57
THE HEALTH NEEDS OF POOR CHILDREN: FEDERAL AND STATE APPROACHES * BIRT HARVEY, M.D. Past President American Academy of Pediatrics
Clinical Professor of Pediatrics Stanford University School of Medicine Palo Alto, California
T HIS MORNING WE HEARD DATA on the deplorable health status of poor children and about possible approaches to this problem. I shall discuss advocacy because it must underlie implementation of any of these approaches. Parenthetically, I believe in advocating for all children because if one advocates only for poor children, a lot of eyes glaze over. If programs are implemented for all children, poor children who are most in need of those programs will utilize them and, therefore, benefit most from them. I shall discuss some of the problems with financing and delivery of health care for poor children, some proposals under consideration to address these issues, and what scenarios may occur in this and subsequent Congresses. What current programs address the health needs ofpoor children, and what are the problems with them?
By far the biggest program is Medicaid. It is not a good program for children largely because it is discriminatory and because services are often unavailable. Medicaid eligibility varies widely from one state to another. In Alabama the two children of a mother who earns more than $1,500 a year are not eligible for care under Medicaid. If this family moves to Alaska, these children will be Medicaid-eligible even if their mother earns $15,000. Medicaid benefits, like Medicaid eligibility, vary from state to state. Some states limit to 14 the yearly days of hospital care that a child may receive. Others limit the number of outpatient visits for sick care to two visits a month. Others have not covered eyeglasses even in the presence of documented visual defect. *Presented as part of the 1991 Annual Health Conference, Children At Risk: Poverty and Health, held by the Committee on Medicine in Society of the New York Academy of Medicine May 20 and 21, 1991
Vol. 68, No. 1, January-February 1992
58
B. HARVEY
58B.
Because Medicaid reimbursement varies from state to state, the availability of physicians and other providers varies in tandem. Reimbursement in some states is so inadequate that the only care available to many eligible children is in hospital emergency departments or Medicaid mills. Within a particular state, the Medicaid program may discriminate on the basis of age. Why should a five-year-old child be eligible for diagnosis and treatment of a strep throat under Medicaid, whereas an eight-year-old sibling is not? The Medicaid program was conceived of noble intentions, and it worked better at its inception than it does now despite valiant efforts by Congress and by the Children's Defense Fund to make the program equitable and available. They have succeeded in raising the age of coverage, in broadening eligibility, and in mandating appropriate services. Nevertheless, Medicaid remains a poor program. The program that was established under Title 5 in 1935 called the Crippled Children's program in many states-funded care for many children who had remediable conditions that, if left untreated, could result in permanent disability. The initial thrust of attacking remediable orthopedic problems has been expanded since 1935, but it has expanded unevenly. Eligibility varies from state to state, and so does whether or not a particular condition with handicapping potential is covered. Why should a child who has leukemia or bronchopulmonary dysplasia be covered in one state but not in a bordering state? Our categorically financed programs are inherently discriminatory. For example, the child of a member of the military is eligible for care under the Champus program in the Department of Defense. Parental occupation also helps some other children -the children of migrant workers,for example -to get care. Some children receive health care through the Indian Health Service, but only if they live on reservations. Community Health Centers provide health care to some children living in nearby locations. Still others fit into categories that receive care because they have specific blood diseases or disorders of specific organs. Even within these categories, there is sometimes discrimination: children with sickle cell anemia or certain hemoglobinopathies fit into a category eligible for care, but children with other hereditary anemias do not. Children with AIDS receive care not available to children with other causes of immunodeficiency. The ultimate example is end-stage renal disease. The legislative and executive branches of our government, in their wisdom, rejected the age-old concept of the heart as the center of the body and conferred this distinction upon the kidney. A child with end-stage renal disease has complete coverage throughout childhood and including transplant under Medicare. The leukeBull. N.Y. Acad. Med.
