PNHP

For-profit hospital problems in England and Canada

For-profit hospital problems in England and Canada

`P3′ disasters elsewhere should be a warning

May. 4, 2003
MICHELE LANDSBERG

The SARS outbreak in Toronto was sad and scary enough. But imagine this: A new outbreak occurs, spreading across Ontario. Patients in Brampton and in Ottawa find, to their horror, that their lives depend on their spanking new “public-private partnership” hospitals. And the private owners don’t want to deal with the crisis, thank you very much.

Contracted-out maintenance crews balk at entering the hospital. Privatized cleaning staff demand danger pay, which the hospital owners can’t or won’t pay.

The public board of directors, responsible only for clinical care, finds itself at loggerheads with the private owners, who don’t want to pay for beefed-up security, screening, cleaning, dietary and maintenance crews. The board doesn’t even have access to the hospital’s books, let alone any power over the management of the physical plant.

Fighting back in defence of its threatened profits, the hospital sues the Ontario government for billions of dollars in unanticipated costs.

Bogged down in legal battles and unable to pass even minimal preventive hygiene standards, both hospitals dramatically shut down.

Yes, this scenario is a fantasy, but not so far-fetched. This year, the Ontario government is pushing ahead stubbornly with its Brampton and Ottawa “P3” arrangements — the friendly little nickname for “public-private partnerships.”

If they get away with it, they plan on creating lots more, in reckless disregard of the consequences.

The idea, and the only idea, behind P3 public facilities is that it gets the capital costs of building hospitals, schools and even police stations and city halls off the government’s books.

Private companies build and own the facilities and lease them back to the public for 30, 40 or 60 years — at the end of which, the private owners, not the public, usually own the building.

P3s are different from the usual mode of construction, because the people who put up the capital also own and manage the building. And they certainly don’t intend to open their books to the public or be responsive to public demands.

In fact, in a blood-chilling example of capitalist thinking, P3 lawyers in Vancouver, in a city hall presentation, deplored what they called “the Inherent Diseases” of the public sector. The diseases? An emphasis on process, transparency and public justification. In other words, the P3s think that democratic accountability is a “disease” akin to typhoid.

Everywhere these P3s have been tried, they’ve crashed in disaster. In England, shoddy construction in P3 hospitals has led to grotesque accidents, ceiling cave-ins and frightening mechanical failures, along with emergency sale of public land and assets to ensure private profit.

Britain’s auditor-general, looking at the P3 accounting schemes, called them “pseudo-scientific mumbo-jumbo.” The British Royal College of Nurses says that privatization of hospital cleaning services is closely related to a rise in infections. The British Medical Journal reports that P3 hospitals have cut medical and service staff by 30 per cent.

Costs have been astronomical. Hundreds of millions of dollars have been spent on consultant fees alone; legal costs are a bottomless pit as the private owners try to wiggle out of contractual obligations in patient care. And because all these deals are done in secrecy, in the interests of “corporate privacy,” corruption is rampant. Just what we need for the next globalized epidemic: dirtier hospitals, management secrecy, shoddy building practices and profit-taking at the expense of patient well-being.

Apparently, Health Minister Tony Clement hasn’t read all those alarming reports — especially last year’s McMaster University study showing that private for-profit hospitals have a higher death rate because they skimp on care.

Listen, Mr. Minister, stop long enough to consider the Canadian evidence that P3 really means Profligate, Perilous and Profiteering.

Nova Scotia cancelled its P3 schools project but is stuck with costly 35-year leases, plus $32 million in extra costs.

Construction was shoddy, siting arbitrary and public access limited. Students had to drink bottled water for a year after arsenic was found in one school’s water supply, and the school’s private owner refused to take responsibility.

In P.E.I., the government cancelled a P3 hospital when it realized how expensive it would be.

In B.C., a P3 information system in Vancouver General Hospital racked up an extra $82 million in costs instead of the $72 million it was supposed to save.

