Kerry Was On To Something and the Big Three Automakers Get It

Last week when the Big Three automakers paid a call on George W Bush they wanted to talk about the woes of the auto industry. "Among their complaints," Scott Lehigh notes in the Boston Globe, "The heavy healthcare costs they shoulder are hindering their ability to compete." Their idea for a solution didn't interest Bush much, but Lehigh suggests, "Nancy Pelosi and Harry Reid should sit up and take notice." Indeed they should...

And what did they suggest by way of a solution? Something John Kerry proposed during his presidential campaign: a reinsurance arrangement to pay for chronic or catastrophic healthcare costs, thereby effectively taking those cases out of private health-insurance plans.

"One possibility they discussed conceptually was a pool to address the disproportionate costs associated with those who have chronic or serious illnesses," says Greg Martin, Washington spokesman for GM.

Not that anyone mentioned Kerry's name in the West Wing confab; that would have been impolitic indeed.

But certainly the Massachusetts senator is the one that nostrum is most associated with.

In his 2004 campaign, Kerry called for having the federal government pay three-quarters of the additional expenses for patients whose healthcare costs exceed $50,000 a year, provided savings from that cost relief helped reduce employee health-insurance premiums.

Removing those costs from private plans could have big effects. Although they constitute less than 1 percent of all cases, catastrophic care accounts for 20 to 30 percent of healthcare expenses.

If the government were to pick up most of the bill for catastrophic care, health-insurance premiums wouldn't be under such constant pressure. According to some estimates, premiums would be 10 percent lower than if private plans continued to pay for such care.

Now, Kerry's political stock isn't exactly soaring. But at a time when some on the left see a politically unattainable single-payer system as the only true solution to the nation's healthcare problems, and some on the right insist that impractical, unproven health savings accounts are the proper prescription, the senator's concept represents pragmatic middle ground.

The interest the notion has evoked from the auto industry demonstrates its appeal to business.

And here, what's good for General Motors -- and Ford and Chrysler -- would certainly be good for the country.

Health-coverage costs are a recognized drag on US firms competing with companies from nations where health coverage is a government responsibility. It is a particularly pronounced burden in the auto industry, adding as much as $1,500 to the price of a new vehicle.

Okay, so we get that Bush would need to be "getting caught in a sudden downpour of common sense" to embrace a plan like this and making it doubly hard it would "mean endorsing an idea his opponent put foward," -- not just any opponent, but the opponent Bush and cohorts truly love to hate, John Kerry.

"A plan like Kerry's would cost at least $40 billion a year," says Lehigh and "The senator proposed paying for that -- and his other healthcare ideas -- by repealing the Bush tax cuts for households earning more than $200,000." Well -- throw that plan out the nearest window, Bush will no doubt say -- "That obviously would be a nonstarter for a president who sees those tax cuts -- but not our growing healthcare problems -- as part of his legacy."

Still, the idea should be attractive for congressional Democrats who came to power largely as an electoral rebuke to the Republican administration -- and who now must develop an agenda with broad appeal.

It would give the party a popular healthcare stand, one the GOP would oppose at its political peril. Consider:

Kerry's scheme would offer premium relief for virtually everyone covered by a private healthcare plan.

That's important for a party that wants to be seen as a champion of the middle class, and not just the poor.

And the proposal lets voters understand the real benefit they would receive if some of the Bush tax cuts were rolled back. Democrats wouldn't simply be raising taxes in a vacuum, in other words.

Finally, in boosting the competitive posture of US firms, the party could underscore its Clinton-era credentials as a responsible economic steward.

Indeed, it's hard to think of a more persuasive endorsement than the one the notion received last week.

Remember the way opponents portrayed Hillary Clinton's healthcare plan as a dangerous big-government scheme? Just imagine Democrats being able to say that their new healthcare proposal makes such good sense that the Big Three automakers had actually suggested a similar idea to a Republican president.

On July 31, John Kerry laid out a plan calling for universal health care coverage by 2012. Putting Kerry's plan for catastrophic healthcare into play would certainly be a great start to that goal. Lehigh is right on this, the Big Three automakers are right on this. Kerry has been right on this.

Note to Pelosi and Reid: It's time for the Democratic caucus to step up to the plate and push this through in the new Congress.