HEALTH NEEDS
59 59~~~~~~~~~~~~~~~
mic child in need of a bone marrow transplant is at the mercy of a parent's health insurance status. Thus, government financed health care coverage for poor children may depend on parental occupation, geographic location, the disease, or the specific organ affected. Categorical programs do not lack worth, but because they are not integrated into a reasoned whole, they form a crazy quilt that excludes many children and that does not provide the greatest good to the greatest number of children. The tendency in this country to respond to crises and to pressure groups with yet another categorical program often leads to gaps or, on the other hand, it may lead to duplication. Just as insurance varies from state to state, so do public health programs that affect children. Standards for newborn metabolic screening programs to detect hypothyroidism, galactosemia, and other disorders vary from state to state. Some have stringent laboratory testing standards, and most limit testing to a single state laboratory or regional laboratories. In other states, test results may be less accurate because almost any laboratory that wants to perform screening tests can do so. In states that have a screening program with no action pursuant to an abnormal test result, a child may receive fine care only if the right person happens to receive the report of an abnormality on a screening test. Other states have an intensive follow-up program so that all children with abnormal screening test results are tracked down, a definitive test performed, and necessary care provided promptly. Our federal government does provide funds to immunize children who cannot afford vaccines, but because federal funding is inadequate, it often must be supplemented by the states, and here again states vary in levels of
supplementation. Another similarly spotty public health program, fluoridation of water, depends upon where a child lives. Why should some children have more cavities than others because of an inadequate state or local health policy? At the delivery end, care is often fragmented; parents must go to many different agencies to get care for various problems. A commission studying California's government reported recently that the state has 160 separate programs dealing with children's health, located in 37 different units of government and in seven different departments. They have 25 separate sets of eligibility criteria. Such fragmentation is not only costly and wasteful, but it is degrading to recipients as well, as Dr. Ellwood pointed out. Here in New York City, the Center for Family Life in Brooklyn appears to be an effective model to bring multiple delivery systems together. Throughout the country we need many more innovative one-step shopping centers delivering health care. Vol. 68, No. 1, January-February 1992
60
60
B. HARVEY
Enumerating all of these administrative, financing, delivery, and public health issues shows clearly that we need a national child health policy. What we really need, of course, is a national children's policy because health issues cannot be separated from development, education, and social support issues. Actually, children's health issues cannot be separated from the health of some adults: prenatal health of the mother affects a child's health, and later parental health status, as Dr. Hertzig noted, affects a child's health in general and mental health in particular. Because we are not as wealthy a nation as we would like to be, we need to set priorities. Where should we put our dollars to best meet the health needs of children? We need goals for the year 2000 and beyond, not just diseaseprevention goals as outlined by the Public Health Service. To set attainable goals we need much better data collection so that we can frequently reassess our progress toward goals. If development of a national child health policy can be viewed as a first step toward a broader goal, removing barriers to care might be seen as the first step toward a child health policy. Not all barriers to care are financial, but elimination of money as a barrier to child health care is certainly one of the cornerstones of a child health policy. Financial barriers to child health care are complex, but one fact is easily understood: financial access to care is closely related to insurance status, and between 10 and 12 million children have no health insurance at all. Many others are uninsurable or underinsured. Some may still dismiss the typical uninsured child as one born to a 16-year-old, black, unmarried adolescent and therefore not deserving of insurance provided by the government. That child deserves health care as much as any other, but that child is a far cry from the demographically typical uninsured child in this country. Most are nonminority, and they live with two parents, at least one of whom is working. Gradually, lawmakers are becoming aware of who the uninsured are and how widespread the lack of health insurance is. Thus, we are seeing many proposals to cover the uninsured in our country. What are some of the major proposals under consideration? Most proposals deal with the lack of health insurance for the 33 to 34 million residents of the United States who have no insurance, not just children. One plan, proposed by the American Heritage Foundation, would mandate catastrophic coverage by requiring people to buy individual insurance policies. A tax credit would support the insurance payment for those with low incomes. This proposal is not a good one for children, most of whom need preventive and acute illness care rather than catastrophic care. Bull. N.Y. Acad. Med.