In Alberta, the public board of a P3 school is grimly shouldering the extra expense caused by cheap and hazardous building techniques.

In every case, from England to Australia, government auditors have found that the sole reason for building P3 facilities is to get capital costs off the government’s books in order to fool the public into believing the budget was “balanced.”

When Tories argue that we can’t afford health care or hospitals without private money, they are playing three-card monte. Believe their sleight-of-hand accounting at your peril. Huge sums of public money are poured into those P3 long-term leases, going straight into private pockets instead of public service. But those costs show up on the books of some future government — and that’s their sole point.

Most of Ontario’s citizens believe firmly in public medical care and public hospitals. They’d be horrified to see our public institutions slip away into private hands, where we can’t demand answers, insist on access or hold the owners to account.

We do, however, have one last way to fight back.

On Saturday, May 10, the Ontario Health Coalition will launch its Caravan of Protest at the corner of Front and Bay Sts. at 2:30 p.m.

The march will wind through the financial district, stopping at the Bank of Montreal and Borealis Building, two of the bidders on P3 medical facilities.

Join in, even if you’ve never marched before. The weather forecast looks fine, there will be a double-decker bus to symbolize two-tier medicine (but also to make it easy for tired walkers), and there will be entertainment by Samba Allegra, Sizzlestick Theatre, Tintower Puppets, Judith Thompson, clowns and street theatre.

Make a noise to save our public system. If we can’t do that much, we’ll deserve what we get when the next epidemic strikes.

Michele Landsberg’s column usually appears in the Star Saturday and Sunday. Her e-mail address is mlandsb@thestar.ca.

http://www.thestar.com/NASApp/cs/ContentServer?pagename=thestar/Layout/Article_Type1&c=Article&cid=1051643375965&call_page=TS_Columnists&call_pageid=970599109774&call_pagepath=Columnists

Congressional testimony on Medicare cost sharing

House of Representatives
Committee on Ways and Means Subcommittee on Health
May 1, 2003
Hearing on Medicare Cost-Sharing and Medigap

Statement of Patricia Neuman, Sc.D., Vice President and Director, Medicare Policy Project, Kaiser Medicare Policy Project, Henry J. Kaiser Family Foundation:

I am testifying today on behalf of myself and Thomas Rice, Ph.D., Professor and Vice Chair of the Department of Health Services at the UCLA School of Public Health. This testimony reviews the evidence on the effects of cost-sharing on health-care utilization, and the implications for proposals that would modify Medicare’s cost-sharing structure.

Medicare plays a critical role in the lives of 41 million elderly and disabled Americans, offering a reliable source of health insurance at a time in their lives when they are most likely to need medical care. Medicare pays for much-needed basic medical services, such as physician and hospital care. However, with high cost-sharing requirements and no outpatient prescription drug coverage, Medicare is substantially less generous than plans typically offered by large employers.

Gaps in Medicare’s benefit package are increasingly problematic for beneficiaries given that many have relatively modest incomes and limited assets, and face declining access to affordable supplemental coverage. Four in ten Medicare beneficiaries live on incomes below twice the federal poverty level – about $18,000 per person and $24,000 per couple in 2003, and the same number have less than $12,000 in countable assets, leaving them with little capacity to pay for unexpected medical expenses. On average, Medicare beneficiaries spend more than a fifth of their income on health expenses, including Part B premiums; Medicare cost-sharing; non-covered services, such as prescription drugs; and premiums for supplemental insurance.

The evidence now suggests that access to supplemental coverage is on the decline… Between 1996 and 1999, while the share of beneficiaries with supplemental coverage remained stable due to the increase in Medicare+Choice enrollment, the number of beneficiaries with Medigap policies declined by 1.5 million, bringing the share of all Medicare beneficiaries with Medigap coverage from 29% to 24%. Since then, enrollment in Medicare+Choice plans has also dropped by roughly the same number.

