Look Outside the Beltway for Better Health-Care Reform

Imagine truly universal coverage with a relatively free-market approach and a limited government role

IN the health-care ``end game'' of political compromise, the White House appears to be abandoning its position of no compromises on universal coverage. The likelihood increases daily that politicians will end up redefining ``universal'' as something less than 100 percent.

The Senate Finance Committee adopted a bill that aims for 95 percent coverage by 2002. This week, President Clinton admitted, ``We know we are not going to get right at 100 percent.'' At the moment, he aspires to ``somewhere in the ball park of 95 percent or upwards.'' Political horse-trading almost certainly will erode ``universal'' coverage further from these already-compromised projections.

Backpedaling on universal coverage is part of a tradition of political compromise that bargains away the goals of health-care reform. In the last 50 years, the federal government has winked at huge profits for insurance companies (the 1945 McCarran- Ferguson Act), finagled financing and presided over mushrooming costs (Medicare-Medicaid beginning in 1965), complicated regulation and swelled bureaucracy (``managed care'' beginning in 1972) - all in the name of greater coverage. The consequence has been increasing disenfranchisement of Americans from health care.

Polls this week indicate that 79 percent of Americans want true universal coverage. We can have it together with equitable financing and cost controls. But not if we stay in the tradition of federal government reform. Outside the Beltway, extrapolitical powers such as scientific principles and free-market forces have some jurisdiction. Invoking the private sector may be the only way to salvage the ideals of government health-care reform. If we widen the debate and consider the larger context of health care as practiced in the real world, the original goals appear achievable.

Imagine a plan for truly universal coverage under an equitable, single-payer system but with a relatively free-market approach and a limited government role. It might look something like this:

* Let the government fund a basic level of universal health care, using a voucher issued to every American, its value determined annually based on the total amount appropriated by Congress for health care. Everyone - young, old, healthy, or infirm - would receive equal access to services.

* Appoint a semi-independent board of experts qualified to decide which services the vouchers could cover. Like the Federal Reserve Board, it would have its own power to make periodic adjustments according to scientific monitoring and research. Independent research could be contracted through the existing Agency for Health Care Policy and Research.

* Abolish employer mandates. Whatever the government spends on health care ultimately comes from the taxpayer. Let Congress state clearly what it wants to spend on government-sponsored health care, then levy it as the tax that it is.

* Use private-sector competition, not government bureaucracy, to optimize delivery and control costs. Under Medicare, fiscal intermediaries already compete for subscribers. Take that concept and expand it to include existing insurance companies and new entrants. By law they would provide mandated coverage to anyone, regardless of age or prior conditions, while they could also compete to offer attractive extended coverage. To avoid the conflict of interest that tempts health maintenance organizations to save money by withholding treatment, intermediaries wouldn't treat patients directly, but would contract with independent physicians and hospitals.

* To safeguard freedom of choice, leave plenty of room for everyone to opt out of the government system. Patients could choose care inside the system or pay extra for extended coverage. Physicians and hospitals would practice either inside or outside the system, but not both, lest the United States repeat the mistakes of other countries where physicians operating in both systems put privately paying patients first.

Why not universal coverage now, founded on fiscal realism? It's within reach; it's just not within the narrow context of the debate in Washington. The Opinion/Essay Page welcomes manuscripts. Authors of articles will be notified by telephone. Authors of articles not accepted will be notified by postcard. Send manuscripts by mail to Opinions/Essays, One Norway Street, Boston, MA 02115, by fax to 617 -450-2317, or by Internet E-mail to OPED@RACHEL.CSPS.COM.