A think tank's plan for universal coverage is more in tune with Democrats than with the current Republican administration.

Voters can expect to hear a lot about universal health care as the Democratic candidates spar over which of their ideas will do the best job providing an umbrella of medical coverage over the nation. For most candidates, campaign promises will center on a blend of tax initiatives and extended government health programs. Hoping to push the debate even further, the Commonwealth Fund issued its own road map to universal coverage — and the fund's ideas — outlined by the health policy experts Karen Davis and Cathy Schoen. All of these participants are helping shape a set of principles that may provide a coherent alternative to the Republicans in the coming election.

Their map points to several key milestones:

  • Ensure small-business and self-employed coverage. Opening all the managed care plans that now offer coverage to government workers under the Federal Employees Health Benefit Program to any business with fewer than 50 employees, to the self-employed and to the uninsured.
  • Offer premium support. The uninsured with low incomes would receive a tax credit to help pay for insurance costs that exceed 5 percent of their incomes. That threshold would rise to 10 percent for anyone in upper tax brackets. They too would be allowed to join an FEHBP plan.
  • Expand Medicare. Drop the age restriction on Medicare to 60 for anyone without access to group coverage and give state programs additional federal funds to offer coverage for anyone with income below 150 percent of the federal poverty line.
  • Tax employers to pay for services. Companies that don't offer insurance would be required to pay up to $1 for each hour clocked by an employee to help fund coverage for the uninsured.

Schoen and Davis say that if participation were mandatory, the plan would reach out to 39 million of the 42 million without coverage and, even as a voluntary program, would reach 33 million.

Total cost to the federal government: An estimated $70 billion a year.

"We know what works in the current system," says Davis, president of the fund, "so we should build on success instead of trying to reinvent the wheel. The consensus approach gives people the choice to keep the coverage they have if it's working well for them. It provides long-term vision, but also lends itself to phasing in and adjustments over time with experience. The federal government could begin to enact some pieces of this plan immediately."

By implementing the plan in pieces, adds Davis, the government could roll it out while keeping an eye on costs and the economy. Davis also touted the plan's built-in efficiencies.

An employee at a restaurant, for example, would be enrolled under the same plan regardless of employer. That would reduce the constant churn in enrollments, reducing administration costs for small businesses, and help reduce overhead for doctors, as well. And once a new electronic claims administration system was implemented and given time to stabilize, it would also provide the kind of data that could be used to examine overutilization and misuse of resources, adding some new controls and efficiencies that could bring down the cost of medicine.

Need extra money to pay for it?

Just put off the 1 percent income tax cut scheduled for next January, say the authors.

That's an idea that will find a willing audience on the Democratic side of the coming presidential contest and a cold shoulder from Republicans allied to Bush's aggressive campaign for new tax cuts.

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