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Posted on October 26, 2006

Senator Kuehl plans to re-introduce SB 840 next year.

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By California State Sen. Sheila Kuehl
Tikkun Magazine
November 2006

As the State Senator for the 23rd Senate District in California, I represent almost a million people on the west end of Los Angeles County and the southern part of Ventura County. It’s a diverse district, culturally, economically, religiously—containing some of the wealthiest neighborhoods in the state, as well as working class neighborhoods where one of the most urgent issues is gang violence. There are high-rise urban neighborhoods, suburbs, agricultural areas, some of the most beautiful wild land in the state, and miles of gorgeous coastline.

My constituents are bus drivers, movie stars, shop owners, social workers and teachers. My job brings me into frequent meetings with Chambers of Commerce, union members and leaders, entertainment industry leaders and representatives of their crews, law enforcement officers, gangland peace brokers, doctors, lawyers and Native American tribes. I find it interesting that, no matter how diverse the group or the subject matter of a meeting, talk inevitably comes around to health care and how our health care “system” is broken.

The facts are chilling. In California, nearly one of every five persons lives without any health care coverage at all. Over 80 percent of these uninsured are employed. Even though various solutions to the crisis have been brought to the Legislature or proposed by initiative over the last few years, we (like the rest of the country) find it easier to agree about the extent of the problem than about a solution.

Some aspects of what the people want are clear enough. Over and over, we are told that individuals want the right to choose their own doctors. Doctors want to regain control over their patients’ care—they don’t want insurance company bean counters telling them what to do. Patients and doctors want evidence-based standards for appropriate medical care—not formularies dictated by pharmaceutical companies.

People don’t want insurance companies passing judgment on their healthcare—and they don’t want the government to own the doctors and hospitals, either. They want quality and choice, and they don’t want to have to choose between medical care and their life savings—or between medical care and food.

The Costs of Our Current System

The health care crisis doesn’t just affect the poor and the working poor. A study in Health Affairs this past February reported that about half of personal bankruptcies result from medical expenses. People who declare bankruptcy are people with assets to protect. The lack of national health care means that one traffic accident or one serious illness can wipe out a lifetime of careful financial decisions.

The effects of today’s health coverage crisis on our common lives are broad and deep. The economic effects are the easiest to measure. For most people with on-the-job insurance coverage, premium costs are rising (at about 9 percent a year, at the very least, and, increasingly, by double digits) faster than real wages. Co-pays and out-of-pocket expenses are also going up, as coverage decreases. The share of these costs borne by employees is rising, but so are employer costs. Major financial scandals, such as the looming wave of retirement pension defaults and the degradation of stocks in large American-based companies are aggravated by the rising costs of providing health care coverage benefits. Labor unions are spending increasing amounts of time, money, energy, and good will on struggles, not for improved wage packages, but simply to hold onto the already inadequate coverage for their members that employers now provide. Many large employers provide no healthcare coverage at all, leaving their minimum-wage workers to rely on MediCal.

For those who are uninsured, and for the growing number who are under-insured (nearly 16 million in 2003, according to an article in Health Affairs), this lack infiltrates every aspect of life. Nagging conditions go untreated until they explode into medical catastrophes. Simple high blood pressure, which could have been controlled with medication, leads to a stroke. Undiagnosed diabetes results in a coma, and hospitalization.

Of course, these disasters cause immeasurable anguish to those most directly involved. What may be less obvious is how much the rest of us also pay for these avoidable catastrophes. People without adequate insurance wind up in emergency rooms—where they will receive much more expensive care than they would have had with regular doctor visits. Hospitals bear the brunt of this over-reliance on ERs, not only because facilities are overused and patients have to wait to be seen, but also because many of the patients treated in ERs are not insured and cannot afford to pay for the care they get. Hospitals also face shrinking reimbursements and daunting red tape when dealing with insurance providers. As a result, hospitals close each year, but new ones don’t open. All of California’s people, insured or not, have to make do with fewer care providers.

