Figure 1

National Health Reform and the 2008

Presidential Election

Jennifer Tolbert
Principal Policy Analyst,
Kaiser Commission on Medicaid and the Uninsured

for
National Press Foundation
November 12, 2007
Washington, DC
K A I S E R C O M M I S S I O N O N
Medicaid and the Uninsured
 Figure 2

Number of Nonelderly Uninsured Americans,

2004 - 2006
Uninsured in Millions
46.5
43.0 44.4

9.4
8.4 8.7
Children
Adults

34.6 35.6 37.0

2004 2005 2006

K A I S E R C O M M I S S I O N O N
SOURCE: KCMU/Urban Institute analysis of March CPS for each year. Medicaid and the Uninsured
 Figure 3

Average Annual Premium Costs

for Covered Workers, 2000 and 2007
$12,106
Employer Contribution
Worker Contribution

$6,438 $8,825

$4,479
$2,471 $4,819
$3,785
$2,137 $3,281
$334 $694 $1,619

2000 2007 2000 2007

Single Coverage Family Coverage
Note: Family coverage is defined as health coverage for a family of four. Data
K A I S E R C O M M I S S I O N O N
represents average for all types of plans.
SOURCE: Kaiser/HRET Survey of Employer-Sponsored Health Benefits, 2007. Medicaid and the Uninsured
 Figure 4

Cumulative Changes in Health Insurance Premiums,

Overall Inflation, and Workers’ Earnings, 2000-2006
Health Insurance Premiums Overall Inflation Workers' Earnings

100%
87%

80% 73%

59%
60%
43%

40%
25%
20%
20% 15%
11% 10% 12%
7% 18%
4% 14%
0% 10%
5% 7%
0%
3%
2000 2001 2002 2003 2004 2005 2006
Note: Data on premium increases reflect the cost of health insurance premiums for a
family of four.
K A I S E R C O M M I S S I O N O N
SOURCE: Employer Health Benefits, 2006 Annual Survey, Kaiser Family Foundation
and Health Research & Educational Trust, September 2006. Medicaid and the Uninsured
 Figure 5

Who are the Uninsured?

<200% FPL
Children
14% 200-299% FPL
Parents 3%
4% Children 300% FPL+
17%
Other Adults 12% Parents

Children 3%

Parents 4% 34%
Other Adults
9%
Other Adults

Total = 46.5 million uninsured

K A I S E R C O M M I S S I O N O N
SOURCE: KCMU/Urban Institute analysis of March 2007 CPS. Medicaid and the Uninsured
 Figure 6

Trend: Interest in Health Care Rising

Percent naming HEALTH CARE as one of the top two issues they’d most like to hear
presidential candidates talk about, by political party self-identification:

50%
45%
42%
39%
40%
Democrats
30%
30%
26% 25%
24% 30%

21% Independents
20%
22% 21%
18%
10%
Republicans

0%
Mar-07 Jun-07 Aug-07 Oct-07

K A I S E R C O M M I S S I O N O N
Source: Kaiser Health Tracking Poll: Election 2008 Medicaid and the Uninsured
 Figure 7

Interest in Cost vs. Coverage

Which ONE of the following health care issues would you most like to hear the
presidential candidates talk about?
40%
Reducing the costs of health care 44%
and health insurance 38%
39%

32%
Total
Expanding health insurance 21%
Republicans
coverage for the uninsured 41%
Democrats
30%
Independents
15%
Improving the quality of care 18%
and reducing medical errors 12%
16%

7%
Reducing spending on government 11%
programs like Medicare and Medicaid 5%
8%
K A I S E R C O M M I S S I O N O N
Source: Kaiser Health Tracking Poll: Election 2008 (conducted October 1-10, 2007) Medicaid and the Uninsured
 Figure 8

What Plan Does the Public Want?

