Schwarzenegger's Late XMas Present to Insurers & The Single-Payer Movement

This diary brought to you by the National Nurses Organizing Committee as we work to make 2007 the Year of Single-Payer Healthcare.

The fight over nsingle-payer health care in this nation is now being fought in California, which last year passed a single-payer health program only to see Governor Schwarzenegger veto it.

Yesterday, hobbled by his own broken leg, Governor Schwarzenegger presented his own alternative plan via video conference to a packed Sacramento room containing representatives of just about every group that cares about health care reform.  While Washington dithers over "nibbling around the edges" reforms, Schwarzenegger's proposals instantly become the most-talked about plan for wide-ranging changes in the health care arena since Hillarycare--and like Hillarycare, Schwarzencare is almost too complicated to talk about, with dozens of planks hoping to shore up rather than fundamentally reform our healthcare system.

Also like Hillarycare, Schwarzencare is ambitious;  Schwarzenegger himself said repeatedly, he hopes to build a model, "that can be shared with the rest of the nation," and finally make himself relevant on a substantive instead of symbolic level.   Unfortunately, his plan will make much worse our already-broken health care system, so patient advocates must watch it closely.

But first, let's give Governor Schwarzenegger credit for making a serious effort to pass legislation dealing with the health care crisis.  He said he would, and he did.  He gets an "A" for attendance.  Let's also give him credit for including illegal immigrants in his plan.  (Does it really require employers of illegal immigrants to get health insurance for them? Wow.)

That said: his plan is terrible.  
*    It is a huge boon to insurance companies (his big donors).  
*    It is a recipe for financial ruin for most people who get sick.
*    It does nothing to address the crushing problem of health care costs.
*    It saps an already-underfunded public health system.
*    Funding mechanisms seem vague or unrealistic.
*    It is a cycnical attempt to derail genuine health care reform--and provide states around the country with a blueprint for also derailing it.

Advocates for a genuine national health care plan should engage with this on an intellectual level, and point out its failings.  Schwarzenegger is arguing for much much more of the same, and if you love our current health care model you'll love his renovation plans.  Fortunately most people DON'T love our health care system, and this plan provides us the opportunity to advocate for real changes.

Let's go to the details of the plan, which you might have seen covered everywhere. The New York Times seemed to like it and gives a blow-by-blow account of many of its planks.  The LA Times was not so fond, noting

But many leading consumer advocates, academics and business leaders said they feared that the governor's proposal was inadequately financed and would shift more responsibility for healthcare to families while unintentionally encouraging businesses to drop or downgrade the coverage they now offer.

The Orange County Register looks at some of the divisions on the right, while the San Jose Mercury News notes a bruising battle in the offing.  Dozens of articles covered it, many of which can be found at Rough & Tumble.

So what exactly does the plan do?  It's the kitchen sink theory of legislating--everything is in there, in an attempt to placate enough opponents.  The big question is, if a piece or two falls out of the mix, will the whole plan fall apart?

Schwarzenegger included:
1.    An individual mandate--meaning every person is required to purchase health insurance.  This is a "forced market" for the insurance industry of 4 to 5 million new consumers.  OF COURSE--the cheapest insurance will be "junk insurance" with high deductible and tough caps, meaning if you get sick you'll still go bankrupt, but only after the insurance companies have picked some meat off your carcass.
2.    An employer mandate---all businesses with more than 10 people must give their employees coverage or pay 4% of revenue into a state pool to help cover them.  Advocates of single-payer have long argued that our illogical employer-based system puts American businesses at a competitive disadvantage with other nations.  See: GM.
3.    An end to insurance companies refusing to cover people based on age or occupation.  Of course they can charge still them exorbitant rates based on age or occupation, so this feel-good plank is largely irrelevant.
4.    A requirement that insurance companies put 85% of their dollars into patient care.  So a) they are guaranteed a profit of 15% and b) it is very easy to manipulate what a patient care expense is, so we have another largely irrelevant plank--but one that hints at the big problem with our "market-based medicine," which is huge profits for an unnecessary middleman, the insurance industry.
5.    Some shell games moving money around among hospitals, doctors, and Medi-cal.
6.    Partially funded by cutting the public health budget by $2 billion.  So we're taking patient care dollars and running them through an insurance industry machine that will lop off between 15% and 30%?
7.    Coverage for illegal immigrants.

Much more to discuss as this behemoth sails towards the legislature.

Tags: Health care, nurses, Schwarzenegger, single-payer (all tags)

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