By John Reichard, CQ HealthBeat Editor

June 6, 2008 -- The escalating enrollment in private Medicare fee-for-service plans reflects their popularity, but their cost is becoming a concern for Democratic lawmakers.

An aide to Rep. Pete Stark, D-Calif., chairman of the House Ways and Means Health Subcommittee, said Friday that the plans are "certainly threatening the long-term health of the program." Stark says Congress should intervene this year.

The plans offer Medicare beneficiaries extra benefits, but are relatively costly to the government and lack networks of providers who coordinate to make care more efficient. A new analysis shows private fee-for-service plan enrollment is up by more than 400,000 people so far this year.

Total enrollment now tops 2 million, up from 610,000 in October 2006. Rapid continued enrollment growth would complicate efforts to alter the plans to make them less costly, as beneficiaries exert political pressure to hold onto the extra benefits they offer.

The aide noted that any legislative action would not affect enrollment until 2009, and that delaying action until then would not affect enrollment until 2010. Meanwhile, private fee-for-service plans are fueling much of the enrollment growth in the Medicare Advantage (MA) program, the private health plan side of Medicare.

Private fee-for-service (PFFS) plans accounted for more than half of the enrollment growth of 800,000 in the Medicare Advantage program in the first four months of this year, according to the new analysis, which was released June 5 by the Kaiser Family Foundation.

The Kaiser analysis found that, because of the pace of enrollment in Medicare Advantage, which include a variety of options in addition to PFFS plans, "policy makers may soon have limited ability to alter course since continued growth in Medicare Advantage plan enrollment will generate entrenched interest and shifts in money flow that could be hard to reverse."

"While PFFS plans account for only 19 percent of MA plan enrollment, they accounted for about 60 percent of total enrollment growth from 2006 to 2007," the Medicare Payment Advisory Commission (MedPAC) noted in a March report to Congress, The panel advises Congress and the Medicare program on payment and quality issues.

Almost 10 million of Medicare's 44 million beneficiaries are now enrolled in Medicare Advantage plans, which Republicans tout as a way to apply market forces to Medicare to control costs and increase quality. But projected payments for Medicare Advantage plans in 2008 will be 13 percent higher than those for providers in traditional Medicare, the MedPAC report said. Those for PFFS plans will be 17 percent higher.

"This added cost contributes to the worsening long-range financial sustainability of the Medicare program," said the MedPAC report. The panel called for payment equality between the private health plan side of Medicare and its traditional plan.

Private Fee For Service Plans 'Here to Stay?'
Analysts following the Medicare Advantage program expect PFFS plans to continue to be a powerful market force, although they may evolve over time with eventual regulatory changes.

"When you have more than 2 million members in a government program, that program is here to stay," said Dan Mendelson, president of Avalere Health, a Washington, D.C.–based consulting firm. "It's a law of physics."

Like the Kaiser analysis, Avalere Health data shows strong PFFS growth. Mendelson says his firm's analysis shows that enrollment in the plans grew from 1.6 million in June 2007 to 2.3 million by the end of April 2008, a 42 percent increase.

PFFS enrollment gains for the rest of 2008 will tail off because the enrollment period has ended in which most Medicare beneficiaries can sign up for a plan, analysts say. "Obviously the numbers are going to plummet now that the open enrollment period is over," said John Gorman, CEO of the Washington, D.C. .–based Gorman Health Group.

But Gorman says that without legislative intervention, enrollment gains will be strong again next year. "I think the numbers are certainly going to be consistent with the trends we've seen in the past couple of years unless Congress does something," he said. One factor fueling growth is the big commissions paid to sales agents for signing up new enrollees in the plans, he said. "There are some companies out there offering more than $900 per sale."

Mendelson notes there are two parts of the PFFS plan market: in one, plans are marketed to individuals; in the other, they are marketed to companies for their retirees. Individual sales growth slowed markedly last year because Congress got "nervous" about strong-arm sales tactics that led companies to rein in their marketing practices, he said. But overall, "private fee-for-service is a very attractive option for some beneficiaries, and that will continue to be true," he said.

Administration Defends Plans
The Bush administration and its congressional allies argue that the higher payments to Medicare Advantage plans are an investment in systems of coordinated care and a competitive structure that eventually will bring costs down more effectively than traditional Medicare.

