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Health America.

Never has the issue of affordable health care been more important than it is today We face a crisis in health care which threatens the health and well-being of all Americans - young and old, rich and poor, urban and rural, business and labor, insured and uninsured.

Health care costs continue to rise rapidly out of control. At the same time, many of the nation's health care institutions are on the brink of collapse. More and more, access to affordable health care is as serious a problem for working Americans and middle-class families as it is for low-income citizens.

In our prosperous nation of 250 million people, health care should be a basic right for everyone, not just the wealthy. Yet, 34 million Americans have no insurance at all. An additional 60 million people have insurance that even the Reagan Administration said was inadequate. Their protection often runs out at the time it is needed most - when they face catastrophic costs from serious illness or injury.

Even those with adequate coverage today are only one step away from losing their insurance, too. Some are one serious illness away from being dropped by their insurer; thus they are one management cost-cutting decision away or one pink unemployment slip away in this recession from joining the ranks of the uninsured.

Families with inadequate health insurance face a grim reality each day knowing that an accident or an illness could wipe out their lifetime savings. But the danger is much greater than the loss of economic security alone.

According to surveys by the Robert Wood Johnson Foundation, one million Americans each year are denied health care because they cannot pay for it. Another 14 million do not even look for the care they need because they know that they cannot afford it.

Two-thirds of the uninsured with serious health symptoms such as loss of consciousness or serious bleeding do not receive medical attention. A recent study in Washington, D.C. indicates that almost half of the uninsured people admitted to the hospital could have avoided hospitalization with timely care from a family doctor.

The effects of the health care crisis are also devastating to the nation's children. Ten million children, more than one in every seven, are uninsured. Almost one in every three poor children is uninsured, and over 300,000 children with disabilities are uninsured.

The Senate Labor and Human Resources Committee has held several hearings on the state of health care. We have heard many compelling stories of the daily problems people face struggling to care for their loved ones without access to health insurance.

Steve Tolgham of Georgia told of his son Chris, a bright, energetic young man who has epilepsy. The family has been forced to sell its house to help meet medical costs. Donna Johnson of Oklahoma (whose story appeared in the June 1991 issue of EP) brought her four-year-old son Eric to Washington to tell of their many fruitless efforts to obtain insurance. Birth injuries left Eric with multiple handicaps, including epilepsy and cerebral palsy; insurance companies refuse to provide coverage because of Eric's "pre-existing condition." And these stories are only the tip of the iceberg.

From 1979 to 1986, cutbacks by businesses led to the loss of coverage for three million dependents of insured workers. One-fourth of American children do not even see a doctor once a year. For many children, the only family doctor they know is the hospital emergency room.

Spending on health care now totals $700 billion dollars a year. The cost of health care is rising twice as fast as wages. Corporate expenditures on health care now exceed corporate profits. The amount that American families must pay for health care beyond insurance rose from $63 billion to $162 billion dollars in the last 10 years.

Yet these billions of dollars have not prevented newborn American infants from dying at rates higher than those of almost every industrialized country in the world. Nor have they raised our national life expectancy as high as in many other countries. These dollars have failed to provide insurance for millions of working Americans or adequate protection for millions more.

Health care providers face the twin problems of increasing numbers of uninsured people and escalating costs. Often, this predicament imperils their very existence. Many hospitals, because of their commitment to serve the uninsured, are drowning in a sea of red ink. Half of all public hospitals are operating at an average loss of $11 million. Six hundred hospitals are likely to fold within the next few years.

In New York City, an emergency room wait for a hospital bed may last three days. Forty-one other states report similar problems. Across the nation, one-in-three hospitals has dropped out of the trauma care system because they cannot afford the uninsured patients that arrive in their emergency rooms daily. Even in hospitals with a wealthy, well-insured clientele, costs continue to skyrocket.

Businesses are also major victims of the health care crisis. Small businesses face a disastrous insurance market. They must pay an average markup of 25 percent compared to large firms. Those small businesses willing to pay the exorbitant prices often lose out in the long run.

