Obama's Health Care Record
By SCOTT GOTTLIEBMay 5, 2008
Laughing gas can be useful during complicated dental procedures, but should every health plan be required to cover it and should health insurance cost more because of it?
Barack Obama thinks so. As a state senator in Illinois, he voted to require that dental anesthesia be covered by every health plan for difficult medical cases. Today, the requirement is one of 43 mandates imposed by Illinois on health insurance, according to the Illinois Division of Insurance. Other mandates require coverage of infertility treatments, drug rehab, "personal injuries" incurred while intoxicated, and other forms of care.
By my count, during Mr. Obama's tenure in the state Senate, 18 different laws came up for a vote and passed that imposed new mandates on private health insurance. Mr. Obama voted for all of them.
As a presidential candidate, Mr. Obama says people lack health insurance because "they can't afford it." He's right. But he is also partly responsible for why health insurance is too expensive. A long list of studies show that mandates like the ones Mr. Obama has championed drive up the cost of insurance for the very people priced out of coverage.
A 2008 study by an insurance-industry supported research organization, the Council for Affordable Health Insurance (CAHI), estimates that mandates increase the cost of basic health coverage by 20% to 50%, depending on the state. Average policies in high-mandate New Jersey cost about $4,000 according to a 2004 insurance survey, much more than the $1,200 charged in low-mandate Wyoming.
CAHI estimates that there are 1,961 state-mandated benefits across the country. It's not just specific products and services that get mandated, but also whole categories of providers like chiropractors and psychologists. By one count, states have enacted about 500 laws mandating coverage for 25 different types of providers.
States also mandate new categories of eligibility that force small businesses to cover additional dependents. One popular measure is the "slacker mandate," which extends coverage to unmarried dependents under the age of 30.
Not all mandates are equally expensive. Drug rehab, for example, increases a plan's premiums by 9% on average, according to America's Health Insurance Plans (AHIP). Coverage for psychologists adds 12% to premiums. But in total, in some states mandates increase the cost of insurance from 10% to 20%, according to AHIP.
These increased costs aren't shared equally among all who have health insurance. People who are covered through self-insured employers (usually large corporations) are shielded from state mandates because of the federal Employee Retirement Income Security Act (ERISA), which prevents states from enacting controls on plans that cross state lines.
The burden of paying for state mandates is usually borne by individuals who buy their own insurance, small employers and others not covered by ERISA. In total, about half of the people who have insurance bear the brunt of the cost of state mandates. And, as it turns out, individuals who do not work for large corporations are much more likely to be uninsured. AHIP calculates that between 20%-25% of uninsured Americans can't afford coverage because of the increased cost of providing mandated care.
It doesn't have to be that way. If insurers were allowed to offer "bare-bones" plans – which would be cheaper because they would cover just essential care – many consumers who are priced out of health insurance now would likely buy these plans instead of living without insurance.
State mandates even hurt those who have insurance because they prompt insurers to cut back on coverage for catastrophic illnesses. This undermines the purpose of insurance by turning policies into prepaid health care rather than security from the economic consequences of serious medical problems. And because many mandates define the duration and scope of specific benefits, they lock in treatment standards that grow outdated as knowledge advances. That can diminish incentives to find more effective ways of delivering medical care.
Why, then, do we have mandates?
For the simple reason that each mandate has a powerful constituency – be it chiropractors, dentists or other groups – who benefit when their services are included on the list of mandated care. These groups pressure lawmakers to expand the list of mandates and, over time, the list grows to be very long and expensive. Often the care that is being mandated is for minor medical problems because small, routine ailments are suffered by more people and therefore have broader political constituencies.
One way to make insurance more affordable is to extend the benefits of the ERISA exemption to people who buy insurance on their own, putting them on a level playing field with those who get coverage through large employers by freeing them from expensive state insurance laws.
Most insurance plans would still cover important health-care items such as prenatal HIV testing or routine colon cancer screening or bone density tests – three additional mandates Mr. Obama helped enact in Illinois. But without government mandates, plans would also have the flexibility to offer lower-priced insurance options.
Better still, Congress could pass legislation that has long languished in the House allowing people to purchase health plans across state lines. People could choose which state regulations to buy into, creating a market for the insurance mandates. This would give states more incentives to fix local problems that have helped make health insurance expensive in the first place. It's a fair bet that there would be an exodus of policyholders from higher-cost, higher-mandate states like New Jersey and even Illinois (which has more expensive mandates than about half of the other states).
Mr. Obama says people need more options to purchase insurance outside the workplace. He also says he can draw on his experience as a state legislator to lead a reform of the kinds of special interests that pursue these mandated benefits. Right now Mr. Obama's health-care proposal, like Hillary Clinton's plan, does the opposite by adding federal regulations on top of state laws.
"My plan emphasizes lowering costs," Mr. Obama says. If that is really what he wants to do, he can start by freeing consumers from forced subsidization of the pricey state mandates. Given a choice between the lower costs he promises and subsidized dental anesthesia he has delivered, some would opt for the affordable health insurance and make do with some extra Novocain.
Dr. Gottlieb is a resident fellow at the American Enterprise Institute.
Showing posts with label Health INsurance. Show all posts
Showing posts with label Health INsurance. Show all posts
Tuesday, May 6, 2008
Saturday, March 15, 2008
Canada's Health System Is Sick
Promise Of Choice
By INVESTOR'S BUSINESS DAILY | Posted Tuesday, February 26, 2008 4:20 PM PT
Socialized Medicine: Quebec's former health minister is tacitly admitting that the system he helped create is not sustainable. It has, as Claude Castonguay has succinctly noted, reached "a crisis point."
Actually, when 40% of the province's $60 billion budget is spent on health care, or when public health care costs in Canada are growing at twice the rate of the economy as a whole, we'd say the crisis point was reached long ago.
But better late than never. And Castonguay, known as the father of the Quebec public health care system that was copied by the rest of Canada, should be commended for acknowledging that the province's health care costs are unbearable.
He should also be applauded for proposing further privatization. A report issued last week recommends that Quebec move toward a mixed-delivery system that includes more private care.
The report, "Getting Our Money's Worth," also calls for user and access fees that will cut the incentives to make those "free" doctor visits for minor ailments that have clogged the system and sent costs soaring. It also suggests eliminating the rule that prevents doctors from practicing in both the public and private sectors.
These are mere details, though. Of greater significance is the admission that state health care doesn't work. Perhaps most revealing is Castonguay's statement that "patients, instead of being seen as an expenditure for the hospital, become a source of revenue."
In nations that have the blessing of a liberalized economy, people are looked upon as sources of revenue in every facet of life. It's a formula that works well for both seller and consumer.
Even the poor in this nation, where we allegedly have a crisis of the uninsured, benefit from the arrangement: They have color TVs, microwave ovens, cell phones, multiple cars, VCRs and DVD players, air conditioning and plenty of food, enough for obesity to be among the top health problems for those below the poverty line.
"People can choose what car they want to buy, what suit they want to wear, what house they want to live in," Castonguay says. "But when it comes to their health, they don't have a choice. That's what I'm against. We are proposing to give a greater role to the private sector so that people can exercise a freedom of choice."
