Prospects for Universal Health Insurance – a Regional Perspective

1. Prospects for Universal Health Insurance – a Regional Perspective ----- The case for Georgia SecureCare ------ Henry S. Kahn, MD, FACP December 2006

2. "Of all the forms of inequality, injustice in health care is the most shocking and most inhuman" • A great southerner speaking nearly 40 years ago……… • How do southerners feel now ?

3. Louisiana, September 2005 [photos from Atlanta J-C]

4. What, me worry ?

5. Is universal, consolidated, comprehensive health care financing for the USA -- • Irrelevant (-nobody cares) ? • Too expensive (-budget buster) ? • Liberal fantasy (-no popular support)? • All of the above ? ?

7. Ranks of poor and uninsured swell(Atlanta Journal-Constitution, August 30, 2006) An estimated 1.7 million Georgians were uninsured in 2005, up from 1.5 million the year before, according to a Census Bureau survey. Georgia's two-year average climbed to 18.1 percent uninsured in 2004-2005, from 16.9 percent in 2003-2004, according to the survey. That figure leaves Georgia tied for eighth among states with the highest uninsured rates. The estimate of Americans without insurance rose to 46.6 million, or 15.9 percent of the population, ……up from 45.3 million, or 15.6 percent.

9. 100% 100% 100% 100% 100% 100% 92% 80% 60% 45% 40% 20% 0% U.S. Germany France Canada Australia Japan U.K. Percent of Population withGovernment-Assured Insurance Note: Germany does not require coverage for high-income persons, but virtually all buy coverageSource: OECD, 2002 - Data are for 2000 or most recent year available

13. We’re paying for national health insurance, but we’re not getting it ! • We outspend other societies for health care, but we don’t provide universal coverage. • What structural changes could make it better?

14. Georgians for a Common Sense Health Plan: GCSHP Goals ------ • Universal - covers everyone with full choice of provider • Comprehensive - all needed care, no co-pays* • Single, public payer - simplified reimbursement • Improved health planning • Public accountability for quality and cost, but minimal bureaucracy • Discourage investor-owned HMOs, hospitals, etc.

15. Are our ideals realistic for Georgia? • Are Georgians concerned? • Would financing reform in our State be affordable and sustainable? • ‘Feasibility?’: How deep and wide is Georgia political support? Grant support from Healthcare Georgia Foundation

16. Concerned about health care or insurance?

17. Phone survey of 800 voters, weighted by gender, party identification, education, race, age, region, & union status. Margin of error +/- 3.5%

18. Phone survey of 800 voters, weighted by gender, party identification, education, race, age, region, & union status. Margin of error +/- 3.5%

19. Are our ideals realistic for Georgia? • Are Georgians concerned? • Would financing reform in our State be affordable and sustainable? • ‘Feasibility?’: How deep and wide is Georgia political support? Grant support from Healthcare Georgia Foundation

20. SecureCare: A Georgia health program • single plan operated by the state or a non-profit • replaceall existing public and private health insurance; coverage is not connected to a job • choose any primary care doctor you want • no deductibles; -- a $25 co-payment only for visits to a specialist without a referral • generous, comprehensive coverage, including doctors, hospitals (by global budgets), emergency care, prescriptions, mental health services, dental care, and long-term care.

21. What would SecureCare look like? • everyone receives a health care card assuring payment for all needed care • complete free choice of doctor, hospital, other providers • doctors and hospitals remain independent and non-profit, negotiate fees and global budgets with SecureCare • local planning boards allocate major capital expenditures & expensive technology • progressive taxes (“premiums”) go to SecureCare Trust Fund • a single public agency processes and pays bills • accountability and quality control through periodic reviews (macro patterns, not micro management)

22. SecureCare: Proposed funding sources • employer payroll tax = 9.1% of wages and salaries for all employees ($14.2 billion) • government spending for discontinued health programs ($12.8 billion) • income tax payment for all Georgians computed to be equal to about 22.2% of each taxpayer’s federal income tax ($6.0 billion) • increase in the state sales tax on non-grocery items of one % point ($1.25 billion) • increase in tobacco taxes of 50¢ per pack with proportionate increases in taxes for other tobacco taxes ($215 million) • increase in taxes on alcoholic beverages ($52 million) -- NO PRIVATE PREMIUMS; NO OUT-OF-POCKET BARRIERS --

23. Georgia health spending, 2003, in millions • Status quo: Total by all payers: $ 37,150 • SecureCare: ↑ utilization $ 3,840 • SecureCare: ↓ administr costs ($ 3,815) • SecureCare: bulk purchasing ($ 741) Net change in health spending: ($ 716)

24. $761 $1,000 $592 $384 $500 $0 -$122 - $500 - $537 - $1,000 -$916 - $1,500 - $2,000 - $2,500 - $2,299 - $3,000 Under 24 25 - 34 35 - 44 45 - 54 55 - 64 65 and Total Over Age of Family Head Change in average family health care spending by Age of Family Head under the Georgia SecureCare program in 2003: after wage effects The Lewin Group, October 2003

25. Change in average health care spending per family under the Georgia SecureCare program by Family Income in 2003: after wage effects The Lewin Group, October 2003

26. "You have your choice of a weekly pay check or health insurance"

27. Currently Offer Coverage Currently Do Not Offer Coverage $3,500 $2,643 $2,595 $3,000 $2,453 $2,417 $2,152 $2,069 $2,500 $1,966 $2,000 $1,112 $1,500 $668 $829 $1,000 $122 $246 $500 $21 $0 $-115 Under 10 10 - 24 25 - 99 100 - 499 500 - 999 All 1,000 or More Workers Change in private employer health care spending per worker by firm size and current insuring status under the Georgia SecureCare program in 2003: before wage effects

29. Are our ideals realistic for Georgia? • Are Georgians concerned? • Would financing reform in our State be affordable and sustainable? • ‘Feasibility?’: How deep and wide is Georgia political support? Grant support from Healthcare Georgia Foundation

30. Trial 1:Would you support SecureCare?

31. Trial 2:Would you support SecureCare?

34. Private insurers’ High Overhead

39. 56% of Medical Students & FacultyFavor Single Payer;Majority of Med School Deans Concur “What is the best health care system for the most people?” Source: NEJM 1999; 340:928

40. Thanks for your attention, and to many concerned groups --------- • Physicians for a National Health Program • Physicians’ Proposal Writing Committee • National Nurses Organizing Committee • Georgians for a Common Sense Health Plan • Health-STAT • Health Care NOW (H.R. 676, Rep. John Conyers) • American Medical Student Association

41. Some useful websites: www.pnhp.org www.commonsensehealthplan.org www.healthcare-now.org (http://drsteveb.dailykos.com ?) December 2006

43. “Medical” Savings Accounts: No Savings • Sickest 10% of Americans use 72% of care. MSA's cannot lower these catastrophic costs • The 15% of people who get no care would get premium “refunds”, removing their cross-subsidy for the sick but not lowering use or cost • Discourages prevention • Complex to administer - insurers have to keep track of all out-of-pocket payments • Congressional Budget Office projects that MSAs would increase Medicare costs by $2 billion.

44. What's Wrong withTax Subsidies and Vouchers? • Taxes go to wasteful private insurers, overhead >13% • Amounts too low for good coverage, especially for the sick • High costs for little coverage - much of subsidy replaces employer-paid coverage • Encourages shift from employer-based to individual policies with overhead of 35% or more • Costs continue to rise (e.g. FEHBP) • Many are unable to purchase wisely - e.g. frail elders, severely ill, poor literacy