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Thompson's Health Care Rx: 'Transformation' Not 'Reformation'

By Dyane Fils, CQ Staff

April 12, 2007 -- If former Health and Human Services Secretary Tommy Thompson is successful in his presidential bid, he has a plan to overhaul the American health care system. The main themes: boost preventive care and healthy habits, while increasing efficiency through the use of electronic health records.

Thompson, who was elected governor of Wisconsin for four consecutive terms (1987–2001) and was HHS secretary for four years (2001–05), formally announced April 1 that he is seeking the Republican presidential nomination.

Thompson discussed his health plan Wednesday with the National Coalition on Health Care (NCHC), an organization of business, labor, consumer, and provider groups, at a Washington forum hosted by the Kaiser Family Foundation. The aim of his plan is "transformation," he said. "Reformation would be trying to patch up a system that is already failing."

According to Thompson, only 7 percent of all health care costs go toward maintenance of good health and prevention of disease. In order to encourage healthier habits, he said employers should bring in nutritionists to talk to their workers and subsidize the availability of fruits and vegetables in the cafeteria.

He also wants to encourage a tobacco-free culture in America by taxing smokers heavily. The resulting revenue would be placed in a separate account to equip those who want to quit with tools such as counseling and nicotine patches. Employers who provide insurance should charge a fee to employees who smoke, Thompson added.

On a financial front, Thompson said costs can be lowered by eliminating paper-based records, which he said account for 10 percent of health care costs, adding that all medical records should be available electronically so they can be accessed in any hospital or physician's office.

"And finally we just have to come to grips with the idea that we're not going to live forever," Thompson said. A large percentage of health care expenditures occur in the last few months of people's lives, he pointed out, and, "If you are dying of terminal cancer, you should not get a transplant."

According to the U.S. Census Bureau, 44.8 million Americans were uninsured in 2005, the latest year for which figures are available. While there are advocates of a single-payer system in which the government would pay for the care of all U.S. residents, Thompson wants the private sector to play a dominant role. He has rejected single-payer approaches like those included in legislation (HR 676) by Rep. John Conyers, D-Mich., saying that method would only stifle innovation in the medical field.

Instead, each state should appoint a commissioner to solicit bids from insurance companies for the working uninsured whose household income is $60,000 or more a year, he said. "Tear down the artificial laws that say a state cannot bid on a person in another state," he said. He went on to suggest that insurance companies across the nation would bid competitively to attract these new customers, and the federal or state government would then cover those who are too poor to pay anything at all.

The NCHC is inviting all presidential candidates to make a formal statement and discuss their plans for overhauling health care.

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