Too bad Castonguay failed to recognize this in the 1970s, when he was putting together Quebec's socialist health care system and stripping Canadians of their choice. He wouldn't now be forced to unravel the mess while trying to maintain the fiction that the public health care system that "has become a symbol that's very valuable in people's minds" will not be significantly changed.
By INVESTOR'S BUSINESS DAILY | Posted Tuesday, February 26, 2008 4:20 PM PT
Socialized Medicine: Quebec's former health minister is tacitly admitting that the system he helped create is not sustainable. It has, as Claude Castonguay has succinctly noted, reached "a crisis point."
Actually, when 40% of the province's $60 billion budget is spent on health care, or when public health care costs in Canada are growing at twice the rate of the economy as a whole, we'd say the crisis point was reached long ago.
But better late than never. And Castonguay, known as the father of the Quebec public health care system that was copied by the rest of Canada, should be commended for acknowledging that the province's health care costs are unbearable.
He should also be applauded for proposing further privatization. A report issued last week recommends that Quebec move toward a mixed-delivery system that includes more private care.
The report, "Getting Our Money's Worth," also calls for user and access fees that will cut the incentives to make those "free" doctor visits for minor ailments that have clogged the system and sent costs soaring. It also suggests eliminating the rule that prevents doctors from practicing in both the public and private sectors.
These are mere details, though. Of greater significance is the admission that state health care doesn't work. Perhaps most revealing is Castonguay's statement that "patients, instead of being seen as an expenditure for the hospital, become a source of revenue."
In nations that have the blessing of a liberalized economy, people are looked upon as sources of revenue in every facet of life. It's a formula that works well for both seller and consumer.
Even the poor in this nation, where we allegedly have a crisis of the uninsured, benefit from the arrangement: They have color TVs, microwave ovens, cell phones, multiple cars, VCRs and DVD players, air conditioning and plenty of food, enough for obesity to be among the top health problems for those below the poverty line.
"People can choose what car they want to buy, what suit they want to wear, what house they want to live in," Castonguay says. "But when it comes to their health, they don't have a choice. That's what I'm against. We are proposing to give a greater role to the private sector so that people can exercise a freedom of choice."
Too bad Castonguay failed to recognize this in the 1970s, when he was putting together Quebec's socialist health care system and stripping Canadians of their choice. He wouldn't now be forced to unravel the mess while trying to maintain the fiction that the public health care system that "has become a symbol that's very valuable in people's minds" will not be significantly changed.
Tuesday, March 11, 2008
Here's To Your Health
Why McCain has the best health-care plan
His is the only one of the candidate proposals that has a chance of getting medical costs under control. An argument for some free-market sanity.
By Shawn Tully, editor-at-large
McCain's health-care proposal would push more decision-making power into the hands of consumers.
(Fortune Magazine) -- Fellow Americans, choose your revolution. One way or another, we're getting a new health-care system. The old one is obviously broken. The U.S. now has 47 million uninsured, and costs are out of control. The Department of Health and Human Services predicts that if things continue as they are, health spending will almost double by 2017 to $4.3 trillion, or one-fifth of GDP, vs. 16% today.
The crisis has gotten so severe that fixing the system is no longer a partisan issue. Everyone understands that something has to change, and fast. In this presidential race, both sides are proposing radical fixes that would totally transform the way health care is delivered and paid for in America. Both the Democrats and the Republicans embrace the same goals: John McCain, Barack Obama, and Hillary Clinton are all putting forth ways of making health care affordable for every American and stopping a disastrous escalation in costs. Both sides also envision a world where employers play a much smaller role in medical benefits. The differences, of course, are in the way each candidate intends to reach those laudable goals. In essence, McCain wants to create a kind of national insurance market that shoves more decision-making power into the hands of consumers; the Democrats are aiming for a Medicare-like federal superprogram. (We'll stick with the "Democrat" label in this story. The nominee status was still unclear at presstime, and, intraparty sniping notwithstanding, the Clinton and Obama plans are extremely similar.)
So far, the press and public haven't paid much attention to the implications of these dueling visions. This stuff is complicated, and the most revolutionary provisions are buried deep in jargon-filled position papers. But parsing the plans is worth the work: This issue is crucial to America's economic future, and the differences between McCain and the Democrats are profound.
Who has the best plan? Both have huge flaws, but on balance McCain's is better.
McCain's main pillar is the elimination of a tax break that employees receive if their employer provides their health care. That may not sound like a shocker, but it is. The exclusion dates from World War II, when the federal government imposed controls on wages, but allowed companies to compete for workers by offering tax-free health benefits in lieu of pay. The law is largely responsible for the nightmarish patchwork of corporate-provided medical plans we enjoy so much today. Employees and their unions demanded richer and richer packages, and employers complied, since they could buy far more benefits for their employees than workers could buy with after-tax dollars on their own. Americans have paid a steep price, however, by sacrificing their raises as corporate insurance bills exploded, never more so than now.
McCain suggests that we junk all that. Say you're earning $100,000 a year and your company provides about $9,000 toward your $12,000 family premium, which is about average. Today you're taxed only on the $100,000. Under McCain's plan, you'd also pay on the $9,000. That could mean an extra $3,000 or so in federal taxes alone. To compensate for the extra levy, McCain would provide a $2,500 federal tax rebate for individuals and $5,000 per family, meaning a family would simply subtract $5,000 from its tax bill, the equivalent of a big cash payment.
Here's where it gets interesting. Employers would no longer be able to buy more health care with $9,000 of their employees' money than the workers could buy on their own. The raison d'être for corporate health benefits would vanish. Employers have another compelling reason to pass the ball to the employee: While wages are rising around 3% ayear, their health-care costs are growing at three times that rate. "I predict that most companies would stop paying for health care in three to four years," says Robert Laszewski, a consultant who works with corporate benefits managers. Hence, an employer that pays $9,000 for your benefits would simply pack an extra $9,000 a year into your paycheck. (Why? Because in a competitive labor market, companies would have to hand over that cash to employees or risk losing them.) So you'd have $6,000 after tax, plus the $5,000 family credit, to buy insurance. That's $11,000 in new cash that employees can set aside for health care.
So what types of policies would they buy? Employees (and their families) with corporate plans - about 150 million Americans - would probably rush toward high-deductible, low-premium insurance, and use what's left over to pay cash for routine procedures. They would couple those high-deductible policies with Health Savings Accounts, which allow families to put away up to $5,800 ayear, before taxes, for medical expenses. Those plans cost about $10,000. That's not a huge saving from the typical $12,000 corporate plan, but it's a start. More than four million Americans already have HSAs, and the McCain plan would make portable, high-deductible plans the product of choice for a new generation of healthcare consumers.
