[Public Papers of the Presidents of the United States: William J. Clinton (1993, Book II)]
[October 27, 1993]
[Pages 1834-1836]
[From the U.S. Government Publishing Office www.gpo.gov]



Letter to Congressional Leaders on Proposed Health Care Reform 
Legislation
October 27, 1993

Dear Gentlemen:
    The ``Health Security Act of 1993'' holds the promise of a new era 
of security for every American--an era in which our nation finally 
guarantees its citizens comprehensive health care benefits that can 
never be taken away.
    Today, America boasts the world's best health care professionals, 
the finest medical schools and hospitals, the most advanced research and 
the most sophisticated technology. No other health care system in the 
world exceeds ours in the level of scientific knowledge, skill and 
technical resources.
    And yet the American health care system is badly broken. Its 
hallmarks are insecurity and dangerously rising costs.
    For most Americans the fear of losing health benefits at some time 
has become very real. Our current health insurance system offers no 
protection for people who lose their jobs, move, decide to change jobs, 
get sick, or have a family member with an illness. One out of four 
Americans is expected to lose insurance coverage in the next two years, 
many never to be protected again. Altogether, more than 37 million 
Americans have no insurance and another 25 million have inadequate 
health coverage.
    Rising health care costs are threatening our standard of living. The 
average American worker would be making $1,000 a year more today if 
health care accounted for the same proportion of wages and benefits as 
in 1975. Unless we act, health care costs will lower real wages by 
almost $600 per year by the end of the decade and nearly one in every 
five dollars Americans spend will go to health care.
    Small businesses create most of the new jobs in America and while 
most want to cover their employees, more and more cannot. Under the 
current health care system, cost pressures are forcing a growing number 
of small business owners to scale back or drop health insurance for 
their employees. Small businesses spend 40 cents of every health 
insurance dollar for administration--eight times as much as large 
companies. And only one in every three companies with fewer than 500 
workers today offers its employees a choice of health plan.
    Our health care system frustrates those who deliver care. Doctors 
and nurses are drowning in paperwork, and hospitals are hiring 
administrators at four times the rate of health care professionals. The 
system places decisions that doctors should be making in the hands of 
distant bureaucrats. Its incentives are upside down; it focuses on 
treating people only after they get sick, and does not reward 
prevention.
    Clearly, our challenges are great. This legislation is sweeping in 
its ambition and simple in its intent: to preserve and strengthen what 
is right about our health care system, and fix what is wrong.
    Our needs are now urgent. A nation blessed with so much should not 
leave so many without health security.
    This legislation draws upon history. It reflects the best ideas 
distilled from decades of debate and experience.
    It reflects the sense of responsibility that President Franklin 
Roosevelt called for when he launched the Social Security program in 
1933 and recommended that health care be included.
    It reflects the vision of President Harry Truman, who in 1946 became 
the first President to introduce a plan for national health reform.
    It reflects the pragmatism of President Richard Nixon, who in 1972 
asked all American employers to take responsibility and contribute to 
their workers' health care.
    And it reflects the ideas and commitment of

[[Page 1835]]

