Health care costs in the United States are rising at an alarming rate. Yet despite the fact that we spend more per capita on health care than any other industrialized country, we produce some of the worst outcomes by a number of important health measures.
Furthermore, the U.S. remains the only developed nation that does not guarantee health coverage as a right to its citizens. Today, nearly 47 million Americans lack health insurance — leaving one in six
without access to proper medical care. Even more shocking is that more than 80 percent of the uninsured come from working families. Health care costs are imposing an increasing burden on families and placing employers at a further competitive disadvantage. It is time for policymakers to offer a new vision for health care — one that is based on shared responsibility and provides universally mandated, affordable coverage to all.
Instituting meaningful, systemic reforms will require a fundamental shift in how we view employer-provided coverage and health care delivery. While it is critical that businesses maintain a role, we must change our perspective of health insurance as a privilege or benefit tied to employment. Instead, we must consider it a right and responsibility to be shared by the community. Individuals, employers, health care providers and the government all have key roles to play in reaching a truly inclusive and efficient health care model. It is in this vein that I have joined with Rep. Christopher Shays (R-Conn.) to introduce a bipartisan, universal health care proposal that will guarantee every American access to the same coverage as Members of Congress.
The American Health Benefits Program Act (H.R. 5348) is based on a program that has stood the test of time — the Federal Employees Health Benefits Program. Currently, more than 8 million federal employees, retirees and their dependents receive health coverage under the program.
The program, negotiated by the federal government, employs a system of managed competition between private insurance carriers and provides enrollees with a large menu of coverage options. Its use of bulk purchasing helps contain costs and brings stability to the system. In 2007, this resulted in an average premium increase of just 1.8 percent, compared with the private market average of 6.1 percent. H.R. 5348 would use this successful model as a template to provide similar benefits to all Americans, establishing the first ever American Health Benefits Program.
Under the program, employers who wish to continue negotiating with private insurance carriers may do so, as long as the coverage they offer meets a basic standard set by the program. However, employer-sponsored coverage is proving to be more and more prohibitive for businesses as health care costs continue to outpace inflation and insurance options drastically fluctuate from plan to plan. That is why the program allows companies to choose instead to pay a fixed, predictable payroll tax according to their size and average employee earnings. For many businesses, this may cost less than they currently spend on premium contributions and health plan administration.
This new revenue will create a funding stream to allow for a fixed government contribution of 72 percent toward the health care premiums of every participating American. Individuals participating in the program will have a responsibility to pay the remaining share, to the extent they can afford it, with the lowest-income earners receiving subsidies to ensure affordability.
This expanded system of managed competition will ensure that plans compete for enrollees on the basis of benefits, as well as efficiency, service and price. No one will be denied coverage or discriminated against based on their health status or pre-existing condition. The program will offer portable and continuous coverage, and it will incentivize investment in disease prevention and long-term preventative care, which decrease the cost of care over time. Investments in health information technology also will lower costs while increasing quality and efficiency.
The unsettling truth is that society already pays for the uninsured, and it does so at tremendous cost and with staggering inefficiencies. The uninsured are most often forced to seek care from doctors and emergency rooms only after their illnesses reach catastrophic levels, drastically increasing the risk of complications and the costs of treatment. Recent estimates place total uninsured medical expenses at nearly $125 billion a year. Approximately $41 billion of this total comes in the form of “uncompensated care,” which is predominantly borne by the government and financed by the taxpayer. This cost is only compounded by the lost income due to reduced employment and job productivity.
Instituting a system of mandatory coverage will be integral to the success of any comprehensive health care reform. Requiring full participation in the system will bring a younger, healthier population into the insurance market, spreading the risk more evenly. In addition, mandated health coverage will stabilize the insurance market by decreasing insurers’ legitimate fears of attracting a disproportionate share of unhealthy patients. This will result in greater efficiency as well as significantly reduced administrative costs that otherwise would be dedicated to underwriting and target marketing.
Sen. Hillary Rodham Clinton (D-N.Y.) has shown that she recognizes the importance of mandated coverage, and the principles of both personal and shared responsibility in her own universal health care proposal. Furthermore, her plan speaks to the need for any universal mandate to be supplemented with an appropriate subsidy to guarantee affordability. It also must be accompanied by a greater emphasis on early diagnosis, prevention and evidence-based treatments to ensure quality and reduce costs.
The challenges we face in fixing our ailing health care system are great; however, the costs of inaction are even greater. The time has come for policymakers at all levels and across the ideological spectrum to take meaningful action toward developing a health care system that really works for our nation: one that offers Americans choice, calls for shared responsibility and is affordable to all. I look forward to working with my colleagues, advocates and families across the country to achieve a new vision for health care in America.
Rep. James Langevin (D-R.I.) is a co-sponsor of the American Health Benefits Program Act.