Besides eliminating the employer exclusion, McCain's plan boasts another nice feature. It would allow consumers to choose an insurance plan that suits their stage of life. If you're young and healthy, for example, you probably want the cheapest plan you can get. If you're 45 and have four dependents, maybe you want something a bit more expensive and generous. Nine states, including New York, California, and Texas already require that as many as 50 benefits be covered, a list that ranges from in vitro fertilization to mental health services to prescription drugs. These requirements increase the cost of insurance; they're a major reason young people have dropped their coverage. Under the McCain plan, insurers in any state would be free to offer the plans with a vast variety of deductibles, co-pays and benefits. UnitedHealthcare and Blue Cross/Blue Shield plans already provide a menu of packages tailored to groups as varied as Gen Xers and retirees.
The problem with McCain's approach - and it is a huge problem - is that McCain ventures so far toward total laissez-faire liberty that he risks leaving the poor and sick behind. Here's why. Perhaps his most drastic proposal is allowing the same insurance products to be sold across state lines. That seems to make sense, and maybe it does: Look what interstate banking has done for pricing and choice in financial services. But in health care, the upheaval would be so brutal that it scares even the most ardent free-marketer. Many states have some form of what policy wonks call "community rating." Under pure community rating, insurers must charge all customers the same premium no matter whether they're 20 or 55, or whether they have cancer or are models of good health. McCain is targeting community rating for good reason. It forces the young and healthy to pay far more than their actual cost by making them subsidize the elderly and sick. Like the mandated benefits, it's pushed millions of Americans in their 20s to drop their health insurance.
But under the McCain plan, states with no restrictions - Pennsylvania, for example - could sell policies for 25-year-olds that cost around $1,200 a year, one-third the price in New York. Young New Yorkers would drop their plans in favor of Pennsylvania providers, forcing New York insurers to jack up premiums for people in their 50s or early 60s, who need those rich, community-rated plans that cover as many procedures as possible - but who no longer benefit from the excessive premiums paid by the youngsters. It gets worse. Anyone with cancer, diabetes, or other pre-existing conditions will see their premiums multiply too.
To his credit, McCain does have a plan for relatively young, low-income Americans who can't afford insurance. "We would increase the tax credit according to income so that poor families could buy insurance," says Douglas Holtz-Eakin, McCain's policy director. But McCain sorely lacks a plan for people in their 50s without corporate benefits, and Americans with pre-existing conditions, who would be brutally stripped of coverage if insurance crosses state lines. "For his plan to work, McCain has to tell us how he would deal with the old and sick," says Jon Gruber, an MIT economist. "If McCain doesn't tax the healthy to pay for pre-existing conditions, as happens under community rating, he has to tax the taxpayer. That means his plan will require huge subsidies he's not talking about."
NOW FOR THE DEMOCRATS. The core of their plan is a "pay or play" option for employers. Large companies would have the choice of either providing benefits for workers or dropping their coverage. If they chose the latter, they would pay a mandatory payroll tax to support a new government-administered system. That system would have two parts: a Medicare-like public program, and a menu of private options similar to the generous plans available to U.S. government employees today. Workers who are self-employed or lack insurance would go straight into one of these two options. Low-income Americans would receive federal subsidies to purchase the premiums.
In practice, the system would quickly swell the ranks of Americans with government-paid health care. Remember, health-care costs are rising far faster than wages, so companies have a strong incentive to pay the tax and erase that rapidly growing burden from the books. It's also likely that the government plan will offer better benefits than many, or perhaps most, corporate plans. In fact, the Democrats call for rich standard benefits packages based on the plan offered to federal employees. Those packages would have deductibles of just $300 and offer prescription drugs, mental health benefits, and "spinal manipulations" (i.e., chiropractic services), among a cornucopia of other benefits. As a result, the federal plan, potentially packed with new benefits pushed for by lobbyists for various medical specialties, will quickly cause an exodus from employer plans.
The standard benefits package isn't just a bad idea because it will substantially raise the cost to taxpayers. It will also make it virtually impossible for Americans to buy insurance tailored to their needs. Suppose you're one of those 25-year-olds. You probably don't want to spring for a full-blown plan that covers old-age diseases like Alzheimer's and would rather save some money and go with a low-premium, high-deductible plan. But the Democrat approach requires that any competing plans be "actuarily equivalent" (Clinton's term) to the federal employee plan - which translates as a generous minimum standard for health insurance. "With that mandate, you rule out high-deductible plans," says Gruber. "It would make it very difficult to design one that would qualify."
The Democrat proposals have some additional drawbacks. First, the Dems want to heavily regulate the insurance industry by limiting everything from profits to marketing expenses. If the earning power of insurers is determined by federal regulators, their pricing will be too, and thus they will evolve into the equivalent of public utilities. Would you rather have medical prices set by fiat or by nationwide market competition?
Second, the Democrat plan exacerbates the fundamental problem in the American health-care system, which is that no one has any incentive to care about price. (How much is that MRI center charging for your ankle scan? Who cares? Just hand over the $50 co-pay and never you mind.) Creating a huge new medical superstructure would shift far more spending to third-party providers, chiefly the federal government, giving consumers even less incentive to concern themselves with the price of an MRI - or any other service, from an elective wart-removal procedure to a life-saving heart bypass. "The Clinton and Obama plans would enormously increase total health-care spending, but disguise the extra costs by shifting them to taxpayers," says John Sheils of the Lewin Group, a research firm that does statistical modeling for health-care plans.
Despite all that, the Democrats' plan probably beats McCain's if you're scoring on political viability. Their program doesn't involve anything that smacks of a cut in benefits, and it's just easier to win with largesse.
But on economic merits, McCain wins. For all its problems, at least it puts the consumer in charge. Would that create a world where we're forced to dicker with heart surgeons? No. It will create a world where health care is treated as the precious resource that it is, rather than a costless entitlement; where nationwide competition pushes down the price of catastrophic care and consumers focus their attention and budgets on what's really crucial to their health. That's an important first step. The price of health care is never going to get under control until patients get what they deserve: the right to be customers too.
REPORTER ASSOCIATE Christopher Tkaczyk contributed to this article.
His is the only one of the candidate proposals that has a chance of getting medical costs under control. An argument for some free-market sanity.
By Shawn Tully, editor-at-large
McCain's health-care proposal would push more decision-making power into the hands of consumers.
(Fortune Magazine) -- Fellow Americans, choose your revolution. One way or another, we're getting a new health-care system. The old one is obviously broken. The U.S. now has 47 million uninsured, and costs are out of control. The Department of Health and Human Services predicts that if things continue as they are, health spending will almost double by 2017 to $4.3 trillion, or one-fifth of GDP, vs. 16% today.
The crisis has gotten so severe that fixing the system is no longer a partisan issue. Everyone understands that something has to change, and fast. In this presidential race, both sides are proposing radical fixes that would totally transform the way health care is delivered and paid for in America. Both the Democrats and the Republicans embrace the same goals: John McCain, Barack Obama, and Hillary Clinton are all putting forth ways of making health care affordable for every American and stopping a disastrous escalation in costs. Both sides also envision a world where employers play a much smaller role in medical benefits. The differences, of course, are in the way each candidate intends to reach those laudable goals. In essence, McCain wants to create a kind of national insurance market that shoves more decision-making power into the hands of consumers; the Democrats are aiming for a Medicare-like federal superprogram. (We'll stick with the "Democrat" label in this story. The nominee status was still unclear at presstime, and, intraparty sniping notwithstanding, the Clinton and Obama plans are extremely similar.)
