Failing Health: California Prescription


This Wednesday, February 23, California state Senator Sheila James Kuehl will introduce a bill to make California the first state in the U.S. to offer universal health care through a single-payer system.

This is the third time she has introduced similar legislation, and this time it has a fighting chance. California has often been in the forefront of changes that soon swept the nation. Help Senator Kuehl set a precedent, to address the single greatest humanitarian crisis in America, with the greatest economic and social consequences.

For those near enough to Sacramento, there will be a rally beginning at noon on Wednesday, February 23, on the south steps outside the Capitol.

Californians, contact your state senator and representative to let them know that you support SB 921, California Health Insurance Reliability Act of 2005.

Everyone can write a letter of support to Senator Kuehl. Her address:
Senator Sheila Kuehl
State Capitol, Room 4032
Sacramento, CA 95814
Fax: (916) 324-4823

Everyone can contribute money and join the organization Health Care for All which supports the bill, through the website.

The Need

Health care in America is in terminal condition. Most people need only to look at their own lives and experiences to know this. How many have seen loved ones languishing on a gurney in the halls of overcrowded hospitals, where the bills are thousands of dollars a day? How many have had treatments disallowed by corporate HMOs, who moan about low revenues while they make billion dollar acquisitions? How many patients have seen their physicians quit taking insurance because of low payments or excessive bureaucracy, or even get out of medicine altogether? How many are paying more for less coverage, or have been brutally cut off by their HMOs?

How many businesses are struggling because of high health care costs for employees? How many have lost everything to pay medical bills their insurance didn't cover? And how many face pain and death because health care providers won't even treat them because they are uninsured or have inadequate insurance?

Anecdotal evidence and personal stories are backed up by facts. As noted here earlier, a Harvard University study found that illness and medical bills cause about half of all bankruptcies in the United States, an increase of more than 23 times the rate in 1981. Most of the 2.2 million Americans who file for bankruptcy for these reasons start out with health insurance. Most were middle class workers who simply got sick.

"I think it's a societal failure to have people facing bankruptcy over health care," said Dr. Alan Glaseroff, chief medical officer for the Humboldt-Del Norte Independent Practice Association in CA. "No other developed nation has that."

A Boston University study that finds fully half of the nearly $1.9 trillion spent on health care is unnecessary waste, paying for nothing more than excessively high profits, over-the-top drug and hospital prices, unnecessary administrative costs mandated by insurance companies, plus a healthy dollop of fraud and theft.

The fact is that health care and health insurance costs are dragging down businesses, crippling state and local governments, and ruining families---and still millions go without needed health care in the richest nation in world history.

THE BILL

Highlights of the plan, quoting from the Kuehl fact sheet:

"The Health Care for All Californians Act would provide health insurance coverage to all Californians through a single insurance plan offered by the State of California and would control the growth of health care spending through a simplified administrative structure, consolidated purchasing and statewide health planning."

This is universal coverage in every sense of the word: every California resident is covered--- for everything (except elective cosmetic surgeries.) Patients choose their primary care physicians, and every health care provider participates.

So how is this paid for?
"THE PLAN INVOLVES NO NEW SPENDING ON HEALTH CARE. The system will be financed by combining all federal, state and county monies already spent on health care with affordable, broad-based, earmarked state health care taxes that would replace insurance premiums. There are no co-pays or deductibles for at least the first two years. All monies to be spent on health care would be consolidated into a State Health Fund that is established in the California Treasury."

Administrative costs will be limited to 5%, and "Reimbursements will be risk adjusted to ensure that budgets cover the true costs of care." This is very important. Administrative costs of insurers and health care providers are skyrocketing. In particular they are much higher in the U.S. than other industrialized nations. That's ADMINISTRATIVE costs, not the cost of delivering care or new technology. Similarly, the costs of the same prescription drugs are higher in the U.S. than elsewhere.

