Stuart Butler: Let 50 Health-Care Reforms Bloom

By Stuart Butler
Tuesday, September 15, 2009; 11:57 AM

President Obama must recognize how change is actually achieved in America. That means two things: 1. avoiding "big bang" change that is bound to fail; and 2. spurring innovative reform where it usually comes from -- the 50 states.

State governments understand the unique needs of their residents. So give them the challenge and the freedom to try innovative solutions. If these don't work, they can easily be repealed and redesigned, unlike a federal program and bureaucracy. If something works particularly well, the results can be shared with other states that may incorporate or copy the idea. And, best of all, state legislators are not hamstrung by national politics.

To be sure, the federal government needs to lay the groundwork for success by states. We need Congress to amend today's programs and onerous statutory rules to give states the flexibility to take existing money and use it differently. States need greater freedom to work with insurers to establish reinsurance and risk adjustment mechanisms, or other ways to make sure even sicker families can get affordable insurance.

There are already bipartisan bills before Congress to do this, by members as diverse as Reps. Tom Price (R-Ga.) and Tammy Baldwin (D-Wisc.) and Sens. Russ Feingold (D-Wisc.) and Lindsey Graham (R-S.C.). We also need to "keep them honest" (as Obama might say) at the state level by allowing residents of California to buy a health plan in Michigan, for example, if they don't like what their state is doing.

President Obama should also embrace a version of the tax reform of health care supported by Democrats and Republicans alike, and by virtually every health analyst in America, including many in the White House. Without adding to our total tax bill, Congress needs to redesign the tax exclusion for employer-sponsored coverage so that Americans can get the same tax help wherever they work and so that families with modest income get more tax help than Bill Gates does.

Stuart Butler is the vice president of domestic policy issues at the Heritage Foundation.

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