So far, the press and public haven't paid much attention to the implications of these dueling visions. This stuff is complicated, and the most revolutionary provisions are buried deep in jargon-filled position papers. But parsing the plans is worth the work: This issue is crucial to America's economic future, and the differences between McCain and the Democrats are profound.
Who has the best plan? Both have huge flaws, but on balance McCain's is better.
McCain's main pillar is the elimination of a tax break that employees receive if their employer provides their health care. That may not sound like a shocker, but it is. The exclusion dates from World War II, when the federal government imposed controls on wages, but allowed companies to compete for workers by offering tax-free health benefits in lieu of pay. The law is largely responsible for the nightmarish patchwork of corporate-provided medical plans we enjoy so much today. Employees and their unions demanded richer and richer packages, and employers complied, since they could buy far more benefits for their employees than workers could buy with after-tax dollars on their own. Americans have paid a steep price, however, by sacrificing their raises as corporate insurance bills exploded, never more so than now.
McCain suggests that we junk all that. Say you're earning $100,000 a year and your company provides about $9,000 toward your $12,000 family premium, which is about average. Today you're taxed only on the $100,000. Under McCain's plan, you'd also pay on the $9,000. That could mean an extra $3,000 or so in federal taxes alone. To compensate for the extra levy, McCain would provide a $2,500 federal tax rebate for individuals and $5,000 per family, meaning a family would simply subtract $5,000 from its tax bill, the equivalent of a big cash payment.
Here's where it gets interesting. Employers would no longer be able to buy more health care with $9,000 of their employees' money than the workers could buy on their own. The raison d'être for corporate health benefits would vanish. Employers have another compelling reason to pass the ball to the employee: While wages are rising around 3% ayear, their health-care costs are growing at three times that rate. "I predict that most companies would stop paying for health care in three to four years," says Robert Laszewski, a consultant who works with corporate benefits managers. Hence, an employer that pays $9,000 for your benefits would simply pack an extra $9,000 a year into your paycheck. (Why? Because in a competitive labor market, companies would have to hand over that cash to employees or risk losing them.) So you'd have $6,000 after tax, plus the $5,000 family credit, to buy insurance. That's $11,000 in new cash that employees can set aside for health care.
So what types of policies would they buy? Employees (and their families) with corporate plans - about 150 million Americans - would probably rush toward high-deductible, low-premium insurance, and use what's left over to pay cash for routine procedures. They would couple those high-deductible policies with Health Savings Accounts, which allow families to put away up to $5,800 ayear, before taxes, for medical expenses. Those plans cost about $10,000. That's not a huge saving from the typical $12,000 corporate plan, but it's a start. More than four million Americans already have HSAs, and the McCain plan would make portable, high-deductible plans the product of choice for a new generation of healthcare consumers.
Besides eliminating the employer exclusion, McCain's plan boasts another nice feature. It would allow consumers to choose an insurance plan that suits their stage of life. If you're young and healthy, for example, you probably want the cheapest plan you can get. If you're 45 and have four dependents, maybe you want something a bit more expensive and generous. Nine states, including New York, California, and Texas already require that as many as 50 benefits be covered, a list that ranges from in vitro fertilization to mental health services to prescription drugs. These requirements increase the cost of insurance; they're a major reason young people have dropped their coverage. Under the McCain plan, insurers in any state would be free to offer the plans with a vast variety of deductibles, co-pays and benefits. UnitedHealthcare and Blue Cross/Blue Shield plans already provide a menu of packages tailored to groups as varied as Gen Xers and retirees.
The problem with McCain's approach - and it is a huge problem - is that McCain ventures so far toward total laissez-faire liberty that he risks leaving the poor and sick behind. Here's why. Perhaps his most drastic proposal is allowing the same insurance products to be sold across state lines. That seems to make sense, and maybe it does: Look what interstate banking has done for pricing and choice in financial services. But in health care, the upheaval would be so brutal that it scares even the most ardent free-marketer. Many states have some form of what policy wonks call "community rating." Under pure community rating, insurers must charge all customers the same premium no matter whether they're 20 or 55, or whether they have cancer or are models of good health. McCain is targeting community rating for good reason. It forces the young and healthy to pay far more than their actual cost by making them subsidize the elderly and sick. Like the mandated benefits, it's pushed millions of Americans in their 20s to drop their health insurance.
But under the McCain plan, states with no restrictions - Pennsylvania, for example - could sell policies for 25-year-olds that cost around $1,200 a year, one-third the price in New York. Young New Yorkers would drop their plans in favor of Pennsylvania providers, forcing New York insurers to jack up premiums for people in their 50s or early 60s, who need those rich, community-rated plans that cover as many procedures as possible - but who no longer benefit from the excessive premiums paid by the youngsters. It gets worse. Anyone with cancer, diabetes, or other pre-existing conditions will see their premiums multiply too.
To his credit, McCain does have a plan for relatively young, low-income Americans who can't afford insurance. "We would increase the tax credit according to income so that poor families could buy insurance," says Douglas Holtz-Eakin, McCain's policy director. But McCain sorely lacks a plan for people in their 50s without corporate benefits, and Americans with pre-existing conditions, who would be brutally stripped of coverage if insurance crosses state lines. "For his plan to work, McCain has to tell us how he would deal with the old and sick," says Jon Gruber, an MIT economist. "If McCain doesn't tax the healthy to pay for pre-existing conditions, as happens under community rating, he has to tax the taxpayer. That means his plan will require huge subsidies he's not talking about."
NOW FOR THE DEMOCRATS. The core of their plan is a "pay or play" option for employers. Large companies would have the choice of either providing benefits for workers or dropping their coverage. If they chose the latter, they would pay a mandatory payroll tax to support a new government-administered system. That system would have two parts: a Medicare-like public program, and a menu of private options similar to the generous plans available to U.S. government employees today. Workers who are self-employed or lack insurance would go straight into one of these two options. Low-income Americans would receive federal subsidies to purchase the premiums.
In practice, the system would quickly swell the ranks of Americans with government-paid health care. Remember, health-care costs are rising far faster than wages, so companies have a strong incentive to pay the tax and erase that rapidly growing burden from the books. It's also likely that the government plan will offer better benefits than many, or perhaps most, corporate plans. In fact, the Democrats call for rich standard benefits packages based on the plan offered to federal employees. Those packages would have deductibles of just $300 and offer prescription drugs, mental health benefits, and "spinal manipulations" (i.e., chiropractic services), among a cornucopia of other benefits. As a result, the federal plan, potentially packed with new benefits pushed for by lobbyists for various medical specialties, will quickly cause an exodus from employer plans.
The standard benefits package isn't just a bad idea because it will substantially raise the cost to taxpayers. It will also make it virtually impossible for Americans to buy insurance tailored to their needs. Suppose you're one of those 25-year-olds. You probably don't want to spring for a full-blown plan that covers old-age diseases like Alzheimer's and would rather save some money and go with a low-premium, high-deductible plan. But the Democrat approach requires that any competing plans be "actuarily equivalent" (Clinton's term) to the federal employee plan - which translates as a generous minimum standard for health insurance. "With that mandate, you rule out high-deductible plans," says Gruber. "It would make it very difficult to design one that would qualify."