While PFFS plans do not offer coordinate care, rural lawmakers say the plans give their constituents alternatives to traditional Medicare, including extra benefits, that beneficiaries elsewhere have.

Senate Finance Committee Democrats favor lower payments to PFFS plans including a requirement that they form provider networks to make care more efficient. But Republicans on the panel are largely resisting cuts to MA plans, including PFFS plans, and the Bush administration has threatened to veto any legislation passed by Congress this month that pays for blocking payment cuts to physicians through payment cuts or regulatory changes to Medicare Advantage.

"It's evident that more and more seniors are opting for a private Medicare plan that best suits their individual health needs rather than the one-size-fits-all government-run program. This proves what Republicans have been saying all along, that seniors deserve and prefer to have a choice on how and where to receive their Medicare benefit," a House GOP aide said.

The Stark aide said the PFFS plans "are by far the worst" of the MA plans. "Even congressional Republicans will acknowledge behind closed doors that the plans are not doing anything to control costs," the aide said. PFFS critics voice particular concern about growing employer interest in putting former workers in PFFS plans to cover their retiree health benefits. That will accelerate PFFS growth and its associated costs, they say. Ninety-nine percent of Medicare beneficiaries have Medicare Advantage alternatives to traditional Medicare other than PFFS plans, the Stark aide said.

The aide declined to speculate on what Stark might specifically seek to include in the Medicare physician payment bill addressing PFFS plans. "We will see what the Senate produces," the aide said.

Transition to PPOs?
But given the veto threat, Congress is more likely to act in 2009, Gorman said. He predicts that as a result of action next year by Congress, PFFS plans in many markets may face a requirement that they actually form provider networks. That would make the plans a lightly managed form of preferred provider organizations (PPO), he said. PPOs are plans that make it less costly to go to network providers but maintain access to outside providers.

Medicare PPOs are becoming more attractive to beneficiaries because of the fast-rising costs of traditional "Medigap" plans used by seniors to pay many costs not covered by Medicare, Gorman noted. Medicare PPO premiums are lower than in the most popular Medigap plans, PPO enrollees still have access to a wide range of providers, and they get more benefits than they would get in Medigap plans, he said.

Mendelson too notes that PPOs are an up-and-coming part of the Medicare Advantage market. Regional Medicare PPOs grew 80 percent in enrollment between June 2007 and April 2008 and local Medicare PPOs saw enrollment climb 64 percent, he said.

By Whitney Wyckoff, CQ Staff

June 6, 2008 --- Using Medicare as a model to cover all uninsured adults is not the way to address the health care gap in the United States, said Rep. Tom Price, R-Ga., during a panel discussion Friday of a new proposal that would mirror the federal program to cover those without health insurance.

"I think we are brighter and better than the current system that we have," said Price, who worked more than 20 years as an orthopedic surgeon. Price spoke at an event sponsored by the Alliance for Health Reform and The Commonwealth Fund.

The proposal, authored by the Commonwealth Fund, would establish a new program modeled after Medicare called Medicare Extra. Advocates say the federally administered program would improve coverage and access to care while lowering costs, and could yield a health system savings of $1.6 trillion over 10 years, according to the Commonwealth Fund.

There is strong interest among adults for early coverage under Medicare, according to a paper written by Cathy Schoen of Commonwealth. Schoen is co-author of the proposal.

According to Schoen, early coverage under Medicare is supported by 2/3 of adults between ages 50–64 who are covered by their employers and by 73 percent of all older adults.

Under Medicare Extra, anyone filing taxes would be required to have health insurance, and the program would automatically enroll anyone who is uninsured once income taxes are filed. Schoen said 44 million of the 48 million uninsured in the United States would gain coverage through the plan. The remaining, she said, are primarily those who do not file taxes.

Private insurance would still exist under the plan, but all insurance companies would offer community-rated premiums, or premiums that are based on where someone lives, not on age or health status. The Commonwealth Fund estimates that Medicare Extra premiums would be more than 30 percent lower than premiums that are typically charged for employer-sponsored plans.

The program also would establish a "national connector" that would match people with Medicare Extra or private insurance. It also would offer tax credits to allow people to pay for their premiums.

The plan calls for overhauls in payment, health information technology, evidence-based medicine, and public health.

