Sen. Kennedy adds disability-insurance program to health-care bill

From the Wall Street Journal:

Sen. Edward Kennedy (pictured) plans a new disability-insurance program that would automatically enroll all American workers as part of the sweeping health-care bill he is preparing to introduce, aides said May 29.

Premiums would automatically be charged, and in many cases deducted from workers' paychecks, unless they choose to opt out of the disability program. The idea is to give all workers a basic level of protection in case they become disabled. But it could draw complaints from people who see it as a de facto tax, given that few workers are expected to opt out.

On average, premiums could not exceed $65 per month, according to a Senate aide who described the provision in detail.

Participants would be entitled to a cash benefit of at least $50 a day if they become so disabled they cannot participate in at least two or three activities of daily living, such as eating, bathing or using the toilet. The money could be used for expenses to support staying in one's home.

If all American workers participated, one estimate found that the program would collect $320 billion in its first year, the Senate aide said. The money would be put into its own separate fund, not available to other government spending.

Overall, Mr. Kennedy's legislation aims to fix the nation's health-care system by creating a new public health-insurance plan, requiring individuals to buy health-insurance coverage and employers to help provide it and creating new exchanges that would allow Americans to comparison shop for health insurance, according to a committee briefing paper reviewed by The Wall Street Journal.

Members of the Senate Health, Education, Labor and Pensions Committee, which Sen. Kennedy chairs, plan to meet behind closed doors starting Tuesday to discuss exactly what will be in the measure, according to a Senate aide. The committee is expected to hold public hearings on the legislation as early as the following week.

The Massachusetts Democrat, who has been battling a brain tumor, is a key player in the effort to pass a comprehensive health care bill, and his commitment to the disability provision increases the chances it will wind up in the final package. But the legislation has a long trip to go through Congress and there are no guarantees that this provision--or the overall bill--will make it out of Congress.

The provision, a side note to the central debate, addresses Mr. Kennedy's longstanding interest in disability issues. The program, which Mr. Kennedy has long supported as a stand-alone bill, is aimed at establishing a large disability-insurance pool. Supporters say the program could help the millions of workers who lack long-term care insurance while defraying costs for Medicaid, which pays for nursing homes for disabled Americans who have low incomes and have spent their savings. Money from this program would be dedicated to nursing-home bills before Medicaid kicked in payments.

The new program is distinguished from private and public disability programs in that the disabled could collect benefits even if they are still working, and it could be easier to be deemed eligible. It is more similar to long-term care insurance, which only a fraction of workers have, but aides said would be more affordable and more flexible in how the money could be spent.

The Senate aide said the payments aren't meant to replace long-term care insurance.

The expectation behind the provision is that most American workers would choose to participate. Workers would be automatically enrolled at age 18, and premiums would be based on age. Those who started in the program young and stuck with it would see lower premiums throughout their lives than those who opted out and later chose to enroll. Participants would be eligible for benefits after five years.

The Senate aide said that Mr. Kennedy has not actively sought Republican support for the provision, and there are no Republicans co-sponsors for the legislation on which the provision is based. She said that Republicans on the HELP Committee are aware of the provision but have not taken a position either way.

Calls to the committee's Republican staff were not immediately returned.

The provision must also pass through the Senate Finance Committee, which is actively working to assemble its own comprehensive bill. The provision has received little attention there.

Mr. Kennedy has asked the Congressional Budget Office to evaluate the proposal and estimate participation rates.

Exact premiums and benefits would be set by the secretary of Health and Human Services. The secretary also would determine whether someone had to have two or three functional disabilities to qualify for benefits. Disabilities include eating, toileting, transferring, bathing, dressing and continence issues, as well as cognitive problems that impair the ability to do these things.

People living in poverty and students who are also working would owe just $5 a month for premiums.

The incentives are for people to stay in the program while healthy. Those who drop out would have a limited window to rejoin and still receive credit for earlier payments. Someone who is not participating but becomes disabled could join the program only if they are working, and wouldn't be eligible to collect benefits for five years.

"Like all Americans, millions of senior citizens and persons with disabilities want to lead full and independent lives," Mr. Kennedy said in a statement. "Our health reform legislation will make that possible. By providing access to long-term care and services, our legislation will enable our most vulnerable citizens to remain in their own homes and contribute to their communities."

Mr. Kennedy's overall plan would bar health insurance companies from denying coverage to individuals based on a pre-existing health problem, and it would require insurance companies to charge more consistent insurance premiums, reducing regional variances in rates. Further, it would create a national Web site that consumers could use to compare and buy health insurance plans, in the same way they can comparison shop for airline tickets on travel sites. The plan would allow states to create their own such exchanges, too.

The measure would establish a "Patient Safety and Clinical Delivery Institute" aimed at reducing medical errors by promoting best practices, like how to properly insert a catheter. Some hospital patients would be assigned a "discharge advocate" to help patients through recovery, a step to try to reduce the number of patients who are readmitted. Patients with chronic illnesses would get health coaches in an effort to help keep them from getting sicker.

Sen. Kennedy's plan would also reach into medical schools, according to the committee brief. "The Hippocratic Oath says: 'First, do no harm,'" the brief says. "A reformed curriculum will teach the next generation of health care professionals: First, prevent unnecessary disease.'"