NEWS
ANALYSIS
Dueling health proposals
How
Democrats' new plan differs from governor's
Victoria Colliver, Chronicle Staff Writer
Saturday,
June 23, 2007
An agreement by top Democrats in Sacramento this week to put
forward a single health care overhaul plan sets the stage for a
debate with Gov. Arnold Schwarzenegger, who is championing a
proposal of his own.
Both approaches would make landmark changes in health care
policy. Both the Democrats and Schwarzenegger want to reduce the
number of uninsured Californians, expand coverage for children
and make employers play a larger role in financing health care.
But the two proposals differ in several key respects.
State Senate Pro Tem Don Perata, D-Oakland, and Assembly Speaker
Fabian Núñez, D-Los Angeles, agreed Thursday to combine their
separate health bills. The resulting legislative plan would not
require all individuals to obtain coverage, a key departure from
the governor's proposal.
While other health bills remain under consideration, notably a
"single payer" plan by Sen. Sheila Kuehl, D-Santa Monica, the
crafting of a combined bill gives Democrats a program around
which to unite as they bargain with Schwarzenegger, who has not
yet formed his ideas into a bill.
"This is the equivalent of the director saying, 'Places
everybody! Places everybody!' before show time," said Anthony
Wright, executive director of Health Access California, a
coalition of labor and consumer groups.
Schwarzenegger's proposal, which he introduced in January, rests
on what the governor calls "shared responsibility," or a
spread-the-pain approach. His plan asks for contributions from a
wide array of groups: Doctors would chip in 2 percent and
hospitals 4 percent of revenues; employers with 10 or more
workers would have to cover their employees or contribute 4
percent of their payroll tax into a state insurance fund; and
all Californians would have to obtain coverage, from their
employers, from government programs or by purchasing insurance
themselves.
Under the new Democratic compromise, Perata lost his bid to
require coverage for workers earning more than 400 percent of
the federal poverty level in favor of Núñez's
no-individual-mandate clause.
Doctors and hospitals are off the hook for contributions under
the plan. And the employer fee would be considerably more
onerous -- 7.5 percent of payroll costs, with no exemptions for
size.
The governor's plan would require insurers to cover all
individuals regardless of their health status. The Democratic
plan would allow health insurers to exclude those with
as-yet-undefined "serious" medical conditions, but it would
create a high-risk pool funded by the insurers that would
provide coverage to those individuals.
Wright and other health advocates hailed the elimination of an
individual mandate as a victory for consumers that doesn't force
them to buy into a system that advocates consider broken,
lacking proper controls over insurance premiums and other costs.
But the Democratic plan aims to cover fewer people. California
has an estimated 6.5 million uninsured residents. The Democrats
would extend coverage to roughly 3.4 million people.
Schwarzenegger would cover more than 4 million uninsured,
according to the California HealthCare Foundation, a health care
philanthropy based in Oakland.
Business groups, which have reacted negatively to many aspects
of both proposals, found the Democrats' plan particularly
objectionable, both for its larger employer contribution and for
a provision that would allow the state agency that runs the
high-risk pool to raise that contribution at will.
"It really doesn't do a whole lot to help provide health care to
folks. It certainly does impose a costly mandate on business
that won't be able to afford it," said Vince Sollitto, spokesman
for the California Chamber of Commerce, adding that the chamber
believes requiring an employer contribution violates the law.
San Francisco small businessman Scott Hauge, president of an
advocacy group called Small Business California, questioned the
Democrats' plan to require all businesses to contribute,
regardless of size.
Health advocates say a major oversight in the two proposals is a
lack of serious methods to control medical costs and the price
of coverage for consumers.
"All these proposals are really focused right now on is the
expansion of coverage for the types of health care services and
benefits we have now," said Marian Mulkey, senior program
officer for the California HealthCare Foundation.
"It will be important both in the short term and then longer
term to think not just about expanding coverage, but how health
care is delivered and what makes that so expensive."
The Democrats' bill and the governor's proposal are expected to
go through many changes before the legislative session ends in
September. The governor and lawmakers both say they intend to
add cost-containment methods to their proposals.
Wright of Health Access said the similarities, such as expanded
coverage and an employer contribution, outweigh the differences
between the plans.
"What's notable here is not the differences between the
legislators' and governor's proposals. It's the similarities,"
he said. "That is what gives us optimism that major steps will
be taken this year."
The plans compared
Key differences between the governor's and the Democrats' health
proposals:
Requirement: The governor's proposal requires all Californians
to obtain health insurance, while the Democrats' plan does not.
Contributions: Under the Democrats' plan, employers would be
required to put 7.5 percent of payroll costs toward health care
-- nearly twice the 4 percent the governor has proposed.
Impact on insurers: Under the Democrats' plan, insurers would be
required to cover all but the very sick, who would receive
coverage through a state-run high-risk pool. The governor's plan
requires insurers to cover everyone regardless of health status.
E-mail Victoria Colliver at
vcolliver@sfchronicle.com.
http://sfgate.com/cgi-bin/article.cgi?f=/chronicle/archive/2007/06/23/MNGLEQKBRE1.DTL
This article appeared on page A - 1 of the
San Francisco Chronicle
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