Seeking 1 Solution for 2 Intractable Problems
California’s health-care system is critically ill and one remedy that’s needed is to cover more people with insurance. Particularly the working poor.
Require employers who aren’t doing it to provide medical insurance for their workers.
Can’t afford it, most of these companies insist. Especially now in uncertain times.
Expanding health care is a passion of Democrats and labor. Most Republicans and businesses are leery.
The current curse of any company is out-of-control workers’ compensation insurance. Premium rates have been skyrocketing. For Republican legislators and the business lobby, their No. 1 cause is workers’ comp reform.
Is there a potential deal here? Unite the two sides and develop some mutually beneficial treatment for both health care and workers’ comp?
Steve Thompson, lobbyist for the California Medical Assn. and a former top legislative staffer, thinks there is an opening for such a historic agreement.
The CMA is backing a bill sponsored by the California Labor Federation and jockeyed by Senate leader John Burton (D-San Francisco). The concept is called “play or pay.” Employers would be required to provide health insurance for workers or pay into a state fund that would provide the coverage.
An estimated 7 million Californians -- one in five -- lack health insurance. In L.A., it’s one in three under 65. About 90% are workers or their kids.
Their health care suffers because illnesses go untreated. When ailments become acute, the uninsured go to expensive emergency wards, where legally they must be treated. That affects the rest of us. We pay for their care through higher premiums, jacked up by roughly 15%. But this still isn’t enough to fully reimburse health-care providers.
“Half the people showing up in emergency rooms are uninsured,” Thompson says. “Unless they become insured and stop using emergency rooms as a doctor’s office, our entire emergency and trauma system will collapse. Eighty percent of emergency rooms ran in the red last year.”
Labor gets steamed about something else: Companies that do provide insurance for their workers are at a competitive disadvantage with firms that don’t. These “nonplayers” let somebody else -- the public, a spouse’s employer -- pick up the health-care tab for their hires.
Burton’s bill is one of several that would expand medical coverage.
Assemblyman Keith Richman (R-Northridge), a family physician who once headed a large medical group, has a bill to establish a voluntary system of employer-provided insurance for low-income workers. He’d tap into unused federal money and raise taxes on HMOs.
“There’s no question this is an incremental step, but it’s a significant step,” Richman says.
The step proposed by Sen. Sheila Kuehl (D-Santa Monica) is hardly incremental. She’d take a giant leap into a “single-payer” system of universal coverage.
Private medical insurance would be replaced with one public plan run by an elected state health czar. Everybody would be covered and could choose his own provider.
There’d be huge administrative savings, Kuehl says. Only 3% of the cost would be for overhead, instead of 27% as it is now.
But instead of paying premiums, companies and workers would be docked a payroll tax, which the senator acknowledges currently is a political nonstarter. “I want to put this in play,” she says. “I’ll be back next year and then the year after that and....”
Burton’s bill is the biggie because: He’s by far the most powerful lawmaker. His proposal is ambitious, but still considered doable. (The odds are 6 to 5 against, he figures.) And it requires only a majority vote, while the others need two-thirds.
Majority vote or not, for any bill to gain Gov. Gray Davis’ signature, it must have business and Republican backing.
Enter workers’ comp.
“We’re meeting with the business community to sweeten the pot,” Thompson says.
The idea: shift medical care for on-the-job injuries from the workers’ comp system to regular health insurance. Policy wonks call this “integration” -- or “24-hour care” because a worker is covered by the same plan all day, whether at work or at home.
The purpose: Save money through efficiencies and closer review of claims. “People getting fat off the current system will oppose reform,” Thompson says.
Davis’ new finance director, Steve Peace, championed integration as a legislator. Insurance Commissioner John Garamendi also favors it. Soon, Davis and Garamendi intend to team up on some workers’ comp proposal.
Burton’s bill could be fitted with integration. So could Richman’s. Kuehl’s already is.
In medicine, there’s “elective surgery” -- not absolutely necessary, but recommended.
In the Capitol, expansion of medical care is elective legislation -- not essential like the budget. But it’s highly recommended for a healthy California. And the sooner the better.