Foundation offers plan to widen health coverage

By Kim Dixon

WASHINGTON (Reuters) - A requirement that all companies help fund health insurance in the United States and a new public plan option are keys to a plan proposed on Tuesday to dramatically shrink the rolls of the uninsured.

The proposal from the Commonwealth Fund, a private foundation, published in the May/June issue of the journal Health Affairs, is the latest plan aimed at cutting a growing number of uninsured people in the United States, now estimated at 47 million.

Building on the current employer-based system, which finances health care for about 160 million Americans, it proposes a government body to sell lower-priced health plans to small business and individuals.

It would achieve near universal coverage, leaving about 3.6 million without insurance, according to an estimate by the Lewin Group, a consulting firm for governments and private industry.

"The U.S. is the only industrialized country that doesn't cover everyone," Commonwealth Fund president Karen Davis said, noting a opportunity for change when a new president takes office in 2009. "It's there to inform the debate in the presidential election."

Escalating costs and limited access to quality medical care in the U.S. are among the top domestic health issues cited by voters in national polls ahead of the November presidential election.

Out-of-control spending is the key driver. Medical spending has tripled over the past four decades, and now comprises more than $2 trillion per year, or 16 percent, of the U.S. gross domestic product. That is expected to rise to 20 percent by 2017.

The Commonwealth plan calls for employers to provide health coverage or pay into a fund, up to 7 percent of earnings, or $1.25 per hour per worker, to raise about $45 billion.