Plan maps universal health care
A state commission will write a bill based on public and private money for the next session

Saturday, October 28, 2006
BILL GRAVES

A Senate commission has approved, in principle, an overhaul of Oregon's health care system.

The commission will draft a bill in the next few weeks for the 2007 Legislature to make Oregon the first state to provide universal health care with a system to contain costs, said Sen. Alan Bates, D-Ashland, co-chairman of the Senate Commission on Health Care Access and Affordability, which met Friday in Portland.

Oregon is putting itself "on the cutting edge of changing national policy on health care," said Bates, who is a physician. "This is the first step on a very, very long journey."

The time is ripe for major reform because all sectors of the health care system can see "we are heading toward the wall at 80 miles per hour," said Sen. Ben Westlund, an independent from Bend who co-chairs the commission. "If we do nothing, we hit the wall."

Every resident would get an Oregon health card to buy essential medical care. The cards could be issued as early as January 2009, Bates said.

The commission -- which includes four senators and 17 health care professionals -- has been meeting for nine months, but only recently did a reform framework emerge. Challenges remain in working out details, such as how much money each business and worker would contribute, commission members say.

Bates said he expects almost everyone to dislike some elements of the plan; physicians and hospitals will worry about smaller payments for services, for example, and some employees will worry about losing benefits.

The plan would combine public funds, including federal and state Medicaid money, with contributions from employers and employees in a pool managed by a board similar to the Public Utility Commission.

Health insurers and contractors would compete for health card holders, would be required to accept any Oregonian with a card, and would have to offer essential benefits. Those essentials have yet to be determined but would include mental health care, the commission decided.

Residents and employers could supplement their essential insurance by buying more comprehensive coverage. They also could set up tax-free health savings accounts to finance expanded coverage.

To get health cards, Oregonians would have to sign advanced directives describing the level of care they want at the end of life. This would save money by reducing use of respirators, tube feeding, kidney dialysis, resuscitation and other extraordinary efforts for those who do not want them.

All employers would have to participate unless they provided a self-insured plan with at least as many benefits as the state plan. A few categories of residents, including federal employees and veterans, would be exempt.

Oregon would continue Medicaid services for the 400,000 people on the Oregon Health Plan but also could use some pooled money to serve more people.

Expansion would bring more money into the state system because the federal government provides a $60 match for every $40 the state spends on Medicaid.

The commission says the plan would reduce insurance costs for the state and Oregon businesses. It would take existing money that Oregonians spend on health care -- an estimated $10 billion in 2004 -- and stretch it further.

The 600,000 Oregonians who have no health insurance would no longer have to go to emergency rooms for primary care, an inefficient and costly use of hospitals. By reducing that waste, insurers could lower premiums.

The plan also would save money by emphasizing preventive care and management of chronic illnesses, by creating competition among health insurers, by discouraging expensive procedures and by computerizing medical records, the commission says.

Estimated $350 a month

An early estimate by the commission puts the cost of an essential health insurance package at about $350 per person per month, far less than most businesses pay.

The disparity between the 60 percent of Oregon employers that offer health benefits and those that don't would end because all would participate, said Ike Apodaca, vice chairman of the Governor's Small Business Council and a commission member. He noted that 86 percent of Oregon businesses have 19 or fewer employees and that many are being crushed by rising health care costs.

"At the very least, (the plan) will stabilize the double-digit increases in health care premiums that Oregon businesses have been experiencing for the last eight to nine years," he said.

Westlund said the plan could provide "a huge economic stimulus" to the state by attracting businesses looking for lower health care costs.

The commission will turn its plan into proposed legislation, review and refine it and then take it to the Legislature, Bates, said. The Oregon Health Policy Commission, at Gov. Ted Kulongoski's request, also has been working on a plan for universal health care. So has former Gov. John Kitzhaber, who also wants to pool private, state and federal health care money, including Medicare.

Legislators probably will craft a single package of legislation that includes ideas from all these groups, Bates said.

Westlund said everyone will have to risk something to make the plan work.

"But the biggest risk," he said, "is doing nothing."