Proposals from 2008 Candidates:

A new health plan that would provide

insurance for nearly all of the
uninsured and would involve a
51%
substantial increase in spending

A new health plan that is more limited

and would cover only some uninsured 25%
groups, but would involve less spending

A health plan that would keep

things basically as they are
15%

K A I S E R C O M M I S S I O N O N
SOURCE: Kaiser Health Tracking Poll: Election 2008, Volume 3, October 2007. Medicaid and the Uninsured
 Figure 9

Presidential Candidates Differ in Approach

to Health Care Reform
• Democrats generally favor:
– universal coverage
– strengthening the private employer-based system
– building on existing public programs
– purchasing pools and insurance market reforms
– mandates on employers and individuals
– financing by rolling back tax breaks for wealthiest Americans

• Republicans generally favor:

– tax incentives for the purchase of insurance
– expanding the individual insurance market
– consumer-directed plans such as HSAs
– deregulation of the insurance market
– limiting the role of public programs
K A I S E R C O M M I S S I O N O N
Medicaid and the Uninsured
 Figure 10

…But There Are Areas of Agreement

• Importance of health information technology to

improve system efficiency and quality

• Need for price transparency

• Need to improve affordability of health insurance

• Need for some assistance for low-income to afford

coverage

K A I S E R C O M M I S S I O N O N
Medicaid and the Uninsured
 Figure 11

Hillary Barack John Rudy Mitt John

Clinton Obama Edwards Giuliani Romney McCain
Plan Announced: 9/17/07 5/29/07 2/18/07 7/31/07 8/24/07 10/11/07
For
Individual Mandates Children
Only

Employer Mandates

Public Program
Expansion
New Insurance
Pooling Mechanism

Premium Subsidies

Insurance Market
More More More Less Less Less
Regulation
Change Tax
Caps for
Treatment of >$250,000
Insurance
Encourage
Consumer-Directed K A I S E R C O M M I S S I O N O N
Care Medicaid and the Uninsured
 Figure 12

John Edwards

• Individual mandate
• Require employers to offer or contribute to coverage
• Expand Medicaid and SCHIP to all families under 250% FPL and adults
under 100% FPL
• Create nonprofit regional purchasing pools with private plans and
public plan based on Medicare
• Refundable sliding-scale tax credits for purchasing coverage through
pools
• Regulations on insurers to prevent denials of coverage
• Estimated cost between $90-120 billion, funded by ending tax cuts for
those with annual incomes over $200,000

K A I S E R C O M M I S S I O N O N
Medicaid and the Uninsured
 Figure 13

Hillary Clinton
• Individual mandate
• Require large employers to offer or contribute; tax credits for small employers
that offer coverage
• Expand Medicaid and SCHIP
• Expansion of group insurance options through Health Choices Menu (FEHBP
buy-in with public plan option based on Medicare)
• Premium subsidies through refundable tax credits, with limit on premiums as
a percent of income
• Regulations on insurers to prevent insurance discrimination
• Reinsurance for catastrophic retiree health costs
• Estimated cost is $110 billion per year, funded by health system savings and
limiting the tax exclusion for ESI and ending tax cuts for those with incomes
over $250,000
K A I S E R C O M M I S S I O N O N
Medicaid and the Uninsured
 Figure 14

Barack Obama

• Require children to have health coverage

• Require employers to offer or contribute a percentage of payroll to
coverage
• Expand Medicaid and SCHIP
• Create a national health insurance exchange with private plans and a
public plan with benefits similar to those in FEHBP
• Provide income-related subsidies for low-income families
• Regulations on insurers to prevent denials of coverage
• Estimated cost is $50-65 billion, funded by ending tax cuts for those
with incomes over $250,000 and savings to health system
K A I S E R C O M M I S S I O N O N
Medicaid and the Uninsured
 Figure 15
Bill Richardson
• Phased-in individual mandate
• Require employers to offer or
contribute to coverage
• Expand Medicaid and SCHIP
• Allow all to buy-in to FEHBP and
those age 55-64 to Medicare
• Sliding-scale, refundable federal tax
credits for coverage
• Increased insurance regulation
• Estimated cost is $104-110 billion,
funded by savings elsewhere in
proposal
Dennis Kucinich
• National, non-profit single payer
system
• Private coverage allowed for benefits
not included in national plan
• Regionally allocated global budgets for
services, administration, and capital
• Funded through increased taxes and
transferring existing public spending
on health care
• Automatic enrollment
• No premiums
K A I S E R C O M M I S S I O N O N
Medicaid and the Uninsured
 Figure 16

