Governor Howard Dean MD, Health Care For America
Plan Summary
Governor Howard Dean's plan to extend health insurance to all Americans is based on the lessons he learned as a practicing physician and as a governor. As Governor of Vermont, Howard Dean had an unsurpassed record of success in broadening health insurance coverage, achieving the highest rate of coverage for any state of both children and low-income people. The Dean plan offers health insurance to all uninsured Americans, at well under half the cost of President Bush's tax cuts.
The plan is built on four components:
- Start by covering children - The plan calls for extending current programs to every child and young adult under 25 up to three times the poverty level. It will also require employer health plans to extend coverage to dependents up to age 25.
- Expand to Families - For those at lower income levels, extend current programs for children to include parents up to 185 percent of the poverty level. For those above that level, allow them to buy into a health plan similar to the plan for government employees, while providing tax credits to keep insurance affordable.
- Support Small Businesses - Help small businesses afford coverage by letting them buy into the federal employee look-alike program at reasonable rates.
- Send a Message to Large Companies - Without any mandates, the government can still send a strong signal to larger businesses that could afford to but don't provide coverage by limiting their tax deductions and their government contracts.
The Dean plan is ambitious, but realistic, targeted, and affordable. To extend affordable insurance to all Americans, it takes a consensus-based approach that builds on existing systems and that can pass Congress. It avoids mandates that would create firestorms of opposition and make it impossible to get a plan through Congress.
According to an analysis by The Lewin Group, a nationally respected health care consulting firm, at full implementation, the Dean plan, while available to all, would likely be taken up by 31 million of the 41 million Americans now uninsured, at an annual cost of $88.3 billion. The Dean plan covers more people than the plan proposed by Congressman Richard A. Gephardt at about one-third the cost of the Gephardt plan.
Governor Dean's plan will:
- Establish a Families & Children Health Insurance Program (FCHIP), building on the successful but limited State Children's Health Insurance Program, offering health insurance to all children and young adults (up to age 25) in America, and all older adults with low incomes.
- Establish a Universal Health Benefits Program (UHBP), offering a choice of private insurance plans identical to those for members of Congress and federal employees, at affordable rates.
- Provide refundable tax credits to the uninsured to help them afford premiums for the Universal Health Benefits Program.
- Provide additional opportunities for enrollment in either the Families & Children Health Insurance Program or the Universal Health Benefits Program through tax returns.
- Temporarily extend existing insurance coverage for workers after they leave their jobs.
Family & Children Health Insurance Program (FCHIP)
A new Family & Children Health Insurance Program (FCHIP) will build on the success of the State Children's Health Insurance Program (SCHIP). Federal funding will allow states to offer health insurance to all children and young adults under age 25, and all low-income adults.
Ensuring adequate health care to all children is essential to get their lives off to a good start, maintain their health and head off future health problems and expenses. That is why, in Vermont, Governor Dean concentrated on extending health insurance to the state's children. Ultimately, Vermont has the highest insured rates for children in the nation at 96 percent. Extending health insurance to the nation's youngest adults, those 19 to 25, is also important, as they have the lowest insurance rate of any age group in the country, largely because they are no longer covered under their parent's insurance plans and often have not yet moved into jobs that provide employer-based insurance. Older low-income adults also disproportionately lack health care coverage. The evidence is also clear that opening up state-run insurance programs to low-income parents greatly increases the rate at which the parents will obtain that coverage for their already-eligible children, as part of family coverage.
The FCHIP program will be based on these principles:
- The program will be open to (1) all children and young adults (up to age 25) with family incomes under 300% of the poverty level (e.g., $54,000 a year for a family of four); and (2) adults between ages 25 and 64 with incomes up to 185% of the poverty level. Everybody who is eligible must be guaranteed the right to participate in the state programs, as an entitlement.
- As with SCHIP, participation by states will be optional, but federal payments will be generous enough so that states will not incur any additional costs, and as a result all states are expected to participate in the program.
- As with SCHIP, the coverage offered by states must meet minimum federal standards, but states otherwise will have substantial flexibility in designing their programs. As with SCHIP, it is expected that ¾ of participants will be insured through private insurance plans meeting state requirements. Unlike with SCHIP, participants must not be currently uninsured to be eligible for FCHIP.
Governor Dean's health insurance plan will establish a new Universal Health Benefits Program (UHBP), open to all Americans (except those eligible for FCHIP, Medicaid or Medicare), providing coverage identical to what members of Congress and federal employees get through the Federal Employees Health Benefits Program (FEHBP).
The FEHBP is widely recognized as the best program of private insurance plans available to any Americans. Now, however, it is only available to members of Congress and other federal workers. Under the Dean plan, any insurance company that offers a plan to federal workers through the FEHBP will be required to offer an identical plan open to other Americans. All people eligible for the new Universal Health Benefits Program will have a guaranteed right to have that insurance coverage issued to them, at affordable rates.
To ensure that premiums under the UHBP plan actually are affordable, a federally funded reinsurance trust will be available to keep premiums at the levels that would be expected if a broadly representative sample of the public participates in the plan. This will guard against the higher premiums that could result if only people with high medical costs sign up for UHBP plans - or if the participating insurance companies fear that could happen, and set high premium levels to protect themselves.