In addition, results from several surveys point to an erosion of employer-sponsored retiree health benefits.

One key consideration in redesigning Medicare’s benefit package is an understanding of the effects of cost-sharing on beneficiaries’ access to care. Some have suggested, for example, that beneficiaries should bear a greater share of their health-care costs to deter use of non-essential services. A review of the literature, however, identifies several concerns associated with proposals that would raise cost-sharing under Medicare: (1) higher cost-sharing requirements are likely to lower use of medically necessary services and may have a negative impact on beneficiaries’ health status; (2) higher cost-sharing is inequitable, hitting the most financially vulnerable beneficiaries the hardest; and (3) many if not most seniors do not appear to have sufficient information and knowledge to navigate the health-care system and assess their options when faced with high cost-sharing requirements.

Increased cost-sharing can therefore be viewed, colloquially speaking, as a “triple jeopardy” for elderly and disabled beneficiaries with modest incomes:

* Those with low incomes are more likely to be without any form of supplemental insurance that covers Medicare’s cost-sharing requirements; * Since those with low incomes also tend to be in poorer health and need more medical services, Medicare’s cost-sharing requirements will account for a greater portion of their limited incomes if they use the necessary additional services; and * If they do not use the additional services they need, their health is likely to suffer as a result.

In summary, there is substantial evidence showing that cost-sharing leads to lower utilization of health-care services – both necessary and potentially non-essential services. A number of studies show that cost-sharing (or lack of supplemental coverage) deters people from seeking diagnostic and preventive services, as well as services that are often used to treat chronic illness. Lower utilization may reduce health-care spending in the short term, but could ultimately result in poorer health outcomes for seniors and younger beneficiaries with disabilities.

http://waysandmeans.house.gov/hearings.asp?formmode=view&id=338

Comment: This important report should be downloaded. It contains an excellent discussion of the impact of cost-sharing on the use of services, and it explains why proposals to shift more of the burden of funding Medicare to the beneficiaries would result in impaired medical outcomes for many Medicare beneficiaries. The discussion is supported by solid data and informative charts and graphs.

It is much more important to understand the actual impact of policy decisions than it is to listen to advocates of “consumer sensitive” cost sharing state how they “wish” it would work, as if health policy science had confirmed that simply decreasing utilization improves the functioning of our health care system. It doesn’t. Let’s end “wishing” and instead deal with reality. Let’s move forward with reform that really benefits patients.

Results of SF Chronicle single payer poll

San Francisco Chronicle poll, 5/1/03

Results:
77% – Create single-payer system
3% – Make employers “play or pay”
2% – Restore clinics’ budgets
14% – Make cuts, we can’t afford the system we’ve got
3% – Take two aspirin and call Congress in the morning

About 1100 people voted in this poll, which totally lacks any scientific validity. But the poll does make one very important point. The California State Legislature is currently evaluating both an employer mandate model and a single payer model of reform. This poll demonstrates that legislators should not automatically dismiss the single payer model because it is not “politically feasible.”

PNHP and Heritage agree?

Modern Physician Apr 1, 2003 Editorial An irresistible force By Joseph Conn

…on March 10, an officer (Stuart Butler, vice president of domestic and economic policy studies) of the conservative and politically influential Heritage Foundation testified before a Senate committee that a “social contract” exists in the United States to “ensure all residents have affordable access to at least basic health care . . . ”

So now, even the Heritage Foundation accepts the idea of universal coverage.

Butler concedes it would take a public/private partnership to cover everyone, but his plan, presented to the Senate subcommittee on aging, calls for phasing out what he calls the “regressive” tax breaks given on employer contributions to healthcare benefit plans. The excluded federal and state income and payroll taxes–estimated at $125 billion in 1988–would be better spent, he argues, providing “more progressive” tax credits or subsidies to individuals for obtaining health insurance themselves.

