Insurance for the Nation's Health
We have left undone those things which we ought to have done . . .And there is no health in us.
--Book of Common Prayer
WHAT the people of the U.S. ought to have done may be debatable in many areas and in many details. What has been most conspicuously left undone involves health. As long ago as 1883, Iron Chancellor Otto von Bismarck (who could hardly be called socialistic or radical) gave Imperial Germany the world's first Sickness Insurance Act, covering workers and their families. Similar benefits now protect the people of virtually every industrialized nation in the world. But not Americans. Only now are influential members of both parties in Congress giving serious consideration to proposals for blanketing the nation's 205 million citizens with some form of national health insurance.
Jump into Chaos. Last week Robert H. Finch, Secretary of Health, Education and Welfare, declared: "We must build a health-care delivery system of surpassing quality, accessible to every American, everywhere in this nation." But then, at a Manhattan meeting of the United Cerebral Palsy Associations, Finch abruptly backed away from early adoption of a truly comprehensive program. "To move now into some scheme of national health insurance," he said, "would repeat the experience of Medicare and Medicaid, and multiply its consequences ten times over. Without prior planning, preparation and creation of basic resources, we would invite literal chaos." That was literal truth if the operative word in Finch's statement was now. There is no prospect that Congress will enact a comprehensive insurance program and expect to have it working in 1970.
For that matter, at their present rate, Finch's HEW staff is not likely to produce any program by 1980 either. In 1932, the Committee on the Costs of Medical Care, headed by the late Dr. Ray Lyman Wilbur, recommended that doctors be encouraged to practice in groups and that the costs of medical care "be placed on a group-payment basis, through the use of insurance, through the use of taxation, or both of these methods." Though Wilbur was Republican President Hoover's Secretary of the Interior and a former president of the American Medical Association, his recommendations were denounced in the Journal of the A.M.A. as "socialism and Communism."
U.S. citizens now spend $60 billion a year on medical, dental and nursing care, drugs and appliances. Of this, the federal share is $21 billion. Yet by the best estimates, 80 million Americans lack adequate health care. For the majority, the barrier cutting them off from decent care is financial. Either they do not qualify for health insurance under any of the plans offered, or, if they qualify, they have no money to pay the premiums.
Mental and Dental. The Health Insurance Institute reports that 170 million Americans now have insurance to defray hospital expenses and receive more than $7 billion annually in benefits. But in many cases the insurance does not cover all costs, so that $6 billion still has to come out of the insured patients' pockets--and 35 million people have no protection whatever.
As for truly comprehensive medical coverage, the gaps of unmet needs are still greater. There are 155 million who have insurance against surgical expenses, leaving 50 million unprotected, and 130 million insured against "regular medical expense," leaving 75 million unprotected. About 67 million subscribers have "major medical" coverage, which repays them for 70% to 80% of actual outlays for virtually all medical expenses, including prescription drugs. Under whatever type of plan, coverage for the costs of mental illness is spotty and in most cases inadequate. Only 3,000,000 Americans have insurance for dental care.
In 1948, President Harry S. Truman's Federal Security Administrator, Oscar Ewing, with his boss's backing, declared that the U.S. must "provide that all people shall have access to such health and medical services as they require through a system of insurance covering the entire population." The plan was to be financed by payroll taxes rising to 4%; it would be administered by the states with the Federal Government serving only as the collecting and disbursing agent; patients would have free choice of doctor, and doctors would have the right to reject patients; doctors could join the plan or not, as they chose. Despite these highly flexible provisions, the Truman-Ewing plan was denounced as "socialized medicine" by the A.M.A., which succeeded in killing it.
In the Hopper. At least half a dozen plans for U.S. national health insurance have now been formally proposed and introduced in Congress or are in their final drafting stages. None of these originated in Finch's HEW, and none is likely to. In its concern for budget balancing and combating inflation, the Nixon Administration does not sufficiently recognize the potential savings --certainly in health and lives, if not in money--from a national program to insure health care, including preventive medicine, for all.
What the Administration is doing, commendably, is trying to iron out some of the wrinkles that have caused needless overruns in the costs of Medicare and Medicaid. It is proposing that contractors (such as Blue Cross, Blue Shield or group health plans) be authorized to assume responsibility for the total care of Medicare patients for a flat annual fee that would be no more than the current per-patient costs of Medicare from both taxes and the voluntary part.
While most of the drive for comprehensive health insurance is coming from Democrats, they do not have the field to themselves. Among Republicans, New York's Governor Nelson Rockefeller has a plan for both his state and the nation; Massachusetts' Governor Francis W. Sargent has a state scheme, and New York's Senator Jacob Javits has introduced a national bill. Main features of the principal plans:
MEDICREDIT. Devised by the A.M.A. in the hope of heading off any more liberal system and introduced in Congress by Tennessee's Democratic Representative Richard Fulton and Arizona's Republican Senator Paul Fannin, would permit a tax credit on a sliding scale based on income. Families earning less than $5,000 a year could deduct the full cost of their health-insurance premiums from their computed tax. Families with incomes over $10,000 could deduct only 25% of their premiums. For all income groups the top limit would be $150 for a single taxpayer and $400 for those with dependents. For those so poor as to have little or no tax liability, the Federal Government would issue a "medical-care insurance-premium certificate" at the same $150 and $400 rates, which could be used to buy insurance from any approved carrier. Medicare beneficiaries would get income-tax credit for their Part B, supplementary coverage now being raised from $4 to $5.30 a month. Estimated cost: $9 billion to $11 billion.
