Predicting health reform’s impact?

We often hear predictions about the dire consequences if health reform passes. When Healthy San Francisco was passed a few years ago, opponents from a portion of the business community–largely fast food and chain restaurants that don’t provide coverage to their workers– foretold of awful job losses as a result.

Healthy San Francisco has been a success in reducing the number of uninsured by 75%, but what about article in the San Francisco Chronicle by Healther Knight, entitled “Study finds SF health plan didn’t hurt jobs,” says it (emphasis added):

San Francisco’s first-of-its-kind universal health care program and its mandate that employers provide health care has not resulted in feared job losses, according to a new study by a UC Berkeley researcher.

Crunching quarterly data from the U.S. Labor Department, the researcher found that since the inception of Healthy San Francisco’s employer mandate in 2008, the city’s growth rate across all employment sectors was similar to or better than other Bay Area counties. While San Francisco saw its employment rate shrink due to the struggling economy, it actually shrank less than other counties.

This held true in retail, food service, restaurants and hotels, the sectors most strongly impacted by the health care ordinance because they traditionally have a lot of low-income workers and aren’t as likely to offer health insurance as higher-paying industries.

“The San Francisco experiment is working, and it’s working well,” said Ken Jacobs, chair of the university’s Center for Labor Research and Education. “There’s no evidence of any impact of the ordinance on employment in San Francisco.”

The statistics were unveiled Thursday as part of a push by big-name labor leaders and Mayor Gavin Newsom to hype Healthy San Francisco as a public option that’s working – and that could be a model for the rest of the country as it remains mired in a heated debate over health care reform.

“The sky has not fallen – the world as we know it did not come to an end,” said Newsom, adding the controversial policy didn’t prompt businesses to leave, bureaucracies to sprout up or the city’s economy to crater.

For those who predict gloom-and-doom with health reform, the real question should be what does the world look if there is no reform. The status quo isn’t an option–the situation on health care will get worse.

We see this everyday in California, as Timm Herdt of the Ventura County Star explains:

Not much has changed, that is, except for these two things: Group health insurance premiums have gone up another 11 percent, more than double the rate of inflation, and about 1 million more Californians have lost their insurance because they were either laid off or their employers dropped coverage.

Those two developments alone ought to be enough to cause any mortal to demand that Congress not blow this latest opportunity to fix a badly broken system.

They show that the existing system is not really a system at all, doesn’t work and is getting worse.

In 1999, as data collected by the Kaiser Family Foundation show, the average group health insurance premium for a family of four, was $5,791. By 2008, the cost had more than doubled to $12,680.

In four of those nine years, there were double-digit annual percentage increases. In none of those years was the increase less than 5.5 percent.

Employers have been squeezed, hospitals have bled red ink, doctors have been pinched and ordinary folks have seen their healthcare costs soar. The employee share of costs for employer-based policies shot up 117 percent from 1999 to 2008, from $1,543 to $3,354, and that added cost was compounded by higher deductibles and copays.

Through it all, health-insurance companies have largely remained profitable.

But this annual process of raising premiums by twice or three times the rate of inflation cannot go on forever, or even much longer.

Look at that figure of the average cost of a group health plan for a family of four —$12,680 — and ask yourself this: At what price will your employer be forced to throw in the towel? Will it be when a family policy costs $15,000? $20,000? $25,000?

With prices that high, how can anyone feel secure that he or she will have health insurance next year or the year after that?

Having closely followed the health-reform efforts in California two years ago, I know that it is complicated stuff. There are a lot of moving, interrelated parts: providers, private insurers, consumers, employers, labor unions — and not even all the players in the same categories have the same interests.

But while health reform is complicated, it’s not rocket science.

A system built on shared risk cannot work unless everyone, or nearly everyone, is sharing the risks — and it doesn’t work now because about one in five Americans does not have insurance. That’s why the failed California bill, the bill now in the House and the bill now in the Senate have as their principal focus the goal of getting everyone insured.

Each includes a mandate that everyone have insurance, a requirement that all employers either provide a policy to workers or pay a fee, a framework of subsidies to make sure everyone who is forced to buy insurance can afford it, and a requirement that insurance companies respond to a universal-coverage mandate by making their products universally available.

And there is one other common element: an attempt to force price discipline on an insurance industry that will be handed millions of new customers as a result of the mandates…

If the momentum for reform is squandered this time, all America will look back two years from now and see the same price for failure that Californians have seen: 6,380 people losing their health coverage every week and the cost of a family policy marching relentlessly upward toward a day when the private insurance system will collapse under the weight of its own expense.

Without health reform, we didn’t just get stuck with the broken status quo. It got worse, just like everyone predicted.

So which predictions should we listen to this time: the unfounded, unsupported warning of those opposed to reform, or the real consequences if we do nothing?

Health Access California promotes quality, affordable health care for all Californians.
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