While critics of President Clinton's healthcare reform plan, including several powerful business groups, have seemed to control the recent debate, their dominance may fade as the flaws of alternative plans become apparent, observers said.
The rush to judgment of the Clinton plan intensified in the wake of a Congressional Budget Office analysis, released in early February. The CBO concluded that the health insurance premiums employers would be required to pay on behalf of their workers should be counted as government receipts. It also said that health alliances, through which most businesses and individuals would be required to buy insurance, should be viewed as government entities.
But even as CBO chief Robert Reischauer delivered his report to Congress, he tempered it with a warning that if all alternative reform proposals were presented in as much detail and subjected to the same tortured scrutiny that had been applied to the Clinton plan, they too would appear problematic.
The president's health plan "is unique among proposals to restructure the healthcare system, both because of its scope and its attention to detail," Mr. Reischauer said in a statement prepared for the Senate Finance Committee. "Some critics of the proposal maintain that it is too complex. A major reason for its complexity, however, is that it outlines in legislation the steps that would actually have to be taken to accomplish its goals. No other proposal has come close to attempting this."
Clinton administration officials have long complained that alternative reform proposals have managed to evade the criticism that has dogged the president's plan because they lack sufficient detail.
However, the CBO's findings fueled opponents' charges that the president's plan would raise taxes and create a massive new government bureaucracy.
The plan has been pilloried by congressional Republicans and conservative Democrats, as well as by such organizations as the U.S. Chamber of Commerce; the National Association of Manufacturers; the Health Equity Action League; the Business Roundtable; and, most recently, the Christian Coalition.
A major charge is that it would cost jobs, as businesses respond to the mandate to finance health insurance for workers by shrinking their labor force or closing altogether. It also has been indicted on charges that it would lead to the rationing of healthcare, as premium caps force restrictions on service, and reduce consumer choice of physicians and health plans by requiring everyone to buy insurance through regional health alliances.
But at a briefing with reporters the day after the president's State of the Union address, Ira Magaziner, senior White House policy adviser, insisted that the president's plan was the simplest way to achieve universal coverage. Alternative plans seen as less bureaucratic would, in fact, be more complicated, he said.
An increasingly popular proposal offered by Rep. Jim Cooper (D-Tenn.), as well as a plan put forth by Sen. John H. Chafee (R-R.I.), for example, would require that the federal government provide subsidies for health insurance to more than 100 million eligible individuals. Without the large regional alliances envisioned in the president's plan, the bureaucracy needed to process payments for that many people-roughly three times the number of welfare recipients-would be a "nightmare," Mr. Magaziner said.
CBO is still in the process of drafting analyses of various congressional reform plans. Mr. Reischauer offered no fixed timetable for completing them.
As attention to Mr. Cooper's measure grows, controversy and opposition are already converging around its central financing mechanism: a tax cap that would limit deductibility of health insurance benefits for employers and individuals to the value of the lowest-cost plan available.
Revenue from the provision would be used to finance the expansion of public health coverage for the poor. While supporters argue that a tax cap is vital to encourage purchasers to chose the most cost-effective health plans, opponents are dubbing it a middle-class tax hike (Feb. 14, p. 38). William Cox, vice president of government services for the Catholic Health Association, said the cap idea was dead on arrival in Congress.
In a speech at a meeting of the Group Health Association last week, first lady Hillary Rodham Clinton said the Cooper plan's tax cap was "one of the most dangerous and threatening aspects to healthcare reform."
It would restrict choice by penalizing businesses and consumers who weren't in the lowest-cost plans with a loss of their tax benefit, Ms. Clinton said. In addition, it would present massive administrative complications, she said.
"We'd have a difficult time figuring out what the lowest-cost plan is on a year-to-year basis," she said. As health plans vie to be designated as the lowest-cost alternative, "Who will arbitrate that?" Ms. Clinton asked.
The Cooper plan shares the administration's goal of creating managed-care networks and establishing regional insurance purchasing pools to enhance purchasers' buying clout. But unlike the president's plan, it wouldn't require businesses to buy healthcare for their workers, nor would it impose premium caps to control costs. In addition, participation in purchasing pools would be voluntary as well as restricted to small businesses and individuals.
While Mr. Reischauer declined to give a detailed assessment of the Cooper plan before his agency completed its analysis, he hinted that CBO would find that it and any other proposal that lacked regulatory cost control would be far less effective at curbing costs than the president's proposal. Without premium caps, cost estimates for the president's plan would be "quite a bit higher," he told the Senate Finance Committee.
As CBO analyzes the Cooper, Chafee and other plans, "each of those reports will be a valuable education for members (of Congress) and the American public," said CHA's William Cox, referring to the warts that would show up on the those plans.
Mr. Magaziner, meanwhile, told reporters that recent criticism of the president's plan shouldn't be viewed as a death blow. "This is like a roller coaster ride in a hurricane," he said. "There will be a temptation to declare we've lost the game 10 different times. Then all of a sudden, we'll be back in it."