News CoverageSacramento Bee
State health care bind: Fixing inequities can be expensive
by Jim Sanders -- Bee Capitol Bureau
Dec 22, 2002
Maria Teresa Quiej Alvarez and Andrew Willis symbolize the two extremes of California health care: Have and have-not. Got and can't get.
Bridging the gap between them promises to be one of the Legislature's hottest issues in coming months.
Maria Teresa was surgically separated this summer from her 1-year-old twin sister, Maria de Jes�s, whose head was fused to hers from birth. The intricate, life-altering operation took a 40-person medical team more than 22 hours to complete.
"To have this amazing impact on these vibrant girls brought us closer together," said Dr. Michael Karpf, director of the UCLA Medical Center. "It was a very special moment for everyone involved."
About the same time, Willis -- unemployed and uninsured -- found himself with no doctor, little money, and scrambling all night in Sacramento to obtain routine treatment for a painful spider bite. He waited in a hospital emergency room from 6 p.m. to 7 a.m. for a doctor to see his swollen wound.
"Before they even look at you, they ask if you have insurance," said Willis, 44. "People who have insurance get treated first; those who don't get treated last. I'm one of the ones treated last."
Willis and more than 6 million Californians like him are the focus of health care reform proposals that could pit powerful special interests -- from labor to business to medical groups -- against each other.
Activists are pushing for universal health care -- guaranteed treatment for all Californians -- to revolutionize a system that has seen soaring premiums, cuts in benefits, shortages in doctors and nurses, growing strain on county safety nets and growth in the ranks of the uninsured.
Helping the uninsured, advocates say, would help everyone: Many patients who lack medical coverage flock to county clinics for care, straining capacity. Others wait until their ailments become severe, then seek help in hospital emergency rooms, driving up costs systemwide.
"We can't keep going the way we're going," said state Sen. Sheila Kuehl, D-Santa Monica. "It's a mess right now."
But critics worry about the potential costs of universal coverage. They doubt that government could sustain high-quality benefits indefinitely. They say the state's $34.8 billion budget shortfall will make an overhaul politically impossible.
Allan Zaremberg, president of the California Chamber of Commerce, cautions against targeting businesses for more money.
"We need to focus on funding the programs on the books before we start creating new taxes to fund new programs," he said.
Both Kuehl and Sen. Jackie Speier, D-Hillsborough, are preparing legislation for universal health care, but their approaches differ significantly in style, financing and scope.
Kuehl is pushing for a complete overhaul -- a "single-payer" system -- in which the state would replace insurance companies in collecting funds, contracting for medical services, and paying doctors and hospitals for services rendered.
Details are still being developed, but the goal is to provide comprehensive benefits -- including dental, vision and chiropractic care -- without charging co-payments for basic services.
Kuehl contends the program would not cost more than is now spent statewide for health care. Conceptually, the program would rely on various taxes, not insurance premiums. Expansion could be supported partly from savings in administrative costs and through bulk purchasing, she said.
Doctors would have wide latitude to determine appropriate care under Kuehl's proposal. The managed-care system would be replaced by one that relies on medical experts, under the auspices of an elected state health commissioner.
For Willis, Kuehl's proposal would guarantee the right to choose his own doctor and schedule appointments. The measure would not, however, guarantee care as extraordinary as that received by the conjoined twins.
The case of Maria Teresa and her twin sister, Maria de Jes�s, truly was a rarity, illustrating the life-altering possibilities of 21st-century technology. Natives of Guatemala, the girls were brought to Los Angeles by a nonprofit group, Healing the Children, which is raising money to offset $1.5 million in treatment costs.
California voters overwhelmingly rejected a single-payer system in 1994, but advocates say times have changed, driven partly by health care plans that increasingly hit employees in the pocketbook -- through premiums or co-payments.
"Where we used to talk about whether we should attempt universal health care, the argument seems to have shifted to how we can accomplish it," Kuehl said.
Critics aren't so sure, noting that Oregon voters trounced the single-payer idea in a ballot measure last month.
Some critics of Kuehl's plan worry that demand would skyrocket if health care were free, making huge tax increases necessary. Doctors fear getting squeezed on reimbursement rates.
"One major downside is that it eliminates the wonders of private competition," said Bill Wehrle of the California Association of Health Plans. "(It's important) to figure out how to provide quality care at a competitive price."
Other critics of Kuehl's proposal are reluctant to give state officials authority over decisions that could profoundly affect investment in new technology and treatments.
By contrast, Speier wants to build on the existing system, leaving private insurance in place but filling the gaps.
Speier's bill, SB 2, proposes a "play-or-pay" system that would require employers to provide medical benefits or pay taxes toward creation of a publicly subsidized plan, Healthy California, to provide basic benefits to those lacking insurance.
Currently, about 60 percent of the state's businesses offer medical plans.
The California Labor Federation also is developing a "play-or-pay" proposal that would reduce the ranks of the medically uninsured while retaining health care as a central element of collective bargaining.
Critics say "play-or-pay" does little to solve soaring costs and could hurt small businesses, slow economic growth, and prompt some employers to drop their current health plans and force workers into a modest government-run plan.
"People presume that since some businesses provide health care coverage, all business can afford to," Wehrle said. "And that's just not true."
Bruce Bodaken, chief executive officer of Blue Shield of California, recently proposed a play-or-pay model that would exempt very small companies and require uninsured Californians to pay what they can for coverage before subsidies kick in.
"We believe there would be public support for a practical plan that doesn't break the bank," Bodaken said.
Assemblyman Keith Richman, R-Northridge, has proposed a more modest plan, AB 30, that would not offer universal coverage but could serve perhaps 2 million uninsured workers.
Richman seeks to cover low-income childless adults, perhaps by expanding the existing Healthy Families program. Payment would come from employers, from employees, and from state and federal subsidies.
Richman has no funding commitments, however, and obtaining them could be extremely difficult given the state budget crisis.
The brewing battle over health care involves labor and business groups, hospitals, insurers, doctors, nurses, consumers, pharmaceutical companies and other special interests.
"The problem is, there are so many pigs at this trough -- and nobody wants to cut back on their eating," said Jamie Court, director of the Foundation for Taxpayer and Consumer Rights.
"(Most) legislators are not sincere about dealing with this issue because it pits one special interest against another, which means they have to make choices that affect their fund-raising," he said.
But Assemblyman Dario Frommer, a Los Angeles Democrat who heads the Assembly Health Committee, cautioned against rushing to judgment on something as significant and massive as health care reform.
"To do it realistically, we'll have to talk to the public as well," he said. "The issue is not just whether legislators will stand up to special interests. Everyone says the system is broke -- but there's no consensus on how to fix it."
Highlights of the health care bills
- Would overhaul health system.
- Sets up "single-payer" system in which the state would replace insurance companies in collecting funds, contracting for medical services, and paying doctors and hospitals for services rendered.
- Would build on the existing system, leaving private insurance in place but filling the gaps.
- Proposes a "play-or-pay" system that would require employers to provide medical benefits or pay taxes toward creation of a publicly subsidized plan, Healthy California, to provide basic benefits to those lacking insurance.
-Would not offer universal coverage but could serve perhaps 2 million uninsured workers.
- Seeks to cover low-income childless adults, perhaps by expanding the existing Healthy Families program. Payment would come from employers, from employees, and from state and federal subsidies.