Labor's Rx For Health Care
AFL-CIO Touts Single-Payer System
By JANICE PODSADA
Hartford Courant Staff Writer
January 13, 2007
The Connecticut AFL-CIO launched its lobbying effort Friday for a single-payer system for universal health care, which the labor group said would provide affordable health care to the 300,000 to 400,000 state residents currently without health coverage.
The AFL-CIO touted its plan as an enlightened alternative to the business-backed plan put forward by the Connecticut Health Insurance Policy Council earlier this week. Gov. M. Jodi Rell has also proposed a plan.
The single-payer system, the centerpiece of the AFL-CIO’s 2007 state legislative agenda, bucks a trend in Connecticut and other states in which business groups and advocates for broader health coverage have hammered out proposals that would use the state’s collective buying power, often subsidized by taxpayers, to buy health plans from private insurers.
The AFL-CIO plans to release a more detailed version of its single-payer health care plan in a few weeks, said the group’s secretary-treasurer, Lori Pelletier.
Under the AFL-CIO’s universal health care proposal, everyone would pay into a single health care fund - whether it’s a government agency or a trust - that would then pay private doctors and providers. The simple, streamlined system would eliminate the middlemen - insurance companies and their handsomely compensated CEOs - and thereby drastically reduce costs, AFL-CIO said.
“When Aetna and U.S. Healthcare merged several years ago, the CEO received $967 million and a corporate jet - how many MRIs is that?” Pelletier said. She was referring to U.S. Healthcare Inc.’s 1996 merger with Aetna Life & Casualty Co., in which Leonard Abramson, chief executive and founder of Pennsylvania-based U.S. Healthcare, a health maintenance organization company, received more than $967 million in cash, stock and the jet as a result of the $9 billion deal.
With just one organization handling the fund, administrative costs could be kept to about 3 percent, a reasonable goal because Medicare currently operates at 3 percent, she said.
Compare that with the current system, in which 30 percent of health care dollars go for paperwork, profits and other unrelated medical costs, Pelletier said. The insurance industry disputes that figure, putting their administrative costs at about 15 percent.
AFL-CIO leaders, including President John W. Olsen, blasted the business council’s recommendations, describing it as the same old clunker, shored up with a dash of window dressing.
“The business community’s plan is not much more than putting a new set of rims on a 1968 Corolla,” Pelletier said.
Earlier this week, the six-month old council, a coalition of health insurers, business groups and large employers, including United Technologies Corp., rolled out its plan.
Under the council’s plan, the uninsured would be allowed to purchase low-cost policies that would omit some state-mandated insurance benefits, employers would be encouraged to pay at least part of the premiums for part-time and temporary workers, and a new state agency dedicated to improving residents’ health would be established, among other features.
With those radically different plans now on the table, in addition to Rell’s plan, which also relies on private insurance, the legislative debate about health care should grow.
A single-payer system would save everyone money, from government to businesses to workers, Pelletier said.
“The employers’ piece would be half of what it is now,” she said - substantial savings for some small businesses, where as much as 25 percent of the payroll is health care costs. “They could save half,” Pelletier said.
Workers would also have their costs reduced. “An estimated $400 to $800 per year, per insured person, goes toward covering the costs of the uninsured,” Pelletier said.
Patients would be free to decide which doctor or hospital they want to visit. And doctors and medical providers would benefit. Often they can’t afford to hire additional clinical staff because they must first hire the necessary staff to process mountains of insurance forms.
“There are 1,500 national health care plans. Each has a CEO and a vice president. That’s a lot of redundancy,” Pelletier said.
AFL-CIO leaders said the council’s plan wags an accusatory finger at state residents for being “too fat and too lazy” and is a diversionary tactic aimed at glossing over the problems and keeping money flowing into the insurance carriers’ coffers.
A key component of the council’s plan is the creation of a new state agency whose mission would be to improve the health of the state’s residents, reducing health care costs. Employers would be asked to voluntarily weigh in with financial incentives for workers to lose weight, stop smoking and improve their general health.
The AFL-CIO’s 2007 legislative agenda, “A Blueprint for the Future,” focuses on safety, taxes, job creation and retention and the right to organize, Olsen said. Other proposals include a Worker Freedom Act, which would prohibit employers from firing or disciplining workers who don’t attend meetings that have no bearing on work, but are used to promote political or anti-union agendas; a proposal to limit outsourcing, which would require the state to purchase goods and services from Connecticut or American companies; and a tax reform plan to decrease the state’s dependence on the property tax.
Contact Janice Podsada at jpodsada@courant.com.