generations of Congressional leaders who have fought to build a health 
care system that honors our nation's commitments to all its citizens.
    Today America stands ready for reform. For the first time, members 
of both parties have agreed that every American must be guaranteed 
health care. An opportunity has been placed before us. We must not let 
it pass us by.
    This legislation builds on what's best about the American health 
care system. It maintains and strengthens America's private health care. 
It extends the current system of employer-based coverage that works so 
well for so many. It protects our cherished right to choose how we are 
cared for and who provides that care. It invests in improving the 
quality of our care.
    This legislation recognizes that America cannot, and need not, adopt 
one model of health care reform. It allows each state to tailor health 
reform to its unique needs and characteristics, as long as it meets 
national guarantees for comprehensive benefits, affordability and 
quality standards. It establishes a national framework for reform, but 
leaves the decisions about care where they belong--between patients and 
the health care professionals they trust.
    Under this legislation, every citizen and legal resident will 
receive a Health Security card that guarantees the comprehensive 
benefits package. People will be able to follow their doctor into a 
traditional fee-for-service plan, join a network of doctors and 
hospitals, or become members of a Health Maintenance Organization. Like 
today, almost everyone will be able to sign up for a health plan where 
they work. Unlike today, changes in employment or family status will not 
necessarily force a change in health coverage.
    The self-employed and the unemployed will receive their health 
coverage through the regional health alliance, a group run by consumers 
and business leaders, that will contract with and pay health plans, 
provide information to help consumers choose plans, and collect 
premiums. The largest corporations--those employing 5,000 workers or 
more--will have the option of continuing to self-insure their employees 
or joining a regional alliance.
    The legislation is financed by three sources: requiring every 
employer and individual to contribute to paying the cost of health care; 
raising excise taxes on tobacco and requiring small contributions from 
large corporations which form their own health alliance; and slowing the 
growth in spending on federal health care programs. Enormous efforts 
have been made to ensure that the financing is sound and responsible.
    The Health Security Act is based upon six principles: security, 
simplicity, savings, quality, choice and responsibility.
    Security. First and foremost, this legislation guarantees security 
by providing every American and legal resident with a comprehensive 
package of health care benefits that can never be taken away. That 
package of benefits, defined by law, includes a new emphasis on 
preventive care and offers all Americans prescription drug benefits.
    Under this legislation, insurers will no longer be able to deny 
anyone coverage, impose lifetime limits, or charge people based on their 
health status or age. The legislation also limits annual increases in 
health care premiums, and sets maximum amounts that families will spend 
out-of-pocket each year, regardless of how much or how often they 
receive medical care.
    The legislation will preserve and strengthen Medicare, adding new 
coverage for prescription drugs. To meet the growing needs of older 
Americans and people with disabilities, a new long-term care initiative 
will expand coverage of home and community-based care.
    The legislation also provides residents of underserved rural and 
urban areas with better access to quality care. It also offers 
incentives for health professionals to practice in these areas, builds 
urban-rural health care networks, and protects those doctors, hospitals, 
clinics and others who care for people in underserved areas.
    Simplicity. To relieve consumers, business and health professionals 
of the burdens of excess paperwork and bureaucracy, this legislation 
simplifies our health care system. It requires all health plans to adopt 
a standard claim form; creates a uniform, comprehensive benefits 
package; and standardizes billing and coding procedures.
    Savings. The legislation promotes true competition in the health 
care marketplace. It increases the buying power of consumers and 
businesses by bringing them together in health alliances. Health plans 
will no longer succeed by trying to pick only healthy people to insure; 
they will have to compete on price and quality. This competition will be 
backed up by enforceable premium caps.
    This legislation also criminalizes health fraud, imposing stiff 
penalties on those who cheat the system. And it takes steps to reduce 
``defensive

[[Page 1836]]

medicine'' and discourage frivolous medical malpractice lawsuits by 
requiring patients and doctors to try to settle disputes before they end 
up in court, and by limiting lawyers' fees.
    Quality. The legislation empowers consumers and health care 
professionals by providing information on quality standards and 
treatment results. It calls for new investments in medical research, 
including heart disease, bone and joint disease, Alzheimer's disease, 
cancer, AIDS, birth defects, mental disorders, substance abuse and 
nutrition. To help keep people healthy, rather than only treating them 
after they get sick, the legislation pays fully for a wide range of 
preventive services and offers new incentives to educate primary care 
doctors, nurses and other family practitioners.
    Choice. Through comprehensive reform, the legislation gives 
Americans a new level of control over their health care choices. It 
ensures that people can follow their doctor and his or her team into any 
plan they choose to join. It transfers the choice of health plan from 
the employer to the individual, and guarantees a choice of health plans, 
including at least one traditional fee-for-service plan. Doctors and 
health professionals may participate in multiple health plans if they 
wish.
    Responsibility. Under this legislation, every employer and 
individual will be required to pay for health coverage, even if that 
contribution is small. It extends the current employer-based system for 
financing health coverage--a system that now serves nine of every ten 
Americans who now have health insurance. To ensure affordability, small 
businesses, low-wage employers and low-income individuals and families 
will get substantial discounts.
    This legislation will strengthen our economy. Our current system is 
so much more costly than any other system in the world, and the American 
people should not be asked to pay huge new taxes in order to afford 
health care reform. This plan raises no new broad-based taxes, but 
spends our health care dollars more wisely. It levels the playing field 
for small businesses, making it possible for them to insure their 
families and employees. It eases the tremendous burden of rising health 
costs on big business, helping them to compete for global markets. And 
by bringing the explosive growth in health costs under control, it sets 
us in the right direction of reducing our national debt.
    The legislation restores common sense to American health care. It 
borrows from what works today, letting us phase in change at a 
reasonable pace and adjust our course if needed. It builds on what works 
best--and makes it work for everyone. Our task now is to work together, 
to leave behind decades of false starts and agree on health care reform 
that guarantees true security. The time for action is now. I urge the 
prompt and favorable consideration of this legislative proposal by the 
Congress.
    Sincerely,

                                                            Bill Clinton

Note: Identical letters were sent to Thomas S. Foley, Speaker of the 
House of Representatives, and George J. Mitchell, majority leader of the 
Senate. This letter was made available by the Office of the Press 
Secretary on October 27 but was not issued as a White House press 
release.