THE UNINSURED II: Clinton Unveils $110B Package
President Clinton proposed a $110 billion package that would help at least five million uninsured adults to gain coverage. In doing so "he basically endorsed the approach favored by Vice President Al Gore in the Democratic debate over how best to cover the uninsured," the New York Times reports. Clinton's move, which he touted as the "biggest public investment in health insurance since the creation of Medicare in 1965," marks a return to a "pivotal theme [in] his career" (Pear, 1/20). One senior administration official said, "The administration did make a major push in the first term for universal coverage. Since then, we've tried to expand coverage in a cost-effective and realistic way that we could move incrementally toward that goal" (Rosenblatt/Rubin, Los Angeles Times, 1/20). The plan, to be funded out of the non-Social Security surplus, centers around expanding the scope of CHIP at a cost of $76 billion over 10 years. CHIP coverage would be enlarged to cover parents of children who now are eligible for the coverage benefits, CongressDaily reports (Koffler, 1/19). Clinton said, "Most of the parents of the children covered in our Children's Health Insurance Program are themselves uninsured. That's why, as the vice president has urged, I propose to allow parents to enroll in the same health insurance program that now covers their children."
The New York Times reports that before states can see any money from the plan, they must first cover children in families with incomes up to twice the official poverty level, as 30 states have done (1/20). After five years, states would have to expand CHIP at least to parents whose earnings equal the poverty rate. To prevent employers from dropping coverage, the plan would allow employers to pool expenses with state funding. An additional $1.9 billion would go to extend existing CHIP coverage to 19 and 20-year-olds and another $5.5 billion over ten years would be used to bolster the ranks of children on CHIP and Medicaid by 400,000. A broader part of the initiative includes $10.3 billion over 10 years to provide a 25% tax credit to offset the cost of COBRA premiums, providing $5.4 billion for those 55-65 years of age to buy into Medicare and a new tax credit equal to 25% of the premium. Another $4.3 billion will provide permanent access to Medicaid for welfare workers who take jobs that provide no insurance and $313 million in tax credits will help small businesses provide insurance (CongressDaily, 1/19). Clinton's proposals are expected to be featured prominently in his State of the Union address Jan. 27.
Boost for Gore?
Experts said the plan would be popular with the public, but would have trouble in Congress. Henry Aaron, health policy expert at the Brookings Institution said, "I think it will play quite well with the public and for that reason may play poorly with the Congress. This is an election year, and the president may have a hard time selling to the Congress a program for which he will get most of the credit" -- especially when he has been loathe to help out the GOP. House Ways and Means Chairman Bill Archer (R-Texas) noted that "the major tax cut bill Clinton vetoed last fall had included incentives to help low-income people buy health insurance (Babington, Washington Post, 1/20). The New York Times echoed those sentiments, reporting that it appears "unlikely that a Congress controlled by Republicans would make a political gift to Mr. Gore by approving his proposals or adopting the president's package intact" (1/20). The Clinton plan's connection to Gore's proposals was noted on several television shows yesterday. White House spokesperson Joe Lockhardt said, "It was the vice president who first raised the idea of expanding CHIP to family members." Clinton himself said, "I thank the vice president for this proposal. I believe it can make a difference to millions of families."
Harry and Louise Effect?
Clinton also noted the return of "Harry and Louise": "I'd love it if Harry and Louise would just sidle right on in here and say that they think this is the greatest idea since sliced bread, and we could go forward together." Chip Kahn, president of the Health Insurance Association of America, the organization that created Harry and Louise and contributed to the downfall of Clinton's 1994 proposals, said, "The industry doesn't necessarily agree with every detail of his plan, but he is clearly moving in the right direction, and major portions of his plan are similar to those that the industry has offered" (CNN, "Inside Politics," 1/20).