Groups line up on health plan
Governor’s proposal would cost billions
By Robert Manor
Chicago Tribune staff reporter
Published March 6, 2007
Although details of the proposal won’t be known until later this week, interest groups are already starting to take positions for or against Gov. Rod Blagojevich’s plans to expand health insurance to hundreds of thousands of people without medical coverage.
Some business groups don’t like the proposal, in part because it would cost them billions of dollars in new taxes.
The hospital industry likes the plan, in part because it means it would see fewer uninsured patients seeking care but lacking money to pay for it.
Meanwhile, some consumer advocacy groups back the plan as a first step toward insuring at least some of the state’s 1.4 million uninsured. But others say the plan is so complex it won’t work, nor does it go far enough.
“It’s too complicated,” said Dr. Quentin Young, chairman of Illinois Health Care for All and past president of the American Public Health Association. “It’s noble in concept but it is almost certain to fail.”
Blagojevich is expected to announce Wednesday that he supports a new $6 billion tax on corporations, with at least $2 billion going to provide medical coverage to 500,000 Illinois residents and the rest for other state purposes.
The plan is expected to include subsidies so workers could afford health plans. It would be financed by a tax of up to 2 percent on corporate gross receipts and a 3 percent payroll tax on companies that do not offer health insurance, according to early reports.
Insurers would be required to offer a standardized, comprehensive health insurance policy to the uninsured, without regard to existing health problems.
“This is monstrous, the largest tax increase in the history of the state of Illinois,” said David Vite, president of the Illinois Retail Merchants Association.
Vite said a tax on a company’s revenues, which is how he defined a gross receipts tax, is fundamentally unfair. For example, with a 2 percent tax, companies with $10 million in revenue would pay $200,000 a year, whether they were highly profitable, barely breaking even or losing money.
His association, which represents 23,000 retailers, has taken no stance on the idea of expanding health care to the uninsured, Vite said.
“We haven’t taken a position on the governor’s health care proposal because we have not seen it,” he said.
The Illinois Hospital Association, which represents 200 hospitals and health-care systems, is already pushing in favor of Blagojevich’s plan.
Association President Kenneth Robbins said the uninsured miss annual checkups and preventive care. Then they arrive in hospital emergency rooms when ill, often sicker than if they had regular medical attention.
“Many of the problems that the uninsured struggle with could have been prevented had they received the right care at the right time,” Robbins said.
At least one business doesn’t know what to think about the governor’s plan, but is going to study it closely.
“We are in kind of a unique position on this because it affects us not only as an employer but as a provider,” said Michael Polzin, a spokesman for Walgreen Co. “If people have some sort of insurance, they are more likely to get their prescription filled.” Prescriptions are highly profitable to Walgreens.
Polzin said that Walgreens’ 10,000 to 15,000 Illinois employees receive company health insurance if they work more than 30 hours a week.
Some see expanded health insurance, paid for by business, in stark terms.
“I think it’s a big mistake,” said Tom Gimbel, chief executive of The LaSalle Network, a large provider of temporary workers.
He said many employers will react immediately when confronted with higher taxes.
“They will let somebody go,” Gimbel said.
Jenny Wittner, associate director of Women Employed, an advocacy group for the economic advancement of women, wants to know more details about the governor’s plan. “We just know that we are for health care for all,” Wittner said. She noted that the majority of workers in low-wage jobs without health care are women.
And Young, a long-time health-care activist who has pushed for expanded health insurance, sees the governor’s proposal as deeply flawed.
He said Illinois needs to follow the model of Medicare, where the government uniformly provides health insurance to people 65 and over. Illinois should do the same thing, only cover everyone, he said.
“Medicare is a remarkably cost-effective, successful, program,” Young said.
Copyright © 2007, Chicago Tribune