Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: THURSDAY, September 23, 1993                   TAG: 9309230135
SECTION: NATIONAL/INTERNATIONAL                    PAGE: A-13   EDITION: METRO 
SOURCE: ROBERT A. RANKIN KNIGHT-RIDDER/TRIBUNE
DATELINE: WASHINGTON                                LENGTH: Medium

EXPERT CONSENSUS IS: CLINTON'S PLAN IS BUNK

To be sure, he says he can - largely by squeezing out waste and holding down ever-rising medical costs. That, he says, will free enough money to give every American better health benefits than most get now, with no big tax increase and no new debt.

But that's just bunk, according to a striking consensus of experts - liberals and conservatives alike. They cite history; Clinton cites complex computer models. You be the judge.

Clinton promises every American health benefits equal to what most Fortune 500 companies provide. Some 37 million people would gain health insurance.

The elderly alone would get two expensive new "entitlements," generous federal subsidies for prescription drugs and long-term care, while early retirees ages 56-65 could obtain government-sponsored health insurance.

The list of promised benefits runs on - goodies for everyone from big business to family physicians, all calculated to assemble a winning political coalition.

But analysts say it's too good to be true.

"This is Reaganomics all over again. . . . We are again going to tell the people something they love to hear - that you can have a tremendous expansion of benefits and it won't cost anything," said Barry Bosworth, a leading economist at the liberal Brookings Institution. "This is a proposal that is not funded."

"It scares us to death," said Carol Cox Wait, president of the bipartisan Committee for a Responsible Federal Budget. She worries that Clinton's expensive benefits will send federal deficits soaring anew, because she sees nothing to cut costs but empty promises.

"To talk about reducing the rate of growth of health care expenses is to restate the problem. It is not a solution," Wait says.

"We've never enacted a social insurance program in this country that was fully funded," said John Shiels, vice president with Lewin-VHI health-care consultants. Taxes must be raised periodically to pay for Social Security and Medicare benefits, Shiels noted, suggesting that Clinton plans a similar strategy: "They get this on the books, it turns into a sacred cow, and they'll worry about how to pay for it later."

Clinton says he would pick up $238 billion over five years by cutting projected spending growth in Medicare and Medicaid. That's the biggest single source of money he claims for his promised benefits. Outlays for each program would grow by 5 percent a year - instead of more than 10 percent - but skeptics say that slowing spending that much and that fast is unrealistic.

Health-care spending is driven up in part by costly advances in medical technology that cannot easily be cut by bureaucratic command. In addition, Medicare and Medicaid costs have accelerated faster because the number of people entitled by law to their services expands annually. Anyone over age 65 is entitled to Medicare; Medicaid serves the poor.

"It is financed by assumption - that you can cut Medicare and Medicaid by very, very large amounts, much larger than we've ever cut them before. That does not sound very plausible," said Rudolph Penner, former director of the Congressional Budget Office. Penner now directs economic studies for KPMG-Peat Marwick, the big accounting firm.

Last month Congress barely mustered one-vote majorities in each house to cut Medicare's projected spending growth by $56 billion over five years as part of Clinton's deficit-reduction bill. Experts say that Congress might now vote to slash those programs by nearly four times as much.

"Those Medicare cuts are a bad joke," said Gail Wilensky, who administered Medicare in the Bush administration. Cuts that deep, she said, "would decimate the physician/hospital care that people now get under Medicare. Rural hospitals would be devastated. So would Medicare-dependent hospitals in places like Florida."

Altogether Clinton says his reforms would cost the federal government $350 billion over five years. He says he can pay for them out of $441 billion in savings from cuts in projected federal health spending and from dramatic private-sector efficiencies. That would even yield $91 billion for deficit reduction.

Clinton insists his numbers are accurate because his planners spent seven months checking them against sophisticated computer models of the economy. But outside experts simply don't buy them.