1. Proposals for “Universal” Health Care or Back to the Health Care Future Leonard Rodberg Urban Studies Dept., Queens College/CUNY and NY Metro Chapter Physicians for a National Health Program May 29, 2007

2. Everybody’s Got a Health Plan!

3. Why Health Care Is On the Agenda

4. A Declining Number of Firms Are Offering Insurance…

5. Firms Shift Health Insurance Costs to Workers

6. Number of Uninsured Americans (Millions) 19801985199019952000 45 40 35 30 25 20 Source: U.S. Census Bureau Rising Number of uninsured

7. U.S. Health Costs are 70% Greater than the Median of Other Countries United States

8. The Outlier Nation: Our Public System Covers Fewer… Source: F. Colombo and N. Tapay, Private Health Insurance in OECD Countries, OECD 2004 United States

9. While Private Insurance Dominates Source: F. Colombo and N. Tapay, Private Health Insurance in OECD Countries, OECD 2004 United States

10. THE MAJORITY OF AMERICANS HAVE PRIVATE INSURANCE … Total Population Private health insurance - Employer-provided - Individual Public health insurance Medicare Medicaid Uninsured Million % 288 100.0% 174 60.5 % 160 55.6% 14 4.9% 72 25.0% 41 14.2% 31 10.8% 42 14.6% Source: National Center for Health Statistics, 2003

11. …BUT IT PAYS MUCH LESS THAN HALF THE COST 2004 Personal Health Expenditures Private Funds Private health insurance - Self-funded plans - Insurance company plans Out-of-pockets payments Other private funds Public Funds* Medicare Medicaid Other public expenditures $ Billion % $ 1,753 100% $ 965 54% $ 658 37% $340 19% $318 18% $ 236 13% $ 70 4% $ 789 46% $ 309 18% $ 293 17% $ 187 11% * Does not include tax subsidy for private insurance. See Woolhandler & Himmelstein, HealthAffairs 2002 Source: Centers for Medicare and Medicaid Services, 2006

12. HIGH COST OF HEALTH INSURANCE PREMIUMS National Average for Employer-provided Insurance Single Coverage $4,024 per year Family Coverage $10,880 per year Note: Annual income at minimum wage = $10,300 Annual income of average Wal-Mart worker = $17,114 Source: Kaiser Family Foundation/HRET Survey, 2005

13. The Good News “Universal health care” is accepted as a goal by many mainstream politicians. The Bad News “Universal health care” is defined simply as everyone having some kind of insurance, not everyone having access to care. This won’t solve the problem!

14. Common Features of the New Plans The problem: Too many uninsured. The solution: Require everyone to have insurance Employers contribute but don’t necessarily offer insurance These plans don’t reform the structure at all Their true objective appears to be to preserve the private insurance industry, even though it adds cost but no value to our health care system.

15. Wyden Healthy Americans Act “slash and burn” Eliminate the tax deductibility of employer- based insurance  end employer benefit Require individual purchase of private insurance Transitional payments by employers Subsidies to low-income individuals Relies on insurance company competition to contain costs

16. Stark/Edwards/Hacker Plan “individual mandate with a pretty face” Employer mandate (“play or pay”) Individual mandate with community rating Subsidies for low-income Regional purchasing plans (“Health Markets”) Offers government/public program (“single payer”?) as well as private insurance plans.

17. Stark/Edwards’ Seductive Verbiage For everyone: Shared responsibility For the fearful: Lets people keep what they have For those worried about cost: Everyone will work together to make the system more efficient For single payer advocates: Individuals and businesses can choose if they want the public plan

18. Ten Top Reasons Why Individual Mandate is Poor Public Policy 10. Enforcement is bad for public health 9. Insurance companies will resist and undermine community rating and guaranteed issue 8. Financing through premium payments requires complex and intrusive means testing 7. Will not lead to universal coverage 6. If premium is affordable, health care is not (copays, deductibles)

19. Ten Top Reasons Why Individual Mandate is Poor Public Policy 5. Even more bureaucracy (“Health Markets”) 4. Private health insurance will be a continuing consumer’s nightmare (copays, deductibles, exclusions, denials, appeals) 3. Increases the cost of the system, most going to private insurance companies 2. No cost control: continually rising cost

20. And the Top Reason Why Individual Mandate is Poor Public Policy 1. It doesn’t reform the system at all. It would not help those of us who think we’re insured. -- Half of middle- and lower-income adults experience serious problems paying medical bills or insurance premiums. (Commonwealth Fund 2006) -- Three-fourths of those who declare “medical bankruptcy” had insurance (D.Himmelstein et al, Health Affairs, 2005) It doesn’t solve any of the problems -- especially rising costs -- that concern everyone. It is not a real structural change.

21. Kennedy-Dingell Medicare for All “Medicare for most people” Automatic enrollment phased in by age over 5 years Tax-based financing Public Medicare-like program is the “default” Option of Federal Employees Health Benefit Plan, i.e., private insurance Retains Medicaid for the poor, Medicare for elderly Some savings through public program’s efficiencies

22. What’s Wrong With Offering a Public Plan vs. a Private Plan? Consumer cannot predict future health needs  no basis for choosing a plan or accepting limits. Advertising can mislead consumer. Private plans avoid sick people and paying for illness  “adverse selection” for public plan. A “level playing field” is impossible (Private insurance companies require subsidies to stay “in the game”). Most important, there’s no way to control costs.

23. THERE IS A SOLUTION: Expand the existing Medicare program to cover everyone Improve the coverage it offers Eliminate private insurance

24. Conyers/Kucinich/et al Expanded and Improved Medicare for All “single payer national health insurance” Everyone receives a Medicare card assuring payment for all needed care Free choice of doctor and hospital Doctors and hospitals remain independent, negotiate fees and budgets with Medicare Financed through progressive taxes Public agency processes and pays bills

25. Some Implications of “True” Medicare for All The same coverage for everyone: No means testing; coverage would not depend on income, employment or age Medicaid would no be longer needed Hundreds of billions of dollars in administrative costs would be saved Costs would be controlled through capital planning, budgeting, and quality reviews conducted through the single insurer

26. Covering Everyone and Saving Money through Medicare for All Additional costs Covering the uninsured and poorly-insured +6.4% Elimination of cost-sharing and co-pays +5.1% Savings Bulk purchasing of drugs & equipment -2.8% Reduced hospital administrative costs -1.9% Reduced physician office costs -3.6% Reduced insurance administrative costs -5.3% Primary care emphasis & reduce fraud -2.2% Net Savings -4.3% Source: Health Care for All Californians Plan, Lewin Group, 2005

27. How Would It Be Paid For? One Example:

28. Why Such a National Health Insurance Program is Possible Today Everyone is affected: the uninsured, the underinsured, and everyone else who is insecurely insured. Employers who offer insurance want to be relieved of the burden of rising costs and unfair competition from employers who don't offer insurance. Small businesses want to offer insurance to their employees but can’t afford it. Limited reforms that keep private insurance in place have been tried and failed.

29. More Reasons Why Such a National Health Insurance Program is Possible Today Private insurance can’t solve the fundamental problem of cost and access. If we bypass the insurance companies, we can have a Medicare for All system that is simpler, less costly, and provides access to health care for everyone. Every other industrialized country has done it. Let’s move forward with it!

30. RESOURCES Physicians for a National Health Program www.pnhp.org PNHP New York Metro Chapter www.pnhpnyc.org. HealthCare-NOW www.healthcare-now.org Commonwealth Fund www.cmwf.org Kaiser Family Fund www.kff.org