What Clinton Could Learn from the Catastrophic Health Care Catastrophe

...and those in the highest income brackets would pay the maximum $800—clearly a far cry from the $59 tax called for in the original Bowen plan...

...Enter then-secretary of Health and Human Services Otis Bowen...

...Aside from the elderly rich, there was another set of losers—those who were already receiving Medigap insurance free as part of their pensions, namely retired federal employees, teachers, and union members...

...But to ask them to put up $700 or $800 a year while others were paying absolutely nothing was demanding a bit much...

...Of course, compromise will be necessary, but there is a real distinction between a plan driven by the nation's health care needs and one driven by political gamesmanship...

...All Medicare recipients who earned enough to pay more than $150 a year in federal income tax would be required to pay a special 15 percent surtax, capped at $800 per person...

...The exact method matters less than the message...

...By the fall of 1988, House and Senate members started backpedaling—not on the benefits, of course, as this would only further incite the special interests—but just on the financing...

...One role model is Franklin Roosevelt, who was noted for going over the head of Congress, straight to the American people, to push his agenda when necessary...

...On the universal list of Good Ideas That Bombed, the catastrophic care act ranks near the top...

...Asking upper income seniors to pay perhaps $100 or $200 more than poorer counterparts for equal coverage was one thing...

...The easy way out will be to appease them...

...That's a mistake Clinton cannot afford to make —which provides the third and most important lesson: While both Reagan and Bush supported the plan, neither made it his mission to sell it to the American people...

...A few Democrats thanked Bowen and Reagan for their proposal, but also realized that they had been upstaged in the eyes of the powerful seniors' bloc...

...But there is a silver lining if we are smart enough to see it: The debacle shows us how to avoid the same mistakes in trying to create and pass legislation to fulfill another important reform, universal health care for all...

...This brings us to lesson number two for the Clinton administration and the new Congress: Special interests such as doctors and insurance companies will continue to fight tooth and nail to protect their wallets against health care reform...

...In short time, both the Conservative Caucus and the United Seniors of America also targeted millions of seniors through their own direct mail campaigns asking for donations to help fight the act...

...That experience introduced him to the plight of many elderly couples who, although entitled to Medicare benefits, were often left destitute after a serious illness...

...As important as remaining wary of the well-connected will be remaining mindful of the least organized, who are also most in need...

...The effort by Congress and the Bush administration to defend the act on behalf of these people proved to be laughably inadequate...

...This was key not only because long stays often bankrupted seniors, but because the possibility of facing such financial trauma was a burden in itself...

...Simply stated, the people most likely to benefit from the act, the elderly poor and the spouses of the elderly ill, lacked the financial wherewithal to effectively voice their concerns...

...Thus the Democrats disparaged the Bowen proposal and, egged on by the seniors' lobby, claimed that a new, more expansive plan was needed...

...Senator Claude Pepper, the great defender of the elderly, had died, Reagan was gone, and President Bush didn't lift a finger to save the act...

...What's more, there were no longer any defenders with enough visibility or credibility to stop the repeal effort...

...40 The Washington Monthly/March 1993 Not long after the catastrophic care bill became law, the media, with the help of some seniors' lobbies, quickly shifted its attention to the losers under the new legislation...

...Bowen thus urged Reagan to address the problem of major hospital costs incurred after 60 days...

...What Clinton 01 Could Learn from the Catastrophic Health Care Catastrophe pivotal pointers for making national health care happen f the myriad health care plans being }Fed-Exed and faxed to Bill Clinton's policy experts, the one that may serve them best has already failed: the 1988 Medicare Catastrophic Coverage Act...

...Then, when patients get an earful from their doctors about how they'll suffer from health care reform, they'll be ready to fight back...

...The pressure worked: Congress, fearing the In We debriS 0J a failed bill, SOme wrath of hoards of angry, politically active seniors, repealed the act, ending, for all practical purposes, the effort to provide seniors with security against the exorbitant costs of long-term or debilitating illness...

...Perhaps it means calling a "health care summit," or even relying on the more traditional, but still powerful, tools of the presidency, like the State of the Union Address...

...At first, seniors nationwide received pamphlets filled with all but indecipherable bureaucratese describing the complex components of the act...

...And herein lies lesson number one for the Clinton administration: Regardless of the plan Clinton adopts for national health care reform, there will be those who will seek to use it to gain political points, turning a smart idea into sloppy legislation...

...Such groups clearly had a legitimate gripe...

...For Clinton, this may mean returning to town meetings, Larry King, and the radio talk shows he used so effectively during the campaign...

...The President backed Bowen's agenda, but with a major caveat: No taxes could be raised to finance the plan...

...150 days of skilled nursing care...

...In return, beneficiaries would enjoy 100 percent coverage for treatment of serious illness after a $2,000 per year deductible...

...A good concept was slowly ballooning out of control...

...But within a few months, it came under sure attack from geriatric rabble-rousers who believed they were getting a raw deal...

...namely, the 37 million Americans without health insurance...

...March 1993/The Washington Monthly 39 in 1986, when Republicans lost control of the Senate after the Reagan administration attempted to reduce cost-of-living adjustments on Social Security benefits...

