By Adam Searing, NC Justice Center’s Health Access Coalition
The Trojans should have known it. Pandora found it out the hard way. And the Washington politicians eating for free at Jack Abramoff’s fancy restaurant surely wish they had remembered. However, despite a few thousand years of experience, humans still seem prey to accepting dubious gifts without considering the consequences.
The debate over reforming the US health care system provides a case study in this all-too-human failing. Leaders from across the political spectrum who should know better often have fun proposing ideas that fit into the category of “magic bullet” health care solutions. Then they hope that Americans will swallow these “gifts” without considering the consequences.
Unfortunately, these types of reform ideas are appealing. First, they appear to help the 47 million Americans without health coverage (1.3 million in North Carolina) to buy affordable policies, and here is the kicker, without costing the government any new money. Just listen to Tony Snow, President Bush’s press secretary, describe the President’s recent health care reform plan in the State of the Union speech as “revenue neutral” for an example of this.
Of course, since the President’s plan had some middle class people paying more in taxes on their health coverage so that some slightly lower income people could get more favorable tax treatment on their health coverage, his proposal wasn’t really “revenue neutral” for everyone. But no matter. Without new revenue in the system, even the President’s rosiest predictions for his own plan only had it covering three or four million of the 47 million without coverage.
The second reason “magic bullet” policies sound good is that they usually purport to be a wonderful and innovative solution that just hasn’t been tried before. If folks would just implement this great new idea, the thinking goes, all of our problems would be solved. Americans love innovation and the idea that there is a technical solution for every problem. Unfortunately, when it comes to health care, this just isn’t the case.
Another good example of flawed “magic bullet” proposal comes from a Democratic state legislator. At a recent public meeting, this lawmaker announced that the solution to insuring the million-plus North Carolinians without health coverage was to simply tap the $600 million or so in excess reserve funds that NC Blue Cross/Blue Shield has built up over the years to help it back the three-million North Carolinians it currently covers.
Assume for a minute that nonprofit Blue Cross actually is accumulating excess dollars and that that money shouldn’t be returned as rebates to the policyholders who have been overcharged in the first place. There is a deeper problem with such a proposal: $600 million isn’t nearly enough.
The average annual cost for an employer health policy in North Carolina is $10,200 for a family and $3,500 for an individual. Multiply just the individual coverage number by the 1.3 million people without coverage and you get an annual cost to cover the state’s uninsured of over $4.5 billion dollars. Even assuming that’s a high figure and that family coverage and individuals paying premiums would reduce the cost, it’s clear that any realistic and comprehensive health reform proposal needs to discuss the annual allocation of billions of dollars. A one-time infusion of $600 million isn’t going to do much to touch the problem.
These “magic bullet” plans would be merely amusing as policy solutions if it were just their success or failure that was on the line. However, that’s often not the case. As the saying from the ancient world goes, “Beware of Greeks bearing gifts.” With President Bush’s plan, independent analysts are raising the alarm that loss of favorable tax treatment for employer-based health insurance could mean millions would lose the coverage (however imperfect) they now have. With the plan to divert Blue Cross’s excess reserve to help the uninsured, millions of hard working North Carolinians with Blue Cross coverage would be denied rebates of excess premiums they paid into the system.
Real health reform means facing up to the real costs of covering the uninsured – both political and financial. It also means advancing solutions that might not sound like “magic” but that actually have a chance of working – without hurting the health care system for people who are covered right now.
Adam Searing is the Project Director NC Justice Center’s Health Access Coalition