Price said under a bill he introduced (HR 2626) doctors and patients, rather than the federal government, would control the health care system. His plan would offer tax credits for those who purchase insurance. Patients, regardless of who was paying for it, would own the insurance, he said.

Cybele Bjorklund, Democratic staff director for the House Ways and Means Health Subcommittee, said most providers prefer Medicare to private insurance. She also said Medicare would make a good model because of its efficiency.

But Price noted that the Mayo Clinic as well as 25 percent of doctors limit the number of Medicare patients they accept. And Medicare is not efficient, he said.

"It took us 40 years for us to get Medicare to see that it needed a prescription drug program," Price said.

He added that when Medicare was created in 1965, it was estimated that the program would cost $9 billion by 1990. In reality, it ended up costing almost $67 billion, he said.

By Annie Johnson, CQ Staff

June 2, 2008 -- A recent Commonwealth Fund report shows wide disparities in individual states' ability to provide affordable, quality health care to children, highlighting what some consider the inadequacy of new standards for funding the State Children's Health Insurance Program, or SCHIP.

"Unlike adult health care in this country that is largely driven by government policy, children's health care is generally a state-run program," said Edward Schor, who leads the Fund's Child Development and Preventive Care program. Schor also is a pediatrician.

A 2007 directive from the Bush administration said if states wanted to expand eligibility for the SCHIP program to children in families with incomes more than 250 percent of the federal poverty level, they would have to prove that 95 percent of eligible children from families earning less than 200 percent of the poverty level were already enrolled in SCHIP or Medicaid.

"One of the bottom lines of this report is that states can't do this alone," said Karen Davis, president of the Commonwealth Fund. "They need help from the federal government and they certainly don't need to be stymied."

While no single state finished top in every measured category—access, cost, quality, equality, and potential to lead a healthy life—states in the northeast and upper Midwest tended to rank higher in multiple areas, the report found. States in the south and southwest generally had lower scores.

"Many of the best performing states have been pioneers in terms of using public programs to cover uninsured children and improve health outcomes," said a spokeswoman from the House committee on Energy and Commerce. "These positive results highlight the folly of the Republican refusal to reauthorize a robust children's health insurance program last year."

Mostly, Schor and Davis said, the report highlights improvements that could be made to the national children's health system if all states performed as well as the top finishers identified in the report.

For example, Schor said, if the United States had health care coverage for all children at the level of Michigan, there would be an additional 4.6 million children covered.

Among the top-ranked states were Iowa, Vermont, and Maine, which ranked 1st, 2nd, and 3rd in their overall ability to provide children's health care. Oklahoma, the report showed, ranked 51st in overall care and in access to care.

Access, Schor said, is the most important factor in beginning to improve health systems.

"The key request for any discussion about health or health care for children needs to start with do they have access to health care?" he said.

By Drew Armstrong, CQ Staff

June 6, 2008 – 8:25 p.m.-- Democrats will likely bring their long-awaited Medicare bill to the Senate floor this week, but observers of previous dramas involving physician payment legislation are predicting a familiar dance of veto threats and eventual compromise with Republicans and the White House.

Finance Chairman Max Baucus, D-Mont., introduced the bill (S3101) June 6. It would replace a 10.6 percent cut to Medicare's physician payment rates scheduled to begin July 1 with an 18-month "patch" that would give doctors a 1.1 percent pay raise instead. The patch would be paid for mostly with cuts to privately run Medicare plans—cuts that President Bush has adamantly opposed.

The bill is likely to come to the Senate floor in the middle of the week. Majority Leader Harry Reid, D-Nev., and Baucus have agreed to bypass committee action.

"I intend to work on the Senate floor with anyone who wants to strengthen Medicare's service to seniors, keep its costs in line, and get a good bill passed into law," Baucus said in a statement June 6.

The Finance panel's ranking Republican, Charles E. Grassley of Iowa, plans to release his own bill on Monday, said a spokeswoman. While many of its provisions are said to be almost identical to those in the Baucus legislation, Grassley says his bill will contain offsets—focused on a narrow part of those private-sector plans—that will win the approval of the White House.

For those who have watched a similar process unfold year after year since Medicare's cost containment formulas (PL 105-33) first demanded cuts in 2002, the sparring between Baucus and Grassley has the look of a drama in which the audience already knows the ending.

