Fewer Face Higher Health Costs, Administration Says : Medicine: Panetta testifies 30% will pay more for insurance under plan. Earlier 40% figure fueled criticism.

WASHINGTON —  In a damage control exercise, the Clinton Administration said Thursday that no more than 30% of insured Americans would pay more than they do now for health care if its health plan is enacted--a significant reduction from the 40% figure it cited last week.

Testifying before the Senate Finance Committee, Leon E. Panetta, director of the White House Office of Management and Budget, said that the previous figure was an estimate that included only the costs of insurance premiums.

The updated number, averaging costs over the next six years, takes into account all out-of-pocket health costs, including deductibles and co-payments.

Since last week, the Administration has been struggling to explain the 40% figure. The issue was clouded Sunday when Ira Magaziner, the Administration’s chief health care policy adviser, said that only 15% of Americans would pay more under the plan.

However, that figure apparently refers only to the percentage of Americans who would pay more for fewer benefits. The Administration has stated repeatedly that many of those paying higher medical costs--the 30% now cited--also would receive additional medical benefits.

The 40% figure, which Health and Human Services Secretary Donna Shalala presented to the same committee, had stunned many of the Administration’s allies and given fodder to its critics.

At that time, Finance Committee Chairman Daniel Patrick Moynihan (D-N.Y.) had bluntly warned Shalala that the estimate could make the health plan a hard sell politically.

On Thursday, Moynihan described the new figures as helpful, and added: “I think they are straightening it out.”

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For the 30% who would pay more for health care, the typical increase would be $24 a month, Panetta said. For the 70% paying the same or less, he added, the monthly savings would average about $61.

But all the calculations, Panetta said, miss an important point: “If we fail to pass this plan, 100% of (insured) Americans can be expected to pay higher insurance premiums--100%--because that is where health care costs are going right now.”

After the hearing, Panetta said that his figures included only people who are insured by their employers.

His spokesman, Barry Toiv, said that, while there are no estimates available for those who pay for their own health insurance, it is likely that virtually all those people would pay less under the Administration plan.

The Administration’s allies were somewhat heartened by the revised figures, but Rep. Henry A. Waxman (D-Los Angeles), chairman of a key House subcommittee, added: “I don’t think that gross numbers mean anything. You have to look at who’s paying more and what they’re getting for it.”

“Everyone in the Administration seems to have a different figure,” Senate Minority Leader Bob Dole (R-Kan.) said through a spokesman. “Without being critical, it’s all the more reason to go slow, ask all the right questions, get the facts straight and get it right.”

Most of those paying more would be younger and healthier Americans, who currently enjoy low premiums because they are a lower risk, the Administration has said.

A key component of the health care plan would pool these people in large groups with those who present a higher risk and require insurance companies to provide coverage for all.

The freedom to pick and choose which types of customers the companies want to serve--called “cherry picking”--has made insurance unaffordable or unattainable for many small firms and for individuals who have suffered serious illnesses.

During the Finance Committee hearing, Moynihan made another pitch for his proposal of a day earlier to put a heavy tax on handgun ammunition as a means of helping pay for health care and combatting violence. He would impose taxes of as much as 10,000% on particularly lethal forms of ammunition.

Noting that National Rifle Assn. Executive Vice President Wayne LaPierre has called his idea laughable, Moynihan retorted: “I don’t think it’s laughable one damn bit.”

Panetta said that Moynihan’s proposal is “something we need to look at.”

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Meanwhile, First Lady Hillary Rodham Clinton, who headed the effort to develop the health care plan, continued her personal campaign to build support for it.

At Marshall University in HuntingtonVa., a crowd of about 1,000 cheered Mrs. Clinton as she said that the plan needs to become law “so everyone who works gets rewarded instead of penalized for getting up for work every day.”

“Since when should hard-working American citizens have to go on welfare to take care of children with medical problems?” she said.

“The worst alternative facing America is to do nothing (to reform health care). But there are lots of people who benefit by doing nothing,” she said.

BACKGROUND

Health and Human Services Secretary Donna Shalala told the Senate Finance Committee on Oct. 28 that 40% of American families who now have health insurance would pay higher premiums if the President’s health care proposal were enacted. Last Sunday, White House health care adviser Ira Magaziner said in a television appearance that only about 15% of Americans would show a net financial loss under the plan. On Thursday, Budget Director Leon E. Panetta told the Finance panel that no more than 30% of insured Americans would pay more than they do now for health care. The latest Administration number takes into account all out-of-pocket health costs, including deductibles and co-payments.