Penalties for Uninsured Backed by Clinton Not Obama (Update1)
Penalties for Uninsured Backed by Clinton, Not Obama (Update1)
By Aliza Marcus and Avram Goldstein
Jan. 31 (Bloomberg) — Democrat Hillary Clinton is closer to
Republican Mitt Romney than she is to her party rival in the
presidential campaign, Barack Obama, when it comes to providing
health insurance to all Americans.
Just as car owners are required by state laws to have auto
insurance, Americans should be required to purchase medical
policies or apply for government-subsidized plans, Clinton says.
Health coverage mandates by the U.S. won;t be needed if
government assures that insurance is affordable, Obama responds.
Improving U.S. health care is a top concern of voters,
rivaled only by the economy, according to a poll published Jan.
24 by the Washington-based Pew Research Center for the People and
the Press. Senator Clinton of New York and Senator Obama of
Illinois propose expanded government subsidies to cover 47
million uninsured Americans. Obama disagrees with Clinton;s
contention, backed by her former foes in the insurance industry,
that penalties are needed to get everyone covered.
“If people have affordable insurance available, will they
buy it, or will they use the money for something else?;; said Jon
Cohen, managing director of health-care advisory services at New
York-based PricewaterhouseCoopers, in an interview.
Affordable health care for all can;t be guaranteed if those
who think they won;t need insurance can opt out, according to
Clinton and John Edwards, the former senator from North Carolina
who left the Democratic presidential race yesterday. Republican
presidential candidate Romney, the former Massachusetts governor,
backed a mandate for coverage in his state that;s now the law.
UnitedHealth, WellPoint
Insurers, who helped defeat the national health-care plan
offered by Clinton in the early 1990s, are more aligned with her
view than Obama;s this time.
Executives at UnitedHealth Group Inc. of Minnetonka,
Minnesota, the largest U.S. health insurer, and WellPoint Inc.,
of Indianapolis, the second largest, say Democratic proposals
that require them to accept anyone who applies won;t work
economically unless everyone is in the coverage pool.
“For this to work, you need the healthy to subsidize it,;;
said Wayne DeVeydt, WellPoint;s chief financial officer, in an
interview.
“We;ll continue to prosper;; under such a plan, said
UnitedHealth spokesman Karl Oestreich.
GM, Microsoft
An association representing almost 300 large employers,
including General Motors Corp. and Microsoft Corp., today backed
mandates for individuals as part of a U.S. health-care overhaul.
Businesses shouldn;t be required to cover all of their employees,
and the longtime tax break for health benefits that workers
receive from employers should be maintained, the National
Business Group on Health also said in a statement.
Clinton hasn;t said how big a penalty uninsured individuals
would face under her plan. Analysts say it would have to be
substantial.
“You need a minimum $3,000 penalty on income taxes or a
healthy 20-year-old isn;t going to have health insurance,;; said
Christine Arnold, a health-care analyst with Morgan Stanley in
New York, in a telephone interview.
The Democratic candidates; differing approaches emerged in
debates, including in South Carolina on Jan. 21.
“I am not running for president to put Band-Aids on our
problems,;; said the 60-year-old Clinton. “I want to get to
universal health care for every single American.;;
Obama;s Position
Obama, 46, says he would make coverage mandatory only for
children because adults can decide for themselves.
“The problem is not that folks are trying to avoid getting
health care,;; Obama said. “The problem is they can;t afford it.
Every expert that;s looked at this has said there is not a single
person out there who;s going to want health care who will not get
it under my plan.;;
Democratic voters may question Obama;s commitment to
universal health care because he doesn;t back mandates, said
Robert Blendon, a health policy professor at Harvard University
in Cambridge, Massachusetts, in a telephone interview.
“Requiring people to buy something they either don;t feel
they need or that, even with some help, they feel they can;t
afford could be an issue in a national election;; for Clinton,
Blendon said.
Romney opposes a nationwide health insurance plan, saying
every state should develop its own. In his state, he backed a
mandate for coverage as part of a $1.6 billion health insurance
plan that took effect last year.
Romney: `Mandates Work;
“I like mandates,;; Romney, 60, said at a Republican debate
in New Hampshire on Jan. 5. “The mandates work.;;
Three-quarters of an estimated 400,000 Massachusetts
residents who had been uninsured are now covered. Those who
didn;t sign up in 2007 will lose their state personal tax
exemption, worth $219. Next year, the fine will increase.
Massachusetts exempted about 60,000 residents from the
insurance requirement after deciding they didn;t earn enough to
buy private coverage and made too much to qualify for government
subsidies.
Forcing people to buy insurance is a confession of failure,
opponents argue.
“A mandate is often a substitute for doing the hard policies
that make care affordable and accessible,;; said David Cutler, a
Harvard University economist who advised Obama on his health
plan, in an interview. “Why do something that;s going to make
people think you;re out to hurt them?;;
About 20 percent of the U.S. uninsured have incomes of more
than $62,000 for a family of four, and 11 percent make more than
$83,000, according to the Kaiser Family Foundation in Menlo Park,
California.
“Having an individual requirement is similar to other
health and safety regulations,;; said Neera Tanden, Clinton;s
campaign policy adviser, in an interview. “We all bear the costs
when people are uninsured and go to the emergency room.;;
To contact the reporters on this story:
Aliza Marcus in Sacramento, California, at
