On the Governor's Health-Care Plan
More insurance is not the answer
By Deborah Burger
San Francisco Chronicle
Thursday, January 11, 2007
While Gov. Arnold Schwarzenegger deserves credit for finally responding to the state’s imploding health-care crisis, his plan as designed has major flaws, most notably forcing the uninsured to buy what for many will mostly likely be substandard, unaffordable health plans that primarily serve to further enrich big insurers.
Some provisions in the governor’s package are welcome — notably the intent to end the disgraceful denials of coverage based on age or health status, and his pledge to assure access to health services for the undocumented.
However a plan that begins by criminalizing the uninsured with no controls on skyrocketing premiums and, at this point, no standards on what those health plans will include, is a train wreck waiting to happen. Let us hope that the state would establish uniform and comprehensive benefits for all.
In a state where health insurance typically runs up to $12,000 a year for a family of four, it’s a safe bet that many will gamble with their health and opt for the cheapest plan available. As defined by the governor’s proposal, those plans would require families to spend up to $10,000 a year in out-of-pocket medical costs. In other words, the average consumer will have to pay for presumably all of their health services in addition to the premiums the law will force them to pay.
If it sounds as if someone is making out like a bandit, that bandit has a name - the insurance industry. Insurers will gain millions while consumers will receive little in return. A mandate on individuals to buy insurance is the centerpiece of the Massachusetts health plan as well. The experience there to date does not recommend this approach. Many people are choosing not to sign up, even with the tax penalties, because they cannot afford the plans, and due to funding problems, the state has cut back on public education about the program. That’s in a state with 500,000 uninsured as compared to California’s 6.5 million uninsured.
A second area of concern is the proposal to shift some $2 billion in tax funds that now goes to hospitals to cover indigent care and use it to buy coverage for the uninsured. It takes money used for direct delivery of care, and hands it to insurance companies, which take 25 percent to 30 percent off the top for wasteful administrative expenses.
Moreover, the proposal has an ugly underside: Because 70 percent of those funds go to public hospitals and clinics, the proposal will starve the public sector of desperately needed revenue, hastening the closure or privatization of more public facilities. This could have a particularly deleterious effect on low-income communities where most public hospitals are located.
That demonstrates the biggest fundamental problem with the governor’s entire package: A market-based system always puts increased revenues and profits over the health and well-being of those patients it is supposed to serve. As was the clear intent of a number of the free-market architects of the plan, it reinforces and expands the role of the market in health care, the very source of the present crisis. If the governor’s goal is truly universal health coverage, improved quality and effective cost controls, the state should embark on the same tried-and-true course taken by every other industrialized nation, either a national health system, or a single-payer approach as embodied in the single-payer bill, SB840 authored by state Sen. Sheila Kuehl. Kuehl’s bill was vetoed by the governor last year. It will be reintroduced this year.
Under a single-payer system, such as Medicare, one public entity collects all the financing and pays for all medical services through the existing private-care delivery system, with adequate funding for our doctors, hospitals, clinics, and other care.
It’s the only plan that assures everyone is covered with one high standard of benefits and care, as opposed to good care for the wealthy only. It assures choice of physician, reduces administrative waste, provides commonsense budgeting, and ends insurance industry interference in the form of high premiums, high deductibles and denials of care.
Americans spend twice as much per person on health care as the other 21 wealthiest countries, yet World Health Organization data shows Americans live the shortest time in good health and have poorer patient outcomes in category after category from infant mortality to life expectancy to doctor visits.
Being number 21 is hardly good enough. By enacting the single-payer Kuehl bill this year, we could finally have the plan Californians need and deserve.
Deborah Burger, R.N., is the president of the California Nurses Association.