Government News
States May Be Pioneers in Health-System Reform
Psychiatric News
Volume 42 Number 19 page 13-21

Thirteen years after Congress killed the last major push for national universal health coverage, prominent lawmakers are pushing bipartisan health care coverage expansions that put the states front and center.

Congressional leaders said the failed push for universal health insurance led by the Clinton administration in 1994 and other high-profile initiatives since have taught them lessons they have applied to their current push for universal coverage. Those lessons include taking a bipartisan approach and moving incrementally.

Proposed bipartisan legislation includes proposals that would provide federal support to states that take the lead in providing universal coverage for their residents. Under such legislation, those federally funded state programs could serve as models for a nationwide universal coverage program several years later.

Individual legislators differ, however, over what approach they prefer. Some have urged a single-payer system, which they call Medicare for All. Others have urged an employer insurance mandate. And some prefer a mandate on every citizen to obtain health care insurance, similar to the model used by Massachusetts (Psychiatric News, September 21).

"Those are basically the three options, or we could have some hybrid approach; we could mix and match to achieve the goal of covering everyone," said Sen. Kent Conrad (D-N.D.) in a September hearing on universal health coverage. "But the reality we confront is that whatever option is chosen must have bipartisan support. These problems are too big to be tackled by one party alone."

Among the leading proposals is a measure (S 1169) sponsored by Sen. Russell Feingold (D-Wis.) and Sen. Lindsey Graham (R-S.C.) called the State-Based Health Care Reform Act. The bill would establish the Health Care Coverage Task Force to approve grants to states whose proposals mandate minimum requirements in coverage and quality measures and meet cost guidelines. The bill would provide about $40 billion for state matching grants to expand health care coverage, while mandating certain "cost-sharing" limits to keep the coverage affordable for beneficiaries.

"This bill will give select states funding and authority to cover the uninsured in their state in whatever manner will work best within that state," Feingold said.


Federal support for approaches tailored to each state is key to expanding health coverage in a nation where states have such different health care situations, including highly variable rates of coverage and widely differing degrees of service provided by health maintenance organizations versus other types of insurance, according to Henry Aaron, a senior fellow at the Brookings Institution. State-based approaches to universal coverage may prove a better approach than a centralized federal program.

"The objective circumstances of health care across the United States are so different and diverse... .I am skeptical we could design a single system to encompass that diversity," he said.

Another state-based approach would authorize grants for states to create universal health care pilot programs that could become models for other states and the country. The legislation, sponsored by Sen. Bernie Sanders (I-Vt.) and known as the States' Right to Innovate in Health Care Act of 2007 (S 2031), would authorize five, five-year grants to states committed to developing plans for universal, comprehensive, cost-effective health care. The states would have to provide comprehensive benefits, including coverage for long-term care, diagnostic services, preventive care, prescription drugs, dental and vision services, and mental health treatment including that for substance abuse.


Patients who otherwise would have received health care through a federal program—including Medicare, Medicaid, State Children's Health Insurance Program, and Federal Employees Health Benefits Program—would, under Sanders's bill, be guaranteed benefits at least as generous in terms of covered services, access, and availability. They also would not have to pay out-of-pocket expenses beyond what they already pay in the federal health program in which they are enrolled. Federal support for state plans would be limited to the amount of federal funds that would have been spent on health benefits in that state in the absence of the new plan.

"The quickest route toward a national health care program will be when individual states go forward and demonstrate that universal and nonprofit health care works and that it is the cost-effective and moral thing to do," Sanders said.

Another high-profile proposal, known as the Healthy Americans Act (S 334), would require all adults to enroll themselves and their children in either a private insurance plan or to purchase a federally subsidized Healthy Americans Private Insurance (HAPI) plan. Like the Massachusetts universal coverage approach, the bill would establish monetary penalties for people who don't buy coverage.

Sponsored by Sen. Ron Wyden (D-Ore.), the bill requires standardized coverage and allows state options beyond the federal mandate for HAPI plans. Also, the bill requires each state to establish an agency to administer its HAPI plan and to promote prevention and wellness for residents.

As with most universal coverage proposals, the Wyden approach has its critics. Janet Stokes Trautwein, executive vice president and CEO of the National Association of Health Underwriters, a trade group for insurance-industry professionals, compared such an individual requirement with the requirement of 46 states that their residents buy auto insurance. However, research shows 14.6 percent of drivers continue to lack such coverage.

Whichever approaches end up advancing in Congress, advocates of universal health care say the issue cannot wait until after the 2008 election because the number of uninsured is growing every year, as evidenced by Census Bureau figures released in August showing that the number of uninsured Americans rose by 2.2 million from 2005 to 2006 to about 47 million.

"I think the question of fixing health care is so urgent we ought to get on with it, and we ought to get on with it in a bipartisan way," Wyden said.

The State-Based Health Care Reform Act is posted at<http://thomas.loc.gov/cgi-bin/bdquery/z?d110:s.01169:>. The Sanders bill is posted at<www.sanders.senate.gov/files/SRIA.pdf>. The Healthy Americans Act can be accessed at<http://thomas.loc.gov> by searching on the bill number, S 334.

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