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Proposal: "Early Medicare" Program Would Provide Federal Health Care to Uninsured

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.

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