Medicare for All or State Control: Health Care Plans Go to Extremes

WASHINGTON — Liberals and conservatives in Congress were planning on Wednesday to set forth two radically different proposals for health care: a huge expansion of Medicare, which would open the program to all Americans, and a rollback of the Affordable Care Act, which would give each state a lump sum of federal money with sweeping new discretion over how to use it.

The proposals signaled a resumption of the health care wars on Capitol Hill, as lawmakers tried — for opposite reasons — to move beyond President Barack Obama’s health care law, either building on it or tearing it down.

Senator Bernie Sanders of Vermont, the onetime candidate for the Democratic presidential nomination, proposed what he called “a Medicare-for-all, single-payer health care system,” and he said 15 Democratic senators supported it.

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“Instead of wasting hundreds of billions of dollars trying to administer an enormously complicated system of hundreds of separate insurance plans, there would be one insurance plan for the American people with one single payer,” said a summary of the bill prepared by Mr. Sanders’s office.

At the same time, several Republican senators, led by Lindsey Graham of South Carolina and Bill Cassidy of Louisiana, were set to unveil their bill, which would take money spent under the Affordable Care Act and give it to states in the form of block grants.

Their proposal was the last gasp of Republican efforts to undo the Affordable Care Act. Those efforts, which seemed sure of success in January, appeared to meet a dead end on the Senate floor in late July, when Republicans could not muster even a simple majority for a repeal bill.

But Mr. Graham and Mr. Cassidy have persisted, and they said they had encouragement from the White House and some Republican governors.

Under their proposal, money would be distributed based on a complex formula, and the regional cost of living would be one factor, but the sponsors acknowledge that higher-spending states like Massachusetts would receive less than under current law.

The block grant would replace federal money now being spent under the Affordable Care Act for the expansion of Medicaid, for premium tax credits and for subsidies that reimburse insurers for reducing out-of-pocket costs for low-income people.

The Graham-Cassidy bill includes many features of earlier Republican bills. It would repeal the Affordable Care Act’s requirements for most Americans to have coverage and for larger employers to offer it, and would also eliminate a tax on medical devices.

In addition, the Graham-Cassidy bill would make deep cuts in Medicaid, putting the entire program on a budget and ending the open-ended entitlement that now exists. States would receive a per-beneficiary allotment of federal money.

A goal of the Graham-Cassidy bill is eventually to equalize the amount of federal money states receive for the health care of each person with annual income from 50 percent to 138 percent of the poverty level (from roughly $ 6,000 to $ 16,650 for an individual).

Senator John Cornyn of Texas, the No. 2 Senate Republican, said he had not seen any evidence that the bill had the votes needed to win approval in the Senate. And he noted that it had not been analyzed by the Congressional Budget Office, which could take a week or two to estimate how much the bill would cost and how many people would lose or gain coverage. The budget office said that millions of people would lose coverage under earlier Republican repeal bills.

After Sept. 30, the Graham-Cassidy bill would lose procedural protections that allow passage in the Senate with a simple majority, rather than the 60 votes often required for major legislation.

Mr. Sanders says his goal is to establish health care as a right. His bill could serve as a political manifesto and a possible campaign platform for progressive candidates. Among those who have endorsed it are Senators Cory Booker of New Jersey, Kamala Harris of California and Elizabeth Warren of Massachusetts, all Democrats.

Republicans seized on the Sanders bill as an opportunity to portray Democrats as champions of costly, big government programs.

“Bernie Sanders is introducing his Medicare-for-all bill,” said Senator John Barrasso, Republican of Wyoming. “It seems that this complete government takeover of health care is becoming the litmus test for the liberal left.”

About 60 percent of House Democrats have endorsed a “Medicare for all” bill introduced by Representative John Conyers Jr., Democrat of Michigan.

Democratic leaders in the House and the Senate have not endorsed the Sanders bill and say their immediate concern is to protect coverage under the Affordable Care Act, which still faces attacks from Republicans.

Mr. Sanders’s bill would expand Medicare, one of the nation’s largest, most popular entitlement programs. The federal government would establish an annual budget for covered health care services. Medicare’s benefit package would be expanded to include coverage of dental care and hearing aids. The bill would also cover “comprehensive reproductive, maternity and newborn care, including abortion,” the summary says.

The federal government would establish a standard list of covered drugs — a prescription drug formulary for the “universal Medicare program” — and the secretary of health and human services would negotiate prices with drug companies. Such negotiations have been supported by consumer groups, but adamantly opposed by drug makers.

Mr. Sanders did not say how he would pay for his bill. Aides said he would issue a list of financing options. The summary says that Mr. Sanders’s bill would eliminate deductibles and most other out-of-pocket costs for consumers, but that the government “may impose limited co-payments for prescription drugs in order to encourage the use of lower-cost generic drugs.”

Under the Sanders bill, Medicare — now available to people 65 and older and to some younger people with disabilities — would be expanded over four years. In the first year, Medicare would be opened to children through age 18 and to adults from 55 to 64. The eligibility age would be reduced to 45 in the second year and to 35 in the third year, with “every resident of the United States” entitled to benefits in the fourth year.

More than 150 million people under the age of 65 have employment-based coverage. The Sanders bill would separate health insurance from employment, shrinking the role of employers and insurance companies.

Employer-sponsored plans could not duplicate benefits provided by Medicare, but could offer extra benefits, like coverage for private hospital rooms. The government could provide five years of “transition assistance to health insurance administration workers” who could lose their jobs under the bill.

The summary of Mr. Sanders’s bill said it “applies Medicare’s current payment structures” to the expanded Medicare program that he wants to create. This proposal could face resistance from hospitals because studies have shown that Medicare often pays them less than commercial insurers pay for the same services.

Mr. Sanders predicted that “insurance companies, drug companies and Wall Street won’t like this legislation,” and he was right.

David Merritt, an executive vice president of America’s Health Insurance Plans, a lobby for insurers, said: “Whether it’s called single-payer or Medicare for all, government-controlled health care cannot work. It will eliminate choice, undermine quality, put a chill on medical innovation and place an even heavier burden on hard-working taxpayers.”

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