HEALTH NEEDS
61 61~~~~~~~~~~~~~~~
Proposals put forth by Physicians for a National Health Program, by Congressman Pete Stark, and by others essentially expand Medicare to the whole population by an increase in payroll taxes and other public subsidy mechanisms. Last year Congressman Stark introduced a similar proposal, limited to children, but had no cosponsors. This year's proposal, covering all residents of the United States, again received little response. Politically, I believe that these proposals are doomed. Before Congress for the past few years has been the Kennedy-Waxman proposal, an employer-mandated insurance plan with basic benefits to all. Companies with more than 50 employees would be required to provide basic health insurance coverage. This plan is not good for children since they would be covered for preventive care only to age two and since the parents of many children work in companies with fewer than 50 employees. Shortly we shall have the proposal based on the report of the Pepper Commission, a bipartisan national commission authorized to develop proposals to meet the health care needs of the uninsured and of those requiring long-term care. This proposal will require employers to provide insurance with a set of mandated benefits or to be taxed on their payroll, a system commonly referred to as "pay or play. " Using payroll tax funds, the government would provide insurance to those who do not receive health care through an employer plan. This plan is good for children since the benefits emphasize prevention, and all children will be covered. If, because of financial constraints, implementation is to be incremental, children would be among the first insured. A group led by Senator Mitchell and including Senators Riegel, Rockefeller, and Kennedy, will offer a proposal very shortly. Again, this proposal will be pay-or-play, and it will have strong cost containment elements. It has many elements in common with a proposal developed by the American Academy of Pediatrics. The Pepper Commission bill, to be introduced in the Senate by Senator Rockefeller and in the House by Congressman Waxman, also has many similarities to the American Academy of Pediatrics plan. THE AMERICAN ACADEMY OF PEDIATRICS PLAN
The American Academy of Pediatrics proposal will provide health insurance for all children through age 21 and for all pregnant women. Preventive care benefits will include prenatal care for any health problems that occur during pregnancy, pregnancy-related or not; newborn care; preventive care at a fixed schedule of immunizations and visits; and family planning. For preventive care there will be no copayment and no deductible. Vol. 68, No. 1, January-February 1992
62
HARVEY B. HARVEY B.
For another major package of benefits-care for acute and chronic illnesses, hospital care, pharmacy, laboratory, radiography-there will be a 20% copay and deductibles unless family income is below 200% of poverty level; below 133% there will be no copay or deductible; and between 133% and 200% of poverty there will be a sliding scale. Because a third package of benefits -substance abuse treatment, mental health treatment, physical therapy, occupational therapy, treatment for learning disorders -is more open-ended, there will be a cap, but to ensure that no family will be destroyed financially by these health problems, catastrophic coverage will begin at $1,000 per child and $3,000 per family per year. Those not insured by an employer will be financed through Medicaid dollars currently expended on children and pregnant women, an employer payroll tax of approximately 3% and an employee payroll tax of approximately 1%, and premiums from those who can afford them. The federal government will allocate money collected from these three sources to each state depending upon the number of eligible recipients. The state will then contract with private insurers. Thus, there will be no difference between the child who receives care through the state program or through an employer program. Both programs will have similar benefits and similar reimbursements. Both will be provided through multiple insurers. States will play a vital role in this system. They will develop case management for children at high risk, whether the risk be medical or social. The child of a 15-year-old mother or the child of a parent with a high profile for child abuse needs case management and ongoing support for the child and family as much as does the family whose child has a complex medical problem. States will be responsible for regionalization of newborn intensive care, critical care, and multidisciplinary clinics with complex medical problems. States will be responsible for outreach to ensure that all children get into the health care system, and for quality of care and for data collection. Details of this proposal can be found in the New England Journal ofMedicine, October 25, 1990. Passage during this Congress of any legislation providing financial access to health care for large numbers of people is unlikely. What is more likely is insurance reform legislation.
What scenarios can we envision for this and the next several Congresses? One of the main problems with health insurance in our country is the exclusion of people with preexisting health conditions. Parents of a chronically ill child are afraid to change jobs because, to a new insurer, their child's condition will be considered preexisting and therefore not covered. When a Bull. N.Y. Acad. Med.
