Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: TUESDAY, March 6, 1990 TAG: 9003062041
SECTION: NATIONAL/INTERNATIONAL PAGE: A-1 EDITION: METRO
SOURCE: Los Angeles Times
DATELINE: WASHINGTON LENGTH: Medium
Sullivan, delivering the Bush administration's first formal response to the $66 billion program proposed last week by the Pepper Commission, said the administration is worried about any health reform program "if the cost to the business community is too great."
The commission plan calls for free insurance for pregnant women and children up to age 6 in poor families, 90 free days of nursing home care and government paid home care for the severely disabled. All firms with 100 or more workers would be required to offer health insurance to their employees or pay money into a public plan to pay for the uninsured. Smaller companies would be offered tax credits and subsidies to encourage them to purchase insurance for their workers. After five years, any remaining uninsured workers would be covered by the public plan.
It "is a very expensive program," Sullivan said in testimony before the House Aging Committee.
He said congressional enactment of the commission proposal could result in a "catastrophic outcome," a reference to the controversial expansion of Medicare repealed by Congress last year. Taxpayers over the age of 65 revolted against a special surtax, which would have financed extended free hospital care, placed a ceiling on doctor bills and paid part of the cost of prescription drugs.
The Bush administration is determined to fight any new program that requires higher taxes. An expansion of health insurance to cover 37 million Americans now lacking coverage would require expanded yearly outlays of $66 billion for the federal government and $20 billion for business.
"We need to develop a program that is not only effective at delivering services but is mindful of costs," Sullivan said. The United States spends more than any other nation for health care, $2,200 for every American, compared with $1,400 for each resident of Canada, the second biggest spender. "Simply [spending dollars] will not provide us with the best health," Sullivan said. "If it did, we would be the healthiest nation in the world and we're not."
Sullivan emphasized that the administration wants to concentrate on achieving greater efficiencies from current health spending, rather than increase outlays.
Despite prodding from the committee chairman, Rep. Edward Roybal, D-Calif., and other members, Sullivan did not offer an administration alternative to the Pepper Commission plan.
"The only thing we've learned from you is that you're concerned about the $66 billion cost," Roybal said after the committee had questioned Sullivan for nearly two hours.
Two separate health reform studies are under way by the administration, with the results going to the Cabinet domestic policy council, which is expected to prepare recommendations in the fall, Sullivan told Roybal.
However, it appears that any administration health plan would be limited in scope because of concerns over the federal deficit, and the president's pledge to avoid any tax increases.
The administration agrees that uninsured Americans should be offered protection against high medical bills, Sullivan said, but is worried about the added burden for business.
Sullivan said the expense of mandatory coverage could harm business, especially small enterprises. Higher costs could "have an adverse effect on employment and national competitiveness," he said.
However, committee Chairman Roybal said Congress should use the Pepper Commission plan as the basis for health care reform. The commission, named for its first chairman, the late Rep. Claude Pepper, D-Fla., "appears to have essentially fulfilled its charge to ensure health insurance protection for all Americans," Roybal said.
by CNB