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Issue Position: Health Care Reform

Issue Position

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Overview

There is no greater example of government overreach and unrestrained liberalism than Obamacare, the president's signature legislative initiative. It is so deeply flawed and such a clear and present threat to our economic stability that there is no way to fix it; it must be repealed entirely and replaced with market-based solutions that work.

Obamacare is an underfunded, potentially unconstitutional government takeover of one of the largest sectors of our economy. Though the president and his congressional allies such as Tammy Baldwin had the opportunity to work with Republicans on workable solutions, they chose to ram through an ideological formula for government control of a third of our economy. This abuse of power and destructive policy cannot stand.

Our nation can afford neither Obamacare nor prior policy, both of which will cause deficits to balloon, businesses to suffer under excessive costs and families to fear loss of affordable care.

Wisconsin's greatest opportunity to address this urgent issue is to elect Tommy Thompson, a proven reformer and health care expert. Tommy can deliver a Republican majority in the Senate, and he has the knowledge and courage to tackle this complex issue and set our nation on the right course.

Tommy's RESTORE plan for health care addresses the fundamental flaws of our current system:

The myriad of regulations that create complexity, drive up prices and prevent a dynamic insurance market;
The disconnection of economic realities and consumer choices;
And the lack of market-based solutions that create competition and reward quality, innovation and efficiency.

Key Elements of Tommy's Plan:

Repeal Obamacare;
Reward quality and cost savings;
Reform medical liability;
Create a state/federal partnership;
Cover pre-existing conditions;
Reform insurance; and
Enact Medicaid reform.

Health Care Reform Provisions

Repeal Obamacare

It all starts with repealing this disastrous legislation and starting over. The law isn't even close to being fully implemented, but its flaws are already so clearly obvious and the threat to our economy so real that we must start completely over. The few elements of the law that are acceptable are so incidental to the broader public policy that full repeal and replacement is the only viable option.

Tommy's immediate priority in the U.S. Senate will be to repeal Obamacare and restart health care reform deliberations from a clean slate.

Incentivize Quality

The health care debate too often ignores the importance of quality outcomes -- both for cost and for the health of our citizens. Tommy has been a leader in linking quality of health delivery to lower cost and better health.

When Tommy was secretary of the Department of Health and Human Services, he launched the Hospital Quality Incentive Demonstration (HQID) based on the simple premise that hospitals can save money and improve outcomes with the right incentives. He was right.

With 250 hospitals around the country participating over six years, the program focused on quality improvements in treating heart attacks, congestive heart failure, pneumonia, hip and knee replacement and surgical care. Hospitals with improved performance received increased Medicare reimbursement. The results:

Quality scores improved by an average of 18.6%;
The lives of an estimated 8,500 heart attack patients were saved;
There were almost 6,500 fewer deaths annually;
Participating hospitals saved $350 million in expenses; and
The government saved an estimated $1 billion during the life of the program and projected up to $4.5 billion could be saved if applied to all hospitals.

Tommy will pursue linking federal reimbursement for health care costs with quality outcomes, driving down costs and incentivizing innovation. The current fee-for-service system bases reimbursements on procedures. We must move to a new system of rewarding quality outcomes, not merely procedures.

A key element of quality improvement and empowering consumers will be transparency and consistency of health care data. The work of the Wisconsin Collaborative and the Wisconsin Heath Information Organization (WHIO) are examples of health care information sharing that is necessary on a national level.

And Tommy believes Medicare, as a major element of the health care system, should also provide its claims data to organizations such as the WHIO in order to benchmark and track quality improvements. Improved data transparency can be accomplished without compromising privacy.

Encourage Personal Responsibility

Tommy believes we'll never truly reform our health care system until consumers take more responsibility for their health and for spending on their care. Up to 75 percent of health care costs are for chronic illnesses, which can be best addressed by improved behaviors.

Wellness -- Consumers must also take more responsibility for their own health, realizing their health choices have direct economic and quality-of-life consequences. Health care and insurance reform must provide incentives for healthy behaviors such as smoking cessation, weight reductions and chronic disease management.

Consumer Choice -- We must protect the ability of consumers to choose their doctors and control their own health records.

