http://www.latimes.com/news/nationworld/nation/la-na-outlook21nov21,0,4499333.story?track=tottext
Governors Write Their Own Prescriptions for Healthcare Crisis
Ronald
Brownstein
Washington Outlook
November 21, 2005
Last week, one
day apart, two governors took dramatic steps that could crystallize a healthcare
debate developing in the states — even as Washington mostly averts its eyes from
the problems of declining access and rising costs.
On Tuesday, Democratic
Gov. Rod Blagojevich signed legislation making Illinois the first state to
guarantee all children access to health insurance.
The next day,
Republican Gov. Mark Sanford of South Carolina asked the federal government for
permission to shift responsibility for providing health coverage for the state's
poorest citizens primarily to private insurance companies.
These
divergent initiatives signal an escalating competition to develop models for
coping with the slow-motion crisis in healthcare.
Several
Democratic-leaning states are rallying around plans to ensure universal coverage
for children as a first step toward expanding access for adults.
Bill
Richardson, the Democratic governor of New Mexico, says that in his next budget
he'll propose to ensure universal coverage in his state for all children 5 or
younger. Anthony Wright, executive director of the liberal group Health Access
California, says activists are planning a state ballot initiative next November
that would fund universal coverage for children through a cigarette tax increase
of $1.50 a pack.
Blagojevich says he is hoping his action will encourage
more states to fund universal coverage for children; nationwide, about one in
nine children are uninsured. "If we can do it in Illinois, other states can do
it," he says. "The idea that we are going to wait around for Washington or the
Bush administration to do this is not a good use of time."
Conversely,
the hot idea in Republican states is giving private health insurance companies
the principal authority for operating Medicaid, the joint state-federal
healthcare program for the poor. Sanford was actually the second GOP governor to
propose such a shift; Florida's Jeb Bush has already won approval from
Washington for a test he'll begin next year, assuming the Legislature gives its
final blessing in December.
Last week, approving a proposal from Rep.
Mike Rogers (R-Mich.), House Republicans nudged other states to follow; the
House authorized a five-year, 10-state test of Health Opportunity Accounts,
which would allow low-income families to buy healthcare directly from doctors or
insurers as an alternative to Medicaid.
Compared with the GOP
initiatives, Blagojevich's plan builds more on the existing public systems.
Since his election in 2002, Blagojevich has steadily expanded access to the
Children's Health Insurance Program — a state-federal partnership, known as
CHIPs, that provides insurance to the children of working-poor families.
(Children in the poorest families receive coverage through Medicaid.) Those
expansions, with an improving economy, have reduced the number of uninsured
children in Illinois by about half, to about 250,000 this year.
The law
Blagojevich signed last week covers those remaining children by allowing all
uninsured families to purchase subsidized insurance for their children through
the state's CHIPs. Insurance would cost $40 per child per month for
middle-income families, about one-fifth as much as private insurance; the
state's cost would rise to $100 million annually within five years. Eventually,
Blagojevich wants to add adults.
While Blagojevich would increase the
state's role in guaranteeing care, Bush and Sanford want to shift authority to
the private sector. Medicaid now guarantees all eligible low-income families
access to a specific set of services, such as doctor visits or X-rays. Both Bush
and Sanford would instead provide a fixed sum for Medicaid recipients to
purchase private health insurance.
Some guarantees would remain (for
instance, children covered under Medicaid would receive the same services they
do now), but the insurance companies would be granted unprecedented freedom to
determine the scope of the services recipients obtain.
In essence, both
Bush and Sanford would move Medicaid away from a program that ensures recipients
defined benefits in healthcare toward one that guarantees them only a defined
contribution from the state to their care. In that way, these initiatives
advance a broader Republican goal — and crystallize the difference between this
proposal and Democratic initiatives such as Blagojevich's.
The public and
private economic safety net constructed from the New Deal through the Great
Society relied mostly on defined benefits — a set monthly pension or Social
Security check, or a menu of services covered by Medicare. Most private
employers have already departed from that vision by replacing pensions with a
defined contribution to 401(k) retirement plans.
In the name of
increasing choice, expanding ownership and saving taxpayer dollars, many
Republicans also want to shift from a defined-benefit to a defined-contribution
approach in the key public safety net programs: Social Security (by reducing
guaranteed benefits and increasing reliance on individual investment accounts),
Medicaid (through ideas such as the Florida and South Carolina proposals) and
Medicare (where Congress has authorized the test of a voucher-like system
similar to those Medicaid plans).
Democrats believe all of these ideas
transfer too much financial risk to individuals. Instead, they want to bolster
public programs that share risk collectively to provide individuals with
guaranteed benefits — like Social Security or the CHIPs plan Blagojevich is
using to cover all Illinois kids.
Democrats this year won an early round
of this debate when they blocked President Bush's plan to restructure Social
Security. But the competing healthcare proposals from Illinois and South
Carolina show that this argument is far from settled. Long after both governors
are gone, it's likely that America will still be wrestling over whether its
social safety net should look more like the vision Blagojevich or Sanford
offered last week.
*
Ronald Brownstein's column appears every Monday. See current and past
Brownstein columns on The Times' website at
latimes.com/brownstein.