SCHWARZENEGGER'S HEALTH CARE REFORM PLAN BOOSTS INSURANCE INDUSTRY

by Rose Ann DeMoro

(PNS) -- Every Californian has a clear stake in the current health care debate in Sacramento. More employers are slashing health care coverage for workers and their families, dropping coverage entirely, or forcing union members on strike to preserve hard-earned benefits. There's a solution, and it's not Gov. Arnold Schwarzenegger's health care plan.

The need for genuine universal health care reform could not be greater. Health insurance premiums in California rose 61 percent from 2000 to 2004. The percentage of workers with employer-based coverage is shrinking. California ranks 46th in the nation in the number of uninsured, and three-fourths of the uninsured here are in working families.

Yet, instead of a solution that will really solve the crisis, the plan proposed by Gov. Schwarzenegger, along with similar versions from the leaders of the Assembly and Senate, primarily serves to expand the role of the insurance industry in health care, and would force millions of Californians to accept substandard, unaffordable health plans.

Most insidious is the Governor's proposal to require all individuals to buy health insurance without any controls on insurance premiums, drug or hospital charges or standards to affirm that individuals are getting more than junk insurance.

With no check on rising premiums, and the Governor even seeking to lift existing regulations on what insurance plans must provide, many Californians may end up saddled with bare-bones plans with limited benefits that, Schwarzenegger suggests, include out-of-pocket deductibles of up to $7,500 per individual and $10,000 per family.

In other words, the average Californian may well have to pay for all their medical expenses in addition to the premiums the law forces them to buy. Or many could just forgo preventive care and other medical visits, resulting in more pain and suffering and greater costs down the road.

That's not a universal health plan, it's a prescription for disaster, coupled with the proposed penalty that you could be barred from getting a job or enrolling your children in school for failure to comply, in addition to tax penalties or fines.

But, for the big insurers, it's a huge windfall, some $400 million in additional profits from millions of new Californians required to buy insurance plans that may provide them little in return.

Further, the Governor's plan's proposed tax on employers who don't provide benefits could actually encourage employers to drop benefits for currently covered employees. The proposed tax of 4 percent is less than the 9 to 11 percent many businesses now pay in benefits, again not counting ever-rising premium costs. The tax may not even be legal; a nearly identical law in Maryland was just thrown out by a federal court.

Ultimately, the Schwarzenegger plan would further widen the gap between those who can afford comprehensive health plans and the rest of California, and shift the risk and responsibility from insurers to individuals. There's a better way, the same course taken by every industrialized nation in the world, a single-payer system, such as Medicare and SB 840, or a national plan, as we have for veterans. Only one health care reform proposal, SB 840, a single-payer system, can provide the health security California's working people need.

Under SB 840, you don't face the loss of health benefits if you lose your job or are forced out on strike. You don't face constant employer demands for concessions in the form of higher co-pays, deductibles, caps on coverage, and reduced medical care. You don't have to worry about retiree health care if you retire before age 65. And, you are no longer at the mercy of the insurance industry predators who routinely deny care.

By enacting SB 840 we can set a model for the nation and finally end our health care nightmare. Let's demand the best, not settle for the worst.