Affordability and cost will be big issues in fall session

When Congress returns to session in September, the silliness about euthanisia and a government take-over of health care will be behind us. Then the debate will begin to focus on practical questions of cost: how to pay for a plan that would make health insurance affordable for American families that don't have coverage now and have precious little to contribute to insurance premiums.

That is the view of Drew Altman, president and CEO of the Kaiser Family Foundation.  According to Altman, the August town hall meetings have focused on a few hot-button issues that activists on the right and the left care most about. 

For folks in the middle, the key question about health reform is whether or not the dollars can be made to work.  To quote Altman, "What kind of subsidies will be available to make coverage more affordable for people?  What kind of coverage will people receive and will it meet the public's expectations?"

These issues, of course, are linked - both fiscally and politically.  "The greater support there is for the positive things that reform will do for people, the easier it will be to gain political support for the revenues and subsidies in the proposals."

Altman identifies five key questions to watch as this debate plays out through the fall.

1.  How high up the income scale will subsidies go?  400 percent of the federal poverty level, as proposed in HR 3200?  Or only 300 percent?  And how much of a family's income will it be expected to pay toward premium costs? 11 percent as proposed in HR 3200 or something higher?

2.  Will there be a requirement that everyone obtain coverage and how severe will the penalties be for not complying?  The answer largely depends on the adequacy of the subsidies.  If  too barebones, then the public will oppose a mandate and/or any penalites for noncompliance. And that would undermine universal coverage.

3.  What coverage will people get?  Of course, there will be lots of choices for people with the financial resources to shop around, but for those buying subsidized coverage, what will be included in the minimum coverage package?  If too little is covered, then people will decide it isn't worth it to buy coverage.

4.  How much will insurers be allowed to vary premiums by age?  In the voluntary system we have today, age rating is necessary to keep younger (and healthier) individuals participating in the insurance system.  In a universal system, that won't be necessary.  So how much more should a 60-year old pay for health insurance than a 20-year old?  HR 3200 suggest twice as much; other proposals have suggested five times as much. 

5.  What will be available for the lowest income Americans?  Currently, 65 percent of the uninsured have incomes below 200 percent of the federal porty level.  At that income level, families can not be expected to pay more than a tiny fraction of the cost of coverage.  Should Medicaid be expanded to provide coverage for this income group?  Or should public subsidies be made avalable for the purchase of private coverage?

"It will be important to look not only at the financing of reform," says Altman, "but also at what people get for the money."