Campaigning on health care: with health care reform on just about everybody's mind, the presidential hopefuls propose solutions.

• Author: Brand, Rachel
• Position: Cover story

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Everyone who has read the paper, eyed an astounding medical bill or waited in an emergency room agrees: Our health care system is a mess. The United States has the highest per-capita health care spending among industrialized countries--$5,635 per person, almost two and a half times the average for other nations. And yet our population's life expectancy is ranked 28th behind most European nations, and our nation's health care system is ranked 37th, behind nations such as Singapore, Oman and Malta. Worse yet, 46.5 million Americans, one sixth of the U.S. population, are uninsured.

So after a dozen years of simmering on the national back burner, talk of health care reform is boiling. Pollsters call it the top domestic voter issue, and it may become our next president's top domestic reform bill.

"It's on the front burner, and the water's probably boiling over and spilling onto the stove and making flames," says Len Nichols, director of the health policy program at the New America Foundation, a nonpartisan think tank in Washington, D.C.

"That's OK, I like flames," Nichols says, in the voice of a policy wonk whose issue has finally arrived.

It's no secret we need to cover more people, improve quality and lower costs. And the federal government has far greater powers than states to change health care financing, from altering the tax code to reworking Medicare and Medicaid.

But the political parties have somewhat different visions. Democrats are mostly focused first on getting everyone into the leaky boat of our health care system, through mandates and subsidies. A discussion of cost comes later.

Republicans say they want to fix the boat first: make health insurance affordable and value-conscious by making market reforms. They say that will persuade--rather than push--the uninsured to jump aboard.

Forward thinkers from either party know that reform can't exist without taking on the issue of spiraling costs. "If we don't tame the health care cost growth beast, none of us are going to be able to afford health insurance in 20 years," Nichols says.

This isn't news to the roughly 28 states experimenting with health care reform. From Massachusetts to Vermont, California to Maine, states are working on creating bipartisan programs that drill into the hard issues of cost, quality, access and affordability. And while grateful for the national attention, state legislators want their hard work honored.

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"My biggest hope is that [the federal government] would support the work of the states and not interrupt it," says Representative Steve Maier, a Vermont Democrat. "Not every state is the same. There ought, at some level, to be some sense of federalism here supporting the work of states, maybe even supporting different models by way of demonstration."

Pennsylvania Republican Senator Edwin Erickson agrees. "We want money--with no strings, obviously. If the feds want to get into health care reform, fine, give us freedom to operate it as we see fit."

Here's a look at what's being proposed by some of the presidential candidates, with state legislators' views on its relevance.

REWORKING PUBLIC PROGRAMS

Medicaid and SCHIP cost states and the federal government a combined $310 billion a year, and pay the health costs of more than 47 million Americans (June 2006). For the most part, the programs are designed to cover children and their very low-income parents and people with disabilities. Childless adults, unless disabled, don't qualify. Democratic candidates want to grow these programs as a first step toward covering the uninsured.

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Senator John Edwards of North Carolina, for instance, would "commit the necessary federal resources" to expand Medicaid to all adults who earn $20,000 or less and all families of four that earn less than about $50,000. Less specific, Senator Hillary Clinton of New York promises Medicaid would cover poor, childless adults.

Republicans, on the other hand, say Medicaid is plagued with outdated rules and inefficiencies. Although the 1115 waiver process already exists to let states get around these rules, several Republicans say states should have even more flexibility.

Senator John McCain of Arizona says he would encourage states to experiment with "alternative forms of access ... use of private insurance in Medicaid; alternative insurance policies and insurance providers."

Former Massachusetts Governor Mitt Romney and former New York Mayor Rudy Giuliani would change Medicaid to a block grant payment that increases by the consumer price index every year. For the most part, Medicaid payments are now based on services rendered--it's an open-ended entitlement. In addition, Romney would take Medicaid payments funneled to hospitals for the uninsured, and make them available to states that deregulate their insurance markets. He says he will encourage innovation by "sending federal funds to states through block grants and removing the burdensome administrative requirements that prevent them from improving the program."

Ed Haislmeier, a senior research fellow with the Heritage Foundation, says states first should "look at all the money they have in their...