HEALTH NEEDS
HEALTH
NEEDS
63
63
parent takes a job at a small company, the insurance plan may be reasonably priced and adequate for family needs, but when a child subsequently develops leukemia or another equally chronic and expensive health problem, the insurer may double company premiums. If the company then seeks insurance elsewhere to get a more reasonable rate, the chronic disease becomes a preexisting condition ineligible for coverage. Another major problem is that insurance premiums are experience-rated rather than community-rated. Insurers look at the insurance utilization experience in a company when they set its rates. Because small companies generate relatively little experience, insurers tend to set high rates that many small employers cannot afford. With community rating, insurers would have to rate all employers on a community-wide basis; they could not discriminate against small employers. These issues are important since three quarters of the employed uninsured work in settings of fewer than 25 employees. Oregon, Kentucky, and Connecticut have passed legislation to address -in small, incomplete ways -the problems of exclusion and of setting rates based on experience. Eleven other states are considering legislation to address insurance inequities. A few bills concerning preexisting conditions or community rating have been introduced in Congress. One proposal encourages states to drop mandated benefits; in exchange, insurers would be required to provide barebones insurance for small groups at competitive rates. This plan would be bad for children's health because insurance would cover primarily catastrophic events, and this does not meet the needs of most children. Other federal proposals address finance issues by providing tax credits for small employers or by helping states financially if they set up reinsurance pools for employees at high risk. The administration position has not been spelled out, but they are interested in insurance reform, and chances are good that insurance reform legislation may come from this Congress. Currently, chances are not good in this session for legislation to provide insurance for all our people. It is important that all of us interested in the welfare of children continue efforts to expand and upgrade existing services and benefits and to work for the removal of barriers to health care by passage of a national child health policy. The New York Academy of Medicine, both through its organizational structure and through the efforts of individual members who are leaders in medicine, can be influential in persuading members of Congress to cosponsor the American Academy of Pediatrics proposal. This would in no way preclude advocating also for passage of any of the other broader proposals to include all our uninsured. Vol. 68, No. 1, January-February 1992
THE HEALTH NEEDS OF POOR CHILDREN: FEDERAL AND STATE APPROACHES * BIRT HARVEY, M.D. Past President American Academy of Pediatrics
Clinical Professor of Pediatrics Stanford University School of Medicine Palo Alto, California
T HIS MORNING WE HEARD DATA on the deplorable health status of poor children and about possible approaches to this problem. I shall discuss advocacy because it must underlie implementation of any of these approaches. Parenthetically, I believe in advocating for all children because if one advocates only for poor children, a lot of eyes glaze over. If programs are implemented for all children, poor children who are most in need of those programs will utilize them and, therefore, benefit most from them. I shall discuss some of the problems with financing and delivery of health care for poor children, some proposals under consideration to address these issues, and what scenarios may occur in this and subsequent Congresses. What current programs address the health needs ofpoor children, and what are the problems with them?
By far the biggest program is Medicaid. It is not a good program for children largely because it is discriminatory and because services are often unavailable. Medicaid eligibility varies widely from one state to another. In Alabama the two children of a mother who earns more than $1,500 a year are not eligible for care under Medicaid. If this family moves to Alaska, these children will be Medicaid-eligible even if their mother earns $15,000. Medicaid benefits, like Medicaid eligibility, vary from state to state. Some states limit to 14 the yearly days of hospital care that a child may receive. Others limit the number of outpatient visits for sick care to two visits a month. Others have not covered eyeglasses even in the presence of documented visual defect. *Presented as part of the 1991 Annual Health Conference, Children At Risk: Poverty and Health, held by the Committee on Medicine in Society of the New York Academy of Medicine May 20 and 21, 1991
Vol. 68, No. 1, January-February 1992
58
B. HARVEY
58B.
