03/08/2007 11:59 am ET Updated May 25, 2011

A Plan for Health Reform

Since 1994, lawmakers on both sides of the aisle have considered it politically risky to offer a plan to fix America's broken health care system.

The American public, though, has paid the price for this silence as health care costs skyrocketed, millions went uninsured, and millions more grappled with financial insecurity and hardship. PricewaterhouseCoopers estimates that this year alone, health care premiums will rise 11 percent, several times the rate of inflation. Many with health coverage go to bed every night knowing they may be one more rate hike away from losing the coverage they have, and more than 40 million Americans have little or no coverage at all. The effects of rising health care costs have been devastating; approximately half of the personal bankruptcy filers surveyed for a study published in Health Affairs in 2005 cited medical causes as a significant reason for their financial troubles.

Last year, Massachusetts became the first state to directly address this issue when it passed a universal health care bill mandating that every resident have health insurance. Legitimate concerns continue to haunt the Massachusetts plan, as it offers no approach to containing costs and it subsidizes the affluent through regressive taxes. But Massachusetts deserves credit for starting the debate on health care, and in its wake have followed a number of lawmakers, interest groups and academics with their own plans to fix health care - including me.

My plan, known as the Healthy Americans Act, would provide universal coverage to every American, and would cost no more than what we, as a nation, are paying right now. Not only that, under my proposal every single American would have a health plan as good as what Members of Congress currently receive at taxpayer expense.

Here's how it works. Employers who provide employee health benefits would be required for two years to convert their workers' health care premiums into higher wages. Those employers who don't currently offer health benefits would have to make phased-in "Employer Shared Responsibility Payments," which would be used to provide financial assistance to individuals and families of modest income. After those two years are up, all employers will make "Employer Shared Responsibility Payments," the size of which would be determined by their relative ability to pay.

Employees, in turn, would have to purchase private health coverage, and to ensure that it's affordable, the plan would fully subsidize the premiums for those who live below the poverty line. Those people between 100 percent and 400 percent of the federal poverty line would also receive subsidies on a sliding scale to help pay their premiums.

As for the insurance companies, they would no longer be allowed to "cherry pick" their customers. Under the current system, insurance companies can pick and choose which customers they sign up - typically the healthy ones - and send those in fragile health to government programs more fragile than they are. I propose in the Healthy Americans Act that insurance companies be required to cover every individual who chooses to enroll and that they be prohibited from raising prices or denying coverage if individuals are sick or are at risk of becoming sick.

That's my plan in a nutshell. So what next? How do we proceed from here?

In Congress, lawmakers have yet to reach a consensus on how, or when, to move forward. Some feel we should spend the next few years watching how the states fare in their efforts to fix health care. This group believes our role in the Congress should primarily be to ship more federal money to the states for their reforms and then pretty much call it a day.

I and others respectfully disagree. We believe there is no possible way the states can fix health care because the states did not create the major problems in American health care. Who did? The federal government, the big spender of health dollars in America and the architect of the policies now driving American health care toward implosion.

In February, a group of us in the Senate came together and sent a letter to President Bush, inviting him to work with us to fix the nation's health care crisis. That group consisted of ten senators - five Democrats, five Republicans - all of whom agreed that we can no longer afford to stay the course on health care. Our letter also put forward the following set of principles that form a foundation upon which Republicans and Democrats can reform our listing health care system: ensuring that every single American has affordable, quality, private health coverage; modernizing federal tax rules for health coverage; creating more opportunities and incentives for states to design health solutions; taking steps to create a culture of wellness through prevention; encouraging more cost-effective chronic and compassionate end-of-life care; and improving access to information on price and quality of health services.

There is rarely a perfect time for radical change, but the signs are pointing to a readiness among the American public, businesses, and even politicians for the federal government to take action. With a host of proposals on the table and a President examining new ideas for health reform, we have an obligation to give real reform our best shot.