Proposal by Democratic Presidential Candidate Sen. John Kerry To Address Catastrophic Medical Claims Profiled

The Washington Post on Saturday profiled presumptive Democratic presidential nominee Sen. John Kerry's (Mass.) proposed health care plan to address catastrophic medical claims (Connolly, Washington Post, 6/5). Kerry's health care plan calls for the federal government to assume the costs of workers whose annual health care expenses exceed $50,000 (California Healthline, 5/14). Under the plan, the government would reimburse employers for 75% of medical bills over $50,000 incurred by individual employees each year. Federal data indicates that catastrophic health claims account for less than half of 1% of the total claims in the United States but generate 20% of the country's health care costs, according to the Post. In exchange for the benefit, which would establish the federal government as a sort of secondary insurer, employers would be required to provide health insurance to all workers and offer programs to detect chronic diseases early and manage such conditions to prevent them from becoming more serious. The program could save businesses and employees an estimated $288 billion in premiums over 10 years but would cost the government $257 billion in administrative reductions, Emory University health economist Kenneth Thorpe said. Kerry says that the plan would make health insurance more affordable for small businesses, the Post reports. However, critics of the plan say that because Kerry plans to pay for it by reducing Bush's tax cuts for people whose annual incomes exceed $200,000, it "does little more than shift costs from ratepayers to taxpayers," according to the Post (Washington Post, 6/5).