Some good news on health financing

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Florida Governor Charlie Crist got the legislature to approve—unanimously—innovative reform that could dramatically affect Florida’s number of uninsured, now running at 21% of the population, the fourth highest rate in the nation.

The “Cover Florida” plan will allow insurers to offer plans exempted from the 50-some mandates that Florida imposes. The new plans will cost as little as $150/month, or less. Plans will enroll only those who have gone without coverage for six months. It also creates a clearinghouse through which small businesses that can’t afford coverage can offer their employees similar plans (Wall St J 5/29/08).

In New Jersey, Republican Assemblyman Jay Webber of Trenton will introduce legislation, modeled on the Shadegg plan, allowing any state resident to buy low-cost insurance from any registered policy in any of the 50 states. A family health plan that costs an average of $5,799/yr elsewhere costs $10,398 in New Jersey.

Democrats, however, are rallying behind a plan to require every uninsured person in New Jersey to buy a plan from a new state-administered program. “So a state that is already so broke that its politicians are contemplating mortgaging its highways might now add a $1.7 million health subsidy (Wall St J/ 5/29/08).

Massachusetts should have tried a similar idea, suggests Greg Scandlen. The average cost in Commonwealth Care is $4,994 per person. Next door in Hartford, Conn., the most expensive policy for a 35-year-old male, for a zero-deductible, zero-coinsurance HMO, is $2,744. Other plans cost half that, or less. “Massachusetts would have been better served if it simply allowed its residents to buy coverage next door and paid all of their premium” (Consumer Power Report #130, 6/6/08).

Manitowoc County, Wisconsin, saved the taxpayers nearly $2,600 per family plan by providing its employees a high-deductible health plan (HDHP) with a health savings account (HSA). The county fully funded the $3,000 deductible, and eliminated more than $4,000 in employee costs for premiums and copayments (ibid.).

State governments, including Georgia and Indiana, are beginning to turn to HDHPs and HSAs, to the consternation of opponents such as Niko Karvounis. He writes: “HDHPs and HSAs are actually thriving—and in fact penetrating our health care system at a relatively brisk rate.” This is a problem because “their proliferation weakens the political viability of the health reform we really need” (Consumer Power Report #128, 5/21/08).

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4 Comments

  1. 1. If 1/5 of the population is not insured, then the remaining 4/5 has to pay an addition 25% to cover the uninsured: (5/4) x (4/5) = 1.

    2. Rationing care is not avoided by universal coverage, however achieved.
    There will still be limits to what can be afforded, unless we are willing to borrow to pay for care.

  2. 1. If 1/5 of the population is not insured, then the remaining 4/5 has to pay an additional 25% to cover the uninsured: (5/4) x (4/5) = 1.

    2. Rationing care is not avoided by universal coverage, however achieved.
    There will still be limits to what can be afforded, unless we are willing to borrow to pay for care.

  3. Stiffling competition among the several states for insurance product dollars only brings higher cost and misery onto the population of the restricted and monopolized state. The focus of efforts to expose inequity should be on the odious profiteering that is perpetuated by this monopoly rooted in stultifiyng regulation. The politicians from both major parties who support this should be exposed and called to account.