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06/07/2017

In Calls for Repeal Comes Opportunity for Universal Coverage

by Craig Klugman, Ph.D.

According to the conservative press, the Affordable Care Act is failing. They point to the number of insurance companies that have withdrawn from the marketplaces including Ohio, where there are 20 counties with no plans available. They point to rising premiums and co-pays, and consider the experiment a failure that must be repealed. Of course, they are not considering the cost savings that preventive care provides in the longer term or the improved quality of life in having medical care. Those reports also ignore that the federal government has been giving confusing messages, rolling back the supportive regulations and subsidies, and that the healthcare industry is trying to adapt to a shifting landscape. Nor do they talk about the lowest rate of uninsured ever, the increase in people able to see doctors, the decrease in hospital’s unreimbursed care, the decrease in national health care spending, and the decreasing inflation rate of medical costs.

In a recent meeting between the executive and (Republican) legislative branches, there is a renewed call to repeal the Affordable Care Act. What is a state to do that has to create a budget and does not know what the health care laws will be or even what federal funds might be available for helping provide care? Some states are not waiting around for repeal and replace but are taking matters in their own hands. New York, California, and Nevada may soon be on the way to single payer health systems. And if Republicans are true to their states rights roots, then letting states design and run their own systems should be a good thing.

The California Senate passed SB 562, a bill that begins the process of creating a single-payer system in that state.

This bill, the Healthy California Act, would create the Healthy California program to provide comprehensive universal single-payer health care coverage and a health care cost control system for the benefit of all residents of the state. The bill, among other things, would provide that the program cover a wide range of medical benefits and other services and would incorporate the health care benefits and standards of other existing federal and state provisions, including, but not limited to, the state’s Children’s Health Insurance Program (CHIP), Medi-Cal, ancillary health care or social services covered by regional centers for persons with developmental disabilities, Knox-Keene, and the federal Medicare program.

The California plan is estimated to cost $400 billion a year, which would be paid for by a 15% payroll tax. The various California health programs already cost $367 billion meaning that the new plan should not cost more than current programs. The tax would be in lieu of premiums, deductibles and copays that people currently pay.

At the same time, New York State’s Assembly passed a bill to create a single-payer system that “would establish a universal health care system within the state, known as New York Health, and expand coverage eligibility to include all residents, regardless of wealth, income, age or pre-existing condition.”

That California and New York would move in this direction probably surprises few people since these are traditionally progressive states. What is surprising is that the Nevada legislature passed a bill permitting anyone in the state to buy into Medicaid. This option would be a public health insurer for anyone in the state who lacks health insurance coverage. Under a Republican governor, this might be the first state to provide a “Medicaid for all” public health insurance program. The bill is sitting on the governor’s desk.

Beyond Nevada’s plan, there are not a lot of specifics on how these public insurance programs would operate, what they might cost, how they would be funded, what doctors and hospitals would be included, and what would happen to existing private companies and people who get insurance through their employers. Under the ACA, states can apply for waivers that permit them to experiment with insurance and delivery models while still receiving federal subsidies, so that might be a viable mechanism. Both the California and New York plans need to pass a second legislative house and be signed by their governors meaning that Nevada may be first in the nation with its program.

“Medicaid for all” was one of the planks of Bernie Sander’s presidential campaign. Given that the Congressional Budget Office predicts the proposed American Health Care Act would raise premiums (for those who are older and sicker), decrease Medicare rolls, and dramatically decrease coverage (including dropping about 23 million people from insurance), state officials are looking for solutions that will increase coverage and reduce cost.

Opponents of single-payer and universal coverage say that costs will spiral out of control, hospitals will fail, and the system will collapse. The same was said about the Affordable Care Act, the Clinton health plan, the Nixon health plan, Medicare, Medicaid, and even Social Security. Despite Republican propaganda, the ACA has been fairly successful.

The irony of this debate is that calls for repealing the Affordable Care Act may do more for bringing us to a universal health system, or at least a single-payer insurance system, than has been possible before.

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