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From the Publisher: Costs are critical to health care reform |
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Written On: March/April 2008 |
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Written By: Don C. Brunell |
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In some ways, the current debate over health care gives me a sense of déjà vu. Remember Yogi Berra’s famous saying: “It’s like déjà vu all over again!”
If you remember, in 1992, President Bill Clinton was going to make his wife, Hillary, the “health care czar.” She was going to totally overhaul the nation’s health care system and require all employers to provide health insurance for their workers. The effort was a disaster, and died a quick death.
Now that Sen. Hillary Clinton is running for president, she has dusted off the old playbook and is once again pushing universal health care.
In 1993, Washington Gov. Mike Lowry and Democrat legislators mandated that all employers provide a uniform universal insurance plan to all workers in the state, except those in unions. Union leaders figured out that the rank and file was better off with the health insurance they negotiated, so they told Lowry and legislators, “Thanks, but no thanks.”
Lowry’s feat earned him an overnight stay in the White House. He was to be the harbinger of what was to come, but there was one tiny glitch. Congress needed to grant Washington an ERISA waiver to impose the “employer mandate.”
No ERISA waiver for Washington
Congress passed the Employee Retirement Income Security Act in 1974 to ensure that private sector employee benefits were uniform for multi-state employers. Washington’s health care mandate would be different, and other states would not be required to follow it. Therefore, without a waiver, our state could not require employers to provide their workers with the state-designed health care plan.
Congress did not grant the waiver, despite some heavy lobbying by then-Congressman Mike Kreidler, our state’s current insurance commissioner.
Fast forward to 2008.
While Sen. Clinton is calling for national universal coverage, Sen. Karen Keiser, D-Des Moines, chair of the Health Care Committee, is enamored with a proposal that nearly passed in Wisconsin. It provides universal health care and it’s funded by up to a 17-percent payroll tax. Employers would pay two-thirds of the premium.
On the House side, Rep. Eileen Cody, D-West Seattle, chair of the Health Care Committee, wants to pass a plan similar to the one in Massachusetts where individuals are mandated to buy health insurance and the government connects them to the coverage.
The Massachusetts plan is the only model that has been put into operation, so let’s look at how it’s faring.
In the Massachusetts plan, the state heavily subsidizes people making less than $30,000 a year and a family of four making under $60,000. That insurance is selling like hotcakes. Massachusetts reports that 133,000 of the estimated 207,000 people eligible for the heavily subsidized coverage are enrolled. But that portion of the program has already busted the budget by $150 million.
Massachusetts plan over budget
According to Grace-Marie Turner, president of the Galen Institute, the state’s plan isn’t nearly as popular among folks who aren’t eligible for government subsidies. In fact, only about 10,000 of the more than 215,000 uninsured in Massachusetts have signed up.
So, how’s it working so far for those who have signed up? According to Turner, because of the costs involved, Massachusetts’ insurers expect to raise rates by 10 to 12 percent in 2008, twice the national average. And people who have signed up for the plan are finding it hard to find doctors who will see them.
While we will hear much about universal health care during the presidential campaign, remember: There’s no free lunch when it comes to health care.
Somebody has to pay. It’s in the public interest to ensure that, as we talk about health care, we carefully calculate the costs to see if we are really better off under a whole new system. Regardless of how difficult those costs are to determine, it is essential that we have accurate information about the costs of universal care as we work to increase access and improve patient care.
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