States tackle uninsurance—will Michigan be next?

Updated 10:00 AM October 16, 2006

States tackle uninsurance—will Michigan be next?

By Kara Gavin
Health System Public Relations

With little hope of a federal-level effort to provide access to health insurance for the 45 million Americans who lack it, individual states have begun to roll out their own plans for some or all of their residents, according to speakers at a recent U-M Health System event.

Representatives from Hawaii, Illinois, Massachusetts and Michigan described the programs in place or under development in their respective states at a panel discussion Oct. 6 at University Hospital. The event was organized by the Forum on Health Policy, which is directed by Marilynn Rosenthal of the Medical School.

The discussion was moderated by Richard Lichstenstein of the School of Public Health, who opened the event by harkening back to failed national health coverage efforts in 1915 and 1948. Many of the same arguments against universal insurance made then are being used today, he noted, including that it would add an enormous and unsupportable burden to the health care system, that it was socialistic and un-American and that it wasn't working well in Europe.

Still, some states have gone further than ever before in addressing the problem. Massachusetts' plan, which mandates that every resident must obtain some sort of coverage by mid-2007, made national headlines earlier this year when it was signed into law.

Through a combination of new government and private plans, including increases in the maximum income levels needed to qualify for state help, the commonwealth hopes to chip away at its 7 percent uninsurance rate. A companion program will give hospitals and doctors incentives to improve the quality of the care they deliver.

But the devil is in the details, said Helen Luce of Blue Cross Blue Shield of Massachusetts, who helped craft the legislation during her time as chief of staff for a leading state senator. For instance, the individual mandate calls for those who can afford any level of insurance to purchase it, but the definition of "affordable" hasn't been set.

Even so, she said, the state's employers and voters now seem to understand that the premiums of those who have health insurance help pay for the care of those who do not—and that near-universal insurance could benefit all.

The Illinois plan focuses on making sure that all children, and most parents, have a guaranteed way of receiving health insurance coverage, explained the state's Medicaid director, Anne Marie Murphy.

The All Kids plan, introduced this summer, replaces Medicaid for children and parents and allows families of all income levels to receive coverage on a sliding scale of premiums and deductibles. Some of the innovations that have made the program unique include presumptive eligibility, which automatically enrolls children before their qualifications for coverage are determined, and a program by which nonprofit organizations are rewarded for helping families submit a successful application for coverage.

Those two states have just embarked on their uninsurance-reducing plans, but one state's plan goes back decades, said the third speaker, Chris Pablo of the Hawaii Uninsured Project. Since 1975, the island state has required employers to offer coverage to full-time employees, and required self-employed people to find coverage. But the current reality finds a lack of compliance with this mandate, which the state is working to address through increased services for the uninsured.

So what can Michigan learn from these states' experiences? Janet Olszewski, director of the Michigan Department of Community Health, described a plan that currently is awaiting approval from the federal government and will need to be approved by the state Legislature.

It aims to find coverage for Michigan's 1.5 million uninsured residents by subsidizing coverage for individuals and families that make less than 200 percent of the federal poverty level, and creating a better structure for private insurers to offer affordable insurance plans to those who earn more. The plan doesn't include a mandate for coverage, Olszewski said, but rather aims to reduce costs and encourage the creation of new insurance products to make it attractive for everyone to get some sort of coverage.

"We need to restructure Michigan's economy, and that requires willingness to think outside the box," she said, noting that major employers approached the state government about finding ways to decrease uninsurance. If all approvals are received, she said, the Michigan plan could go into effect in early 2007.

In the end, said panelist Lincoln Smith of Altarum, an Ann Arbor-based research institute, the push to increase access to health insurance is being driven by state governments that have the financial ability and the political will to make difficult choices and achieve compromise.

But state governments may be lagging behind their constituents, he said. "Seventy-two percent of the U.S. population believes in coverage for everyone, on moral grounds," he said, but it will take courage for government to take the steps needed to get there.

For more information on the Forum on Health Policy, visit www.med.umich.edu/forum. The forum's next event will be held Feb. 16, and will be titled "Pills, Politics and the Public Good."

States tackle uninsurance—will Michigan be next?

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