Health Leaders Say Insurance Plan Is Good Medicine : Medical costs: Orange County officials are receptive to the Deukmejian Administration proposal, although some say it leaves too many people without coverage.

The issue was health insurance.

But as state Health and Welfare Agency Secretary Clifford Allenby told it, it also involved something he called “the gorilla behind the door.”

That was Allenby’s descriptive phrase, used at a meeting with Orange County health leaders recently, for a new Deukmejian Administration effort to contain spiraling medical costs.

As a regular member of the Orange County Coalition for Health Care Solutions--a task force formed by state Sen. Marian Bergeson (R-Newport Beach)--Allenby was meeting with 19 local health leaders to share thoughts on problems such as indigent care and overcrowding in maternity wards.

But on Friday, Allenby spent much of the meeting discussing a major statewide issue--an innovative proposal by the Deukmejian Administration to require all employers to provide health insurance for full- and part-time workers, as well as their dependents.

The proposal surfaced Thursday--ahead of the Deukmejian officials’ plans--in a Los Angeles Times account.

Still in Draft Form

Allenby confirmed that story but stressed that the plan is still in draft form and not yet approved by Gov. George Deukmejian. He added that part of the plan calls for pumping an additional $600 million into the state Medi-Cal system for indigent care, the first increase in years.

Although Medi-Cal money would increase, the plan seeks to limit sharp rises in the cost of private insurance or medical care with a threat--or as Allenby calls it--”the gorilla behind the door.” According to the draft proposal’s “Fail Safe Affordability” section, if the price of medical care rises above the Consumer Price Index by the program’s third year, then anyone in the state will be allowed to join Medi-Cal, buying into it just as one would buy private insurance.

And if Medi-Cal expanded greatly, Deukmejian officials believe, their market power would be enormous in negotiating doctor and hospital fees. In addition, Medi-Cal would be competing with the private insurance market.

Allenby emphasized that “bringing regulations or a commission (to control costs) just would not work. We call it ‘the gorilla behind the door’ because the gorilla is (this:) . . . we have Medi-Cal as the alternative if costs aren’t controlled.”

Deukmejian officials estimate 5 million Californians are without insurance. About 4 million of them--mostly low-wage workers and their dependents--would be covered by their plan, although the homeless, the unemployed, retired people and some disabled people and students would be left out.

In Orange County, an estimated 160,000 of the approximately 400,000 county residents who now lack health insurance are probably not covered under the governor’s plan, said Chauncey Alexander, chairman of United Way’s Health Care Task Force.

O.C. Officials Respond

The Orange County members of Bergeson’s commission got their first glimpse at the governor’s thinking on health coverage Friday. And they seemed receptive.

Bergeson described it as “a very bold new plan.” And Tom Uram, director of the Orange County Health Care Agency enthused: “It’s great for Orange County if this will happen.”

Expressing mixed emotions was Alexander. “We’re delighted to have a general (Deukmejian) join the army of private citizens fighting the battle of decent health services,” he said later.

But he believes the Deukmejian Administration should “move to universal coverage,” add stronger cost-containment measures and finance the plan from taxes. He added that he was speaking for himself; his task force’s 45 member organizations still must review the plan.

Also not quite sure was Mary Piccione, director of UCI Medical Center in Orange. She expressed concern that unemployed people were not covered but was pleased that there would be new money poured into the health care system. In all, she said, “there are some problems out there. But it’s a hopeful new direction.”

Also expressing reservations was Ellen Severoni, executive director of California Health Decisions, a citizens’ health care group. “I applaud the decision to move forward,” she said, but “we’re never going to control costs by putting more money into the system in a new way.”

Allenby recounted the history of the plan, saying that Deukmejian made it clear last September that he wanted to tackle the insurance problem.

Deukmejian made those remarks in a public signing--one of only a handful he hosted last year--when he approved a bill giving tax credits to small businesses that provide health insurance to their workers. “And the governor expressed that he was serious. He wanted something to address the problem of the uninsured,” Allenby said.

Doctor Shortage

Though the proposal would add new money to the Medi-Cal system, Allenby acknowledged that “we have an access problem in Medi-Cal”--that Medi-Cal recipients in Orange County and elsewhere in the state have difficulty finding doctors who will accept them. Also, he said, “we all recognize that Medi-Cal is underfunded.”

In other matters Friday, the Bergeson commission heard reports that there are not enough beds for indigent obstetric patients at Orange County hospitals with Medi-Cal contracts and the crowding may spill over to other private hospitals.

The county’s Medi-Cal hospitals are currently delivering babies at 122.8% over capacity, a study by the Hospital Council of Southern California said. And there are indications, according to studies by both the hospital council and the March of Dimes, that all obstetrical delivery services in Orange County will soon be inadequate.

Allenby agreed Orange County is facing a dilemma. “This could become a very significant problem with or without government support,” he said.

Several hospitals and groups are seeking money from the state tobacco tax to build large “birthing centers,” maternity facilities for low-risk mothers, that could handle 3,000 babies a year.

But Russ Inglish, Orange County representative for the Hospital Council, said he isn’t sure that these would meet the demand. “We’re going to need to build two of these a year until this (baby boom) slows down,” he said.

Nonetheless, a representative of the state commission that selects Medi-Cal hospitals told the Bergeson committee that there was no problem. “Based on research, we really don’t see a capacity problem in Orange County,” said Hrant E. Kouyoumdjian, senior hospital negotiator for the California Medical Assistance Commission.