...A collective gasp could be heard in Congress as Democrats considered how they had alienated perhaps the most politically active segment of the older American population...

...And so, the NCPSS&M sent fliers to its 5.5 million members, 97 percent of whom voted in the previous election, urging them to help fund the campaign against the "Seniors Only Income Tax Increase...

...Designed to protect elders from the financial and mental trauma of ever-growing medical fees, the bill was enacted by Congress and signed by President Reagan with grand expectations...

...Clinton has shown skill in connecting with the people, which should make selling the nation on his health care reform plan more a matter of will than ability...

...Only strong political leadership could have prevented this...

...In the case of national health care reform, they are likely to be overpaid doctors, hospitals that overbill, and bloated insurance companies...

...Inevitably, some will benefit less from health care reform than others...

...Gray matter But all these goodies had to be paid for somehow...

...Congress' solution was to replace Bowen's flat rate premium with a "supplemental premium...

...In the years since, Congress and the executive branch, both badly by Greg MonfilS burned by the episode, have made virtually no effort to revive catastrophic care...

...Geezer displeaser It is here that the odious National Committee to Preserve Social Security & Medicare (NCPSS&M), the Conservative Caucus and other lobbies of their ilk slink into view...

...Instead of attacking the problem at its root, which would have meant showing the courage to peel back some of the overloaded benefits, and thus eliminating the need for unfair financing methods, Congress had taken the easy way out and simply upped the tax rates...

...People earning under $25,000 a year would pay about $58 a year for catastrophic coverage...

...It was reported that one Congressman's mother so berated her son over the matter that he refused to take her calls...

...80 percent of prescription drug costs after a $600 deductible...

...The lessons of catastrophic care legislation begin with how the bill failed...

...Sacrifice by some for the good of all—whether to create catastrophic insurance or universal insurance—is necessary, but that sacrifice must be reasonable...

...With a Democrat in the White House and a Democratic Congress, it will be tempting to fall into the same Santa Claus mode of the framers of the catastrophic care act...

...The Democrats also noted that the flat rate was regressive, forcing a disproportionate share of the burden upon the elderly poor for whom the $2,000 deductible created an already catastrophic burden...

...and 80 hours of respite care to ease the burden on family members caring for disabled elderly, among other benefits...

...The final version provided all seniors with: full coverage for hospital stays of any length after a $560 deductible for hospital costs and a $1,370 deductible for doctor bills...

...those earning about $40,000 would be required to put in $400 a year...

...Indeed, many seniors' lobbies looked upon the complex, front-loaded, not entirely adequate act as just the sort of legislation that could be easily misrepresented for profit...

...This, combined with the fact that they do not vote as dependably as their more affluent contemporaries, made them a lower priority in the eyes of many lawmakers...

...If Clinton uses his presidential bully pulpit to emphasize the need for doctors, hospitals and insurers to make a legitimate sacrifice in income so that the nation is not bankrupted by health care costs, he may not win over the American Medical Association, but at least Congress and the rest of the country will be encouraged to stand up to it...

...In short, the poorest seniors would pay nothing and the wealthiest would pay the most...

...Bowen's plan called for an extension of benefits financed by a mandatory, flat rate annual premium of $59 assessed against all Medicare enrollees...

...It wasn't long before a compassion-fest erupted in Washington, with now the White House, now Congress, now the White House claiming that we, not they, had the interests of the elderly at heart...

...Within weeks Congress was inundated with more than 2 million letters and thousands of phone calls from elderly citizens condemning Congress for passing the bill...

...Clinton—not a Cabinet secretary, not leaders of Congress—must step forward to speak for the millions most in need...

...The biggest losers in the fiasco were, of course, the nation's 31 million seniors...

...Chastened by the experience, Reagan and Republican congressional leaders moved to recapture the "compassion agenda" by extending an olive branch to the elderly...

...38 days of home health care...

...Doctors may not like the fact that health care reform means they'll have to hold onto their Volvo a couple more years before buying that Jaguar, but that's not a valid reason to buckle to their demands...

...That's not because we need catastrophic care insurance any more than universal coverage, but because the catastrophic care bill's tortured collapse can provide the new administration with a road map of exactly what to avoid in tackling the tougher task of overhauling the entire health care system...

...Because Medicare automatically reduces payments after 60 days of hospital care and eliminates them entirely after 90 days, the only way elders were able to protect themselves financially in the event of long-term hospitalization was to purchase "Medigap" insurance to fill in the gaps where Medicare leaves off...

...The same holds true for the retired federal employees and union members...

...As Paul Hewitt of the National Taxpayers Union explains, "Whipping up the elderly is a billion-dollar industry...

...But unlike the framers of the catastrophic care act, the writers of universal care legislation should remember that a good bill is also a fair one...

...Senator John McCain pointed to 20,000 letters, 10 of which were in support of the act...

...The story begins Greg Monfils is an Oakland, California, writer...

...When the catastrophic care act was repealed, the soft voice of the elderly poor was, not surprisingly, drowned out by their wealthier counterparts...

...On July 1, 1988, Reagan signed the Medicare Catastrophic Coverage Act—the biggest expansion of Medicare since its introduction in 1965...

...Bowen's wife had spent the last three months of her life in a hospital with terminal bone cancer...