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The Rough Road to Health Care Reform : Corporations: Big business, once a major supporter of Clinton's health proposal, has become deeply skeptical of the plan's promise to allow it some independence.


WASHINGTON — Big business, whose powerful help President Clinton will need in selling his health care program, is deeply skeptical of the Administration's promises that major corporations will be allowed to keep running their own independent health systems.

The Clinton plan proposes that corporations with more than 5,000 workers be allowed to operate their own health systems outside the giant regional health alliances, which would purchase health insurance on behalf of all other Americans. However, companies choosing to stay outside the regional alliances, would have to pay a 1% payroll tax in addition to the costs of their own plan.

"Our people view this as a slippery slope leading to a government-run single-payer system," said Lawrence Atkins, coordinator for the Corporate Health Care Coalition, whose members include General Electric, Boeing, DuPont, Arco and other giant firms.

The extra tax, plus the prospect of tougher-than-expected financial controls, is dimming the enthusiasm many firms once had for the notion of a health care system under which all their competitors would be required to join them in offering generous benefits.

The Clinton plan wouldn't really give firms independence because it would exercise ultimate control over spending and also would impose a new tax burden on the biggest employers, Atkins said.

Another employers group, the Assn. of Private Pension and Welfare Plans, also criticized the special tax, calling it "discriminatory."

A 1% levy for those staying outside the regional alliances "is a tremendous hit--it will cause us real problems in terms of economic growth," said William Campbell, president of the California Manufacturers Assn., who led a group of California executives on a visit to Washington this week.

Coverage historically has been comprehensive and generous for the workers at the biggest companies. "The Fortune 500 companies typically offer a fairly wide range of choices among health maintenance organizations," said Westcott Price, chief executive officer of FHP International, a large HMO firm with some major corporate clients.

Generous family coverage often meant the giant corporations were paying the health care bills for their workers' spouses, who were frequently employed by firms without any health insurance.

Mandated coverage, with all employers required to provide insurance, would wipe out the economic free ride given to some companies, according to corporate leaders.

However, the final form of the Clinton plan, although it mandates coverage, threatens the autonomy of the companies that already provide good benefits, critics say.

"We welcome the President's speech and we support the idea of providing access for health care to everyone," said Mary Dee Beall, manager of government affairs for Hewlett Packard. "But we think we've done a really good job in managing costs, and we have more confidence we can do it more effectively than any new government-created entity," she said.

The corporations, even if they stay outside the alliances, would be subject to rules limiting the amount of yearly increases allowed for health insurance premiums, and would be required to offer the standard benefits package devised by a new national health board.

Employers "would have neither the incentive nor the means to influence health costs, since they would be limited to paying bills wholly determined by others," according to the analysis prepared by the Assn. of Private Pension and Welfare Plans.

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