Butler did not urge employers to stop paying for their employees’ healthcare coverage, but that is inevitably what would happen without the tax breaks.

http://www.modernphysician.com/article.cms?articleId=1817

Comment: As we approach the inevitability of major reform of our highly flawed system of funding care, it is instructive to note policy issues on which groups as diverse as Physicians for a National Health Program and the conservative Heritage Foundation can agree.

Heritage believes in a “social contract” and PNHP believes in a “human right” to affordable, universal access to health care, though Heritage would limit that to “basic” care and PNHP would include all “beneficial” care.

Heritage recognizes a fundamental flaw in the regressive tax benefits of employer-funded health plans. The regressive nature is due to the fact that health plans provided by the employer are actually part of the employee compensation package. Since they are deductible to the employer, but not taxable to the employee, higher-income individuals receive a much greater tax benefit than do lower-income individuals. This is tax policy that benefits the wealthy but not the poor.

Remarkably, both Heritage and PNHP believe that our health care system should be funded through tax policies that are more progressive. This is a dramatic meeting of diverse minds. Both PNHP and Heritage believe that we should use the tax system in health care funding, and that the taxes should be more equitable.

Unfortunately, we are still in different worlds on the next step. Heritage would turn the hapless recipient of a tax credit loose in the overpriced and inadequate private individual insurance market where the masters of “market medicine” will relieve the patient of their funds without the necessity of providing adequate, affordable access to beneficial services. PNHP stands firm on the principle that only a publicly administered, single payer system of social insurance can ensure that everyone would have truly affordable access to all important beneficial services.

There is one important caveat. Although we agree that employment-linked insurance should be eliminated, we cannot do that until we have established a program of social insurance. In spite of the injustices of our current system, it is crucial that we maintain the employer’s role in providing coverage. Without it, tens of millions more would join the ranks of the uninsured.

We need to proceed, as expeditiously as possible, with our efforts to establish a single payer system. But, until we are there, let’s not dismantle the employer base of coverage.

K. Sullivan on Blendon's polls

Response of Kip Sullivan to Robert Blendon’s polls:

From Don’s comment:

Dr. Blendon could improve his credibility by conducting polls that ask about views on universality, comprehensiveness and affordability of social insurance. Rather than asking exclusively about government and taxes, the poll should begin with a statement such as “Medicare and Social Security are programs of social insurance that are designed to include everyone and to be funded equitably.”

Kip Sullivan’s response:

Don,

I have what I think is an even more important suggestion for Dr. Blendon. He should stop asking respondents whether they would pay $50 or $200 or $500 more “to insure the uninsured,” and instead start asking, “If a universal insurance program would reduce your premium and out-of-pocket costs by $500, and increase your taxes by $500, would you support such a program?” Blendon’s question and my proposed question make different assumptions about costs. Blendon’s question assumes there is no way costs can be lowered while coverage is expanded; my question does not.

The other problem with Blendon’s question is that it assumes financing of universal coverage must be regressive. (A per head tax of $50 or $200 is regressive; it takes a rising portion of income as income declines.) My suggested question also suffers from that defect. Blendon should explore how support for universal coverage is affected by progressivity of financing by asking some follow-up questions, such as, “If a universal insurance program would reduce your premium and out-of-pocket costs by $500, and increase your taxes by $200, would you support such a program?”

Blendon keeps asking Americans his loaded question, and, not surprisingly, their responses show they are reluctant to pour even more money into our dreadfully expensive system. From this Blendon concludes, “Americans say they want universal coverage but they don’t want to pay for it.” If Blendon wants to continue posing his loaded question, fine, but the least he can do is draw the appropriately narrow conclusion, which is, “Americans want universal coverage, but they don’t want to buy it at the current price at which coverage sells these days, and they don’t want to pay for it with a regressive tax.”

Kip

Vote today, May 1, in poll for health care reform

The San Francisco Chronicle is conducting a poll on health care reform. Two of the choices include single payer and “play or pay” employer mandate. Although the poll is not scientifically valid, a large response could demonstrate the level of passion that we have for reform.