The Democrat proposals have some additional drawbacks. First, the Dems want to heavily regulate the insurance industry by limiting everything from profits to marketing expenses. If the earning power of insurers is determined by federal regulators, their pricing will be too, and thus they will evolve into the equivalent of public utilities. Would you rather have medical prices set by fiat or by nationwide market competition?
Second, the Democrat plan exacerbates the fundamental problem in the American health-care system, which is that no one has any incentive to care about price. (How much is that MRI center charging for your ankle scan? Who cares? Just hand over the $50 co-pay and never you mind.) Creating a huge new medical superstructure would shift far more spending to third-party providers, chiefly the federal government, giving consumers even less incentive to concern themselves with the price of an MRI - or any other service, from an elective wart-removal procedure to a life-saving heart bypass. "The Clinton and Obama plans would enormously increase total health-care spending, but disguise the extra costs by shifting them to taxpayers," says John Sheils of the Lewin Group, a research firm that does statistical modeling for health-care plans.
Despite all that, the Democrats' plan probably beats McCain's if you're scoring on political viability. Their program doesn't involve anything that smacks of a cut in benefits, and it's just easier to win with largesse.
But on economic merits, McCain wins. For all its problems, at least it puts the consumer in charge. Would that create a world where we're forced to dicker with heart surgeons? No. It will create a world where health care is treated as the precious resource that it is, rather than a costless entitlement; where nationwide competition pushes down the price of catastrophic care and consumers focus their attention and budgets on what's really crucial to their health. That's an important first step. The price of health care is never going to get under control until patients get what they deserve: the right to be customers too.
REPORTER ASSOCIATE Christopher Tkaczyk contributed to this article.
Tuesday, March 4, 2008
Good For Your Health
Shadegg Introduces Health Care Choice Act
Washington, Dec 12, 2007 -
Shadegg Introduces Health Care Choice Act
Legislation will lower cost, make insurance more affordable for the uninsured
WASHINGTON, DC – In the era of eBay and Amazon.com, there should be a better way to shop for health insurance. Today, Congressman John Shadegg (R, AZ-3) introduced an innovative bill that empowers consumers to use the Internet and other means to find affordable health insurance policies.
The Health Care Choice Act, which has forty co-sponsors, harnesses the power of the marketplace to allow Americans to compare insurance policies from across the country and pick one that best meets their needs. It would provide every American with more and better health insurance choices. The legislation would also reduce the number of Americans who have been unable to find affordable coverage.
“People should be able to get the health insurance that best suits their needs,” Shadegg said. “Offering people choices in a nation-wide market will reduce the cost of health insurance for Americans, including the roughly 47 million uninsured.”
According to the National Center for Policy Analysis, a 25-year-old male in good health could purchase a policy for $960 a year in Kentucky. A similar policy would cost about $5,880 in New Jersey.
Shadegg concluded, “Rather than going through fifty different regulatory processes, this bill will allow an insurance company to go through one process and sell to people in all fifty states. We can help people, not by setting up a massive new government bureaucracy, but by empowering individuals to make the best choice for themselves and their families.” The following members are original co-sponsors of the Health Care Choice Act: Dan Burton (IN-5), Wally Herger (CA-2), Ron Paul (TX-14), Roscoe Bartlett (MD-6), Pete Hoekstra (MI-2), Jack Kingston (GA-1), Barbara Cubin (WY), Dan Lungren (CA-3), Mark Souder (IN-3), Zach Wamp (TN-3), Dave Weldon (FL-15), Chris Cannon (UT-3), Joe Pitts (PA-16), Pete Sessions (TX-32), Paul Ryan (WI-1), Todd Akin (MO-2), Henry Brown (SC-1), Jeff Flake (AZ-6), Darrell Issa (CA-49), Jeff Miller (FL-1), Mike Pence (IN-6), Todd Platts (PA-19), Adam Putnam (FL-12), Joe Wilson (SC-2), Marsha Blackburn (TN-7), Tom Feeney (FL-24), Trent Franks (AZ-2), Phil Gingrey (GA-11), Jeb Hensarling (TX-5), Marilyn Musgrave (CO-4), Rick Renzi (AZ-1), Charles Boustany (LA-7), John Campbell (CA-48), Virginia Foxx (NC-5), Cathy McMorris Rodgers (WA-5), Kenny Marchant (TX-24), Tom Price (NC-4), Michele Bachman (MN-6), David Davis (TN-1), Mary Fallin (OK-5), Luis Fortuno (PR), and Adrian Smith (NE-3).
Washington, Dec 12, 2007 -
Shadegg Introduces Health Care Choice Act
Legislation will lower cost, make insurance more affordable for the uninsured
WASHINGTON, DC – In the era of eBay and Amazon.com, there should be a better way to shop for health insurance. Today, Congressman John Shadegg (R, AZ-3) introduced an innovative bill that empowers consumers to use the Internet and other means to find affordable health insurance policies.
The Health Care Choice Act, which has forty co-sponsors, harnesses the power of the marketplace to allow Americans to compare insurance policies from across the country and pick one that best meets their needs. It would provide every American with more and better health insurance choices. The legislation would also reduce the number of Americans who have been unable to find affordable coverage.
“People should be able to get the health insurance that best suits their needs,” Shadegg said. “Offering people choices in a nation-wide market will reduce the cost of health insurance for Americans, including the roughly 47 million uninsured.”
According to the National Center for Policy Analysis, a 25-year-old male in good health could purchase a policy for $960 a year in Kentucky. A similar policy would cost about $5,880 in New Jersey.
Shadegg concluded, “Rather than going through fifty different regulatory processes, this bill will allow an insurance company to go through one process and sell to people in all fifty states. We can help people, not by setting up a massive new government bureaucracy, but by empowering individuals to make the best choice for themselves and their families.” The following members are original co-sponsors of the Health Care Choice Act: Dan Burton (IN-5), Wally Herger (CA-2), Ron Paul (TX-14), Roscoe Bartlett (MD-6), Pete Hoekstra (MI-2), Jack Kingston (GA-1), Barbara Cubin (WY), Dan Lungren (CA-3), Mark Souder (IN-3), Zach Wamp (TN-3), Dave Weldon (FL-15), Chris Cannon (UT-3), Joe Pitts (PA-16), Pete Sessions (TX-32), Paul Ryan (WI-1), Todd Akin (MO-2), Henry Brown (SC-1), Jeff Flake (AZ-6), Darrell Issa (CA-49), Jeff Miller (FL-1), Mike Pence (IN-6), Todd Platts (PA-19), Adam Putnam (FL-12), Joe Wilson (SC-2), Marsha Blackburn (TN-7), Tom Feeney (FL-24), Trent Franks (AZ-2), Phil Gingrey (GA-11), Jeb Hensarling (TX-5), Marilyn Musgrave (CO-4), Rick Renzi (AZ-1), Charles Boustany (LA-7), John Campbell (CA-48), Virginia Foxx (NC-5), Cathy McMorris Rodgers (WA-5), Kenny Marchant (TX-24), Tom Price (NC-4), Michele Bachman (MN-6), David Davis (TN-1), Mary Fallin (OK-5), Luis Fortuno (PR), and Adrian Smith (NE-3).
