"If the U.S. were to shift to a system of universal coverage ï¿½ the savings in administrative costs would be more than enough to offset the expense of universal coverage." - Congressional Budget Office and the General Accounting Office
How We Can Insure Everyone & Save Money
Californians are already paying for universal coverage. We're just not getting it. Under the current system, those without insurance seek care in emergency rooms but are forced to wait until illness is chronic and care much more expensive to provide.
We're also pouring a large portion of every health care dollar into wasteful private insurance companies, their executive salaries and stock options, lobbying and advertising. Read a report that found that the average annual income of top health insurance execs is $15 million - 338 times the average U.S. household income. Last year, former WellPoint CEO Leonard Schaeffer took home $250 million in cash and stock.
A recent analysis of one proposal for universal health care, SB 840, found that Californians could save $8 billion dollars each year by switching to a universal health care system that insures everyone, focuses on preventive care, eliminates insurance company waste, and leverages the state's purchasing power by buying in bulk.
Read FTCR's comprehensive report about problems and solutions in the health care system.Reduce Overhead & Administration Costs
HMOs, PPOs and other health insurers are wasting billions of our health care dollars each year. These companies are more bureaucratic and ten times more costly than public health care programs like Medicare.
HMOs use phony arguments that blame patients for cost increases and coverage restrictions. But in 2002, health insurance overhead costs, including advertising, administration and profit, became the fastest growing component of health care spending. It is estimated that half of every dollar spent on health care is wasted on clinical and administrative waste, insurance company profits, and overpriced pharmaceuticals.
A new California Health Plan open to all patients will eliminate private insurance companies that don't provide health care benefits along with their waste, paperwork, profits, excessive executive salaries and advertising. Resources will be redirected to actual treatment. Doctors, nurses and hospitals will be paid directly. The result: More health care for our money. The program will decrease total health care spending while providing more treatment and services.
Take Advantage of Bulk Purchasing
Under the California Health Plan, the government would be allowed to pool our health care money and use California's enormous buying power to buy discounted prescription drugs and medical supplies. With 35 million people, California has a larger population than Canada which negotiates prescription drug discounts of 60% on behalf of all patients.
Another advantage of a California Health Plan open to anyone is that all patients would be covered in a large insurance pool. With everyone paying into one health care system - young and old, healthy and sick - we can provide better care for less money. That's the way health insurance is supposed to work.
Focus on Preventive Care
Insurance companies do not heal or treat anyone. Physicians, nurses and health practitioners do. Under the current system, insurance companies actually make more money by NOT providing health care. Health care providers are not adequately paid for their services because insurance companies keep our money for themselves.
A healthier and more economical approach is to focus on preventing disease and getting patients the care they need when they need it. A California Health Plan would ensure that patients have access to doctors who would have the power to provide treatments and tests to detect disease before it progresses.
Privately Delivered, Publicly Accountable
To achieve universal access, effectively manage costs, and improve quality the California Health Plan will give decision-making authority to a publicly accountable independent body that does not have a financial stake in the outcome of policy decisions.
In addition, the California Health Plan will provide publicly available uniform quality standards to evaluate the quality of the care patients are receiving for their health care dollars. A single state agency will be responsible for setting quality standards, collecting data and reporting outcomes.