"Baucus has to try to get cloture and fail before his leadership and members allow him to go negotiate a narrower, more stripped-down bill with Grassley and the White House," predicts a House GOP aide. "I predict the endgame will be a narrow, stripped-down package that includes an 18-month doc fix."

Jennifer Bell, a lobbyist with Alston & Bird and formerly a Grassley aide, agreed.

"Baucus needs Grassley and Grassley needs Baucus," said Bell, who is lobbying on the bill. "They've done what they need to do with their caucuses, and now they'll come back together and wrangle with the White House, mostly over offsets."

That process will likely create a narrower package, Grassley predicted after hearing about Baucus' bill.

That also means that the administration will likely get its way in shrinking the Baucus offsets to private-sector Medicare plans.

"The administration has concluded it can take up the gauntlet and win on everything they really care about. And it looks like they're going to," Bell said.

Likely Cuts
The Democratic bill would cost about $20 billion over five years, Baucus said, and the offsets will come almost entirely from the Medicare Advantage program, in which private insurers provide benefits in place of government-run Medicare. His proposal would cut funding to Medicare Advantage programs that get extra funds because they are in areas with teaching hospitals—so-called Indirect Medical Education payments. It would also limit the private plans' ability to use a process called "deeming," through which health care providers not explicitly enrolled in the plans could be forced to participate whenever a patient covered by the plans visited them.

Another cut comes from Medicare's oxygen benefit, which pays for seniors to have oxygen tanks that help them breathe. Many Democrats believe oxygen providers are overpaid.

Also included are changes to make sure pharmacies are paid promptly by Medicare and restrictions on how private Medicare plans market themselves to seniors.

Many Democrats have pushed hard for Medicare Advantage cuts, arguing that the private plans are overpaid and damaging to traditional Medicare. Many Republicans, however, believe that private-sector competition will eventually reduce costs.

In a May 22 letter to lawmakers, Health and Human Services Secretary Michael O. Leavitt said Bush would veto any Medicare bill that cuts payments to Medicare Advantage plans.

Despite that threat, many outside observers believe some Medicare Advantage cuts are inevitable in a final package, most likely starting with trims to those Indirect Medical Education funds. The cuts in Grassley's bill are widely expected to come from those payments, which were included as an offset in Bush's fiscal 2009 budget.

By CQ Staff

June 4, 2008 -- A year after Massachusetts launched its health coverage plan, the number of uninsured adults fell by almost half, from 13 percent to 7.1 percent, according to a new study published in the journal Health Affairs.

The study, written by Urban Institute researcher Sharon K. Long, also found no evidence of individuals dropping private insurance to enroll in public health programs. Among low-income adults, the group eligible for subsidized coverage under the Massachusetts program, employer coverage increased by five percentage points between fall 2006 and fall 2007.

Under the law, uninsured residents over age 18 must obtain health insurance if affordable coverage is available and pay penalties if they don't. Similarly, employers with 11 or more workers must contribute toward the cost of health coverage or pay a penalty of $295 annually per uncovered worker.

The Health Affairs study also found that as a result of the program, low-income adults in Massachusetts were more likely to have a place that they usually go to when they are sick or need advice about their health. They were also more likely to have a doctor visit for preventative care or a dental care visit.

Higher than expected take-up rates have increased costs beyond previous estimates, Long wrote, with the long-run success of the program hinging "in part of sustaining support for the new policies in the face of these higher costs."

By John Reichard, CQ HealthBeat Editor

June 5, 2008 -- In the middle of May, two Taiwanese officials, Hou Sheng-Mou and Michael S. Chen, came to Washington facing a tough assignment: promote single-payer health care in a city where it's widely regarded as a non-starter in the debate over revamping the U.S. system.

Their visit didn't command much attention from reporters covering that debate; countries like the Netherlands or Switzerland that have universal coverage based on strong private health care systems loom larger as potential models for a U.S. overhaul.

Adding to their challenge was that Drs. Hou and Chen hoped to influence U.S. policy in a forum unlikely to compel much attention by mainstream media—an event organized by Michigan House Democrat John Conyers, Jr., a lawmaker who isn't widely perceived as specializing in health care issues and who, until recently, was regarded as little more than a fringe liberal by the mainstream media.

