Joyce Beck, who runs a small hospital and network of medical clinics in rural Nebraska, is reluctant to plan for the future until voters decide between President Barack Obama and Mitt Romney.
The candidates’ sharply divergent proposals for Medicare, Medicaid and coverage of the uninsured have created too much uncertainty, she explained.
“We are all on hold, waiting to see what the election brings," said Beck, chief executive of Thayer County Health Services, based in Hebron.
When Americans go to the polls next month, they will cast a vote not just for president but for one of two profoundly different visions for the future of the country’s health care system.
With an Obama victory Nov. 6, the president’s signature health care law — including the contentious requirement that most Americans obtain health insurance or pay a tax penalty — will almost certainly come into full force, becoming the largest expansion of the safety net since Lyndon Johnson pushed through his Great Society programs almost half a century ago. If Romney wins and Republicans capture the Senate, much of the law could be repealed — or its financing cut back — and the president’s goal of achieving near-universal coverage could take a back seat to Romney’s top priority, controlling medical costs.
Given the starkness of the choice, historians and policymakers believe this election could be the most significant referendum on a piece of social legislation since 1936, when the Republican Alf Landon ran against Franklin D. Roosevelt and his New Deal programs.
For Medicare and Medicaid, the government health programs for older Americans, low-income people and the disabled, the candidates have sharply different visions as well. Romney’s proposals call for fundamental changes in the structure of the programs, placing more emphasis on private-sector competition and much less on government regulation.
Obama would expand Medicaid to cover millions more people; Romney would effectively shrink it, giving each state a fixed amount of federal money to cover its disadvantaged population with more control over eligibility and benefits. Romney would eventually give each Medicare beneficiary a fixed amount of federal money to pay premiums for either the traditional Medicare program or private insurance. Obama would preserve the structure of Medicare but try to rein in costs, in part by trimming payments to health care providers.
As seen in last week’s presidential debate, the health care discussion has become a dizzying flurry of numbers, bold claims and counterclaims. But the outlines of what might happen under a Romney administration or a second Obama administration go something like this:
If Romney wins
Even though he helped develop the landmark 2006 law that required most Massachusetts residents to have health insurance — a model for the Obama law — Romney has said repeatedly that he believes that requiring Americans to buy health insurance as national policy is the wrong approach. The focus should not be on increasing the number of insured Americans, his advisers say, so much as on controlling health costs by fixing the dysfunctional insurance market.
Romney has been less specific about what he will put in place if the law is repealed. But most of his ideas are aimed at bolstering market forces. One of the biggest problems, he says, is that people who get health insurance through their employers receive a tax break — the value of employer contributions to their premiums is not counted as income — while people who buy coverage in the individual insurance market generally get none. Romney says he would level the playing field by creating tax breaks for people who buy insurance on their own — a measure that might encourage even those with the option of employer-sponsored coverage to buy their own plans instead.
Romney believes that if more people buy coverage on their own, insurers will compete harder for their business, thus presumably lowering costs. And if insurance is separated from employment, the Romney campaign says, people will be able to keep their coverage if they lose or change jobs.
Paul Fronstin, an economist at the Employee Benefit Research Institute, a nonpartisan organization, said the proposal would work only if Romney made additional efforts to bring down the cost of health care. In the past, he said, advocates of such proposals typically offered tax credits ranging from about $1,500 to $2,500 a year for an individual — not necessarily enough to make coverage affordable.
“Will other things bring down premiums to make those tax credits more meaningful?" Fronstin asked. “That’s an open question."
If Obama wins
If Obama is re-elected, he would step up efforts to carry out the health care law. Given the controversy over the law and the logistical challenge of setting up state insurance “exchanges," where people can shop for coverage, the transition will probably be rocky. But many doctors, hospitals and insurance companies are determined to make it work.
On Jan. 1, 2014, the requirement that most Americans have medical coverage takes effect. Private health plans will start enrolling people in October 2013. The result, according to the Congressional Budget Office, is that 30 million uninsured people will eventually gain coverage. To help them afford it, the federal government would subsidize private insurance premiums for people with incomes up to four times the federal poverty level (up to $92,000 for a family of four). And it would expand Medicaid to cover more poor people, including many adults without children.
Obama and Democrats in Congress have beaten back efforts to change the law before its major provisions take effect. But after the election, Congress will be under intense pressure to rein in deficits and debt, and lawmakers will focus anew on the costs of Medicare, Medicaid and the new health care law, which together are expected to account for one-third of all federal spending in 2022.
Paul Ginsburg, president of the nonpartisan Center for Studying Health System Change, said that a willingness to compromise might help Obama persuade Republicans to accept the health care law if he wins a second term. For example, Ginsburg said, the president and congressional Democrats might agree to delay the biggest, most expensive parts of the law for a year.
