YOU ARE HERE: LAT HomeCollections

Clinton Unveils Health Reform : He Says U.S. Is at a 'Magic Moment' for Action : Medicine: The package would provide coverage to all Americans and seeks to curb rapid cost increases. It would require employers to pay 80% of insurance and would set up regional cooperatives to purchase care.


WASHINGTON — President Clinton, declaring that the nation has reached "a magic moment" of bipartisan commitment to action, formally unveiled Wednesday what he and his aides hope will be the central achievement of his presidency--a national health care plan that, for the first time, would provide coverage to all Americans.

Speaking to a joint session of Congress and a national television audience numbering in the tens of millions, Clinton declared that "this health care system of ours is badly broken and it is time to fix it." A reformed system, he insisted, should be more secure, simpler for patients and doctors, less expensive but structured to preserve freedom of choice and quality of care.

"We have got to strengthen what is right with our health care system, but we've got to fix what is wrong with that system," he said.

Displaying a small, credit-card-sized "health care security card" emblazoned with the presidential seal, Clinton told his audience that under his plan all Americans would be guaranteed comprehensive health benefits, and he challenged Congress to make health security the first principle of health reform.

"Let us agree on this," Clinton said, "before this Congress finishes its work next year, you will pass, and I will sign, legislation to guarantee this security to every citizen of this country."

Launching the health care plan fulfilled a central promise of Clinton's presidential campaign, albeit somewhat tardily. Clinton, who had originally promised a health care plan within the first 100 days of his presidency, delayed the effort for three months while he wrestled with Congress over the budget plan that passed in August.

As outlined in his speech and in briefing materials prepared by Administration officials in recent weeks, the President's plan is aimed at achieving a goal sought by social reformers for decades: health coverage for all Americans. At the same time, it seeks to restrain the rapid escalation of health care costs that has brought the current medical system to the brink of crisis.

To accomplish those twin goals, the plan would:

* Require that all employees have health insurance. The cost of premiums would be divided about 80%-20% between employers and workers, and the insurance would have to meet minimum federal standards for quality and comprehensiveness.

* Require that this insurance be obtained through a network of regional health care alliances--essentially huge purchasing cooperatives--that would negotiate with doctors, hospitals and other health care providers to set fees and restrain spending.

Health insurance premiums for the working poor and the unemployed would be subsidized by the government.

To cushion the financial blow for small businesses that do not now provide health insurance, Clinton would provide government subsidies so that the cost of health care premiums would be limited to a fixed percentage of each company's payroll.

To pay for the subsidies and other elements of the plan, Clinton is counting on the ability of the new system to reduce administrative costs, paperwork and red tape dramatically, thereby squeezing billions of dollars in savings out of the nation's current health care budget.

Critics have expressed grave doubts about whether those savings can be realized, but Clinton insisted in his speech that the goal can be achieved. "We can save money in this system if we simplify it," he said.

Clinton would also impose roughly $15 billion a year in new "sin taxes," including an increased tax on cigarettes and other tobacco products, and a tax on large companies that decide to stay out of the new system. But, Clinton insisted, his plan could be financed without a new broad-based tax.

Under the plan, Americans would still be able to choose traditional "fee-for-service" medical plans, in which individuals choose doctors and pay separately for each treatment. But the proposed system would contain financial incentives and penalties to encourage people to sign up for "managed care" plans, such as health maintenance organizations. Even doctors in fee-for-service plans would have to accept limits on their fees.

Clinton's plan now faces months of debate in Congress, where it will compete with several rival proposals.

Some liberal Democrats plan to offer a "single-payer" proposal, which would create a Canadian-style health system in which the government paid all health bills and raised taxes to cover the costs. Moderate Republicans and some conservative Democrats have offered a plan that would bring about universal coverage more slowly than Clinton and without the mandate that employers cover all workers. More conservative Republicans have proposed a plan that would not achieve universal coverage but would make insurance easier for small businesses to buy.

Los Angeles Times Articles