But to ignore the event meant missing a chance to consider a nation that has successfully grappled with the challenges the United States now faces—intolerable health cost increases and a large uninsured population.

It also meant missing a glimpse of the surprising power the single-payer idea still holds in parts of America's own health policy community, and the role U.S. academics played in Taiwan's adoption in 1995 of single-payer health care. The academics' enthusiasm for the single-payer approach endures more than a dozen years later, despite the emphatic rejection by Congress in 1994 of government-run health care.

Hou and Chen found a friendly audience when they visited the Rayburn House Office Building May 22 to speak at the afternoon forum organized by Conyers' staff. By the time it was over, remarks by the Taiwanese officials and various academics had clearly energized single-payer advocates in attendance.

Struggling to Be Heard
Senior government officials may be celebrities of sorts in their own countries, but they seem all but anonymous when they venture abroad. Seated for an interview at a table outside the Capitol Hill Starbucks on the morning of the forum, Hou and Chen, vice president of Taiwan's Bureau of National Health Insurance, seem far removed from the trappings of power. Hou, in fact, is removed from power—he stepped down as Minister of Health a few days earlier with the change of government in Taiwan.

The pair struggle to be heard above the din of nearby caffeine-fueled conversations and the roar of a fire engine flying past. But if they feel any sense that their efforts are futile, they do not show it. Wearing ties designed to look like American flags to honor their hosts, they patiently answer question after question about health care in Taiwan, rejecting American notions about what a single-payer system means.

"In Taiwan, we have no waiting lists," says Hou. "In Taiwan, the doctor works on Saturday. They operate on Saturday afternoon." Moreover, the government does not tell its citizens where they must go for care, he said. Sophisticated information technology is a part of the health system. Each resident of the country carries a "smart card" to entitles them to health care.

"With the smart card you can go to any clinic at any time without an appointment," Hou said. And there is no "gatekeeper" denying access to specialists, a frequent complaint among Americans about U.S. managed care companies.

This freedom of choice helps improve quality because providers must compete to attract patients, Hou says.

The smart card also contributes to the quality and efficiency of the system by giving doctors a medical profile of the patient and by automating payment. When a provider swipes the card, the patient's medical history and medications show up on the computer screen and the government is billed for the provider's services.

Under the Taiwanese system, "everyone is included and at a very reasonable cost," Hou summarizes.

Controlling Costs
The climate now in Taiwan is a marked contrast with its situation before its adoption of a single-payer system of universal coverage in 1995. Only 59 percent of the population had health insurance at the time, and health costs were growing at double-digit rates. Now 99 percent of the Taiwan population is covered and health costs are growing between 4 and 5 percent annually.

Hou says the single-payer approach is key to keeping costs generally affordable because everyone is in the same insurance pool. That means premium money left over because of the relatively low costs of healthy people can be used to pay for the care of sick people. In a system of multiple smaller insurers, sicker people have a hard time finding affordable coverage because insurers try to make money by appealing to good risks and avoiding bad ones.

Taiwan also relies on global budgets to keep costs under control. Payments are based on a point system that measures the level of health care resources being used. The payment rate per point drops if doctors are ordering so many appointments, tests, and procedures that the cap is likely to be exceeded. Points are recalibrated every three months and doctors respond to changes, seeing fewer patients if point values drop, Hou says. But payment rates for critical care are not adjusted based on utilization, he adds.

Having just one payer eases uniformity of billing and payment systems unlike a system in which multiple insurers compete for profits. Administrative costs average below two percent of all health spending in Taiwan. In the United States, however, administrative costs gobble up 15 to 30 cents of the health care dollar, analysts say.

The single-payer scheme also gives the government strong leverage to set prices. Doctors "are paid much less than in the United States," Hou says. "The private sector is rather weak. We are good in bargaining."

Taiwanese citizens have access to modern medical technology including things like bone marrow transplants, joint replacement surgery, cataract surgery, and coronary artery stents. But Hou says patients pay more out-of-pocket for more advanced technology, such as ceramic rather than metal joint implants. The system is more cautious than U.S. payers are about adopting new technology, he says.

Hou is anxious not to offend his American hosts, however. "There are also good things about the United States. I do not mean to criticize the U.S.," which has the best medical schools and the best technology, doctors, and pharmaceutical innovation, Hou says.