To cast your vote: http://www.sfgate.com/ (The question is half way down the right column.)

Blendon – "…we don't have enough money…"

The New York Times
April 30, 2003
Health Care Limps Up Political Ladder
By Robin Toner

The health care crisis is returning to American politics – gradually, but inexorably, with a force that will most likely grow as rising costs and deepening cuts squeeze more and more voters.

Pollsters say the issue ranks high with Democratic primary voters, which means that every presidential candidate must address it.

Meanwhile, rising health costs, coupled with declining revenues, are forcing states to consider major cutbacks in Medicaid – the program that already covers millions of people who would otherwise be uninsured. State officials have not, so far, received the help they are pleading for from Washington.

There is an incongruity here, as Bob Blendon, a Harvard University expert on public opinion and health, put it: Candidates are proposing bold visions to expand coverage in the future, “and we don’t have enough money to pay for the present.”

http://www.nytimes.com/2003/05/01/politics/01TALK.html

Comment: Dr. Blendon’s comment is unfortunate. His polls (with KFF, NPR, WP and others) have been used to inform our political leaders that Americans do not want a government-run, taxpayer-funded system. His insistence on continuing with the pejorative phrasing of his question on social insurance has contributed to the belief that reform must be incremental and not comprehensive.

Now Dr. Blendon has adopted the rhetoric of those who are opposed to reform in stating that “we don’t have enough money to pay for the present.” Numerous studies have demonstrated that we are already spending more than enough to fund comprehensive health care for everyone, but we need to reform the system to make that a reality. 98% of Americans believe that the issue of affordability of health care must be addressed.

Dr. Blendon could improve his credibility by conducting polls that ask about views on universality, comprehensiveness and affordability of social insurance. Rather than asking exclusively about government and taxes, the poll should begin with a statement such as “Medicare and Social Security are programs of social insurance that are designed to include everyone and to be funded equitably.” Then asking questions about support for adopting social insurance for health care for everyone should provide more objective responses.

It is helpful to understand the impact of the prevailing political rhetoric, but it would be even more helpful if we understood precisely what Americans really do want in the way of affordable access to health care.

K. Sullivan on Blendon’s polls

Response of Kip Sullivan to Robert Blendon’s polls:

From Don’s comment:

Dr. Blendon could improve his credibility by conducting polls that ask about views on universality, comprehensiveness and affordability of social insurance. Rather than asking exclusively about government and taxes, the poll should begin with a statement such as “Medicare and Social Security are programs of social insurance that are designed to include everyone and to be funded equitably.”

Kip Sullivan’s response:

Don,

I have what I think is an even more important suggestion for Dr. Blendon. He should stop asking respondents whether they would pay $50 or $200 or $500 more “to insure the uninsured,” and instead start asking, “If a universal insurance program would reduce your premium and out-of-pocket costs by $500, and increase your taxes by $500, would you support such a program?” Blendon’s question and my proposed question make different assumptions about costs. Blendon’s question assumes there is no way costs can be lowered while coverage is expanded; my question does not.

The other problem with Blendon’s question is that it assumes financing of universal coverage must be regressive. (A per head tax of $50 or $200 is regressive; it takes a rising portion of income as income declines.) My suggested question also suffers from that defect. Blendon should explore how support for universal coverage is affected by progressivity of financing by asking some follow-up questions, such as, “If a universal insurance program would reduce your premium and out-of-pocket costs by $500, and increase your taxes by $200, would you support such a program?”

Blendon keeps asking Americans his loaded question, and, not surprisingly, their responses show they are reluctant to pour even more money into our dreadfully expensive system. From this Blendon concludes, “Americans say they want universal coverage but they don’t want to pay for it.” If Blendon wants to continue posing his loaded question, fine, but the least he can do is draw the appropriately narrow conclusion, which is, “Americans want universal coverage, but they don’t want to buy it at the current price at which coverage sells these days, and they don’t want to pay for it with a regressive tax.”