Market Based Health Care
Congress can redeem itself with a simple and cost-free cure rather than an elaborate and expensive complication. The Health Care Choice Act, sponsored by Rep. John Shadegg (R., Ariz.) and Sen. Jim DeMint (R., S.C.), would let American consumers purchase health insurance across state lines, just as they now may shop coast to coast for mortgages.
Shadegg-DeMint would let insurers licensed in one state sell to individuals in the other 49. As such, Congress would use its constitutionally enumerated powers to liberate interstate commerce and transform 50 separate, closed markets for medical coverage into one open, national market for health insurance.
“Two-thirds of the uninsured have incomes below 200 percent of the federal poverty level, and most cite unaffordability as the top reason for why they are uninsured,” said Shadegg, who hopes to succeed Rep. Tom DeLay as House majority leader. “Until consumers can purchase their health care like their auto, homeowners, or life insurance, we won’t reform health care; we will only re-regulate it.”
“Just as Delaware became a magnet for banking, some states will become magnets for health insurance,” predicts Dr. David Gratzer, a physician and Manhattan Institute senior fellow, and one of this idea’s earliest proponents. “People seem to understand intuitively that it doesn’t matter whether their checks come from Delaware or New York or California. Likewise, the issues around health insurance are cost and availability rather than state of origin.”
Location matters. A health policy for a single Pennsylvanian costs roughly $1,500 annually. Cross the Delaware into New Jersey, as George Washington did in 1776, and a similar health plan costs about $4,000, thanks to government regulations.
“When doctors worsen a patient’s condition, we call it an iatrogenic ailment,” Dr. Gratzer notes. “We lack an equivalent term for when politicians aggravate a problem.”
By mandating benefits, legislators have swelled the standing army of the uninsured. As Victoria Craig Bunce and J. P. Wieske explained in their January 2005 report for the Council for Affordable Health Insurance: “Mandating benefits is like saying to someone in the market for a new car, if you can’t afford a Lexus loaded with options, you have to walk.” Making every health policy cover acupuncturists, marriage therapists, or in vitro fertilization, as some states do, looks less compassionate when such adornments drive the humble from the market. CAHI estimates that state mandates can hike insurance prices 20 to 45 percent.
“Guaranteed issue” rules, which let people wait until they ail to purchase coverage, also boost prices. Ditto “community rating.” It slaps the same government-controlled price on insurance for everyone — young or old, fit or fat — in a given jurisdiction. This is as idiotic as charging 16-year-old boys and 60-year-old widows the same amount for auto insurance.
Economics aside, Dr. Gratzer praises Shadegg-DeMint’s clinical potential. “The more people who are covered the better,” he says. “That means fewer people hesitate to get tests or follow up with physicians. Eventually, that will lead to a healthier population.”
Critics argue that letting consumers shop for health insurance will launch a dreaded “race to the bottom” as Americans buy inexpensive plans from unscrupulous insurers in unregulated states. But which states, precisely, let health insurers operate like numbers rackets? Of course, consumers could avoid questionable plans in clueless jurisdictions by patronizing reputable, sensibly supervised providers.
So, what will this cost? Nothing. Unlike nearly every action by this Republican Congress, this legislation expends no tax dollars. Your wallet is safe. For now.
Democrats routinely complain that 45 million Americans lack health insurance. Many are between jobs, young, or more prosperous, and decide to forgo insurance. Still, Democrats correctly call this a serious concern for many Americans. The Shadegg-DeMint proposal could be a key solution to this problem. Democrats should embrace this Republican idea. If they rather would deny the uninsured an expanding array of lower-cost health-coverage options, let them stand up this election year and say so.
— Deroy Murdock is a columnist with the Scripps Howard News Service and a senior fellow with the Atlas Economic Research Foundation in Arlington, Va.
Shadegg-DeMint would let insurers licensed in one state sell to individuals in the other 49. As such, Congress would use its constitutionally enumerated powers to liberate interstate commerce and transform 50 separate, closed markets for medical coverage into one open, national market for health insurance.
“Two-thirds of the uninsured have incomes below 200 percent of the federal poverty level, and most cite unaffordability as the top reason for why they are uninsured,” said Shadegg, who hopes to succeed Rep. Tom DeLay as House majority leader. “Until consumers can purchase their health care like their auto, homeowners, or life insurance, we won’t reform health care; we will only re-regulate it.”
“Just as Delaware became a magnet for banking, some states will become magnets for health insurance,” predicts Dr. David Gratzer, a physician and Manhattan Institute senior fellow, and one of this idea’s earliest proponents. “People seem to understand intuitively that it doesn’t matter whether their checks come from Delaware or New York or California. Likewise, the issues around health insurance are cost and availability rather than state of origin.”
Location matters. A health policy for a single Pennsylvanian costs roughly $1,500 annually. Cross the Delaware into New Jersey, as George Washington did in 1776, and a similar health plan costs about $4,000, thanks to government regulations.
“When doctors worsen a patient’s condition, we call it an iatrogenic ailment,” Dr. Gratzer notes. “We lack an equivalent term for when politicians aggravate a problem.”
By mandating benefits, legislators have swelled the standing army of the uninsured. As Victoria Craig Bunce and J. P. Wieske explained in their January 2005 report for the Council for Affordable Health Insurance: “Mandating benefits is like saying to someone in the market for a new car, if you can’t afford a Lexus loaded with options, you have to walk.” Making every health policy cover acupuncturists, marriage therapists, or in vitro fertilization, as some states do, looks less compassionate when such adornments drive the humble from the market. CAHI estimates that state mandates can hike insurance prices 20 to 45 percent.
“Guaranteed issue” rules, which let people wait until they ail to purchase coverage, also boost prices. Ditto “community rating.” It slaps the same government-controlled price on insurance for everyone — young or old, fit or fat — in a given jurisdiction. This is as idiotic as charging 16-year-old boys and 60-year-old widows the same amount for auto insurance.
Economics aside, Dr. Gratzer praises Shadegg-DeMint’s clinical potential. “The more people who are covered the better,” he says. “That means fewer people hesitate to get tests or follow up with physicians. Eventually, that will lead to a healthier population.”
Critics argue that letting consumers shop for health insurance will launch a dreaded “race to the bottom” as Americans buy inexpensive plans from unscrupulous insurers in unregulated states. But which states, precisely, let health insurers operate like numbers rackets? Of course, consumers could avoid questionable plans in clueless jurisdictions by patronizing reputable, sensibly supervised providers.
So, what will this cost? Nothing. Unlike nearly every action by this Republican Congress, this legislation expends no tax dollars. Your wallet is safe. For now.