"The system would be governed by a state elected health care commissioner who would head the California Health Care Agency. This agency would be assembled through the consolidation of the existing healthcare agencies." So: less private insurance bureaucracy, and no net increase in state bureaucracy.

How can universal health care possibly be affordable? Here's what this plan says:

By using state bulk purchasing power, "we anticipate a 40% to 50% decrease" in prices of prescription drugs. Bulk purchasing could save the state $4 billion, and patients will still have no co-pays. By extending primary and preventive care to everyone, some $3.5 billion to $6 billion a year could be saved from the costs of unnecessary emergency room visits and hospital stays made unnecessary by preventive care.

WHY THIS BILL WILL WORK

A study already exists showing this approach will work. The Lewin Report finds that this program will reduce total health spending in California by $8 billion in the first year, and will save some $344 billion that would otherwise be spent without this plan by 2015. The Lewin Report is viewable at Health Care For All.

A good summary of the bill, the study and the bill's prospects by SF Chronicle business columnist David Lazurus.

WHY THIS BILL HAS A CHANCE

The idea of universal health care coverage was very popular when President Clinton proposed it, and his bill was widely expected to pass, until the opposition funded by health insurers kicked in. But today, after nearly a decade of corporate HMO dominance, there is much wider recognition among physicians and even some insurers that the health care system is failing. The argument that gob'ment health care will create immense bureaucracies can elicit only horselaughs today, when doctors and hospitals are swamped with paperwork and constantly deal with interference from insurance companies in their decisions on care.

Business owners who might otherwise be skeptical can't help but notice that health care insurance costs are becoming a heavy burden. Small businesses struggle to stay afloat because of these costs, while large companies find they can't compete internationally because of the income they must devote to health insurance. This plan, says the Lewin study, is likely to save virtually all California businesses money.

Meanwhile, this bill has some carrots. It claims that the pharmaceutical industry won't lose money on it; the revenue lost by bulk purchasing will be made up with sheer numbers of patients, for 10 million Californians who have no prescription drug benefits now will be covered.
Hospitals are well aware of the drain on their income in the emergency room, where people without insurance show up for all their health care. The plan offers at least the possibility of a way out of the chaos of inpatient care in overcrowded, understaffed hospitals (the subject of this column by Jon Carroll in the San Francisco Chronicle.

As for the argument that government can't afford this, the truth is that government is paying billions without bulk savings or cost containment. All levels of government face the consequences of more than 6 million Californians who lacked health care coverage at some point in 2001. The burden that doesn't fall on the state, often falls on local governments. Ruehl estimates state and local governments would save $43 billion in the first ten years under her plan.

Ruehl argues that California can't afford NOT to enact universal health care. Others who are disgusted and frazzled with the current system may be willing to take a chance even if they aren't so sure this plan will work. The fears over rationing of care, or inadequate quality,become problems to address within the single payer system, not reasons to vote against it. Give health a chance! For millions of Californians must ask, how can single-payer universal health care be worse than the current system?

Californians are looking for a solution. A ballot measure mandating employers to provide health care coverage failed only narrowly, despite well-funded opposition. But had it passed, it would not be the solution. Even worse is a bill currently being offered that requires that every employee in the state buy health insurance in the current system, which would only transform chaos into punitive madness.

This single payer system is much fairer, and will save Californians money. Families with under $150,000 in annual income would, on average, see savings ranging between $600 and $3,000 per family under the program in 2006. Seniors could save an average of $1100 a year per household.

It's no wonder that this bill is endorsed by the American Medical Student Association, American Nurses Association, California Association of Public Hospitals and Health Systems, the
California Nurses Association and California Mental Health Association, as well as the League of Women Voters, many Democratic and Green Party organizations, labor unions, and organizations representing women and elders.

Clearly the issue of universal health care is not going to be debated in the U.S. Congress anytime soon. In California there is a chance to get the issues aired, perhaps even to force the Governor to take a stand and sign or veto this bill, and who knows? If the people are clear about what they want, a single payer plan for health care covering everyone in California could actually happen. And if it happens in California...