Because Medicaid reimbursement varies from state to state, the availability of physicians and other providers varies in tandem. Reimbursement in some states is so inadequate that the only care available to many eligible children is in hospital emergency departments or Medicaid mills. Within a particular state, the Medicaid program may discriminate on the basis of age. Why should a five-year-old child be eligible for diagnosis and treatment of a strep throat under Medicaid, whereas an eight-year-old sibling is not? The Medicaid program was conceived of noble intentions, and it worked better at its inception than it does now despite valiant efforts by Congress and by the Children's Defense Fund to make the program equitable and available. They have succeeded in raising the age of coverage, in broadening eligibility, and in mandating appropriate services. Nevertheless, Medicaid remains a poor program. The program that was established under Title 5 in 1935 called the Crippled Children's program in many states-funded care for many children who had remediable conditions that, if left untreated, could result in permanent disability. The initial thrust of attacking remediable orthopedic problems has been expanded since 1935, but it has expanded unevenly. Eligibility varies from state to state, and so does whether or not a particular condition with handicapping potential is covered. Why should a child who has leukemia or bronchopulmonary dysplasia be covered in one state but not in a bordering state? Our categorically financed programs are inherently discriminatory. For example, the child of a member of the military is eligible for care under the Champus program in the Department of Defense. Parental occupation also helps some other children -the children of migrant workers,for example -to get care. Some children receive health care through the Indian Health Service, but only if they live on reservations. Community Health Centers provide health care to some children living in nearby locations. Still others fit into categories that receive care because they have specific blood diseases or disorders of specific organs. Even within these categories, there is sometimes discrimination: children with sickle cell anemia or certain hemoglobinopathies fit into a category eligible for care, but children with other hereditary anemias do not. Children with AIDS receive care not available to children with other causes of immunodeficiency. The ultimate example is end-stage renal disease. The legislative and executive branches of our government, in their wisdom, rejected the age-old concept of the heart as the center of the body and conferred this distinction upon the kidney. A child with end-stage renal disease has complete coverage throughout childhood and including transplant under Medicare. The leukeBull. N.Y. Acad. Med.
HEALTH NEEDS
59 59~~~~~~~~~~~~~~~
mic child in need of a bone marrow transplant is at the mercy of a parent's health insurance status. Thus, government financed health care coverage for poor children may depend on parental occupation, geographic location, the disease, or the specific organ affected. Categorical programs do not lack worth, but because they are not integrated into a reasoned whole, they form a crazy quilt that excludes many children and that does not provide the greatest good to the greatest number of children. The tendency in this country to respond to crises and to pressure groups with yet another categorical program often leads to gaps or, on the other hand, it may lead to duplication. Just as insurance varies from state to state, so do public health programs that affect children. Standards for newborn metabolic screening programs to detect hypothyroidism, galactosemia, and other disorders vary from state to state. Some have stringent laboratory testing standards, and most limit testing to a single state laboratory or regional laboratories. In other states, test results may be less accurate because almost any laboratory that wants to perform screening tests can do so. In states that have a screening program with no action pursuant to an abnormal test result, a child may receive fine care only if the right person happens to receive the report of an abnormality on a screening test. Other states have an intensive follow-up program so that all children with abnormal screening test results are tracked down, a definitive test performed, and necessary care provided promptly. Our federal government does provide funds to immunize children who cannot afford vaccines, but because federal funding is inadequate, it often must be supplemented by the states, and here again states vary in levels of
supplementation. Another similarly spotty public health program, fluoridation of water, depends upon where a child lives. Why should some children have more cavities than others because of an inadequate state or local health policy? At the delivery end, care is often fragmented; parents must go to many different agencies to get care for various problems. A commission studying California's government reported recently that the state has 160 separate programs dealing with children's health, located in 37 different units of government and in seven different departments. They have 25 separate sets of eligibility criteria. Such fragmentation is not only costly and wasteful, but it is degrading to recipients as well, as Dr. Ellwood pointed out. Here in New York City, the Center for Family Life in Brooklyn appears to be an effective model to bring multiple delivery systems together. Throughout the country we need many more innovative one-step shopping centers delivering health care. Vol. 68, No. 1, January-February 1992