But there is a missing ingredient in the United States when it comes to universal coverage. "What you do not have is political commitment."

For single-payer advocates at least, there's no question Capitol Hill is generally hostile terrain. Many analysts say single-payer systems are underfunded and that adopting one in the United States would choke off the profits needed to fund America's position as the world's leader in medical innovation.

Aside from philosophical and economic objections, drug and insurance companies happen to be the source of campaign donations that prop up the political careers of many lawmakers.

There is now greater interest in covering the uninsured through tax code changes to subsidize the purchase of private coverage. But if that strategy doesn't pan out, the seemingly moribund single-payer idea could yet make a comeback, propelled by the enthusiasm of ardent academics, liberals, and labor groups.

Single-payer fans are convinced that theirs is the one model that can eliminate enormous waste in health care spending from administrative costs and geographic variations in methods of delivering treatment that drive up expense and add nothing to quality. They say the savings not only can cover the uninsured but also tame what many economists regard as the nation's leading fiscal challenge—rising health care costs.

The term 'singe payer' by itself does not mean government-run. It simply means that all health care bills are paid by a single organization. That entity is usually the government, but the doctors and hospitals it pays may be in private practice or privately owned.

In the minds of Republicans and many Democrats, however, single-payer is no less than a radical attack on the nation's private enterprise system, an approach that would eliminate the nation's private health insurance industry and the thousands of jobs and billions in shareholder value it represents.

Praise from Johns Hopkins, Princeton Analysts
People might think the single-payer approach is bureaucratic and inefficient, but speakers at the forum extolled the efficiency of Taiwan's system.

Only 1.6 percent of Taiwan's health care spending goes to administrative costs, while those expenses consume 15 to 30 percent of health care spending in the United States, speakers said. "What is not spent on administration can be spent on other things," noted Tsung-Mei Cheng, a Princeton University–based health policy analyst who helped design Taiwan's single-payer plan. "It's like night and day, or heaven and hell, pardon the word," she said of the difference in administrative costs.

The nation's health information system allows timely monitoring of medical conditions for which patients are seeking treatment, assisting efforts to counter threats to public health, speakers said.

Benefits under the system are comprehensive, Cheng said. They cover "everything under the sun," from bone marrow transplants to coronary artery stents to cataract surgery, she said. Female life expectancy on the island exceeds that of the United States by two months, she added.

A payroll tax of 4.5 percent helps fund the system but employees don't pay it all; employers and the government also chip in to help pay it. A surcharge on tobacco and lottery revenues also helps fund the system.

And the switch to universal coverage hasn't led to health care gobbling up a big share of Taiwan's Gross Domestic Product. Health care accounted for 4.8 percent of GDP before universal coverage was adopted in 1995 and now stands at around 6 percent, Cheng said. In comparison, the United States spends 16 percent of its GDP on health care and has some 45 million uninsured people.

The lesson of Taiwan and other countries with single-payer systems is that "universal coverage is possible without breaking the bank," said Gerard Anderson, a health policy professor at Johns Hopkins University who helped Taiwan plan its system. "We have our 45, 47, 48 million Americans without health insurance coverage and yet we spend twice as much per capita as most other industrialized countries."

Countries with single-payer systems also "are able to control health care expenditures over a period of time" at growth rates the same or lower than that of the United States, Anderson added. "And when they go in and decide they are not spending enough money on health care compared to other industrialized countries, they can take action to do this."

Laura Morlock , another health policy expert at Johns Hopkins University, said that health care is the most popular government service in Taiwan. But the system faces challenges as well, she noted.

Despite Successes, Struggles Too
"Perhaps the greatest challenge at the moment is their attempt to balance revenues and medical expenditures," she said. Medical care expenditures are growing at about 5.5 percent while their revenues are growing at an average rate of 4.7 percent. "The shortfall is only about 10 days of their expenditures, still you don't want that situation to increase." To insulate those who set premium charges from political pressures, rate increases should be tied automatically to medical expenditure levels, she said.

Hou's view is that considerably more money needs to be pumped into the system. Spending 6 percent of GDP on health care is "too little," he said. That figure instead should be "seven or eight."

Cheng from Princeton observed in a recent interview with the public TV program "Frontline" that there is "tightness everywhere" in the Taiwanese system because of public resistance to premium increases. Over the history of its national health insurance program, premiums have risen just once, producing a seven percent increase. The "tightness" consists of a lack of funding for research and development, slower adoption of new technology, and lower ratios of doctors and nurses to the general population, she said.

