A Shot in the Arm for America's Uninsured?

An unusual coalition of interest groups is tackling the problem

The millions of Americans who lack health insurance may be about to get some first aid. Their plight had taken a backseat in Washington as the roaring economy drove down the ranks of the uninsured in 1999 by 1.7 million, to 42.5 million--the first decline in 12 years. But, of course, the problem never went away.

Now, behind the scenes, powerful interest groups have been quietly converging around a range of remedies and, in the process, making at least a partial solution a political possibility. What's pushing the AFL-CIO and liberal groups such as Families USA and the Consumers Union to the center is the realization that there's little chance of getting what they really want--national health insurance or broad subsidies for the uninsured--from a Republican President and a divided Congress. At the same time, the medical Establishment, including hospitals, insurers, and business groups, worry that resurgent health costs and a faltering economy could cause a new rash of insurance cutoffs. The resulting outcry, they fear, could goad Congress to enact broad government programs, especially if Democrats retake either house in 2002.

CONSENSUS. So the two camps find themselves approaching common ground. The liberal groups are willing to go along with modest solutions such as tax credits, which stand a good chance of being tacked on to President Bush's tax-cut bill or to a patients' bill of rights. And the business groups are cautiously embracing an expansion of government programs such as Medicaid and the State Children's Health Insurance Program (SCHIP), which may soon come up in Congress. "It's possible that Medicaid and SCHIP expansions will be the price the GOP pays for the tax cuts," says Gail Wilensky, who advised Bush on health policy during his campaign.

The new consensus began to emerge after the election. Families USA joined with the Health Insurance Association of America (HIAA), the health insurer trade group, and the American Hospital Assn. to push a tax-credit plan (table). The idea: a break for employers that choose to pay a larger share of medical premiums for low-wage workers than they do for higher-wage ones. Dubbing their plan the "Strange Bedfellows" proposal, the two groups also back expansion of Medicaid and SCHIP to the uninsured. Top officials from these longstanding political foes have even taken national tours together to push their proposals.

That alliance gave the issue even more momentum. Between Election Day and Jan. 10, the Robert Wood Johnson Foundation, a nonprofit group active in health-care issues, sponsored seven regional conferences on the uninsured problem. Co-sponsors included not only the Strange Bedfellows partners but also an array of medical professionals, from doctors to nurses to low-wage health-care workers. Even the U.S. Chamber of Commerce, which abhors public-program expansions, participated, although it disagrees with the Strange Bedfellows' plans.

MAKING A DENT. There's also a flurry of renewed interest in Congress. In the next few weeks, Senators James M. Jeffords (R-Vt.) and John Breaux (D-La.) plan to reintroduce their tax-credit proposals from last year. Senator Edward M. Kennedy (D-Mass.), along with Senator Olympia Snowe (R-Me.), will try to expand the SCHIP program. Another key GOP player is new Health & Human Services (HHS) Secretary Tommy Thompson, who as governor of Wisconsin expanded his state's SCHIP to cover low-income parents, in addition to the low-income kids for whom it was designed.

The Administration may go along with some of these ideas. A tax credit to help the poor buy insurance would be a politically smart addition to a tax-cut bill that Democrats attack as benefiting mostly the wealthy, notes Thomas A. Scully, president of the Federation of American Hospitals and a Bush adviser on the HHS transition team. And Treasury Secretary Paul H. O'Neill has previously supported tax credits for the uninsured.

All the proposals on the table won't solve the problem of the uninsured. At best, they might shrink the rolls by a few million, experts say. But that would still put a decent dent in a problem that once seemed too difficult to solve.

By Phoebe Eliopoulos in Washington

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