our work, we’ll take it,” she said, peeking into the examination rooms filled with patients. “But we could build three of these clinics and still not meet the demand in this neighborhood.”

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Edwards and Kerry on health

Democratic presidential candidates John Edwards and John F. Kerry each would spend money to reduce the number of Americans without health insurance. But their plans to accomplish that differ in key respects.

Edwards’ plan: Mandates that all parents provide health insurance for children through age 21, but provides tax subsidies to help lower-and middle-income families cover the cost.

Kerry’s plan: Federal government assumes all the cost of providing Medicaid to roughly 20 million low-income children; in return, states contribute to coverage for millions of working-poor adults and their children.

Edwards’ plan: Provides subsidies for low-income uninsured adults to purchase coverage, but would cover less of the cost than Kerry’s plan.

Kerry’s plan: Federal government assumes three-quarters of the cost for all patients whose annual bills exceed $50,000, as long as insurers and employers pass savings on to workers.

Edwards’ plan: Uses tax breaks to subsidize coverage at small businesses if a majority of their workers are low-income.

Kerry’s plan: Provides tax subsidies to encourage small businesses to insure their workers.

Edwards’ plan: Requires insurance companies to allow parents to cover their children on family plans through age 25.

Kerry’s plan: With the help of federal subsidies, allows uninsured people to buy into the plan that provides coverage for federal workers and members of Congress.

Edwards’ plan: Expands federal aid for community health clinics.

Kerry’s plan: Requires states to eventually contribute to coverage for uninsured single adults earning up to the poverty line.

Source: L.A. Times research