NCPA - National Center for Policy Analysis


June 12, 2007

Democratic presidential hopeful Hillary Clinton recently unveiled HillaryCare 2.0 and promoted it in Michigan. While it may be a slimmed-down version of her original nationalized health care plan, it maintains the original's focus on federal bureaucracy over lowering costs and access, says Devon Herrick, senior fellow at the National Center for Policy Analysis.

At the heart of her "new" plan is the idea that government should consider requiring individuals to have health coverage.  Sen. Clinton wants to accomplish this in a number of ways:

  • Forcing insurers to accept all applicants regardless of health status and reining in direct-to-consumer drug advertising.
  • Requiring that employers provide health coverage or subsidize workers' coverage in some way.
  • For instance, under "pay or play," employers would be forced to spend money on health care or pay a fee into a state-run pool; either way, it amounts to an extra tax on labor.

We've seen this before, says Herrick.  Bad elements of Sen. Clinton's plan can be found in state proposals from California, Illinois, Pennsylvania and Massachusetts.  Most notably the idea of guaranteed issue:

  • Guaranteed issue requires insurers to sell policies to all state residents who apply, regardless of their health status or pre-existing medical conditions.
  • While it sounds like a way to protect consumers from costly illness, it actually harms them by driving up prices for the majority of people who are healthy.
  • When insurance companies are forced to accept all applicants, they raise premiums to guard against the increased risk of losses.
  • As a result, insurance is a poor value for everyone except those with serious health conditions.

Source: Devon Herrick, "New Hillary care plan contains same old ailments," Detroit News, June 12, 2007.


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