Ensuring Access to Health Care

Expanding Coverage

A nation as prosperous as ours can and should do more to help those who lack health insurance. Of the 45 million uninsured, an estimated 8 million are children, and 4 out of every 5 uninsured are in working families. The cornerstone of the Kerry-Edwards plan covers these children and low-income families through an expansion of Medicaid and Children’s Health Insurance Program (CHIP) eligibility. Using a simple formula, the plan covers more than 18 million uninsured children and adults while simultaneously providing fiscal relief to states in its first 3 years. The Kerry-Edwards plan accomplishes these goals by striking a new compact with states. In exchange for expanding coverage to children in households with an annual income up to 300% of the poverty level, families up to 200% of poverty, and childless adults up to 100% of poverty, the federal government assumes the full cost of children’s Medicaid coverage.

The plan restores Medicaid and CHIP coverage for legal immigrant pregnant women and children while maintaining our nation’s commitment to providing health care for veterans and Native Americans. It expands program capacity for the truly underserved, including community health centers, school-based care, and special programs for migrant worker families and other vulnerable populations.

While recognizing that public programs are essential, the Kerry-Edwards plan also uses tax incentives for private insurance to increase coverage. Small businesses, for example, are eligible for a refundable tax credit of up to 50% for the cost of health care premiums. These tax subsidies, combined with cost containment initiatives described below, will save small businesses approximately 15% in health care costs and decrease the cost of insurance to their employees by two thirds.

Making Health Care More Affordable

The rising cost of health care undermines US competitiveness and contributes to the increasing number of uninsured. During the last 4 years, family premiums have increased by more than $3500 and prescription drug prices have grown 4 times faster than inflation. Workers’ earnings have not kept pace. Last year alone, health premiums increased by nearly 14% while wages increased by only 3%. The Kerry-Edwards plan directly addresses these inequities. It makes health care coverage more affordable through a premium rebate pool for employers through a new insurance option based on what’s currently available to members of Congress and through administrative efficiencies.

Notably, the plan does not merely shift costs to employees and patients through high deductible plans and increased cost sharing. Instead, the premium rebate pool makes health care more affordable by sharing the cost of care for the sickest Americans between those paying for private insurance and the government—in essence, a federal backup for catastrophic, high-cost cases. The plan reimburses private and public employer and group health insurance plans from the rebate pool for a portion of these catastrophic costs. Savings to insurers from high-cost cases are returned to enrollees through premium reductions. The resulting savings will decrease family premiums up to $1000 annually. In addition, the rebate makes premium increases more stable over time. There are no mandates nor are there any bureaucratic, cumbersome restrictions. The “reinsurance” portion of our health care plan builds on strengthens of the employer-based system.

In addition, working Americans—including those who retire before age 65—will have the opportunity to purchase insurance through the health plan currently available to members of Congress. This new and separate insurance pool, known as the Congressional Health Plan, will provide affordable health insurance options that do not currently exist in the individual insurance market. But the plan does not eliminate existing insurance options: There is no requirement to participate in the new pool for those who choose not to do so. Taken together, the premium rebate pool and the new group insurance option will reduce premiums and provide health insurance for an additional 9 million Americans who currently lack health coverage.

In addition to guaranteeing access to the Congressional Health Plan for all Americans, we will provide additional help for those who need the most help:

• We will provide low- and moderate-income Americans aged 55 through 64 years with a 25% tax credit to help pay the cost of their premiums.

• My plan helps low- and moderate-income Americans between jobs by offering them a 75% tax credit to help pay for their premiums.

• We will make health care more affordable for small businesses by offering them a tax credit that covers up to 50% of their premium contribution for low- to moderate-income employees.

• Finally, low- to moderate-income individuals whose employers do not provide them with coverage will get a credit to help pay the cost of participating in the federal health plan.

Taken together under my plan, we will make sure that 95% of Americans, including all children, have health coverage. My plan will provide health coverage for 27 million individuals who are currently uninsured.

Making health care more affordable also means purchasing health care more efficiently and minimizing administrative expenses. Approximately 25% of US health dollars are spent on nonmedical costs—principally the costs associated with paperwork burdens, including the preparation, submission, calculation, and payment of bills. This is unacceptable. No other industry bears costs of this magnitude. The Kerry-Edwards plan thus creates a technology bonus to encourage the use of modern computerized health care transactions, harnesses the power of the federal government to require insurers doing business to file claims electronically as a condition of participation, and aims toward adoption of electronic patient medical records by 2008.

Furthermore, the Kerry-Edwards plan creates an environment that fosters new approaches to prevention, health promotion, and disease management—based on objective, evidence-based assessments of what actually works. Physicians must have the ability to develop, practice, and receive appropriate reimbursement for providing preventive care and ensuring optimal management of chronic conditions. The Kerry-Edwards plan recognizes the importance of prevention and good chronic illness management by establishing a quality bonus to reward practices and plans that improve clinical outcomes, reduce racial or ethnic disparities, and reduce medical errors.

My plan also makes prescription drugs more affordable for seniors by requiring the US Department of Health and Human Services (HHS) to negotiate better prices; allowing re-importation so Americans can purchase cheaper drugs from Canada; requiring transparency rules for Pharmacy Benefit Managers that do business with the federal government; and helping states provide discounts to other populations through more efficient contracting.