Democrats routinely complain that 45 million Americans lack health insurance. Many are between jobs, young, or more prosperous, and decide to forgo insurance. Still, Democrats correctly call this a serious concern for many Americans. The Shadegg-DeMint proposal could be a key solution to this problem. Democrats should embrace this Republican idea. If they rather would deny the uninsured an expanding array of lower-cost health-coverage options, let them stand up this election year and say so.
— Deroy Murdock is a columnist with the Scripps Howard News Service and a senior fellow with the Atlas Economic Research Foundation in Arlington, Va.
Small Business Health Care Solution
More than 44 million Americans are uninsured, with nearly 60% of those employed by small businesses. As health care costs continue to rise, fewer employers and working families will be able to afford coverage, and the number of uninsured Americans will inevitably rise.
To make health care more affordable and accessible for small businesses, the Chamber promotes passage of legislation that would create federally regulated small business heath plans (SBHPs), also known as association health plans (AHPs). Allowing small businesses to arrange their health benefits through associations will make coverage more affordable by spreading risk among a much larger group, strengthening negotiating power with plans and providers, offering insurance across state lines, and reducing administrative costs. To appeal to their broad membership bases, associations will need to offer comprehensive benefit packages that meet a broad array of health needs and preferences.
Small Business Health Plan legislation (previously known as Association Health Plans) - has been introduced again this Congress. The House has once again passed its version of the bill. The focus is now on the Senate.
109th Congressional Action
Small business health plans (SBHPs) would make health care more affordable and accessible for small businesses. The House of Representatives has passed this legislation seven times, and President Bush has made the enactment of SBHPs a central feature of his second term health care agenda. This legislation has remained stalled in the United States Senate, for over a decade. However, the Senate did bring the legislation up for debate in May 2006.
Sen. Michael B. Enzi (R.-WY), chairman of the Senate Health, Education, Labor and Pensions (HELP) Committee, introduced new legislation, S. 1955, the Health Insurance Marketplace Modernization and Affordability Act, in November 2005, to address the concerns of SBHP opponents and to reach compromise on the issue. The Senate HELP committee passed this legislation on March 15. During Health Week (May 9-12), the Senate brought S. 1955 up for debate.
Unfortunately, May 11, we did not have enough votes to overcome a filibuster on Small Business Health Plan (SBHP) legislation (S. 1955, the Health Insurance Marketplace Modernization and Affordability Act). While it is uncertain whether the Senate will consider this legislation again this year, the response from the business community was overwhelming and you are to thank for getting the bill this far. A vote on the Senate floor is unprecedented! But SBHP legislation does not end here. Senator Enzi (WY), who proposed the legislation, will attempt to re-work the bill to attract the support necessary to win a future vote.
It is imperative to note that this is the first time in 11 years that small business health plan legislation was debated on the U.S. Senate floor. That is tremendous progress and it would not have happened without the support of small business like yours. The vote to end debate and avoid filibuster was 55 - 43. We were only five votes short of the 60 votes needed to avoid a filibuster and move to a final vote.
The outcome is disappointing, but support like yours got this issue to the floor with a majority supporting it. This is the highest member response we have ever seen and you should be proud of the work you did. The stage is set for Small Business Health Plans to come up again and fare even better!
To make health care more affordable and accessible for small businesses, the Chamber promotes passage of legislation that would create federally regulated small business heath plans (SBHPs), also known as association health plans (AHPs). Allowing small businesses to arrange their health benefits through associations will make coverage more affordable by spreading risk among a much larger group, strengthening negotiating power with plans and providers, offering insurance across state lines, and reducing administrative costs. To appeal to their broad membership bases, associations will need to offer comprehensive benefit packages that meet a broad array of health needs and preferences.
Small Business Health Plan legislation (previously known as Association Health Plans) - has been introduced again this Congress. The House has once again passed its version of the bill. The focus is now on the Senate.
109th Congressional Action
Small business health plans (SBHPs) would make health care more affordable and accessible for small businesses. The House of Representatives has passed this legislation seven times, and President Bush has made the enactment of SBHPs a central feature of his second term health care agenda. This legislation has remained stalled in the United States Senate, for over a decade. However, the Senate did bring the legislation up for debate in May 2006.
Sen. Michael B. Enzi (R.-WY), chairman of the Senate Health, Education, Labor and Pensions (HELP) Committee, introduced new legislation, S. 1955, the Health Insurance Marketplace Modernization and Affordability Act, in November 2005, to address the concerns of SBHP opponents and to reach compromise on the issue. The Senate HELP committee passed this legislation on March 15. During Health Week (May 9-12), the Senate brought S. 1955 up for debate.
Unfortunately, May 11, we did not have enough votes to overcome a filibuster on Small Business Health Plan (SBHP) legislation (S. 1955, the Health Insurance Marketplace Modernization and Affordability Act). While it is uncertain whether the Senate will consider this legislation again this year, the response from the business community was overwhelming and you are to thank for getting the bill this far. A vote on the Senate floor is unprecedented! But SBHP legislation does not end here. Senator Enzi (WY), who proposed the legislation, will attempt to re-work the bill to attract the support necessary to win a future vote.
It is imperative to note that this is the first time in 11 years that small business health plan legislation was debated on the U.S. Senate floor. That is tremendous progress and it would not have happened without the support of small business like yours. The vote to end debate and avoid filibuster was 55 - 43. We were only five votes short of the 60 votes needed to avoid a filibuster and move to a final vote.
The outcome is disappointing, but support like yours got this issue to the floor with a majority supporting it. This is the highest member response we have ever seen and you should be proud of the work you did. The stage is set for Small Business Health Plans to come up again and fare even better!
Health Coverage For All
No matter who becomes our next president, health care will be a major. If you're in favor of some kind of universal coverage maybe the Oregon Health Plan (OHP) is one of the options the next president should consider. It's intent was to cover those that made too much money to qualify for Medicaid but made too little to afford health insurance. The plan does not cover everything, it's a basic plan. See the following link to see the details. http://dhsforms.hr.state.or.us/Forms/Served/HE9035.pdf
One of the problems with the OHP is there are not enough funds to fully fund it, Therefore, a lottery is held when openings exist. But it might be a viable solution if we decide upon universal coverage for those who can't afford health care. For those of us who can afford it or are covered by an employer plan, well let's look at improving health insurance through reductions in cost and market based plans.
One of the problems with the OHP is there are not enough funds to fully fund it, Therefore, a lottery is held when openings exist. But it might be a viable solution if we decide upon universal coverage for those who can't afford health care. For those of us who can afford it or are covered by an employer plan, well let's look at improving health insurance through reductions in cost and market based plans.
What Is The OHP?
