A New Approach to Health Reform

A new cast of players in key posts in Congress and the incoming Bush administration presages a new approach to solving entrenched health reform problems in the new year.

President-elect George W. Bush offered ideas during the campaign to energize the private health sector to solve problems that have eluded politicians and bureaucrats for decades.

Unlike the Clinton-Gore administration’s focus on expanding government-run health programs and reliance on top-down mandates and regulations, Bush wants to tap enhanced market competition and consumer choice.

The incoming Bush team has a solid core of expertise to help chart a new course in the health reform debate.

Treasury Secretary-designate Paul O’Neill and new Ways and Means Committee Chairman Bill Thomas bring a deep understanding of the problems in the health sector and share Bush’s approach to innovative solutions.

And with Gov. Tommy Thompson as the incoming secretary of Health and Human Services, Bush will have as his chief health spokesman a governor who understands the importance of devolving control from Washington and giving people the resources they need to help themselves.

Over the last eight years, the nation has been subjected to a constant barrage of regulations and mandates, and the creation and expansion of programs to lure Americans into taxpayer-supported health coverage.

Yet today, nearly three million more Americans are uninsured than in 1993. Health insurance premiums are again rising at double-digit rates. And Americans in government programs like Medicare and Medicaid face frustrating restrictions on access and services while doctors and patients alike are buried in an avalanche of paperwork.

There is no time to waste. The new approach to health reform will be reflected the initiatives that Bush will advance early on. During a news conference last week, Bush spokesman Ari Fleischer said that expanding access to prescription drugs for needy seniors will be a top priority, along with widening access to health insurance.

The initiatives that Bush is proposing are small changes on the margin, but like turning a giant battleship in mid-course, a few degrees of change can result in a very different destination.

For example, he wants to provide a prescription drug benefit for senior citizens through his Immediate Helping Hand initiative.

The Bush program is targeted to seniors who most need help, moves power and control to the states, and is designed to avoid disrupting private coverage for the great majority of seniors who already have it. It would provide $48 billion over four years to the states to enable them to expand or create their own programs to assist seniors in obtaining prescription drugs.

Nearly half of the states already have such programs, and they provide a ready model for quick action. Gov. Thompson was the first governor to endorse state block grants for prescription drugs and will be important in making the case for this initiative.

Then comes the hard part — overall Medicare reform. Medicare is not sustainable as it currently is structured. As financial pressures continue to grow, it will be more and more difficult for beneficiaries to get the services and medical products that they want and need, especially as more and more treatments are available through advancing medical research.

Chairman Thomas co-chaired a commission two years ago that developed a Medicare reform plan that would have given seniors options for more comprehensive coverage, including plans with drug coverage, but Clinton torpedoed the commission’s work. Bush would be well advised to set up a new commission to take the ideas to the next level.

Bush wants to use the leverage of the imperative for a comprehensive prescription drug benefit to advance overall Medicare reform, and Thomas will be a strong advocate for modernization of the program at the helm of Ways and Means.

And the uninsured also can expect help from the Bush administration. Treasury Secretary-designate O’Neill has long been an advocate of changes that would rectify the discrimination in the tax code against Americans who don’t get health insurance through their workplace.

As part of his work in selling the Bush tax cut plan, O’Neill will advance tax credits for the uninsured to give them added resources and incentives to buy insurance on their own. Not only will this help millions of uninsured American families to get coverage, but it also will inject much-needed vitality into the private health insurance market.

Another refreshing change will be that health care will be part of a more balanced policy agenda. Unlike 1993, when the Clintons came storming into Washington determined to reengineer the entire U.S. health care system, health care will compete in the Bush administration with a number of other priority issues, including tax cuts, education reform, and military readiness.

This balanced approach, along with a uniquely qualified team, has a much greater chance of producing meaningful results.

Ms. Arnett is president of the Galen Institute in Alexandria, VA, that focuses on health reform through an energized competitive marketplace.

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