Rudy Giuliani

• Provide tax deduction of $15,000 for purchase of coverage through

individual market (echoes Bush proposal)

• Deregulate insurance market to encourage lower-priced policies; allow

purchase of insurance across state lines

• Simplify HSA regulations

• Provide refundable tax credits to help the low-income purchase

insurance

• Provide states with block grants to reduce costs, expand coverage, and
address adverse selection issues

K A I S E R C O M M I S S I O N O N
Medicaid and the Uninsured
 Figure 17

Mitt Romney

• Reform tax code to permit full deductibility of premiums and cost

sharing for those with at least catastrophic coverage

• Eliminate the minimum deductible requirement for HSAs

• Encourage states to deregulate insurance market to provide lower-

priced policies

• Use state and federal DSH funds to provide subsidies for lower-income
families to purchase private coverage

• Medicaid block grants with increased state flexibility

• Plan will be financed by redirecting existing federal subsidies for

uncompensated care
K A I S E R C O M M I S S I O N O N
Medicaid and the Uninsured
 Figure 18

John McCain

• Remove tax advantage for employer-sponsored insurance

• Provide tax credit ($2,500 individual/$5,000 family) to everyone for
purchase of private insurance
• Require states participating in Medicaid to develop additional premium
subsidies for high-cost and low-income individuals
• Encourage multi-year insurance products
• Allow purchase of insurance across state lines, national health
insurance plans (not state-regulated), and association health plans
• Encourage state flexibility under Medicaid
• Overall emphasis on controlling costs through improved disease
management, coordinated care, health information technology, and
medical malpractice tort reform K A I S E R C O M M I S S I O N O N
Medicaid and the Uninsured
 Figure 19
Fred Thompson Mike Huckabee
• No formal plan announced
• Key statement from speech: “I
think it is best if you, yourself
decide what is best for you and
your family, with insurance that
doesn’t have to depend on your
employment – coverage that
you can take with you if you
change jobs; insurance that
you may purchase from
anywhere in the nation for the
best value. This would be
market driven and would make
health insurance affordable for
more Americans.
• Provide a health insurance tax
deduction for individuals and families
• Provide a health insurance tax credit
for low-income taxpayers
• Expand HSAs so they are available to
everyone, including those without a
high deductible plan
• Allow states to experiment with
market-based approaches to
coverage
• Emphasize prevention and disease
management; reduce premiums for
those who lead healthy lifestyles
K A I S E R C O M M I S S I O N O N
Medicaid and the Uninsured
 Figure 20

Assessing Expansion Proposals

• Does the proposal seek to achieve universal coverage?

• Will coverage under the proposal be comprehensive?
• How will the proposal affect businesses?
• How will the proposal affect individuals?
• How will the proposal be financed?
• How will the proposal affect cost and quality of health care?
• What is the role for states in the proposal?
• What is the role for the federal government?

K A I S E R C O M M I S S I O N O N
Medicaid and the Uninsured
 Figure 21

The Future of Health Care Reform

• Problems plaguing health care system will not go away

– Growing uninsured (47 million)
– Declining rates of employer-sponsored coverage
– Rising health care costs

• States will continue to advance proposals

– Trend-setting states will lead the way
– Comprehensive reform not possible in all states

• SCHIP debate has highlighted ideological divide over health

care reform and will influence state action

• Health care reform ranks near the top of presidential campaign

issues
K A I S E R C O M M I S S I O N O N
Medicaid and the Uninsured