Tax Credits for Uninsured Americans
Taxpayers who at the time they file their tax returns have been uninsured for six months will get a refundable tax credit to help them afford coverage under the Universal Health Benefits Program. The tax credit will be available to all that are not eligible for Medicaid, FCHIP, or Medicare. The amount of the tax credit will be equal to the difference between the UHBP premium and 7.5 percent of the taxpayer's income (AGI). The tax credit will be refundable, so that even those with low tax liability will be able to use it. The tax credit check would apply only to standard plan premiums for insurance coverage.
Insurance Enrollment Through Tax Returns
Governor Dean's plan will automatically enroll uninsured taxpayers in Medicaid, FCHIP, or UHBP insurance plans through their tax returns. For uninsured taxpayers who fail to make a choice, the default result would be their enrollment in the appropriate plan, although they later would again have the option to drop the coverage before paying any premium.
Making enrollment automatic on a tax return would greatly increase the rate at which people participate in insurance plans for which they are eligible. By contrast, currently, about one-quarter of all uninsured children are eligible for Medicaid or SCHIP but are not enrolled.
Extension of Insurance for Workers Leaving Jobs
The Dean plan includes two measures to help workers keep their coverage under employer-provided health insurance when they leave a job. First, under the only mandate in the Dean plan, employers who provide insurance to their workers will be required to continue paying their share of the premium for a covered worker for two months after he or she leaves the job. This helps workers through the transition period before they become eligible for insurance through a new employer, which typically is not immediately available. Second, for those who are uninsured for longer, the federal government will pay 70% of the premium cost for continuation of the previous employer's insurance plan under COBRA. This will give meaning for the first time to COBRA coverage, which now is so expensive that few workers are able to take advantage of it.
Paying for the Dean Plan
There is abundant evidence that Americans are fully prepared to forego the Bush tax cuts in order to extend health insurance to all.
The cost of providing access to affordable health insurance for all Americans under Governor Dean's plan is $88.3 billion per year at full implementation in FY2008 according to estimates by the Lewin Group. This is far less than half the cost of George W. Bush's tax cuts - both those enacted in 2001 and those he is still proposing in 2003.
| Bush 2001 tax | Bush 2003 tax | Total Bush | |
| cut as passed | cut as proposed | Tax cuts | |
| 2006 | $135B | $96 | $231 |
| 2007 | $152 | $79 | $231 |
| 2008 | $160 | $82 | $242 |
| 2009 | $167 | $84 | $251 |
(Sources: Joint Committee on Taxation, Estimated Budget Effects of the Conference Agreement for HR 1836, JCX-51-01, May 26, 2001; Estimated Budget Effects of the Revenue Provisions Contained in the President's Fiscal Year 2004 Budget Proposal, JCX-15-03, March 4, 2003.)
Howard Dean On The Issues
Healthy Children
Politicians set their clocks by election cycles. Too often their solutions to problems are two- and four-year fixes. But most of our problems require a vision that looks far into the future, fixes that must work long after that election cycle is history. I learned that lesson each day over my 11 years as Governor of Vermont.
Budget decisions I made in my first term impacted budget decisions I made in my tenth term. Environmental protections I fought for in my early years will benefit my children and grandchildren far into the future. I stopped framing my decisions in a two-year viewfinder, and began looking five, ten and even 100 years into the future.
Most politicians don't think long term in politics. Yet children are a long-term proposition.
When I became Governor in 1991, Vermont had the largest budget deficit in the history of the state, as well as the highest marginal tax rate in America. As a Democrat, I had to cut spending and reduce taxes to make Vermont an attractive place to do business and create jobs.
This process involved difficult conversations with state officials, scaling back spending on programs I cared about. It was during one of these conversations that the Commissioner of Corrections came to me asking for a 14% budget increase. Everyone else, including those who provide crucial programs like health care and education, was being asked to cut spending, but prisons -- the most expensive and least effective social service investment we make -- needed more money.
My view of social spending changed in that instant. Because studies show that any competent kindergarten teacher can make a pretty good guess about the five kids most likely to end up in prison, I decided to focus Vermont's efforts and money on new families with very young babies and children. Surely money spent before a child develops problems would be better spent than after, I reasoned.
Today in Vermont, we invest in our children. We visit every child and new mother in the hospital at the time of birth. We offer home visits two weeks after discharge to talk about everything from nutrition to housekeeping to substance abuse to the value of reading. Last year 91% of moms accepted our visit. While most of those families didn't need help, the ones who did got the assistance before the child turned one, not when the child showed up in kindergarten with serious problems. I believe that one day this program will result in much lower incarceration rates in Vermont. But the good news is that in the first seven or eight years, we have already seen child abuse drop by 43% in the 0-6 age group, and child sexual abuse drop by 70%. Combine this with what is essentially universal health care for all Vermonters under 18 and one of the largest drops in teen pregnancy in the country, and we have a record on children to be proud of.
