Like the prologue to a good drama, the introduction last week of a Senate Democratic leadership plan for healthcare reform set up the final acts of the reform debate in Congress.
Politically, the debate has boiled down to universal coverage. Or, more specifically, whether it can be achieved without employer-mandated health insurance.
Senate Majority Leader George Mitchell (D-Maine) acknowledged that the plan he put forward last week does not achieve universal coverage, but it would reach 95% coverage, which he called "a very important measurement on the way to universal coverage." On the other hand, the plan introduced days before by House Majority Leader Richard Gephardt (D-Mo.), which includes an employer mandate, would cover all Americans.
Adding to the confusion, President Clinton, in a nationally televised press conference last week, indicated support for both the Gephardt and Mitchell plans (See related story, p. 16).
Republicans, meanwhile, were preparing to offer a bill sponsored by Senate Minority Leader Robert Dole (R-Kan.) that shuns heavy government intervention in favor of insurance reforms and other incremental changes in the healthcare market. The plan would be offered as an alternative to the Democratic measure during floor debate on reform legislation, expected to begin this week.
Weakening the troops? The question going into this week's critical round of action remained: How much political effect would the less ambitious Mitchell plan have on an already skittish House?
Former Ways and Means Committee Chairman Rep. Dan Rostenkowski (D-Ill.) said even members of the committee, whose legislation is the basis of the Gephardt plan, are "having second thoughts about whether they are going to support (the bill) on the floor of the House if there's a mandate in it."
"Why should (House members) take the heat now?" Mr. Rostenkowski asked.
The most telling indication last week that employer mandates may be in trouble in the House was, according to several lobbyists, that Mr. Gephardt already was preparing an alternate plan that would weaken the employer mandate. No details were known about that plan, however.
Predictably, reaction to the Mitchell plan was mixed. Moderate Democrats praised the bill as a move in the right direction, while Republicans decried it as a step back toward the Clinton plan.
Sen. John Danforth (R-Mo.) said the Senate Finance Committee had "rejected the idea of an employer mandate. That idea has now crept back into Sen. Mitchell's proposal."
Demonstrating how narrow the political middle ground really is, Senate liberals also were critical of the Mitchell plan, which they said did not achieve universal coverage.
"Our votes are not to be taken for granted," said Sen. Paul Wellstone (D-Minn.), a supporter of single-payer healthcare.
Lost details. What concerns many healthcare observers most is that with Congress' focus on crafting an acceptable employer mandate, details of the plans, and their possible consequences, seem to be getting lost.
"The healthcare reform debate right now really misses the healthcare point," said Pamela Bailey, president of the National Committee for Quality Healthcare. "The employer mandate is by no means the end of the story."
One of the provisions that providers are most concerned about in the Mitchell plan would place a 25% excise tax on any "high-cost" health insurance plan. A high-cost plan is defined as one having a premium that increases faster than the growth rate of the Consumer Price Index plus two percentage points in any given year after 1999.
The tax would be levied against insurers and providers. Insurers would collect from providers with reduced reimbursements.
"This is a premium cap, pure and simple," said Michael Bromberg, executive director of the Federation of American Health Systems. "It may be slightly better than the Clinton premium caps, but it is still terrible."
Another sore spot is the Medicare reductions that are part of both plans. The Gephardt plan includes $110 billion in Medicare spending restraints over a five-year period. Responding to criticism by the American Hospital Association, Mr. Gephardt said the mix of cuts, which had been heavily skewed against hospitals, had been revised.
The Mitchell plan has $54 billion in Medicare reductions over five years. According to early estimates, about 60%, or about $33 billion, would come from hospital reimbursements.
"The Medicare cuts combined with the premium caps are really a double whammy," said Michael Rock, senior associate director for the division of congressional relations at the AHA. "Add to that the fact that (the Mitchell plan) doesn't get to universal coverage, and you have a major problem."
Supporters of the Mitchell plan, which, according to a preliminary estimate by the Congressional Budget Office, would not affect the deficit in the first five years, say the Medicare cuts and premium tax are needed to finance the bill. The CBO's final analysis is expected this week.
Protesting providers. Outside the nation's capital, hospitals in the Northeast were waging an all-out, grass-roots effort to stop proposed Medicare cuts.
This week, for example, the New Jersey Hospital Association will run full-page ads in major newspapers across the state urging its congressional delegation to vote against Medicare reductions.
Under a headline that warns, "You will pay the difference," the NJHA said, in the year 2000, hospitals will be paid only 60 cents for every dollar of care provided to the elderly. If the proposed Medicare reductions go through, hospital bills will be higher, lots of healthcare workers could lose their jobs, and some hospitals may close their doors, according to the ad.
The 100-member association spent $15,000 on the ad campaign, and the AHA matched that amount.
However, there also are provisions in the Mitchell plan that healthcare providers hope to save. One such item is the $72 billion over five years in funding for academic health centers.
"We are very pleased," said Mary Beth Bresch-White, legislative analyst for the Association of American Medical Colleges. "Absent the level of funding in the Mitchell plan, (academic health centers) would not survive."