Tax Credits For Health Insurance And Medical Savings Accounts

Prologue: The failure to pass health system reform legislation in the 103d Congress taught the nation and its leaders several lessons. One of the clearest of these was that the nation does not yet have an appetite for comprehensive, sweeping changes in its health care system. Many problems remain, however, and in the absence of systemwide change, the nation can move toward solutions to these pressing problems. In this forum authors from across the political spectrum offer their prescription for reform in “bite-size chunks.” First, Mark Pauly and John Goodman, of the University of Pennsylvania's Wharton School and the National Center for Policy Analysis, respectively, offer a proposal for medical savings accounts and tax credits, to allow the market to work better for individual purchase of health insurance. Next, Judith Feder and Larry Levitt of the Department of Health and Human Services present an agenda for achieving universal coverage in gradual steps over the next several years. These steps should be designed to minimize disruption in current insurance arrangements and should “be readily understood as improving the status quo,” the authors write. Stuart Butler of the Heritage Foundation presents a conservative agenda for incremental health system reform, emphasizing competitive solutions, not government regulation and mandates. David Cutler of Harvard University and the National Bureau of Economic Research states the goals of incremental reform as cutting health care costs and improving the nation s health status. Finally, Gail Wilensky of Project HOPE, who is former head of the Health Care Financing Administration, presents an agenda for reforming Medicare, building on the program's past successes to bring it in line with innovations in the private insurance marketplace.