Beginning in 1987, a group of Oregonians, appointed by Gov. Neil Goldschmidt, including health care providers and consumers, business, labor, insurers and lawmakers, agreed on a common objective — keep Oregonians healthy. They developed a political strategy to attain their objective, answering three main questions about Oregon's health plan: who is covered, what is covered, how is it financed and delivered. They agreed that:
• All citizens should have universal access to a basic level of care• Society is responsible for financing care for poor people• There must be a process to define a “basic” level of care• The process must be based on criteria that are publicly debated, reflect a consensus of social values, and consider the good of society as a whole• The health care delivery system must encourage use of services and procedures which are effective and appropriate, and discourage over-treatment• Health care is one important factor affecting health; funding for health care must be balanced with other programs which also affect health• Funding must be explicit and economically sustainable• There must be clear accountability for allocating resources and for the human consequences of funding decisionsThe result of this debate: From 1989-1993, the Oregon Legislature passed a series of laws known collectively as the Oregon Health Plan.Senate Bill 27 (1989) extended Medicaid coverage to Oregonians with income below the federal poverty level and established a set of benefits based on a prioritized list of health services. This expansion required waivers of federal law from the Health Care Financing Administration (HCFA), now known as the Centers for Medicare and Medicaid Services (CMS).SB27 also created the Oregon Health Services Commission to rank medical services from most to least important to the entire population. The Legislature defines the OHP Standard and OHP Plus benefit packages from this list. The prioritized list is maintained by the Health Services Commission.The Health Services Commission, following many hours of public hearings around the state, established a prioritized list of more than 700 physical health, dental, chemical dependency and mental health services. The Legislature sets the funding level to cover a certain number of services on the list, but cannot rearrange the list.
• All citizens should have universal access to a basic level of care• Society is responsible for financing care for poor people• There must be a process to define a “basic” level of care• The process must be based on criteria that are publicly debated, reflect a consensus of social values, and consider the good of society as a whole• The health care delivery system must encourage use of services and procedures which are effective and appropriate, and discourage over-treatment• Health care is one important factor affecting health; funding for health care must be balanced with other programs which also affect health• Funding must be explicit and economically sustainable• There must be clear accountability for allocating resources and for the human consequences of funding decisionsThe result of this debate: From 1989-1993, the Oregon Legislature passed a series of laws known collectively as the Oregon Health Plan.Senate Bill 27 (1989) extended Medicaid coverage to Oregonians with income below the federal poverty level and established a set of benefits based on a prioritized list of health services. This expansion required waivers of federal law from the Health Care Financing Administration (HCFA), now known as the Centers for Medicare and Medicaid Services (CMS).SB27 also created the Oregon Health Services Commission to rank medical services from most to least important to the entire population. The Legislature defines the OHP Standard and OHP Plus benefit packages from this list. The prioritized list is maintained by the Health Services Commission.The Health Services Commission, following many hours of public hearings around the state, established a prioritized list of more than 700 physical health, dental, chemical dependency and mental health services. The Legislature sets the funding level to cover a certain number of services on the list, but cannot rearrange the list.
The Oregon Health Plan
Oregon holds health insurance lottery
By SARAH SKIDMORE
Oregon is conducting a one-of-a-kind lottery, and the prize is health insurance.
The state will start drawing names this week for the chance to enroll in a health care program designed for people not poor enough for Medicaid but too cash-strapped to buy their own insurance.
More than 80,000 people have signed up since registration for the lottery opened in January. Only a few thousand will be chosen for the program.
"It's better than nothing, it's at least a hope," said Shirley Krueger, 61, who signed up the first day.
It's been more than six months since she could afford to take insulin regularly for her diabetes. That puts her at higher risk for a number of complications, such as kidney failure, heart disease and blindness.
Her part-time job leaves her ineligible for her employer's insurance plan and with too little income to buy her own.
"I'm worried about it. I know it's a death sentence," Krueger said.
An estimated 600,000 people in Oregon are uninsured, according to the Oregon Department of Human Services.
Those selected in the lottery will be eligible for a standard benefit program, which was once a heralded highlight of the Oregon Health Plan.
At its peak in 1995, the program covered 132,000 Oregonians. State budget cuts forced the program to close to newcomers by 2004, but it now has several thousand openings.
The program covers their most basic health services, medications and limited dental, hospital and vision services at little or no cost.
The health insurance lottery winners will be chosen in a series of drawings that could take a few months.
"This is such a wonderful opportunity," said Ellen Pinney, director of the Oregon Health Action Campaign. "We've heard absolutely no complaints, just a lot of hope that they are the ones who will be selected."
Advocates for the uninsured say the demand for the program underscores the state's need for health coverage.
"We have pretty much returned as a state, in terms the percentage of uninsured, to where we were in the late '80s when we created (the Oregon Health Plan standard benefit)," said Barney Speight, director of the Oregon Health Fund Board.
The board is supposed to come up with a plan to address health care access and coverage for Oregonians for consideration in the 2009 legislative session.
Gov. Ted Kulongoski considers the Oregon Health Plan a basis to build on, said Anna Richter Taylor, a spokeswoman for his office. The plan has been able to maintain its benefit package for people who are aged, blind, disabled, under 19, pregnant or receiving Temporary Assistance for Needy Families benefits.
But providing coverage for a larger population is a goal that could take much longer to reach.
"It's a huge challenge for one session -- it's probably going to be a sequential process," Richter Taylor said.
By SARAH SKIDMORE
Oregon is conducting a one-of-a-kind lottery, and the prize is health insurance.
The state will start drawing names this week for the chance to enroll in a health care program designed for people not poor enough for Medicaid but too cash-strapped to buy their own insurance.
More than 80,000 people have signed up since registration for the lottery opened in January. Only a few thousand will be chosen for the program.
"It's better than nothing, it's at least a hope," said Shirley Krueger, 61, who signed up the first day.
It's been more than six months since she could afford to take insulin regularly for her diabetes. That puts her at higher risk for a number of complications, such as kidney failure, heart disease and blindness.
Her part-time job leaves her ineligible for her employer's insurance plan and with too little income to buy her own.
"I'm worried about it. I know it's a death sentence," Krueger said.
An estimated 600,000 people in Oregon are uninsured, according to the Oregon Department of Human Services.
Those selected in the lottery will be eligible for a standard benefit program, which was once a heralded highlight of the Oregon Health Plan.
At its peak in 1995, the program covered 132,000 Oregonians. State budget cuts forced the program to close to newcomers by 2004, but it now has several thousand openings.
The program covers their most basic health services, medications and limited dental, hospital and vision services at little or no cost.
The health insurance lottery winners will be chosen in a series of drawings that could take a few months.
"This is such a wonderful opportunity," said Ellen Pinney, director of the Oregon Health Action Campaign. "We've heard absolutely no complaints, just a lot of hope that they are the ones who will be selected."
Advocates for the uninsured say the demand for the program underscores the state's need for health coverage.
"We have pretty much returned as a state, in terms the percentage of uninsured, to where we were in the late '80s when we created (the Oregon Health Plan standard benefit)," said Barney Speight, director of the Oregon Health Fund Board.
The board is supposed to come up with a plan to address health care access and coverage for Oregonians for consideration in the 2009 legislative session.
Gov. Ted Kulongoski considers the Oregon Health Plan a basis to build on, said Anna Richter Taylor, a spokeswoman for his office. The plan has been able to maintain its benefit package for people who are aged, blind, disabled, under 19, pregnant or receiving Temporary Assistance for Needy Families benefits.
But providing coverage for a larger population is a goal that could take much longer to reach.
"It's a huge challenge for one session -- it's probably going to be a sequential process," Richter Taylor said.
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