If this nation wants healthy adults and less expensive social programs, we need to cut back on the empty rhetoric so prevalent in Washington and make a serious investment in our children. Talking about children is not the same as nurturing children, and the American people know the difference.
Howard Dean On The Issues
Universal Health Care
As a doctor, I understand the fear facing families without health insurance. As a Governor, I am proud that virtually every child under 18 and more than 90 percent of adults in Vermont are eligible for health coverage. But as a country, the United States can do better on this front.
To help finance this effort, we must repeal the President's tax cuts -- which have thrown America back into the huge deficits of the 1980s -- and balance the federal budget. We cannot build crucial social programs without a solid financial foundation.
Guaranteeing coverage to all Americans will involve a mix of state and federal programs, as well as the existing private sector. Similar to our program in Vermont, states should be required to guarantee coverage for all children under age 23. In return, the federal government should assume responsibility for drug and acute medical care for Americans over age 65. In addition, older Americans deserve a pharmacy benefit under Medicare - an unaffordable impossibility under the current fiscal policies of President Bush. With a pharmaceutical package, Medicare becomes a decent insurance program. Finally, to cover those between the ages of 23 and 65, we should use the present employer-based system with refundable tax credits and federal subsidies to cover low- and moderate-income Americans who lack insurance.
This plan is affordable and simple, relying on three existing systems - one for children, one for seniors, and one for those in between - which all Americans can understand.
Governor Howard Dean, MD
An Unparalleled Record of Accomplishment with Healthcare
DEAN’S RECORD ON HEALTH CARE ACCESS
“AS A PHYSICIAN, I’VE SEEN THE SUFFERING CAUSED BY THIS NATION’S HEALTH CARE CRISIS, AND AS A GOVERNOR I KNOW IT CAN BE SOLVED.”
- Health Care – 96% of Vermont’s children have health care coverage thanks in part to Governor Dean’s Dr. Dynasaur program, and an additional 3% are eligible for coverage.
- Access – Governor Dean expanded health care for children in low to middle income families. Children 18 or under, whose families are at or below 300% of the Federal Poverty Line, are eligible for insurance at virtually no cost.
- Mental Health – Howard Dean was the first Governor in the nation to sign the Mental Health and Substance Abuse Parity Act. This bill guarantees coverage for mental illness and substance abuse at the same level as severe illness.
- Women’s Health – During Governor Dean’s tenure, the breast and cervical cancer rate went from slightly above average to below the US average, thanks to Vermont’s comprehensive screening system. Vermont’s Medicaid program was also expanded to cover treatment for women diagnosed with breast and cervical cancer.
- Teen Pregnancy – Under Governor Dean, teen pregnancy rates dropped 49%, to the lowest rate in the country.
- “Healthy Families Visionary Leadership Award” – Presented by Prevent Child Abuse America.
DEAN’S RECORD ON CHILDREN’S HEALTH CARE
~“GIVE CHILDREN HOPE BY INVESTING IN PREVENTION.”
- Success By Six – As a doctor, Governor Dean has placed a strong emphasis on early childhood prevention and health care, which is why 89% of pregnant Vermont women enter prenatal care in the first trimester of pregnancy. In Vermont, 91% of families with a birth received a community visit, and those parents who wanted assistance and support received it.
- Dr. Dynasaur – Governor Dean has expanded children and pregnant women’s access to health care. Currently 58,903 children are covered under the program. Dr. Dynasaur covers children up to the age of 18 within families up to 300% of the Federal Poverty Line.
- Child Abuse – During Governor Dean’s tenure, Vermont was the first state to institute a statewide protocol for abuse investigations. In return, Vermont saw a 45% decline in physical and sexual abuse of children. This included a 64% decline in physical abuse victims ages 0-3 and a 43% decline in physical abuse victims ages 0-6.
- Child Sexual Abuse – 84% decline in sexual abuse victims ages 0-3 and 70% decline in sexual abuse victims ages 0-6.
- Immunization – 81.1% of children are fully immunized by age 2 and 97% by the time they start kindergarten, which makes Vermont second in the nation in child immunizations.
DEAN’S RECORD ON SERVING THE ELDERLY
“WE CAN PROVIDE HIGHER QUALITY OF LIFE BY AVOIDING INSTITUTIONAL SERVICES WHENEVER POSSIBLE.”
- Prescription Drugs – Governor Dean understands the importance of access to prescription drugs in preserving the health and avoiding unnecessary institutional care of our seniors and people with disabilities. While in office Governor Dean expanded pharmaceutical assistance to these Vermonters. Vermont has three pharmacy assistance programs with the level of benefits for each program indexed to household income. Seniors and people with disabilities can have incomes up to 225% of the federal poverty line and receive assistance with their prescriptions.
- Nursing Homes– Governor Dean decreased the state’s reliance on nursing homes by mandating that funds be shifted from nursing homes to other services, such as home health care where people can live with independence and dignity. Over $30 million dollars has been shifted from paying for nursing homes to paying for in-home and community based services.
- Home Health Care – Between 1996 and 2000, there was a 161.3% increase in individuals receiving a home based waiver and services, while there was a decrease of 13.5% of individuals living in nursing homes.
Source: Dean For America 2004 Website
