Advocates of a state-by-state approach, including Republican Utah Gov. Gary Herbert, say imposing a one-size-fits-all fix ignores local variations in health care markets, demographics and politics.
He and others are agitating to turn the joint federal-state Medicaid program into a system of block grants, money that states could spend as they see fit. “Real health care reform will rise from the states, the laboratories of democracy,” Herbert said at a congressional hearing last week.
But supporters of a national approach contend cash-strapped states are in no position to fast-track innovations. Without some federal coordination, controlling costs will prove difficult.
And homegrown alternatives are few in number.
To get out from under national reform, states must insure virtually all their citizens. The coverage must be affordable and as comprehensive as the federally-mandated basic plan. They can’t spend more than the feds and they have to get it done by 2017 — or by 2014 if legislation to move up the date clears Congress.
“The reality is Utah’s health reform has, of yet, done nothing to reduce the number of uninsured in the state. Until Utah is willing to invest in that side of the equation, the waiver will remain out of reach,” said Lincoln Nehring, senior health policy analyst at Voices for Utah Children.
So far, the only state to significantly reduce its uninsured rate is Massachusetts, which like Utah, rests its reforms on a health exchange.
They are the first states to experiment with an idea first floated by the conservative Heritage Foundation: state-controlled insurance marketplaces that work by pooling the purchasing power of individuals and small businesses, allowing them to enjoy the same economies of scale and lower-priced premiums as large companies. Massachusetts’ success is due, in large part, to the state’s embracing the individual mandate, the requirement that people purchase coverage or face a penalty, and its subsidization of coverage — the very aspects of federal health reform that Utah is fighting.
The Bay State also is able to keep premiums in check through stiffer insurance regulations than Utah has been willing to undertake.
Loathe to impose mandates on private insurers, Gov. Herbert rejects the idea of dictating how to design the required bare minimum policy. He also wants freedom to change the way health providers are paid under Medicaid and balks at expanding the program.
But, plagued by high premiums, Utah’s exchange has been slow to catch on. As of March 1, 68 of the state’s 67,000 small businesses were enrolled spanning 811 employees and their dependents for a total of 2,181 customers. By comparison, the five-year-old Connector boasts 220,000 customers.
Looked at on a per customer basis the Connector actually runs leaner, costing $145 per person to Utah’s $275.
Of course, that’s excluding hundreds of millions of dollars that Massachusetts spends subsidizing coverage for 160,000 of the 220,000 Bay State residents enrolled its Connector.
In the other article, Stewart notes that the Legislature, evidently in a move to make the Utah Health Exchange artificially appear to be a great success, has begun to look at a couple of bills. Here is the entire article:
A bill that some say is a ruse to make Utah’s Health Insurance Exchange look successful is wending its way through the Legislature.
A centerpiece of Utah’s health care overhaul, the exchange is a government-operated marketplace where small-business owners and employees can comparison shop for health coverage and leverage their combined buying power to obtain more affordable premiums.
Federal health reform will bring exchanges to all states in 2014, though they’ll look much different from Utah’s, which has been plagued by high premiums and low enrollment.
HB404 would direct lawmakers to scour the Public Employee Health Plan for places to cut costs and consider dumping its 25,000 beneficiaries, mostly state workers, into the exchange.
Insurance companies, brokers and the union representing public employees oppose the bill, sponsored by Rep. Don Ipson, R-St. George.
“There are forces at play to say that the way to make the exchange look successful in Utah is to drive public employees into it. Instantly you’ll have 25,000 to 30,000 belly buttons in it,” said Kelly Atkinson, a lobbyist for the Utah Health Insurance Association. “If the exchange is to be successful, it should stand on its own.”
The bill passed the House late Monday night 45-28.
First, let me ask members of the Utah Legislature why they would want to artificially inflate the public perception of the Utah Health Exchange? By any measure, it is simply a failure. Why pretend otherwise? Given the comments of the lobbyist from the Utah Health Insurance Association, it appears that insurers are wanting the Utah Health Exchange to fail. If the legislature can not even please Utah's powerful corporate insurers with its minimalist approach to a web-based method to sell their product, why go on with the effort? Why prop up a failed business model?
Second, if the Public Employees Health Plan is a success (and it is), why not simply try to emulate what is good about PEHP for every Utahn? Aren't all Utah taxpayers actually paying for the health benefits that public employees get through PEHP? Since that is the case, why can't the legislature make it possible for all Utahns to enjoy the advantages of the PEHP business model--non-profit, public trust fund, low overhead?
Third, in the sidebar for the first Tribune article, the efforts of various states to offer an alternative to Obama-Care were featured. Put simply, the only real achievements so far have been by Massachusetts (which is the prototype for Obama-Care), Vermont (which is seriously considering a Canadian-style or state government based single payer, California (which twice passed the same single payer format and which Schwarzenegger twice vetoed), and Utah's Health Exchange (which would not qualify as an improvement over Obama-Care). Why not consider an alternative for Utah which would not grow state government (like the Vermont proposal) but would improve on Obama-Care by capitalizing on the strengths of Utah's own PEHP?
The Utah Healthcare Initiative is proposing health system reform which would be superior to Obama-Care in every way but is not a state government based single payer. Better quality and more efficient care would reduce the cost of care and make care affordable for all Utahns. Of course the Utah Health Insurance Association would oppose the Utah Healthcare Initiative proposal, but they are already opposing the Utah Health Exchange. And insurers oppose any reasonable health system reform because anything with promise to reduce costs will inevitably limit the ability of health insurers to make as much money as possible.
Let's stop pretending that we can tweak the system we have. Remember what Clayton Christensen recommends: we must creatively disrupt the old way of doing health care business.
Dr. Joe Jarvis