LDI Health Policy Seminar Series Featuring Charles N. Kahn III
LDI Health Policy Seminar Series

Charles N. Kahn, MPH
The Federation of American Hospitals

What's to be done about the uninsured?
(Note this presentation requires the use of PowerPoint 2000.)

January 25, 2002, 12:00 p.m.
Colonial Penn Center Auditorium
(3641 Locust Walk)

Biosketch Summary

On January 25, Charles N. Kahn, President of the Federation of American Hospitals, discussed the current state of the uninsured in the United States. Mr. Kahn has worn many hats in the health care and political arenas that enabled him to present an "insider's" point of view on the uninsured and potential legislative solutions. He outlined the current state of the "uninsured problem," its history, the impact of the current political context, and prospect of the issue receiving attention in the 2002 health agenda of Washington.

Approximately 40 million Americans are without health insurance; Mr. Kahn said that this figure was projected to rise to 55 million in 2008 if the economy is as strong as it was in the late 1990s, or to 61 million if the economy continues to struggle.

Mr. Kahn explored the important link between employment, the economy and health insurance coverage. The majority of privately insured individuals in the US receive health insurance through their employer. If the economy falters and unemployment rises, as we see currently, then the number of uninsured will likely increase. Historically, the employment based-system has recovered after dips in coverage. He noted, however, "the issue of affordability is probably the key issue with expanding coverage." Because managed care is no longer seen as effective for containing costs, employers must turn to other mechanisms, such as cost-sharing through deductibles and/or premiums. Cost-sharing at a time when the economy is in trouble is problematic, because many individuals will not be able to share those costs. Thus, the number of uninsured may continue to rise.

Mr. Kahn next discussed a brief history of health insurance coverage as a political issue. He highlighted the pitfalls of past attempts to expand health care coverage and argued that the pressure to reform health care perhaps competed with the goal of expanding coverage. He traced the shifting emphasis on the uninsured from the need to "solve the problem" in the early 90s, to a focus on insurance issues, to initiatives to cover children and then their parents, to efforts to combine policies, and finally to assistance for displaced workers who are becoming uninsured.

Mr. Kahn discussed the "political buzz" last year around expansion of coverage during the development of the Stimulus Package at the end of the 2001. The Stimulus Package debate captured the two sides of the issues. The GOP wanted a tax credit for the unemployed to subsidize displaced workers, whereas the Democrats wanted a COBRA subsidy to help individuals who have lost their jobs, some expansion of Medicaid coverage, and an increased federal match for state Medicaid programs. "This is a classic division between using the tax structure to subsidize private coverage, versus a basically public-oriented, government-oriented approach - essentially those are the battle lines of the debate," said Mr. Kahn.

He outlined the current political context for solving the problem of the uninsured. "The rules of the game changed on September 11th…what our politics were prior to September 11th, they fundamentally changed after the incidents in New York and Washington." Now, he explained, the President has overwhelming public support and tremendous popularity. In addition, the public's perception of the direction of the country is positive, trust in government has soared, and people want to see the government do more. Other political and economic factors in 2001 have also set the scene for change, including the Democrats gaining control of the Senate, the recession, and the disappearing budget surplus. And he cautioned that public support for the President in the setting of anti-terrorist campaigns might be separate from support for the President's domestic and fiscal policy agendas.

Mr. Kahn outlined three factors that will influence the off-year congressional elections: first, the public's perceptions about the economy and what incumbents and challengers might do about it; second, presidential popularity and how the public perceives his job performance, both on foreign and domestic policy; and third, the interests of seniors, whose primary issue is prescription drug coverage. The party that gains control of Congress will strongly influence the 2002 health care agenda. "In a sense policy this year is spelled p-o-l-i-t-i-c-s."

Mr. Kahn closed with an examination of the possibilities of compromise surrounding the issue of the uninsured. He believes that if the battle lines are drawn around politics as the defining issue, the reform imperative as the primary ideology, and cost, it will be very difficult to come to resolution. However, Mr. Kahn sees more promise and possibility for compromise if policymakers reach a common definition of the issues, if legislators can settle for their second choices, and most importantly, if the focus is on expanding coverage rather than on health care reform.

Charles N. ("Chip") Kahn is President of the Federation of American Hospitals, the nation's preeminent advocacy organization for investor-owned hospitals and health systems. (Mr. Kahn became the Federation's President in June, 2001.) The Federation represents nearly 1,700 owned and managed hospitals that offer traditional care, ambulatory care, psychiatric and rehabilitative care, as well as allied companies involved in health insurance and healthcare systems

Mr. Kahn's leadership on health care issues and in the political arena is well recognized. In February 2001, The Hill newspaper selected him as one of the capital's top "rainmakers." From 1995-1998, while serving as staff director of the Health Subcommittee of the House Ways and Means Committee, he played a critical role in the passage of the Health Insurance Portability and Accountability Act (HIPAA) and the Medicare provisions of the 1997 Balanced Budget Act (BBA). Mr. Kahn also has served as minority health counsel to Ways and Means, senior health policy advisor to former Senator David Durenberger (R-MN), and legislative assistant of health to former Senator Dan Quayle (R-IN).

Before coming to the Federation, Mr. Kahn was one of the nation's top leaders in the health insurance industry. As President of the Health Insurance Association of America (HIAA), he focused national attention on the plight of the uninsured, effectively placing this issue at the forefront of the national public policy agenda. Under his leadership, HIAA dramatically increased its membership and prestige, and was named by Fortune magazine for three consecutive years as the nation's most influential insurance trade association in its "Power 25" list of Washington, DC-based lobbying organizations.

In 1993 and 1994, as HIAA Executive Vice President, Mr. Kahn was instrumental in mounting the ground-breaking "Harry and Louise" campaign that called into question the Clinton health reform plan - a campaign characterized by Advertising Age magazine as "among the best conceived and executed public affairs advertising programs in history." In 2000, Mr. Kahn brought back Harry and Louise as advocates for the uninsured, a move applauded even by traditional critics of the industry.

Early in his career, Mr. Kahn directed the Office of Financial Management Education at the Association of University Programs in Health Administration (AUPHA) - where he worked primarily on developing the health care financial management curriculum - after completing an administrative residency with the Teaching Hospital Department of the Association of American Medical Colleges.

Mr. Kahn has numerous academic and advisory appointments. He serves as Chairman of the University of Michigan's Economic Research Initiative on the Uninsured, on the Robert Wood Johnson Health Fellowships Program Advisory Board, the Board of Visitors of the School of Public and Environmental Affairs at Indiana University, and the Medicare Competitive Pricing Advisory Committee. He also is a member of Delta Omega, the national honorary public health society.

In addition to teaching health policy at The Johns Hopkins University, George Washington University, and Tulane University, Mr. Kahn writes about health care financing. Most recently, his paper, "Building a Consensus for Expanding Health Care Coverage," co-authored with Ron Pollack of Families USA, appeared in Health Affairs (January, 2001). He also co-authored "Budget Bills as Precedents for Medicare Policy: The Politics of the BBA" (Health Affairs, January/February 1999) and "Why We Should Keep the Employment-Based Health Insurance System" (Health Affairs, November/December, 1999).

Mr. Kahn holds a Masters of Public Health (M.P.H.) degree from Tulane University School of Public Health and Tropical Medicine, which in 2001 bestowed upon him its prestigious "Champion of Public Health" award. He also received a Bachelor of Arts degree from The Johns Hopkins University.

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