CAUSE: Years 1-5

Overview

In this first phase a new national basic care system for children is established, adults 19–64 will have the option to purchase public primary and preventive care coverage, and the Medicare program for the aged and disabled is updated. Important reforms made to promote healthy behaviors, make private insurance more affordable, increase the use of evidence-based care, and improve the capacity of health systems to deliver needed care.

Children Aged 0-18:

Beginning in 2010, during the first five years of implementation, children 0-18 will be covered by CAUSE, an approach modeled on Part A and Part B of the current Medicare system. CAUSE will be used as a foundation that will provide all children with basic coverage for health care. There will be income-adjusted premiums. Families can continue with private insurance plans if they offer comparable benefits. There will be an option to purchase additional coverage in the form of private wraparound plans for deductibles and co-pays. There will also be the option to purchase a private supplemental plan for benefits and services not included in the basic CAUSE plan. This will ensure health care for every child, but it will preserve the choice of coverage that the U.S. already enjoys. CAUSE will also maintain the quality of an individualized patient/doctor experience and still not exclude those in the U.S. who truly cannot afford health care for their children.

To encourage the continued purchasing of high-quality, individualized, private plans, incentives will be enacted for private citizens and corporations. Parents who purchase private insurance may deduct the CAUSE costs for qualifying plans. Large firms employing more than 200 employees will receive tax deductions if they offer qualifying plans to employees’ children while small firms employing less than 200 employees will receive tax credits if they offer qualifying plans to employees’ children. Eligibility for CAUSE will be determined through tax returns and for those who do not file taxes, annual eligibility determination will be made by state Medicaid programs. A national minimum eligibility for Medicaid will be at 150 percent of Federal Poverty Level (FPL).

CAUSE deductibles and long-term care for beneficiaries ages 0-18 will be paid by individuals through private wraparound plans or by Medicaid. All services will be funded through a financial transaction tax and maintenance of current funding, and increased taxes on tobacco products. Respective national, state and sub-state elected health boards will help create the standards for the CAUSE coverage so that the plans will encompass the needs of the individuals and specific populations within states and sub-state regions. This will help states and sub-state regions to maintain personalized coverage for the unique needs of people in their communities. The newly established health boards will also certify private plans as alternatives to CAUSE coverage. Funding levels for specific health boards will consider both population and health system features, so that regions with health care access and quality challenges have the opportunity to invest in system improvements. The Federal Medical Assistance Program (FMAP) will be changed to provide increased federal funding to large sub-state areas with populations of more than 500,000 people that are poorer than their state averages. This would directly enhance the access to and quality of care. Medicaid payment rates to providers and hospitals will be equal to those of the CAUSE plan.

Adults Ages 19-64:

Individuals ages 19-64 will have an option to buy into what is currently Medicare Part B, with an emphasis on outpatient, primary care, and preventive services. It will provide an affordable health care alternative without strangling the private insurance market or interrupting health care coverage that some people prefer. Inpatient services, which are currently a part of Medicare Part A, will remain with private insurers. These plans will be purchased separately from outpatient services and will be coverage for catastrophic care. The quality of care provided currently will not be lowered, but there will still be basic core coverage for primary and preventive services at affordable costs for everyone in this age group. Medicaid will remain as currently designed for persons ages 19 and older.

Primary and preventive services, most outpatient medical services, outpatient mental health/substance abuse services, medications, and equipment and supplies will be included in Part B as determined by individual state and sub-state health boards. The CAUSE deductibles associated with each of the aforementioned services will be determined by the respective health boards to ensure fairness to providers, while maintaining the quality and affordability of services.

Lastly, the ceiling on post-graduate residency training slots for medical students will be lifted to increase the number of board certified physicians able to care for patients. This will guarantee greater numbers of doctors in any given medical facility, increasing the amount of patients able to been seen by a physician and the amount of time and care given to each patient. This will also help provide every individual with a primary care physician, cutting back on chronic disease and high long-term care costs. The quality of care given to both CAUSE holders and private insurance holders would potentially increase.

Specific to People Ages 65 And Above:

Medicare beneficiaries currently consist of individuals ages 65 and older, people with end stage renal disease, and people classified as disabled through the Social Security Administration. Under the CAUSE approach these persons will be provided the current Medicare coverage and cost-sharing structure, but coverage may be modified based on recommendations of the national health board. Under CAUSE, Medicare Part D will be absorbed by what is now Medicare Part B; Medicare Part B will in turn be redesigned to include the vital aspects of Medicare Part D in a more efficient and effective way. CAUSE will eliminate Medicare Part C completely. Services from Medicare parts A and B may be reimbursed on a fee-for-service basis or through qualifying managed care plans. Reimbursement to managed care plans will be on a case-mix adjusted basis that will be based on the medical complexity of patient population, but cannot exceed 95 percent of a new Average Annual Per Capita Cost (AAPCC) covering all of CAUSE.