A Connecticut lesson for state reformers
Although a prior Quote of the Day discussed a Policy Brief on which this report is based, some specifics in this final report are very pertinent to the current debate over various state efforts to provide universal coverage.
Health Coverage in Connecticut: Three Routes to Reform
By Stan Dorn, Jack Meyer and Elliott Wicks
Prepared for Universal Health Care Foundation of Connecticut
Three models for reform:
- One Health Plan Serving All Residents (Single plan)
- Health Insurance Purchasing Pool with Competing Private Plans (Private plans)
- Expanding the Health Coverage Safety Net While Requiring All Parents To Cover Their Children (Safety net)
Benefits:
- Single plan - All state residents get comprehensive coverage; no high deductibles
- Private plans - 61% of residents in pool, with diverse private options
- Safety net - Some adults get tax credits to access purchasing pools
Population covered:
- Single plan - No uninsured
- Private plans - No uninsured
- Safety net - 3.6% uninsured
Integration of low-income households:
- Single plan - Integrated into state health plan
- Private plans - Partial and voluntary integration into pool
- Safety net - Very little integration
Employer health costs:
- Single plan - Major savings
- Private plans - Significant savings
- Safety net - Minimal savings
Household health costs:
- Single plan - Major savings
- Private plans - Significant savings
- Safety net - Minimal savings
Total spending on health care and insurance:
- Single plan - $10.03 B
- Private plans - $10.56 B
- Safety net - $10.66 B
http://www.universalhealthct.org/admin/uploads/1057745758a8a7e7ef7.89093563.pdf
Comment:
By Don McCanne, MD
The “single plan” above technically is not a single payer proposal since it leaves Medicare in place, and it defines benefits as those typical of employer-sponsored plans. But it does include important features of the single payer model in that everyone is automatically enrolled, and the plan is administered by a state commission. Thus the impact demonstrated by the modeling of the “single plan” approaches that of the the beneficial effects previously demonstrated by other studies modeling bona fide single payer plans.
There are no surprises here. As with single payer, the “single plan” covers everyone, with the most comprehensive benefits of the proposals, and with the greatest cost savings - globally, and individually for businesses and households as well.
The current surge of interest in achieving universal coverage at the state level is certainly understandable considering the continued negligence of the federal government in failing to address this gross injustice. What is particularly valuable about this report is that it provides insight into the potential impact of the current proposals under consideration.
The “safety net” model has the greatest likelihood of being enacted since it merely entails expanding coverage for children and perhaps for a few low-income adults. But it is the most expensive and has almost a negligible impact on the problems we are facing. Those supporting this model (e.g., Families USA) contend that the perfect should not be the enemy of the good. But when a much more effective and less expensive option is available, then the “good” is actually bad as it is the enemy of the perfect.
Recognizing the gross inadequacies of the “safety net” model, many states are turning to the “private plans” model in the form of mandates for either employers or individuals to purchase private plans. This report indicates that the “private plans” model is significantly more costly than the “single plan,” and other studies have indicated that expanding coverage through private plans is the most expensive form of attempting to achieve universal coverage.
Also this report indicates that the “private plans” model would be universal, when, in fact, a mandate to purchase insurance can never be universal because many individuals or businesses simply do not have the funds required. This model fails because premiums for plans that are effective in preventing medical debt are too expensive for far too many people. We usually include Switzerland, the second most expensive system, in the list of countries with universal coverage, though actually many there are left without coverage because they also use an individual mandate. In fact, they will have a single payer measure on their ballot this year as a reaction to the inequities of their individual insurance market.
The most important lesson for states appears above under “Benefits.” The states are struggling to find affordable options, which really means affordable insurance premiums, but not affordable health care. The “private plans” model calls for “diverse private options,” which means plans with affordable premiums that expose individuals with significant health care needs to major medical debt. The “single plan” calls for “comprehensive coverage with no high deductibles.”
The policy lesson? The least expensive proposal, “single plan,” is the only one that really does cover everyone, and does it with coverage that really works. A bona fide national single payer program would be even better.