Proposals for “Universal” Health Careor

Back to the Health Care Future

Leonard Rodberg

New York Metro Chapter

Physicians for a National Health Program

February 27, 2007

Why Health Is On the Agenda

A Declining Number of Firms Are Offering Insurance…

Firms Shift Health InsuranceCosts to Workers

HIGH COST OF HEALTH INSURANCE PREMIUMS

National Average for Employer-provided Insurance

Single Coverage $4,024 per year Family Coverage $10,880 per year

Note: Annual income at minimum wage = $10,300 Annual income of average Wal-Mart worker = $17,114

Source: Kaiser Family Foundation/HRET Survey, 2005

Number of Uninsured Americans (Millions)

1980 1985 1990 1995 2000

45

40

35

30

25

20

Source: U.S. Census Bureau

Rising Number of uninsured

Bush Plan• The problem: Employers provide too much insurance,

leading to excessive spending• Bush’s solution:

– Tax employer-based insurance that is “gold-plated”– Provide tax deductions (not credits) to allow people to buy their

own insurance. No mandates on anyone.

• The impact (Lewin): – 9 M fewer uninsured (12 M lose employer coverage, 2 M would

remain uninsured) – Newly-insured are mainly upper-income– $62 B in annual federal expenditures

• No reform of individual insurance market: inaccessible to low- and middle-income families or pre-existing conditions

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U.S .Out-of-Pocket Expenses are Greater than Those of Other Countries

Source: OECD 2006

Physician Visits Per Capita

Hospital Inpatient Days Per Capita

Stephen Colbert on the Bush Health Plan

“It's so simple. Most people who can't afford health insurance also are too poor to owe taxes. But if you give them a deduction from the taxes they don't owe, they can use the money they're not getting back to buy the health care they can't afford.”

New Health Care Proposals (as of February 27, 2007)

• America’s Health Insurance Plans

• Better Health Care Together Campaign

• Health Coverage Coalition for the Uninsured

• Sen. Ron Wyden, SEIU, Safeway

• Federation of American Hospitals

• John Edwards

The Good News --and the Bad News

• “Universal health care” is accepted as the goal.

• This is defined to mean simply helping the uninsured buy private insurance.

America’s Health Insurance Plans“the private insurance protection plan”

and

Federation of American Hospitals“the private hospital protection plan”

• Expand SCHIP and Medicaid eligibility for very low-income

• Provide federal and state subsidies and tax deductibility to encourage everyone else to buy private insurance

Better Health Care Together Campaign

“grand coalition”Members: ATT, Kelly Services, Wal-Mart

SEIU, CWA Center for American Progress

Principles but no Program:• Quality affordable insurance coverage for everyone• Individuals are responsible for maintaining and

protecting their health• Improved value for health care dollar• “Shared Responsibility”: Businesses, government,

individuals all contribute.

Health Coverage Coalition for the Uninsured

“even grander coalition”Members: UnitedHealth, Blue Cross, Kaiser AHA, AMA

Chamber of Commerce, NAM, Pfizer AFL-CIO, SEIU AARP, Families USA

Could agree only on:• Expanding coverage as a goal• Expansion of SCHIP• Tax credits for children’s insurance

Wyden Healthy Americans Act“slash and burn”

Supporters: SEIU, Safeway, Families USA

• Eliminate the tax deductibility of employer-based insurance end employer benefit

• Require individual purchase of insurance• Transitional payments by employers• Subsidies to low-income individuals• Relies on competition to contain costs

John Edwards Plan“individual mandate with a pretty face”

• Medicaid and SCHIP expansion• Employer mandate (“play or pay”)• Individual mandate with community rating• Government subsidies for low-income• Regional purchasing plans (“Health Markets”)• Government program (“single payer”?) as well as

private plans. (cf Medicare Advantage)Note: Jacob Hacker plan: Identical content,

different verbiage

Edwards’ Seductive Verbiage

• For everyone: Shared responsibility

• For the fearful: Lets people keep what they have

• For those worried about cost: Everyone will work together to make the system more efficient

• For single payer advocates: Individuals and businesses can choose if they want the government plan; if so, the system will “evolve toward a single-payer approach.”

(For more, see www.johnedwards.com)

What’s Wrong with an Individual Mandate (partial list)?

• Will not lead to universal coverage• Enforcement is anti-public health• Affordable premium vs

affordable health care • Employers will drop coverage

(“crowd out”)• Insurance companies resist community

rating

What’s Wrong with an Individual Mandate (partial list cont.)?

• Health insurance: a consumer’s nightmare

(copays, deductibles, exclusions, denials, appeals)

• Complexity/humiliation of means testing• More bureaucracy (“Health Markets”, etc.)• High cost ($120B Federal + ???B for

individuals)• No cost control/continuing rising cost

Common Features of these Plans

• Identification of the problem: too many uninsured.

• Their solution: Require everyone to have insurance

• Employers should contribute but not necessarily offer insurance

• Their mission: Save private insurers

None of These Plans Will Happen!

• They cost hundreds of billions of dollars

• They benefit only those with low incomes and those without insurance

Note: Half of middle- and lower-income adults experience serious problems paying medical bills or insurance premiums. (Commonwealth Fund 2006) These plans do nothing for them. 

• They don’t solve any of the problems (especially rising costs) that concern everyone

None envisions a real structural change.

A Familiar Headline – But It’s Wrong!

• It is the unaffordable, inefficient privateinsurance system that is collapsing.

• Employers should contribute their fair share,just not through private insurance.

• Going backwards to individual purchase of insurance is not the answer.

Employer-Based Health Insurance System ‘Collapsing’

(Wall Street Journal, 7/17/06)

Some of the Problems created by private insurance

SOME OF THE PROBLEMS CREATED BY PRIVATE INSURANCE

• Excessive administrative costs• Excessive complexity• Continuously rising costs• Lack of coordination, budgeting, and planning• Regressive financing via premiums• Widespread underinsurance and bankruptcy• Interference in physician decision-making• The “hassle factor”

SO HERE’S OUR REAL SINGLE PAYOR SOLUTION:

• Expand Medicare to cover everyone

• Improve the coverage it offers

• Eliminate private insurance

• Automatic enrollment in Medicare for All

• Income-based financing through employers and employees (“shared responsibility”)

Expand and Improve Medicare for All

Conyers Bill - HR 676

Conclusion

Instead of moving backwards, to a time before there was employer-based or group insurance, when everyone was on their own to get health care, we should be moving forward, to recognize health care as a necessary public good that should be a public responsibility. We should be expanding and improving the Medicare program, which we know provides reliable, cost-effective coverage and has been doing so for more than forty years. Public Medicare for All, not private for-profit insurance, is the only path to a future that will truly provide health care for all Americans.