JAVITS BILL. Introduced last month by Senator Javits, to establish a national health-insurance program by gradually extending Medicare coverage to the whole population. For two years after 1971, it would do little more than give full Medicare benefits to all over 65, saving them the Part B premiums. Then the Medicare program would be gradually extended to all Americans. Dental care for children up to age six would be added. Another year later, diagnostic benefits such as physical checkups and eye and ear examinations would be added. Most costs for drugs, dental care, eyeglasses, hearing aids and nursing-home care would not be covered. Javits would finance this with a payroll tax on employers and employees, its proceeds to be matched by an equal sum from the federal treasury. Estimated annual cost when in full swing: $22.7 billion. Other features of the bill would give financial incentive to the establishment of group practices and community health centers. To provide medical services, HEW could contract with both nonprofit and commercial carriers and with state agencies. The Javits plan would rely on the commercial companies to undertake most of the coverage, despite their traditionally unimaginative countinghouse mentality. Says Javits: "We simply have to hit the insurance carriers over the head and make them take the role we give them."
ROCKEFELLER PLAN. First proposed to the New York legislature in 1967 but pigeonholed in committee ever since. Recently resubmitted in modified form, with a companion bill to encourage formation of group practices. Would establish a set of minimum benefits to be bought from insurers: 1) 90 days of in-hospital (including psychiatric) care in semiprivate room; 2) outpatient Xray, diagnostic and other laboratory services, emergency care and minor surgery, physical therapy and psychiatric evaluation; 3) hospital or physician maternity benefits up to $150; 4) hospital-managed or other sponsored home care up to 100 visits a year. Patients would pay $2 in coinsurance for virtually all doctors', clinic and lab services. The state would pay premiums for all with incomes under $5,000 a year, split premiums in the $5,000-6,000 range, while those earning more than $6,000 would pay their own.
GRIFFITHS BILL. Introduced in the House by Democrat Martha Griffiths of Michigan, a member of the powerful Ways and Means Committee. Endorsed by the A.F.L.-C.l.O., it would cover unlimited hospitalization, physicians' services including surgery, preventive care and physical checkups, required nursing-home care, rehabilitation services, dental care for all under 16, eye care and allowances for eyeglasses and prescription drugs. It retains a coinsurance feature, mainly to cut down overuse: the patient would pay $2 toward the cost of all visits to the doctor's or dentist's office after the first, which would be free. It would be financed under the Social Security system, with employers paying 3% of payrolls, the federal treasury matching this, and employees paying 1%. The Government would be free to contract with suppliers of medical care and would offer incentives for more efficient group practices. Cost: $45 billion (including Medicare and Medicaid).
REUTHER PLAN. The motive power behind the Committee for National Health Insurance is Walter Reuther, whose United Auto Workers already have comprehensive regional prepayment plans working in Michigan. With a small and expert staff, C.N.H.l. has been thrashing out details in subcommittees for more than a year. Their final proposal will be introduced by Senators Yarborough of Texas and Edward Kennedy, probably within a month. Most comprehensive of all the plans so far formulated, it is certain to arouse the sharpest controversy. According to Staff Di rector Max Fine, the aim is to attack the health crisis on four fronts: manpower shortages, rising costs, disorganization and uneven quality. Estimated cost (undoubtedly optimistic): $40 billion annually, with $24 billion to be raised by a 51% payroll tax shared by employers and employees, and $16 billion from general revenues. The plan would cover all U.S. residents, absorbing Medicaid and much of Medicare. Through ten regional agencies the Government would contract with suppliers of medical care. The C.N.H.l. plan would encourage group practices, and by giving them a 3% override on contracts would actually discourage nongroup practitioners. To lure doctors into poorer rural areas, they might be offered a combination of salary and fee for service.
While every American may be entitled to at least adequate health care, he is not getting it, and will not, until a momentous national debate reaches election-year levels of acrimony and is somehow resolved.
The issue has already been injected into this year's elections by Democrat Theodore C. Sorensen, campaigning for the U.S. Senate from New York, who last week announced his own plan for "universal health insurance." Apart from such standpatters as the A.M.A. and its arch-conservative Republican allies, there is a growing consensus that some national insurance blanket must be thrown over the ailing body of health care.
It may prove to be more of a patchwork quilt, with multicolored squares for sections covered by contracts with a variety of private insurers. If administration is not made too cumbersome, that would be far better than the present non-system with its huge gaps. Walter McNerney, president of the Blue Cross Association and head of a task force soon to report to the President on the nation's health needs, believes that a monolithic system operated by HEW would be wildly inflationary--and not sufficiently innovative. He wants a flexible, pluralistic plan.
But when? The principal difference between proponents of progress is over whether to put the cart of medical-care delivery before the horse of manpower resources, and let the resources catch up with the overburdened cart--or to take the time to breed more medical horses. That means waiting years for the country's health education system to produce many thousands more doctors and tens of thousands more paramedical personnel. Secretary Finch sincerely believes that the modest expansions of federal health programs that he has submitted to Congress are important steps in the right direction, but will not commit himself to true national insurance. His chief assistant for health affairs, Under Secretary Roger O. Egeberg, thinks that some such plan may very well evolve in "six to seven years." His prognosis is as good as any.
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