Health Reform Revision Caps Federal Subsidies
NOW that the Clinton health plan is fleshed out in 1,342 pages of legislative language, the costs estimates are becoming more clear.
The average American household, Clinton staffers estimate, would pay about 2 percent of its income on health insurance premiums under the plan. The plan would cap the amount a family would pay at 3.9 percent of income.
Some families pay far more than that currently, but most households would probably pay more for their health care than they do now in the early years of the health plan as the program spreads costs around more evenly.
The plan would be fully phased in, offering a basic package of health benefits to all Americans, by the end of calendar year 1997. States would move into the plan in groups beginning in 1995.
If the plan were fully in effect in 1994, which it would not be under the plan, it would add $60 billion to $65 billion to the $998 billion the nation is expected to spend on health care that year, according to Deputy Treasury Secretary Roger Altman.
The plan would probably raise health costs above what they would otherwise be through 1998, he says. Beginning in 1999, the plan should begin cutting costs.
The administration expects about 17 percent of the costs to be paid by private households, 59 percent by business, and 24 percent by government.
While the federal government will pick up a bigger tab to subsidize low-income families and small businesses, state and local governments should see their health care bills going down, says Mr. Altman. These governments usually subsidize the community hospitals that provide large amounts of uncompensated care - that is, care to nonpaying patients - under the current health-care system.