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Presidential Candidates' Health Reform Plans: Prospects for Promoting a High Performance Health System

On March 12, The Commonwealth Fund and the Alliance for Health Reform sponsored a forum on how the leading presidential candidates' health reform proposals would promote a "high performance" health system—that is, not only expand coverage for the uninsured but also improve quality and efficiency and gain control over spiraling health care costs. At the forum, advisors to Senators John McCain (R-AZ), Hillary Clinton (D-NY), and Barack Obama (D-IL) described key features of the candidates' health plans and how they differ, and responded to questions about how the plans address specific challenges. A webcast and transcript of the event are available on kaisernetwork.org.

The Fund's Sara Collins set the stage by describing the major failings of the current health care system, key strategies and principles for improving its performance, major features of the candidates' reform proposals, and survey findings on the public's views on health reform. In particular, Collins outlined principles for reform, developed by The Commonwealth Fund Commission on a High Performance Health System, that are intended to help the public assess reform proposals based on their potential to achieve universal coverage and move the nation' s health care system toward high performance (Figure 1).

Figure 1. Roadmap to Health Insurance for All: Principles for Reform

  • Provides equitable and comprehensive insurance for all
  • Benefits cover essential services with financial protection
  • Premiums/deductibles/out-of-pocket costs affordable
  • Coverage is automatic, stable, seamless
  • Choice of health plans or care systems
  • Broad health risk pools; competition based on performance, not risk or cost shift
  • Simple to administer: lowers overhead costs for providers/payers
  • Minimizes dislocation
  • Financing adequate/fair/shared across stakeholders
Source: S. Collins, Health Care Reform in the 2008 Presidential Election, Alliance for Health Care Reform Briefing, March 14, 2008.

Each of the candidates has put forth a plan to create a more efficient and effective health care system (Figure 2). Collins fits their plans into two distinct approaches:

  1. expanded coverage through individual insurance market with tax incentives, changes to employer benefit tax exemption, and deregulation of state markets (McCain); and
  2. universal coverage through mixed private–public group insurance and reorganized and regulated private group insurance markets, with shared responsibility for financing from government, employers, and individuals (Clinton and Obama).

Figure 2. Presidential Candidates' Health Reform Plans

Clinton Obama McCain
Individual Mandate Yes Children only No
Employer Large firms offer or contribute X% of payroll Offer or contribute X% of payroll No
Medicaid/ SCHIP Expansion Yes Yes No
Private Insurance Markets New group Health Choices Menu through FEHBP with private & public plan options New group National Health Insurance Exchange with private & public plan options Purchase private individual insurance in any state
Subsidies for Low to Moderate Income Tax credit for premium >X% of income Sliding scale premium subsidies Tax credit $2,500 for individuals, $5,000 for families
Quality and Efficiency Measures HIT, Transparency, P4P, Prevention, Comparative effectiveness, Chronic disease management, Disparities, Malpractice reform HIT, Transparency, P4P, Prevention, Comparative effectiveness, Chronic disease management, Disparities, Malpractice reform HIT, Transparency, P4P, Prevention, Chronic disease management, Malpractice reform
Source: S. R. Collins and J. L. Kriss, Envisioning the Future: The 2008 Presidential Candidates' Health Reform Proposals, The Commonwealth Fund, January 2008

While the three reform proposals have much in common, there are some fundamental differences among them. All try to improve quality and control costs through government support for health information technology, pay-for-performance incentives, prevention, chronic disease management, and research and dissemination on clinical effectiveness.[1] But unlike the Clinton and Obama plans, McCain's approach does not strive to achieve universal coverage; it does not expand Medicaid or SCHIP, establish a large insurance purchasing pool, or impose any requirements on individuals to obtain or employers to contribute to coverage. Instead, it relies on tax incentives and deregulation to encourage the purchase of insurance, particularly in the non-group market.

Gregg Bloche, advisor to Senator Obama, said that the Obama and Clinton plans share a vision for health care reform that is similar to the Fund's principles for a high performance health system. Both plans would provide a safety net when self-reliance falters, shield the poor, and tailor public efforts (such as research and subsidies) to make markets work better and help people make value-based choices and lifestyle changes. They rely on "both individual obligation and public responsibility," he said. Bloche also spoke to one of the few differences between the Obama and Clinton plans: the individual mandate. "Obama is open to a mandate but first wants to explore enhanced enrollment strategies such as 'opt out' at the workplace as well as subsidies," he explained. (Opt out refers to automatic or default enrollment in health plans unless an employee specifically chooses to decline the coverage.)

Clinton advisor Katherine Hayes countered that Clinton's proposal to offer subsidies tied to a certain percentage of an individual's income would ensure the affordability of coverage, noting that, "it's indisputable that coverage cannot be universal without an individual mandate." Hayes also said that Clinton's promotion of "patient-centered care" would get patients more involved in their health care through patient-friendly information on outcomes, treatment options, and costs, "not shifting costs to patients."

Raissa Downs, advisor to Senator McCain, explained that her candidate and the Democrats have "significant philosophical differences on how to move forward." McCain does not create a new government process to reform health care. He has a fundamental belief that costs can be lowered, quality and value improved, and new avenues for access opened through a competitive marketplace. He strives to "shore up and make robust the existing private sector delivery system," she said.

As we move toward the presidential election, the health care reform debate is likely to intensify. Collins summarizes her assessment of the leading candidates' proposals: "All three candidates' proposals identify new approaches and leverage points in the health care system that promise to improve quality and efficiency in similar ways. The proposals that aim for universal coverage, however, would not only improve access to care for millions of people, but also offer more levers to move the health care system to higher performance."

For More Information
Contact: Sara Collins, assistant vice president, Program on the Future of Health Insurance, The Commonwealth Fund, (212) 606-3838 or [email protected]

See: S. R. Collins, Health Care Reform in the 2008 Presidential Election, Alliance for Health Care Reform Briefing, March 14, 2008.
S. R. Collins and J. L. Kriss, Envisioning the Future: The 2008 Presidential Candidates' Health Reform Proposals, The Commonwealth Fund, January 2008.
S. R. Collins and J. L. Kriss, The Public's Views on Health Care Reform in the 2008 Presidential Election, The Commonwealth Fund, January 2008.
K. K. Shea, S. R. Collins, and K. Davis, Health Care Opinion Leaders' Views on the Presidential Candidates' Health Reform Plans, The Commonwealth Fund, January 2008.
The Commonwealth Fund Commission on a High Performance Health System, A High Performance Health System for the United States: An Ambitious Agenda for the Next President, November 2007.

Reference
[1] All three candidates endorse pay for performance and comparative effectiveness, but McCain would apply pay for performance to Medicare only, while Clinton and Obama would also apply it to private plans in the new insurance exchange. McCain supports comparative effectiveness research primarily in and by the private sector, and would not necessarily apply it to benefit design in Medicare.

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