Health Care Major Issue for '08 Elections

White House hopefuls are unveiling their plans to improve the nation's health care as presidential primaries draw nearer. The most recent proposal to make headlines comes from U.S. Sen. Hillary Clinton of New York. NPR Health Reporter Julie Rovner and Dr. William Galston (GAHL stun), of the Brookings Institution, compares the plans and their likelihood to sway voters.

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MICHEL MARTIN, host:

I'm Michel Martin, and you're listening to TELL ME MORE from NPR News.

Later in the program, we're going to ask: Is it ignorance or racism? Why are some young people still attracted to hate groups? And the queen is in the house - Latifah that is. Her latest album is full of surprises.

But first, health care reform. When Senator Hillary Clinton issued her plan for universal coverage this week, she became the latest of the three Democratic presidential frontrunners to do so. It's an effort to help the 47 million Americans who don't have health insurance and the millions more who don't like what they have. But can any of these plans actually get the job done? And what do the Republican candidates have to say?

With us to talk about all this are Julie Rovner, health policy correspondent for NPR, and Doctor William Galston, senior fellow of government studies at the Brookings Institution. They're here with me in the studio.

Welcome to you both.

Dr. WILLIAM GALSTON (Senior Fellow, Government Studies, Brookings Institution): Good to be here.

JULIE ROVNER: Hi.

MARTIN: So Julie, let me start with you. I think the world knows that one of the Clinton administration's biggest failures was led by former First Lady Hillary Clinton. It was health care reform. How does the plan she presented this week compare with the last one that didn't succeed?

ROVNER: Well, I think, certainly - and Senator Clinton is the first to say that she learned a lot from that experience in the early 1990s. I think one of the most interesting things is that it's not nearly as detailed. And I think in some of the briefings she's had, you know, since unveiling the plan is that she said, you know, when you would ask specific questions, she'd say, well, that something that would be work out later by Congress. I think one of the big mistakes at the Clinton administration made - and I think it's unfair to pin this all on Senator Clinton.

In fact, there've been some articles out about how it really wasn't her plan. It was the president's plan and it was Ira Magaziner's plan. And you know, yes, her name was attached to it, but a lot of the decisions were made by a lot of other people in the administration, including how it was run. But, you know, they decided as a group to write this entirely detailed bill, and that's really not what the president ought to be doing. It's really up to Congress, if nothing else, to have the buy-in from Congress. Congress passes the laws. And so I think that, quite smartly now and certainly early on, this is primary campaign, still, that she's written a much smaller proposal here.

MARTIN: Give me just bare details of how she gets to universal coverage with this plan.

ROVNER: Well, basically, she's done, frankly, what they've done in Massachusetts, which is to have what we're calling shared responsibility. And I think all - pretty much all the major candidates - Democratic candidates are doing this. There is what we call an individual mandate. It would require every individual to have insurance. If you're employer doesn't provide it, then you have to buy it yourself.

There will be subsidies for people who can't afford it. There will be a limit on how much you'll have to pay. Employers will have to pay something, or they will have to provide it. Not small employers - they'll be given a tax credit to encourage them, but they wouldn't be required. And then the government will provide these subsidies to help people who don't earn that much.

MARTIN: I'm going to come back to you to just get your overall sense of what the Republican candidates are saying, but Bill Galston, let me turn to you for a moment. In a spirit of full disclosure, you have offered some financial support to Senator Clinton's presidential campaign.

Dr. GALSTON: That is correct.

MARTIN: Uh-huh. I'm sure it's a lavished amount, so…

(Soundbite of laughter)

MARTIN: …but I just think everybody would want to know that - what do you think, as a former Clinton administration official, what do you think the lesson - what was the lesson learned from that experience about how to approach this problem? Because everybody still admits it's still a problem. The polls all show that this is one of the top, if not the top, domestic concern that Americans have.

Dr. GALSTON: I think, substantively, the big lesson was that the roughly 85 percent of Americans who do have health insurance are worried about the cost, but - by in large - like what they have. And one of the things that undermined the Clinton plan in 1993 and 1994 was the fear on the part of many people that what they had would be taken away. Senator Clinton has devised a plan, as have other candidates, that make it absolutely clear that people who like what they have now can stick with it. If they don't have anything or if they don't like what they have, they can choose another course. And this idea of choice within the current system - within the current structure - is, I think, the essence of the emerging new paradigm for heath insurance coverage across party lines.

MARTIN: How are these plans all paid for? I mean, I understand that she will roll back the tax cuts that are currently in place so she would allow them to expire on the wealthiest Americans in order to pay for this. But does that get you where you need to go? Is there a - is a tax increase beyond that going to be necessary, whether people are talking about that or not?

Dr. GALSTON: Look, there will be some additional public funds involved in all of these plans, whether at the state level or the national level. And a lot of the details - as Julie indicated - in Senator Clinton's plan and others need to be worked out. But almost all of them, I think, have some combination of proposed savings from efficiency - new efficiency in the health care system, plus money raised in order to pay for the subsidies that lower-income individuals are going to need in order to be able to afford the health insurance plans that they will be required to purchase.

MARTIN: If you're just joining us, we're talking about the various proposals to achieve universal health coverage that are being presented by the presidential candidates, and we're speaking with Dr. William Galston. He's a senior fellow at the Brookings Institution, and NPR's Julie Rovner, health policy correspondent.

