By Joseph Paduda, principle, Health Strategy Associates
As the Democratic presidential nominee race between Senators Hillary Clinton and Barack Obama continues to tighten, examining the differences between their health care plans is critical. Before we dissect the differences, let’s talk about their main similarity: what the plans are not. Neither
The plans of both candidates rely on private insurers to provide coverage, and neither makes changes to the health care provider community. Physicians and other providers do not become government employees under either candidate’s scenario.
The first, and most obvious, difference between the two plans is mandated universal coverage.
Obama's campaign literature and speeches indicate that the Senator is in favor of mandated universal coverage. Obama's rhetoric is inconsistent with his plan, leading me to suspect he wants to have his cake, eat it too, and not get fat.
Obama does have a mandate, but it is specific to children. He requires all kids to have coverage, but his plan does not require working-age people obtain coverage. Obama has said he would consider a universal mandate if coverage was not progressing rapidly (but he does not definite rapid).
Here are the highlights of several other key differences in the two health care plans. Some issues may seem picayune, but the devil is in the details, and details in health care add up to half a trillion bucks or so.
Insurers have to take all comers. That is, individuals with cataracts and family history of cancer and hypertension get coverage. They can't be denied coverage or care.
Benefit Plan Design
Both senators call for a benefit design similar to the Federal Employee Health Benefit Plan, which is not too shabby. By definition, this eliminates individual states' ability to mandate or restrict the coverage of certain types of care (e.g., acupuncture). Therefore, it transfers determination and regulation of health plan benefits from the states to the feds.
Obama would allow states to experiment with richer benefits and plans, as long as those exceed the national standard. Mental health parity is a part of both candidates' plans.
Insurance Buying/Regulatory Agency
Both candidates propose to set up a health insurance exchange/agency/entity to regulate insurers, facilitate enrollment, and provide information to consumers and employers. Obama goes quite a bit further, perhaps up to and over the edge of insurance price control. His website says the "plan will force insurers to pay out a reasonable share of their premiums for patient care instead of keeping exorbitant amounts for profits and administration."
Both plans will require contributions from employers, insureds, and taxpayers. Those in lower income brackets will be subsidized by taxpayers on a graduated scale. In contrast to Obama,
In Obama's, some small employers (he provides no definition of “small”) will not have to help pay premiums.
Obama also promises to cover some portion of employers' high-cost claims; the assumption here is that his plan would have the feds provide stop-loss insurance for claims above a certain dollar threshold.
Cost and Premiums
Here, Obama's plan is silent on age rating, the actuarially sound process of charging older folks more because they are more likely to need care.
Medical Malpractice Reform
And one other nuance:
Notably, Obama’s public relations message is focused on cost containment. He claims that universal coverage cannot be achieved until costs are reduced. Yet his ‘cost reduction’ programs, such as automation, greater use of technology, better reporting of medical outcomes and errors, and a strong focus on managing chronic care, are essentially identical to Clinton’s plan.
Both candidates’ plans also support portability and pay for performance—along with requirements that providers publish their outcomes data, re-importation of prescription drugs, and allowing the feds to negotiate prescription pricing for Part D and other federal programs.
So how do you decide which plan is better? Ask yourself this: do you believe universal coverage is central to health care reform?
(Stay tuned for a comparison of each parties' health care reform platform once the Democratic nominee is announced.)
With the Patient Protection and Affordable Care Act (PPACA) bearing down on corporate America like a mighty nor’easter, many employers have found ways to delay some of the impacts of this storm. The tactics they’re using—along with other significant health plan trends—are revealed in United Benefit Advisors’ (UBA) latest Health
Employers have already spent time, energy and resources preparing for the employer mandate deadline of January 1, 2015 in order to identify opportunities to avoid tax penalties, make changes to health coverage, adopt cost-cutting strategies and, in general, respond to financial pressures, new regulations and innovations.
Traditionally considered a cost-control option for larger employers, self-insurance has become an attractive option for small to mid-size companies in response to the continuing rise of health care cost and health care reform requirements.
Now that some of the bigger issues related to health care reform have simmered down, attention is turning to provisions of the ACA that go into effect in 2018. Specifically, Wells Fargo clients have begun asking about the impact to their health savings account programs of an excise tax on
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