Getting Health Coverage for the Left-Out Millions : Jobs, Not Government, Should Be the Source

One of America’s oldest public-policy debates involves the question of how to provide access to health insurance. The debate on national health insurance has ebbed and flowed since President Harry Truman first proposed Medicare in 1948. In 1989 the issue is coming to flood tide again.

Why? Because 37 million Americans have no health insurance. They are eligible for neither Medicare nor Medicaid (called Medi-Cal in California), and they have no private coverage. They go about their lives trying not to get sick, wondering what will happen to them if they do.

Of the 37 million without insurance, 5.5 million live in California. Almost 3 million of them have jobs, yet still have no health insurance.

Something must be done for these people. Their circumstances are potentially disastrous, for there is no longer an adequate public “safety net” to care for them. County clinics and county hospitals are seriously overloaded and underfunded.

To find reasonable solutions even for a part of this problem, we must examine the history of health insurance in America. Clearly, it always has been employment-based; health insurance is a benefit for 200 million Americans because family breadwinners have jobs.

That sounds like good news. It is not.

The number of those covered by health insurance is shrinking. Since 1984, the percentage of working Californians who have no health insurance through their jobs has risen from less than 15% to more than 20%.

It is unacceptable to have an incomplete system that leaves people out, and steadily continues to leave more people out. The 60-year-old pact between business and government--to provide health insurance in exchange for tax benefits--must be reexamined to determine if it is still viable.

There are two options: Restore the vitality of the employment-based system or abandon employment-based health insurance and replace it with government-based insurance.

I strongly prefer the first solution. To that end, I have introduced a bill in the California Legislature.

It will stimulate the employment-based system in California and re-start its growth.

Here is what the bill does:

--Requires everyone who employs five or more persons more than half time to provide them health insurance.

--Requires only essential health benefits such as physician care, acute hospital care, laboratory and X-ray services, maternity care and limited mental health.

The bill relies entirely on the private sector. It calls for:

--No government insurance.

--No government administration.

--No government cost.

As is typical with important legislative endeavors, there are still problems to be worked out. The health-insurance market, especially for small businesses, has been so disrupted by high costs that coverage often is unobtainable.

The insurance industry recognizes this, and is working to develop new underwriting rules for small employer pools that will improve both availability and affordability. When these are perfected, California law must provide protections that will make them work.

Efforts must be made to contain health- care costs. Physicians and hospital managers acknowledge this and are prepared to accept further refinements of the changes made by the Legislature in 1982 that encourage competition among health-care providers. Those reforms have proved that competition works better than regulation to contain health-care inflation.

The success of those reforms, confirmed by a RAND Corp./UCLA study in 1988, persuade me that a private solution is the better solution. It will be more efficient.

It is simply a fact that California’s government has no money with which to build a government-based system to improve the public “safety net.” It is a more important fact that employers, insurers and health-care providers want a private solution and are ready to work to find it.

I am convinced that the elusive political moment to solve this health insurance problem is at hand. Requiring employers to provide insurance is not destructive.

The majority of California’s employers, large and small, already provide health protection for their employees. Asking all to participate only levels the playing field. It creates fair competition in every business and industry.

The legislation I am proposing asks California’s business community to decide finally whether it wants to renew its 60-year-long commitment to employment-based health insurance or to relinquish it.

After that question is fully debated and fairly answered, those who must make public policy can move forward constructively. We cannot continue to leave 5.5 million Californians out of the health system.