This week’s state forfeiture of more than one half billion, unspent, federal dollars meant to insure poor children shows the great difficulty with incremental efforts to expand health coverage. The time has come for an overhaul of the indecipherable patchwork of insurance programs to create a single, seamless and sensible system.
California is one of forty states that will likely lose the federal funds which were set aside by Congress in 1997 through the Children’s Heath Insurance Program (CHIP). Nationally, forty five percent of the $4.2 billion has been gone unused, but not for a lack of need. There are two millions uninsured children in California and only 330,000 have been enrolled in California’s CHIP program, called “Healthy Families.” California will return more than any other state and more than a quarter of all moneys.
The state deserves much blame for bureaucratic roadblocks, including at one time a twenty eight page application form that has now been cut down to four pages. Psychological barriers also play a role, including the reluctance of some families to enroll because of the stigmatization of public assistance programs. Politics has hurt too. Only recently were states allowed to include parents of eligible children and California has yet to apply for permission. California could also have applied for expanded eligibility for children and enhanced benefits, as well exploring other federal waiver opportunities earlier. But this wasn’t as high a priority for Governor Davis as bolstering an educational system that cannot possibly help sick children.
The larger problem, however, is that we do not have one health care system, but a myriad of them — which creates an ineffective and incomprehensible morass for anyone try to figure out their place in it all. For the insured, the alphabet soup of HMO, PSO, PPO and what they can cover and do not is increasingly fraught with confusion. For the uninsured, the boutique incremental insurance programs are highly selective. An older child in a family may qualify for “Healthy Families,” but the infant would have to go on Medi-Cal. A child may qualify for “Health Families,” but their parents may not quality for any assistance — leaving the family saddled with bills when the breadwinner cannot work. If a family qualifies for Medi-Cal, they are not able to receive Health Families, which has less of a welfare stigma associated with it.
Patients with inadequate or no coverage are often not diagnosed and treated at the earliest opportunity — when it is both most effective for the patient and cheapest for the system. Instead, these patients are typically seen in the emergency room after their diseases have progressed to the point where treatment is not as effective and very expensive. Ironically, this precisely when the patient may be able to access government programs. A middle class cancer patient would have to sell her home to pay for life-saving treatment that no government program will cover . But that patient can access governor insurance programs when they are on their death bed, beyond saving and hospital bills can run far higher than the cost of the initial cure..
My octogenarian neighbor simply cannot understand how California can relinquish the CHIP funds. It is no easier to describe to him how an uninsured patient with kidney problems who cannot afford treatment must wait until end-stage renal disease develops before the government will help — in other words when their kidney is in the final stage of shutting down, not at the initial sign of trouble.
Selective health care insurance systems must be replaced with a system-wide overhaul that guarantees every patient coverage for medically necessary treatment at all times, so that patients are kept healthier and taxpayers are saved the cost of preventable medical tragedies.
Such a seamless system could be financed by eliminating the overhead costs and profits of today’s private insurers and HMOs, which can total twenty to thirty cents of every premium dollar. A study released by the California Nurses Association and the Labor Party found that for the same cost as Americans pay today a new full-coverage health care system can be developed that cuts out the private corporations and puts health care dollars back with private doctors and hospitals to provide treatment. A payroll tax would finance the system, but employers would actually pay, on average, less than they do now.
California is ripe to have its health care system transplanted because of the increasing discontent of physicians, patients, nurses and hospitals with HMO payment and control systems. If a few large employers joined with a coalition of doctors, nurses, hospitals, and patients, there would be a new health care system in California that is far more rational, compassionate and cost-effective. Any interested C.E.O.s can email [email protected].
Consumer advocate Jamie Court is co-author of “Making a Killing: HMOs and the Threat to Your Health” (Common Courage Press, 1999). To respond, email To respond, email [email protected].