While controlling the soaring cost of health care is essential, arbitrary Medicare cutbacks to physicians is not the answer. The underlying problem for physicians is that the sustainable growth rate (SGR) method used to establish Medicare's payment rates for physicians' services is fundamentally flawed. This methodology ties physician payments to the GDP, which bears no relationship to patients’ health care needs or physicians’ practice costs. Left untouched, it would have already resulted in dramatic decreases in physician reimbursement rates under Medicare. Despite policymakers’ actions to prevent such reductions in 2004-2005, the SGR method will again be used to establish payment rates in 2006, resulting in even more dramatic reductions in the physician fee schedule for 2006-2012. Most physician offices are small businesses that cannot absorb big payment reductions such as that experienced by physicians in 2002. As president, I will work to revise Medicare’s reimbursement formula.

Medical Malpractice

Access to care is being threatened as more physicians are leaving their practices due to ever-increasing malpractice insurance premiums. Depending on the specialty and state, median increases in malpractice premiums for physicians ranged from 15% to 30% in 2003. In some states, premium increases ranged from 26% to 73%. These premium increases are clearly unsustainable. Although we must move beyond the current impasse, any solution to this crisis must not compromise patient safety, quality of care, or access. Improvements can and should be made to our medical liability system through a comprehensive approach that seeks to prevent the frivolous lawsuits that clog our system instead of relying simply on a “one size fits all” approach.

Our plan thus makes the system fairer for both physicians and patients by preventing and punishing frivolous lawsuits. Lawsuits should be the last, not the first, line of defense against medical errors. Before a lawyer can bring a medical malpractice case to court, the Kerry-Edwards plan requires a qualified medical specialist to certify that it has merit. Nonbinding mediation in all malpractice claims would be required before cases proceed to trial.

In addition, we need to aggressively pursue the bad apples who make a living by filing frivolous cases—these lawyers would face tough, mandatory sanctions. For example, lawyers who file 3 frivolous cases would be forbidden to bring another suit to court for 10 years—in other words, 3 strikes and you’re out. Punitive damages would be limited to cases of intentional misconduct, gross negligence, or reckless indifference to life.

Finally, the Kerry-Edwards plan eliminates the special privileges that allow insurance companies to collude in ways that increase medical malpractice insurance premiums. In any other industry, such conduct would be subject to scrutiny under the antitrust laws. But an obscure 1945 law gives insurance companies a broad antitrust exemption, and the Federal Trade Commission is forbidden from investigating insurance company misconduct. The Kerry-Edwards plan eliminates this exception.

Patient Bill of Rights

Recent trends in the health care system have eroded professional independence. Too often, decisions about medical care and treatment are made by bureaucrats and accountants rather than licensed clinicians. My health care plan reverses that trend. It ensures a medical practice environment that serves the legitimate needs of patients and recaptures the professional satisfaction of a career in medicine by restoring medical decision making to physicians and nurses.

Not only has the Bush administration continued to block bipartisan efforts to pass a Patients’ Bill of Rights in Congress, it has also sent its lawyers to the Supreme Court to argue against giving patients the right to sue health maintenance organizations. I will push Congress to pass a real Patients’ Bill of Rights that, among other things, ensures that patients can hold health maintenance organizations (HMOs) accountable for improperly denying care. I will also work to ensure the right to see a specialist and the right to a real external appeals process allowing patients to appeal HMO decisions. Further, I support whistleblower protections that allow health care workers to report quality problems without fear of retaliation.

Medical Research

One of the first things we will do in office is to restore integrity and independence to medical research and health policy development. The Bush administration has replaced objective scientific and medical expertise in policymaking, grant review, and research priority development with ideology and political control. This is compromising our research in so many ways, including stem cell research. These unprecedented rollbacks in the commitment to a scientific basis for medical care represent one of the most flagrant threats to the integrity of medical practice. We will choose scientific validity in research as the cornerstone of modern medicine, and we will ensure that ideology does not threaten US dominance in the field of scientific and medical breakthroughs.

Conclusion

Franklin D. Roosevelt once proclaimed that “the test of our progress is not whether we add more to the abundance of those who have much; it is whether we provide enough for those who have too little.” Across this great nation, individuals, families, small business owners, and large corporations consistently cite health care as their topmost concern. Rising health premiums and the recession, among other factors, have added 5 million Americans to the roles of the uninsured.

The Kerry-Edwards health plan will put the country on different track. It respects the current health care system by building on and improving it rather than replacing it or providing cumbersome mandates. It uses public program and tax incentives for private insurance to expand health coverage to all children and 95% of all Americans. And it addresses spiraling health costs through a combination of a premium rebate pool to help out with high-cost patients, using technology to eliminate administrative inefficiencies, and expanding better use of disease management and preventive services. My plan will expand health care coverage to nearly 27 million Americans who are currently uninsured, while making health care more affordable for millions of others.

My goal, and my plan, is to make the best medicine the standard for our health care system, to make the practice of medicine a profession worth pursuing, and to make the best of our health care system available and affordable for every American. I believe in an America where every family looks to the future with hope and excitement, without worry that the cost of caring for its loved ones is too great to bear; where health care is a right, not a privilege; where strong, healthy families build a stronger America.