A single employee with an illness in a firm means that an insurer may find coverage too costly, and the whole group may lose its coverage. Exclusions for pre-existing conditions are often imposed to rule out coverage for the illnesses most likely to require costly medical care.

In the midst of the Great Depression, President Franklin Delano Roosevelt called the nation to action with his dramatic words, "A third of the nation is ill-housed, ill-clothed and ill-fed." Today, more than a third of our nation is ill-protected against illness itself, and it is up to Congress and the Administration to finally respond to this dilemma.

My colleagues in the Senate and I have proposed a plan called "Health America" which will build upon our current health care system, while correcting its worst faults. Health America will guarantee health care for every American family, and it will establish a comprehensive program to control soaring health care costs.

Under the plan, all Americans will have basic coverage - either directly through their employer on the job or through their employer's payroll contribution to the new Federal-State program called AmeriCare. In addition, AmeriCare will provide coverage to the unemployed with premiums based upon their ability to pay.

The vast majority of businesses already provide health care coverage for their workers. More than half a century ago the government required all employers to pay a minimum wage, to contribute to Social Security, and to participate in workers' compensation and unemployment insurance. In 1991, it is long past time for all employers to provide or contribute to health care.

Coverage for children will be part of the initial phase of the plan. The program will be phased in over a five-year period, thus allowing small businesses time to afford the cost of their new obligations. Businesses with more than 100 employees will be required to provide or contribute to coverage immediately. By the fifth year, every American will be assured coverage either on the job or through AmeriCare.

A number of provisions within the plan are designed to ease the financial burden on small businesses. Insurance reform will guarantee that small businesses can purchase coverage at fair prices without regard to the health of their employees. New tax credits will also provide fair treatment for the costs of the self-employed and offset up to 25 percent of the costs of small businesses.

Health America is also the most comprehensive program to deal with the exorbitant cost of health care ever introduced. It will squeeze costly needless care out of the system. A five-year study by Medicare showed that as much as 10 to 20 percent of care was unnecessary, and the Pepper Commission estimated that $18 billion worth of medical care annually was not needed. Our plan will establish guidelines to identify and eliminate this wasteful care.

The program will also eliminate billions of dollars in excessive administrative costs. The current system is strangled by red tape which hinders physicians and patients alike. Over 1,200 separate companies sell health insurance. Their multiplicity of forms, payment procedures and overlapping reviews of doctors and hospitals divert time and money that could be better used for medical care.

Almost half of every dollar spent on insurance premiums by small businesses and individuals goes to cover sales, administrative costs and profits. Health America will reform the insurance market by reducing overhead and using more of each premium dollar to cover medical costs. Billing and claim forms will be standardized; cost-effective, paperless processing will be easier to implement, and the amount of resources devoted to administration will be reduced.

Finally, the plan will end the blank-check payment policies that allow doctors and hospitals to charge virtually whatever they please for care. A new Federal Health Expenditure Board with the authority and independence of the Federal Reserve Board will be established by the plan to set cost guidelines for health care providers and enable patients and insurers to compare costs and quality.

My family has always been fortunate in being able to afford the best medical care available. That same care should be available to every individual. The landmark Health America proposal is a major step toward controlling runaway costs and guaranteeing decent health care for every American family.

Senator Edward M. Kennedy was born in Boston, Mass. and attended Milton Academy, Harvard University, International Law School in The Hague, Netherlands, and University of Virginia Law School. He served in the U.S. Army from 1951-53 in France and Germany. Kennedy was elected to the U.S. Senate November 6, 1962 to fill the unexpired term of John F. Kennedy. He was reelected to five full six-year Senate terms. He served as Chairman of the Labor and Human Resources Committee and was the Chairman of the Subcommittee on Health from 1971 to 1980. He has three children, Kara Anne, Edward M., Jr., and Patrick Joseph.
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Title Annotation:government policies for health insurance
Author:Kennedy, Edward M.
Publication:The Exceptional Parent
Date:Jul 1, 1991
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