Kip

Blendon – “…we don’t have enough money…”

The New York Times
April 30, 2003
Health Care Limps Up Political Ladder
By Robin Toner

The health care crisis is returning to American politics – gradually, but inexorably, with a force that will most likely grow as rising costs and deepening cuts squeeze more and more voters.

Pollsters say the issue ranks high with Democratic primary voters, which means that every presidential candidate must address it.

Meanwhile, rising health costs, coupled with declining revenues, are forcing states to consider major cutbacks in Medicaid – the program that already covers millions of people who would otherwise be uninsured. State officials have not, so far, received the help they are pleading for from Washington.

There is an incongruity here, as Bob Blendon, a Harvard University expert on public opinion and health, put it: Candidates are proposing bold visions to expand coverage in the future, “and we don’t have enough money to pay for the present.”

http://www.nytimes.com/2003/05/01/politics/01TALK.html

Comment: Dr. Blendon’s comment is unfortunate. His polls (with KFF, NPR, WP and others) have been used to inform our political leaders that Americans do not want a government-run, taxpayer-funded system. His insistence on continuing with the pejorative phrasing of his question on social insurance has contributed to the belief that reform must be incremental and not comprehensive.

Now Dr. Blendon has adopted the rhetoric of those who are opposed to reform in stating that “we don’t have enough money to pay for the present.” Numerous studies have demonstrated that we are already spending more than enough to fund comprehensive health care for everyone, but we need to reform the system to make that a reality. 98% of Americans believe that the issue of affordability of health care must be addressed.

Dr. Blendon could improve his credibility by conducting polls that ask about views on universality, comprehensiveness and affordability of social insurance. Rather than asking exclusively about government and taxes, the poll should begin with a statement such as “Medicare and Social Security are programs of social insurance that are designed to include everyone and to be funded equitably.” Then asking questions about support for adopting social insurance for health care for everyone should provide more objective responses.

It is helpful to understand the impact of the prevailing political rhetoric, but it would be even more helpful if we understood precisely what Americans really do want in the way of affordable access to health care.

California health care reform legislation moving foreward

Great news!

The insurance committee of the California State Senate this afternoon approved both SB 2 (Burton/Speier), an employer mandate proposal, and SB 921 (Kuehl), a single payer proposal.

Based on the hearings today, it seems clear that almost everyone agrees that major reform is essential. The debate now centers on just what that reform should be. Most agreed that we should move forward with the legislative process on both proposals, single payer and the employer mandate. The public legislative process should serve to clarify the issues, enabling an informed decision.

If anyone needs help understanding the differences in these models of reform, you can start by reading the article that was the subject of yesterday’s message, “Private Health Plans Versus Social Insurance: Implications for Health Care Reform.”

For the article:
https://pnhp.org/publications/archives/001892.php

Private health plans: the price is too great

Physicians for a National Health Program
April 28, 2003
Private Health Plans Versus Social Insurance: Implications for Health Care
Reform
by Don McCanne

Private health plans are responsible for much of the administrative waste that uniquely characterizes the health care system of the United States. And for this outrageous cost and inefficiency, these plans are providing highly flawed and inequitable methods of pooling funds and allocating health care resources. We are receiving remarkably little value from this very costly industry.

Yet the leading incremental proposals for health care reform call for an expansion of the role of private plans as a method of expanding health care coverage to more individuals. Because of the unacceptable inadequacies and high costs of our current system we will have major reform soon. But before we invest more resources into the health plan industry, we should review the policy implications to decide whether this would be a worthwhile investment.

An evaluation of funding through private health plans would not be complete without comparing this model with a model of public funding through social insurance.

Publicly funded systems of social insurance have a mission to allocate the health care resources as equitably and as efficiently as possible.