Enact Medical Liability Reform

Frivolous and excessive litigation is driving up medical costs through burdensome medical malpractice insurance, court interference and pressure on doctors to practice "defensive medicine" -- prescribing unnecessary diagnostics and treatment to avoid lawsuits. Democrats can't honestly claim to care about health care cost and access while also defending tort laws that line the pockets of trial attorneys.

Tommy will support legislation to establish tighter limits on noneconomic damages, create penalties for frivolous lawsuits and limit liability for products approved for use by the FDA.

Tommy will also pursue policies to allow broader use of experimental treatments for patients who are diagnosed as having terminal illnesses. Our citizens should not have to leave our country to receive potentially life-saving treatments. This action will require careful easing of liability for drug makers, medical providers and the FDA.

We all know someone who has suffered through a terminal illness. These people should be able to voluntarily take experimental drugs that could help them or future victims of disease.

Establish Voluntary State-Federal Initiative

Give states the option to join a new federal-state coverage initiative. The focus of the partnership would be to:

Provide secure coverage for pre-existing conditions;
Broaden coverage for the uninsured; and
Stabilize insurance for individuals and small business workers.

These objectives would be accomplished primarily through federally funded high-risk pools. States choosing not to participate in the new federal-state initiative would be ineligible for the high-risk pools, but they would be allowed to participate in a reformed Medicaid program (see below).

Cover Pre-Existing Conditions

The new state-federal partnership would guarantee that Americans who remain in continuous insurance coverage never pay more than 150 percent of standard rates for insurance, regardless of changes in their health status.

The federal government would provide new block grants to the states with sufficient funding to subsidize the premiums of insurance enrollees who otherwise would be facing premiums above the 150 percent threshold.

Reform Insurance, Support Employer Coverage

Our nation's private health insurance market is functioning poorly as a result of a complex web of regulations that curtail options for consumers and prevent a real market from emerging. We must establish a vibrant health insurance market and make access to care more affordable for our employers and families.

Catastrophic Insurance -- An essential element of a functioning health care system is a competitive market for catastrophic insurance, which consumers can purchase across state lines and retain as they move from employer to employer.

We must allow consumers to buy catastrophic policies without the cost burden of mandated coverage. Consumers must have access to insurance that covers only major medical expenses, which will also lead to healthier lifestyles and more common-sense decisions on medical procedures.

Support for employer-provided insurance -- Provide new federal support for employer health insurance by creating tax credits to offset costs of premiums. Any federal support not used for premium payments would be deposited into a Health Savings Account for future health care costs.

Small Companies: Employees in companies with fewer than 50 workers, including the self-employed, would receive a $2,500 tax credit for individual coverage and $5,000 for family coverage.

Large Companies: Employees in larger companies that were not previously offering coverage would receive the same tax credit as small business workers. Employers would also be offered tax deductions for expenses related to employee benefits that enable employees to purchase individual, portable insurance policies. Employers that offer ongoing insurance will benefit from favorable tax treatment for those expenses.

Insurance support for Unemployed -- Provide a federally financed state-administered voucher to the unemployed, also set at $2,500 for individual coverage and $5,000 for family coverage. The federal government would provide block grant payments to the states to cover the costs of these vouchers.

Personalized Health Insurance -- Regulations must be relieved to allow individuals to customize and personalize their insurance coverage so that they are purchasing only needed coverage. This would allow Health Savings Accounts to be used more effectively.

The costs for these credits would be covered by other budget savings and entitlement reform. This proposal will be funded within the fiscal parameters of Cong. Paul Ryan's Path to Prosperity, which Tommy has endorsed.
Reform Medicaid

Create block grants to states to allow new ideas to emerge. Reduce red tape and regulation and allow states to find new ways to serve the most vulnerable citizens.
Conclusion

The United States has had an inefficient health care financing and delivery system for a long time, but Obamacare has made it far worse. Repealing Obamacare is an imperative for the next Congressional session.

Merely repealing, however, would leave our health care system in disarray, burdened by complex regulations and lacking market forces that drive innovation and efficiency.

Tommy Thompson is a health care expert who is best positioned to bring common sense back to the U.S. Senate. He will lead the fight to repeal Obamacare and replace it with market-based solutions that efficiently and sustainably serve our nation's health needs.


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