Political Obstacles Thwart Attempts to Expand Coverage

Several states had lofty goals for expanding health care access in 2007 but ended up with few concrete results. The outcome ran counter to the aim of many health reform advocates, who hoped that with Washington locked in partisan battles, the states would lead the nation toward major changes.

California, Illinois, and Pennsylvania began the year with the goal of broadly expanding health insurance availability, but cost concerns and a weakening economy brought their efforts up short. Each state proposed wide-ranging health care proposals, but none ended 2007 with bills passed.

Smaller New England states have been more successful with reform. Massachusetts enacted a statewide health care program nearly two years ago, which some reform advocates have seen as a model for other states.

The highest-profile effort of 2007 came in California and resulted in Gov. Arnold Schwarzenegger (R) and Assembly Speaker Fabian Núñez (D) agreeing on a plan to achieve near universal coverage in a state with one of the highest rates of uninsured residents. The measure received Assembly approval, but state Senate President Pro Tempore Don Perata (D) has expressed concern about the cost of the plan at a time when the state faces a massive budget shortfall (see Original article: Calif. Lawmakers Wrangle Over Insurance Mandates).

The outcome in the Senate is less certain because of the plan's $14 billion price tag. Moreover, the threshold for passage in the Senate is high: a two-thirds super majority is required to pass spending measures. The provisions concerning taxes and fees to pay for the expanded coverage will be offered as a package to California voters in November.

“Most independent analysts think that California's revenue picture is likely to worsen by next spring, potentially complicating any proposal that involves new spending,” said Leif Wellington Haase, director of the California Project for the New America Foundation, a nonpartisan think tank based in Washington, D.C., at a press briefing late last year.

In Illinois, Gov. Rod Blagojevich (D) made little progress on his proposals to pay for universal access to insurance by taxing gross business receipts and assessing employers who do not offer coverage to their workers.

His efforts were brought to a halt by the legislature, and he faced a lawsuit stemming from his use of executive authority to widen eligibility for state-subsidized insurance programs.

In Pennsylvania, Gov. Edward Rendell (D) was spurred to take action because of rising costs, including the 76 percent increase from 2000 to 2006 in the per-family cost of insurance coverage, while wages rose only 13 percent.

“We have to do something,” said Ann Torregrossa, director of policy for the Governor's Office of Health Care Reform in Pennsylvania.“ And the governor finally realized that we can't wait for Washington.”

Rendell failed to persuade his politically divided legislature to cover the state's 900,000 uninsured through an employer assessment. Recently, Rendell proposed funding his plan by increasing cigarette taxes and using the surplus in a state fund designed to help physicians pay for malpractice insurance.

David Colby, vice president of Research and Evaluation at the Robert Wood Johnson Foundation, told policymakers at a Capitol Hill briefing last December that state and federal advocates of health care reform need to learn the lesson of Massachusetts' successful effort to establish a statewide program. Many advocacy and interest groups will want different and sometimes competing components in any such program, but the overall effort should not be sacrificed if it cannot perfectly meet all their goals and expectations. Even Medicare has been updated and revised to different degrees every year since it was enacted, he noted.

State health care leaders will have another chance to enact major health care programs in 2008 as governors in New York and Connecticut expect to receive plans for universal health coverage from advisory groups and begin their own legislative struggles.

While little was accomplished in states considering universal coverage plans, more was achieved by those seeking incremental change, according to the National Conference of State Legislatures. The conference, which tracks major legislative accomplishments every year, noted that Maryland and Texas joined 15 states that have created programs to subsidize insurance for some individuals and small businesses. Four other states have new laws guaranteeing that all children receive insurance through expanded eligibility for Medicaid and the State Children's Health Insurance Program (SCHIP). Thirteen states added modest SCHIP expansions for children in 2007.

Continued SCHIP expansions in 2008 will depend on Congress and President Bush resolving their major differences over funding for SCHIP. Bush twice vetoed large SCHIP increases passed by Congress in 2007 before signing an extension of the program through March 2009 with unchanged funding (Psychiatric News, January 18). Democrats may attempt an earlier renewal of the program if they are able to secure Republican cooperation in expanding the program to cover more uninsured children.

The health care focus in 2008 is likely to shift to the presidential campaign, where the leading candidates for the Democratic nomination have each proposed major overhauls. ▪