Chen, the vice president of Taiwan's Bureau of Health Insurance, said lawmakers in Taiwan will soon consider a "second generation" national health insurance bill expanding the tax base for funding the system. "That would solve much of our problem," he said. Instead of taxing only salaries, a resident's entire income would be taxed but the slice would drop from 4.55 percent to 3.5 percent.

But the enthusiasm for the Taiwan model seemed little diminished by talk of such challenges at the forum sponsored by Conyers.

The Michigan Democrat is the sponsor of legislation (HR 676) that would bring a single-payer system similar to Taiwan's to the United States. The measure would provide health care to all individuals residing in the United States, virtually wipe out the for-profit health insurance industry, and disqualify other for-profit providers from participating and create global budgets to control costs.

U.S. Prospects
Despite American antipathy toward single-payer systems, HR 676 boosters seemed upbeat that they could make the bill part of the emerging debate over overhauling U.S. health care.

Momentum is building for single-payer health care, claimed Robert Zarr, president of the Washington, D.C., branch of Physicians for a National Health Program. "Let it be clear that there is growing support," he said. Citing a survey published March 31 in the Annals of Internal Medicine, Zarr said that 59 percent of doctors now support the creation of a national health insurance plan in the United States.

Physicians experience fewer hassles because they don't have to deal with multiple insurance companies, and single-payer systems like Taiwan's offer easy access to providers, advocates of the systems say.

Doctors in the U.S. may seem to have greater freedom to order tests like advanced medical imaging, but Zarr said some countries offer more MRI and CT scans. They also have higher ratios of nurses and doctors to patients, he said.

Advocates added that the single-payer concept is hardly foreign in America—Medicare is a single-payer system and is popular among seniors.

But even ardent single-payer backers acknowledge that U.S. adoption would be a stretch right now. Cheng of Princeton said she thinks adoption of such a system would likely occur gradually. As an example of a potentially gradual approach, she pointed to the universal coverage plan developed by Sen. Hillary Rodham Clinton, D-N.Y., which involves competition between government and private coverage.

Asked whether the Taiwan model could be adopted in the United States, Hou noted that one key difference is that in Taiwan, the insurance industry was not particularly opposed to a single-payer system, unlike the U.S insurance industry. Taiwanese insurers were more interesting in offering life insurance than health insurance, he said.

Another important difference may be economics. Taiwan turned to a universal coverage system on the heels of years of strong economic growth. The United States, of course, is mired in an economic slowdown.

Moral Fervor
But to single-payer die-hards, such talk is beside the point. To them, the real issue is one of morality, the idea that a decent society simply does not permit millions of its citizens to go without adequate health care.

The right leadership is crucial, said one member of the audience who stood up to address the forum.

It turned out be none other than Uwe Reinhardt, the German-born Princeton professor who is perhaps academia's most passionate advocate for single-payer health care. Reinhardt, as it happens, is married to Taiwan-born Cheng, both of whom are now U.S. citizens.

Reinhardt recalled attending the five-year celebration in Taiwan of its adoption of a universal coverage system. Taiwan's president, he said, recalled the gratitude of elderly farmers on a visit to the countryside who grasped his hands and said, "'Thank you, thank you, now when I go to sleep I don't have to worry'" about having money for care. "And the president stood there, and tears were rolling down his cheeks. And that's what it will take. We need in America a president who cares about the American people like that."

Reinhardt said Americans "act more and more like a people sharing a geography. You don't have the ethos that goes with being a nation. In Canada, in Taiwan, they view health care as the cement that makes a nation out of a group of people, rich or poor, when they are sick.

"The other thing we need to recover in this country is a sense of shame.

"All the details, the technical details, we can cover that ... what we cannot do is get the politics straight. And the politics is just another name for moral tradeoffs," Reinhardt said.

Hou made a similar point in his interview. In Taiwan, "the social value has it that the government must take care of the people, while Americans believe in self-reliance," he said. Self-reliance is "respectable," but the facts show "that it can not solve the problem of the uninsured.

"With strong political leadership, national health insurance is definitely not beyond reach, not so far-fetched," Hou said.