Sunday, August 19, 2007

Kids May Get Health Insurance, But What About Their Parents?

ABC News
Kids May Get Health Insurance, But What About Their Parents?

Opportunity 08 is an ABC News project with the Brookings Institution to help presidential candidates and the public focus on critical issues facing the nation.

This week Opportunity 08 takes a closer look at the difficult decisions around social insurance that will face the next president.

Congress is debating options for reauthorizing and expanding the State Children's Health Insurance Program (SCHIP). But what about health insurance for adults?

Only 66 percent of private full-time workers now have employer-sponsored health insurance, down from 80 percent in 1989. Part of the reason is that insurance is expensive. Global competitive pressures are encouraging many firms to eliminate both pensions and health care for their employees and retirees. And that trend is compounded by a continuing increase in the cost of health care, as well as the number of Americans over 65. Both for private retiree health insurance and for government-run programs like Medicare, costs are increasing exponentially.

William Galston of the Brookings Institution says that Americans have become accustomed to a federal government that can fulfill its core responsibilities while commandeering no more than one-fifth of GDP. He describes a tough fork in the road, "Over the next generation, we will face an historic choice: We can have a federal government that plays a significantly smaller role in reducing insecurity and sharing risk through insurance programs, or we can have a government that consumes a significantly higher share of GDP."

Addressing the shortfall in the financial security of Americans must start with distinguishing more clearly between savings and insurance, he argues.

" Personal saving should be the social strategy for events that are likely to occur, such as spending a significant number of years in retirement. " Insurance should be reserved for relatively low probability, high negative-impact events, like unemployment, catastrophic illnesses or injuries, or the early death of a spouse.

A full version of this proposal, as well as supporting background material, is available at

About the Experts and the Project

William A. GalstonWilliam A. Galston, a senior fellow at Brookings, is an expert in domestic policy as well as political campaigns and elections. He served as deputy assistant for domestic policy to President Clinton, and directed national efforts on civic renewal led by Sen. Sam Nunn and Secretary William Bennett. Galston also served as an advisor to presidential candidates Walter Mondale and Al Gore.

Opportunity 08Opportunity 08 aims to help 2008 presidential candidates and the public focus on critical issues facing the nation, presenting policy ideas on a wide array of domestic and foreign policy questions. The project is committed to providing both independent policy solutions and background material on issues of concern to voters.