Julie Rovner, what are the Republicans talking about with health care? And, you know, the barrels came out pretty quickly directed at Senator Clinton, which is logical since she is the frontrunner. And the complaint is - what's the phrase? What's the phrase du jour? It's a socialized - government-run, socialized medicine. Do you think that's a fair criticism?

ROVNER: European-style, government-run socialized…

MARTIN: European style.

ROVNER: …medicine. Yes, interestingly that came mostly…

MARTIN: Code for French.

ROVNER: …yes, or British - from former Massachusetts Governor Romney, interestingly enough, who, of course, signed into law that Massachusetts law that many of the Democratic programs most resemble - kind of ironic. What the - most of the Republicans are looking at what President Bush actually proposed earlier in the year, which is to change the tax code.

One of the big chunks of money that you could get in the health care system is the fact that there is what's called the tax exclusion, which is that people who get their health care from their employers don't pay tax on the value of those health benefits. That's an enormous piece of tax that is not paid. And there's some thought that perhaps that could be reeked and re-circulated, particularly for higher-income people. And, in fact, Senator Clinton takes a little bit of that just for people who earn a lot of money, over $250,000, and only for sort of high-end health insurance. And Senator Wyden from Oregon has a health plan that he's introduced that would look at that. So there's a little - there's a couple of Democrats who is starting to look that…

MARTIN: But that would, in fact, be a tax increase.

ROVNER: Yes.

MARTIN: It's not the same as letting a tax cut expire.

ROVNER: No, it's not.

MARTIN: I'm not sure most people know or even think about the fact that they aren't paying taxes on this benefit.

ROVNER: No, they don't, and it would be. In fact, President Bush's plan would be a tax increase on a lot of people. As you point out, for some people - for many people, it wouldn't be, but that - it's been very controversial. It's something that a lot of health economists have talked about. On the other hand, if you go out and buy your insurance yourself, you don't get any kind of tax breaks. So it's really unfair. It's been this persistent unfairness in the treatment - the tax treatment of health insurance for a long, long time. It's obviously expensive to deal with.

So that's something that the Republicans have pretty much all been talking about, something President Bush started to talk about at the beginning of the year, most of the Republican candidates have picked up on. So that's been a theme of most of the Republicans, but certainly the - I think the big difference between virtually all the Democratic candidates and all the Republican candidates is the Republicans want to use tax code, and they want to make it easier for individuals to buy their own policies - have really less government involvement, except through the tax code.

I think the Democrats want sort of more this, as we said earlier, shared responsibility between individuals, the government and employers. The Republicans want it to be more of an individual responsibility and just to have some tax help for people to buy their (unintelligible).

MARTIN: Are any of the Republicans proposing an individual mandate?

ROVNER: Not so far. Even…

MARTIN: Even Mitt Romney?

ROVNER: Even Mitt Romney.

MARTIN: And that was at the core of the Massachusetts plan.

ROVNER: Even Mitt Romney says it should be up to individual states to do that. It should not be a federal requirement.

MARTIN: Where is President Bush in this? When we last spoke to the two of you, we were talking about this program to extend health insurance coverage to children. The president says he's going to veto the proposal that is coming forward from the Congress. He said one of the reasons he said he's going to veto it is he wants a bigger discussion around universal health care - the bigger theme of health care. Did he mean that? Does he - is he really planning seriously to advance his own proposal for health care in an election year?

ROVNER: I actually talked to the secretary of Health and Human Services Mike Leavitt yesterday, and he was backing off a little bit. Now he's saying, well, maybe we should just have a brief extension of the existing children's health plan while Congress goes back and goes back to the drawing board. So I think perhaps they're backing off a little bit.

But you're absolutely right. For a while, the president was saying he didn't just want an extension to the children's health insurance program because he wanted Congress to do the bigger tax plan that we were just talking about, that he wanted to do the children's health plan and more.

MARTIN: Will Galston, if I could just finally get you to put your former Clinton administration official hat back on - is there, given that the Congress is so polarized - and obviously, one does not know what's going to happen in the 2008 elections. But is there the political will to take on a big issue like that in an election year? Is that actually possible?

Dr. GALSTON: I personally doubt that there's going to be a great leap forward in 2008, but I can say this: There is pent up demand among the American people for serious action in this area. And, equally important, there is an emerging consensus that didn't exist 15 years ago about how to get there from here.

And when you add to that the fact that significant elements of the medical community and the business community have switched sides for very good reasons - times have really changed in the past 15 years - I do believe that the stars are in alignment, and I will go out on a limb and say that if we have unified government beginning in January of 2009 with the Congress and the presidency held by the same party, that I do think that there will be significant action in this area.

MARTIN: Whichever party it is? Either party?

Dr. GALSTON: One way or another. If you have a Republican president and a Republican Congress, which I do not expect, then I think you would have a larger discussion along Republican lines, and perhaps significant action. And certainly, I can tell you that if there's a Democratic president and a Democratic Congress, that serious health care reform is likely to be the first order of domestic policy business for the next president of the United States.

MARTIN: Okay. Well, good. Hopefully, you all will both come back and talk to us again about this. Dr. William Galston is a senior fellow of governance studies at the Brookings Institution. Julie Rovner is a health policy correspondent for NPR. They were both kind enough to join us here in the studios in Washington. Thank you both so much.

ROVNER: You're welcome.

Dr. GALSTON: My pleasure.

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