60
60
B. HARVEY
Enumerating all of these administrative, financing, delivery, and public health issues shows clearly that we need a national child health policy. What we really need, of course, is a national children's policy because health issues cannot be separated from development, education, and social support issues. Actually, children's health issues cannot be separated from the health of some adults: prenatal health of the mother affects a child's health, and later parental health status, as Dr. Hertzig noted, affects a child's health in general and mental health in particular. Because we are not as wealthy a nation as we would like to be, we need to set priorities. Where should we put our dollars to best meet the health needs of children? We need goals for the year 2000 and beyond, not just diseaseprevention goals as outlined by the Public Health Service. To set attainable goals we need much better data collection so that we can frequently reassess our progress toward goals. If development of a national child health policy can be viewed as a first step toward a broader goal, removing barriers to care might be seen as the first step toward a child health policy. Not all barriers to care are financial, but elimination of money as a barrier to child health care is certainly one of the cornerstones of a child health policy. Financial barriers to child health care are complex, but one fact is easily understood: financial access to care is closely related to insurance status, and between 10 and 12 million children have no health insurance at all. Many others are uninsurable or underinsured. Some may still dismiss the typical uninsured child as one born to a 16-year-old, black, unmarried adolescent and therefore not deserving of insurance provided by the government. That child deserves health care as much as any other, but that child is a far cry from the demographically typical uninsured child in this country. Most are nonminority, and they live with two parents, at least one of whom is working. Gradually, lawmakers are becoming aware of who the uninsured are and how widespread the lack of health insurance is. Thus, we are seeing many proposals to cover the uninsured in our country. What are some of the major proposals under consideration? Most proposals deal with the lack of health insurance for the 33 to 34 million residents of the United States who have no insurance, not just children. One plan, proposed by the American Heritage Foundation, would mandate catastrophic coverage by requiring people to buy individual insurance policies. A tax credit would support the insurance payment for those with low incomes. This proposal is not a good one for children, most of whom need preventive and acute illness care rather than catastrophic care. Bull. N.Y. Acad. Med.
HEALTH NEEDS
61 61~~~~~~~~~~~~~~~
Proposals put forth by Physicians for a National Health Program, by Congressman Pete Stark, and by others essentially expand Medicare to the whole population by an increase in payroll taxes and other public subsidy mechanisms. Last year Congressman Stark introduced a similar proposal, limited to children, but had no cosponsors. This year's proposal, covering all residents of the United States, again received little response. Politically, I believe that these proposals are doomed. Before Congress for the past few years has been the Kennedy-Waxman proposal, an employer-mandated insurance plan with basic benefits to all. Companies with more than 50 employees would be required to provide basic health insurance coverage. This plan is not good for children since they would be covered for preventive care only to age two and since the parents of many children work in companies with fewer than 50 employees. Shortly we shall have the proposal based on the report of the Pepper Commission, a bipartisan national commission authorized to develop proposals to meet the health care needs of the uninsured and of those requiring long-term care. This proposal will require employers to provide insurance with a set of mandated benefits or to be taxed on their payroll, a system commonly referred to as "pay or play. " Using payroll tax funds, the government would provide insurance to those who do not receive health care through an employer plan. This plan is good for children since the benefits emphasize prevention, and all children will be covered. If, because of financial constraints, implementation is to be incremental, children would be among the first insured. A group led by Senator Mitchell and including Senators Riegel, Rockefeller, and Kennedy, will offer a proposal very shortly. Again, this proposal will be pay-or-play, and it will have strong cost containment elements. It has many elements in common with a proposal developed by the American Academy of Pediatrics. The Pepper Commission bill, to be introduced in the Senate by Senator Rockefeller and in the House by Congressman Waxman, also has many similarities to the American Academy of Pediatrics plan. THE AMERICAN ACADEMY OF PEDIATRICS PLAN
The American Academy of Pediatrics proposal will provide health insurance for all children through age 21 and for all pregnant women. Preventive care benefits will include prenatal care for any health problems that occur during pregnancy, pregnancy-related or not; newborn care; preventive care at a fixed schedule of immunizations and visits; and family planning. For preventive care there will be no copayment and no deductible. Vol. 68, No. 1, January-February 1992
62
HARVEY B. HARVEY B.
