Nixon went on to explain that the rising cost of health care placed too many American families in danger of being wiped out by a catastrophic illness. Our health insurance system was flawed according to Nixon because too many Americans were uninsured and unable to obtain insurance due to low pay, unemployment or pre-existing conditions and still millions more who had coverage lacked “balanced, comprehensive and fully protective” coverage.
To address the problems, Nixon proposed the Comprehensive Health Insurance Program (CHIP). Nixon pledged that CHIP would allow every American to obtain comprehensive insurance, that no American would pay more than he or she could afford, and patients will be free to choose their doctors. According to Nixon, CHIP would build on America’s existing private insurance market, promote effective use of health care resources, and use public funds only when necessary – all without requiring new taxes.
CHIP contained three key elements: Employee Health Insurance, Medicare, and Assisted Health Insurance.
- Employee Health Insurance – Employers would be required to provide health insurance to their employees, these benefits would need to meet minimum benefit requirements set by the federal government, and employers would be required to cover 75% of the cost of the insurance premium. There would also be a limit placed on annual out of pocket expenses.
- Medicare – CHIP would reform Medicare to add coverage for outpatient prescription drugs and it would place an annual limit out-of-pocket expenses. Medicare would also be required to meet the same minimum benefit requirements established for employers.
- Assisted Health Insurance – CHIP would have replaced the Medicaid program with a new federal/state program to provide health insurance to everyone not covered by Employee Health Insurance or Medicare. This program would also be available to those with pre-existing conditions who were unable to obtain care from private insurers. Premiums and out-of-pocket expenses would vary depending upon income with low income persons paying nothing. The program would have the same minimum benefit package as Employer Health Insurance.
Every person participating in CHIP would receive a Health-card. Modeled after a credit card, it would offer proof of insurance and provide information on blood type and any medical conditions or drug allergies that may be important to know in an emergency.
The Watergate scandal that ended the Nixon presidency also ended CHIP. Congress had no interest in considering comprehensive reform proposed by a President likely to be impeached.
But good ideas never die. Look to the legislation currently being considered in the House of Representatives or being debated in the Senate Finance Committee and you cannot help but see Nixon’s CHIP. Legislation in the House and Senate rely on employer mandates and establish minimum benefit requirements, the House legislation is likely to include a so called “public option” which is exactly what Assisted Health Insurance under CHIP was, both the House and Senate are proposing to create review bodies to promote efficient and effective resource use, both are likely to prohibit insurers from denying coverage based on pre-existing conditions, and both will rely almost exclusively on the existing private insurance industry to provide coverage.
There are some differences – Nixon wanted CHIP to be voluntary for individuals, no one was required to purchase insurance, but the House and Senate will likely include individual mandates. Neither the House nor the Senate will establish annual caps on out-of-pocket expenses for Medicare beneficiaries and prescription drug coverage was added in 2003 (30 years after CHIP proposed adding it). The House and Senate will also maintain the Medicaid program and in fact expand it. And HMOs have long since fallen out of favor – quite unfairly.
But these differences do nothing to diminish the fact that we are today engaged in a great debate over whether to at long last enact health reform first introduced by President Nixon in 1974. It’s not the first time, or even the second time, that we have considered CHIP – President Clinton’s Health Security Act, introduced in 1993, was essentially Nixon’s CHIP, right down to the health card and reliance on HMOs. Clinton dropped the public option and added an individual mandate, but otherwise it was very much CHIP.
So here we are in 2009 considering a reform first proposed in 1974… at what point does a proposal become too old to be deemed dangerous or radical? Nixon’s Comprehensive Health Insurance Program was a good idea in 1974 and it is a good idea today. We may never see single payer in the US, but we could move closer to the German model via the reforms currently on the table.