The personal costs of this crisis are harder to measure, but pretty easy to see. It isn’t always easy to be a patient, even when we can afford it. Health care is one of the most intimate services that a professional can perform for us. As health care consumers, we have to make decisions that are sometimes very difficult, because they will have life-changing consequences for ourselves and for those we love. It’s hard enough to make those decisions under the best possible circumstances. But now, when critical decisions about what’s best for our children and parents, or for ourselves, become infected with the question of what we can afford, the situation is a source of immense anxiety and shame, as well as fear. This is a private anguish that many people never share and can never be measured. But it affects us as communities and as a state.

Furthermore, in order to feel comfortable as patients, we need to form relationships with care providers whom we trust and who know our history based on their own direct experience. The current patchwork of private and public insurance plans with which we now live, along with the practice of insuring most people at the point of employment, means that changing or losing jobs brings the risk of losing the doctors on whom they depend. Many people remain tethered to jobs from which they could otherwise advance only because they don’t want to lose their particular health benefits. A change in provider networks by an employer can tear us away from our primary care physician. And there’s not much we think we can do about it.

California State Senate Bill 840

But we can change the current system. Based on careful studies of the health care problem and analyses of proposed solutions, I introduced a bill that, I believe, would solve California’s health care crisis and could be a template for the rest of the country. State Senate Bill 840 passed the California’s State Senate and the Assembly and was sent to Governor Schwarzenegger for signature. On September 5, the Governor released a statement signaling his intent to veto the bill.

State Senate Bill 840 is a single-payer plan that would have insured every Californian with comprehensive benefits while controlling medical care costs and preserving the right of each of us to choose our own doctors and hospitals. SB 840 would have accomplished these goals without putting additional burdens on California’s general fund.

How could we get more for the same amount we are paying now? SB 840 is based on a model carefully analyzed in a report by the Lewin Group, an independent health care cost/benefit analysis firm with eighteen years of experience. The Lewin Group discovered that almost one-third of every dollar spent on healthcare in California goes to administrative costs—that is, paperwork, not patient care. The Lewin model, on which SB 840 is based, shows that we can reduce administrative costs to about 5 percent of every dollar spent (about a 20% drop) and that the savings will pay for a health care plan that can work for everyone.

Specifically, SB 840 would reduce costs by replacing the current chaos of private and governmental insurance plans with a single, reliable claim and reimbursement system. This is estimated to save about $20 billion in administrative costs. Second, SB 840 would mandate California to use its purchasing power to buy in bulk prescription drugs and durable medical equipment, such as wheelchairs, from pharmaceutical companies. This would save about $5.2 billion dollars. Twenty-five billion dollars buys a lot of health care.

A Human Impulse

A couple of months before vetoing SB840, in remarks before the Commonwealth Club, Governor Schwarzenegger actually stated, “I don’t believe in universal healthcare.” It’s hard to believe that the Governor truly meant what he said, but his veto speaks volumes.

Quality healthcare is not some status symbol or commodity that can be the province of the richest class. It is a necessity of life, like water or breathable air. Surely people who live in such a technologically advanced and wealthy society as ours ought to be able to expect a higher level of health care than we live with now.

Each of us will need health care at some point in our lives. Each of us is vulnerable—each of us will, someday, die. People may be uncomfortable with the subject of health care, because it is a reminder of an aspect of life that we’d rather not look at. But being mortal and vulnerable simply makes us more human.

Popular culture, in our country, places such an emphasis on strength that it has become almost shameful to admit to any need that one can’t fulfill as an individual. Action movie heroes (and governors) make normal people look unnaturally weak. “Tough-guy” strutting is back on the big screen and in politics.

However, it makes no sense to tell a SARS virus to “bring it on.” Nor can we fight illness or injury with “self-reliance.” Like it or not, we are weak animals who rely, not only on our brains, but also on our cooperation with one another.

If we embrace our inevitable interdependence, if we embrace that human impulse we call kindness, we can see that universal healthcare is not only the compassionate solution—it is the fiscally “tough” solution as well.

This is especially true when we expand our idea of cost/benefit analysis. We might point to all the benefits of increased wellness—not only is preventive care cheaper in terms of preventing expensive problems down the road; it also prevents human misery and promotes every level of well-being. We all have an interest in the health of our neighbors.

I seem to remember an excellent self-help book—the title will come to me any minute—that suggested it’s possible and necessary to love one’s neighbor as oneself. When it comes to health care, that’s a sound prescription.