For another major package of benefits-care for acute and chronic illnesses, hospital care, pharmacy, laboratory, radiography-there will be a 20% copay and deductibles unless family income is below 200% of poverty level; below 133% there will be no copay or deductible; and between 133% and 200% of poverty there will be a sliding scale. Because a third package of benefits -substance abuse treatment, mental health treatment, physical therapy, occupational therapy, treatment for learning disorders -is more open-ended, there will be a cap, but to ensure that no family will be destroyed financially by these health problems, catastrophic coverage will begin at $1,000 per child and $3,000 per family per year. Those not insured by an employer will be financed through Medicaid dollars currently expended on children and pregnant women, an employer payroll tax of approximately 3% and an employee payroll tax of approximately 1%, and premiums from those who can afford them. The federal government will allocate money collected from these three sources to each state depending upon the number of eligible recipients. The state will then contract with private insurers. Thus, there will be no difference between the child who receives care through the state program or through an employer program. Both programs will have similar benefits and similar reimbursements. Both will be provided through multiple insurers. States will play a vital role in this system. They will develop case management for children at high risk, whether the risk be medical or social. The child of a 15-year-old mother or the child of a parent with a high profile for child abuse needs case management and ongoing support for the child and family as much as does the family whose child has a complex medical problem. States will be responsible for regionalization of newborn intensive care, critical care, and multidisciplinary clinics with complex medical problems. States will be responsible for outreach to ensure that all children get into the health care system, and for quality of care and for data collection. Details of this proposal can be found in the New England Journal ofMedicine, October 25, 1990. Passage during this Congress of any legislation providing financial access to health care for large numbers of people is unlikely. What is more likely is insurance reform legislation.
What scenarios can we envision for this and the next several Congresses? One of the main problems with health insurance in our country is the exclusion of people with preexisting health conditions. Parents of a chronically ill child are afraid to change jobs because, to a new insurer, their child's condition will be considered preexisting and therefore not covered. When a Bull. N.Y. Acad. Med.
HEALTH NEEDS
HEALTH
NEEDS
63
63
parent takes a job at a small company, the insurance plan may be reasonably priced and adequate for family needs, but when a child subsequently develops leukemia or another equally chronic and expensive health problem, the insurer may double company premiums. If the company then seeks insurance elsewhere to get a more reasonable rate, the chronic disease becomes a preexisting condition ineligible for coverage. Another major problem is that insurance premiums are experience-rated rather than community-rated. Insurers look at the insurance utilization experience in a company when they set its rates. Because small companies generate relatively little experience, insurers tend to set high rates that many small employers cannot afford. With community rating, insurers would have to rate all employers on a community-wide basis; they could not discriminate against small employers. These issues are important since three quarters of the employed uninsured work in settings of fewer than 25 employees. Oregon, Kentucky, and Connecticut have passed legislation to address -in small, incomplete ways -the problems of exclusion and of setting rates based on experience. Eleven other states are considering legislation to address insurance inequities. A few bills concerning preexisting conditions or community rating have been introduced in Congress. One proposal encourages states to drop mandated benefits; in exchange, insurers would be required to provide barebones insurance for small groups at competitive rates. This plan would be bad for children's health because insurance would cover primarily catastrophic events, and this does not meet the needs of most children. Other federal proposals address finance issues by providing tax credits for small employers or by helping states financially if they set up reinsurance pools for employees at high risk. The administration position has not been spelled out, but they are interested in insurance reform, and chances are good that insurance reform legislation may come from this Congress. Currently, chances are not good in this session for legislation to provide insurance for all our people. It is important that all of us interested in the welfare of children continue efforts to expand and upgrade existing services and benefits and to work for the removal of barriers to health care by passage of a national child health policy. The New York Academy of Medicine, both through its organizational structure and through the efforts of individual members who are leaders in medicine, can be influential in persuading members of Congress to cosponsor the American Academy of Pediatrics proposal. This would in no way preclude advocating also for passage of any of the other broader proposals to include all our uninsured. Vol. 68, No. 1, January-February 1992