For the full article:
https://pnhp.org/publications/private_health_plans_versus_social_insurance.php

Special Request: Since this article is several pages long, you may not have time to read it now. If so, please save the link or download it now to be read later. You can use the printer icon on the PNHP page for a printer-friendly format.

Many of the leading proposals for reforming health care would use individual or employer mandates along with tax policy to expand enrollment in private health plans. Many supporters of such incremental reforms understand the benefits of the single payer model, but they believe that it lacks political feasibility. They correctly believe that achievable modest steps are better than no reform at all. But they have to live with the fact that modest reforms have only slowed the rate of deterioration in our system, as the net result of incremental improvements has been a negative. Costs are up, more people are uninsured, under-insurance is epidemic, and portions of our health care infrastructure are threatened with insolvency. And since the newer models of health care coverage leave patients exposed to greater risk, coverage alone is no longer an adequate goal for reform. Our goal must be universal coverage that ensures both financial and health security.

It is no longer acceptable to debate merely whether or not single payer reform is feasible. The debate now must center on whether it is ethical to support reform that increases costs as it perpetuates inequities, or should the ethics of the health policy professions mandate support for an affordable, equitable, universal system of health care coverage? The onus of proving that it is ethical to support inequities and waste because of political feasibility must now be placed on those with lesser goals for reform.

Please use this article to help change the terms of the debate. Share it not only with our colleagues for their use in the debate, but also share it with those who would accept a lesser ethical standard for reform. Let’s end the debate over political feasibility, and begin the debate over the ethics of supporting reform that perpetuates and expands waste and inequities.

For health care justice for all,

Don McCanne, MD
President, Physicians for a National Health Program
www.pnhp.org
don@mccanne.org
Home telephone: 949-493-3714

California Dreamin'

SFGate.com
April 26, 2003
Despite budget woes, lawmakers trying to deal with uninsured
By Steve Lawrence, Associated Press Writer

…California legislators have introduced at least five bills designed to reduce the number of uninsured.

They range from a measure to increase the number of people covered by the state’s Healthy Families program to a bill that would set up a state-run universal health care system with an elected commissioner.

In between are bills that would require all or most employers to offer their workers health coverage.

The bill that seems to have the best chance of passing is a measure by Senate President Pro Tem John Burton, D-San Francisco, and Sen. Jackie Speier, D-Daly City, who chairs the Senate Insurance Committee.

Not only is it co-authored by Burton, who is generally considered to be the Legislature’s most influential member, it has the support of labor leaders and the California Medical Association, a powerful physicians’ group. Art Pulaski, executive secretary-treasurer of the California Labor Federation, predicts it will also win some business support.

Commonly known as a “pay or play,” it would require employers to pay at least 80 percent of the cost of a health insurance policy for their employees, either by buying the policies themselves or contributing to a state fund that would provide coverage.

Sen. Sheila Kuehl, D-Santa Monica, says the ultimate solution is the so-called “single payer” approach in her bill, which would create one state fund to provide health insurance for all Californians.

It’s the only plan that would cover all Californians and actually cut health care spending by reducing administrative costs and eliminating health care profits, Kuehl says.

The Lewin Group, a consulting firm based in Falls Church, Va., looked at nine health insurance options for the state Health and Human Services Agency in 2002, including three single-payer proposals, and concluded the single-payer approach could save the average family up to $813 a year.

But single-payer proposals have been tough to enact. California voters rejected one in 1994.

Voters tend to oppose single payer plans because they take them from their current insurance to something unknown, says John Sheils, a vice president with the Lewin Group.

But Kuehl says she’ll keep bringing it back as many times as it takes. “It’s truly the only plan that makes sense for California.”

On the Net: Read the bills, SB2, AB30, SB921, AB1527, AB1528, at www.senate.ca.gov and www.assembly.ca.gov

http://www.sfgate.com/cgi-bin/article.cgi?f=/news/archive/2003/04/26/state14 13EDT0073.DTL