In 1993, the Clinton administration tried to pass a universal health care plan. There were a number of flaws with that national health care proposal — not least that it was employer-based and rooted in HMO’s (something I work assiduously to avoid) — but it was, at least, an attempt to wrestle the problem to the ground.
It died a painful death, and passed into the national consciousness as Hillary Care, leaving some unpleasant associations for Hillary, and a general distaste for the discussion altogether.
Nearly 14 years later, we’re facing a health care crisis, and the debate has returned at last.
Polimom’s excited by the innovative health care proposals coming from various states. From Massachussetts to Maryland to California, we’re finally seeing creative, bipartisan, locally-focused attempts to engage with the health care monster. While there are devils and details and complicated flaws in these hatchling ideas, such state-level proposals are precisely the approach I’ve been hoping to see. Furthermore, and just as importantly, their authors are bringing the discussion to the people, as this morning’s guest post at The Moderate Voice demonstrates:
Under the Governor’s proposal, all Californians must have a minimum level of insurance to ensure that those with insurance no longer pay for the uninsured. Individuals will be responsible for securing health coverage for themselves and their children and contributing to paying for their coverage. Government will return over $4 billion to doctors and hospitals by increasing federal reimbursement for Medi-Cal. The state will also expand Medi-Cal to poor adults and Healthy Families to children in families earning less than $60,000 annually. Employers with 10 or more employees who choose not to offer health coverage will contribute four percent of social security payroll toward the cost of employees’ health coverage. Companies with fewer than 10 employees—a full 80 percent of businesses in California—are exempt. The four percent fee will discourage employers from dropping their health care coverage in light of the state’s program.
Fascinating — but according to this morning’s Wall Street Journal, there’s a problem — not just with California’s proposal, but others as well, and that problem is Erisa:
But it turns out state schemes that feature “pay or play” employer taxes or mandates are probably illegal.
At least that’s the clear implication of a significant but underreported ruling last week by the Fourth Circuit Court of Appeals, which said that Maryland’s “Fair Share” health legislation — otherwise known as “the Wal-Mart tax” — violates a federal employee-benefits law known by the acronym Erisa.
[snip]
Judge J. Frederick Motz wrote for that court that “The Act violates Erisa’s fundamental purpose of permitting multi-state employers to maintain nationwide health and welfare plans, providing uniform nationwide benefits and permitting uniform national administration.” Last week’s Fourth Circuit ruling affirmed that decision, and it could spell trouble for the California and Massachusetts schemes.
Erisa, evidently passed in an attempt to keep costs for large employers down by eliminating multi-state administrative complications, was probably (like most things) a good idea at the time — but it appears counterproductive to local solutions.
On the other hand, Erisa would seem to fit perfectly into a national plan — something I’m not at all anxious to see. As I wrote forever ago, we’re simply too large and diverse a country to think a federally-administered health care plan could succeed. (See FEMA, Katrina)
Unlike the Wall Street Journal author, Polimom does not think the existence of Erisa is a terminal problem, though, and it absolutely does not make these state proposals “ballyooed” or fraught with “policy blunders”. Erisa is a law, after all — not a constitutional amendment.
But I expect we’re going to come across a number of similar pieces of legislation as this debate moves forward, which means that we’re approaching a fork in the road: Are we interested in state and local solutions to common problems, or do we want our health care administered by the federal government?
If we start there, the path will be smoother… and I know which direction I prefer to go.
Ah, but what of the unintended consequences? Based upon the hall talk where I work, it seems most of those “my age”, i.e., 50+, are looking only at the tax and costs side of the equation and based upon the schelacking they’ve taken on taxes the last three years, are seriously considering taking early retirement with a slightly higer percentage looking at taking “partial” early retirement, i.e. working part time to reduce their exposure to injurious taxation. Most report keeping their eyes focused on a post ’08 time frame as they seem to be operating from the assumption of a “Dem” win in ’08 with rapacious taxation sure to follow.
This has created quite a “crunch” problem at my employer’s shop because at the same time as it’s acknowledged that our employer will experience abnormal attrition of skilled, experienced personnel due to retirements, recruting efforts have met with dismal response because the youngsters aren’t particularly interested in the old line industrial, (i.e. Oil company), businesses. This problem was addressed in a memo to the employees that came out week before last where we were advised that our employer is looking at proposals to expand flex time and to offer employees a part-time work schedule with full time benefits in order to keep people at work long enough to find replacements.
My point in this, (I can’t seem to compose well today), is that the largest pool of taxable income is in the near retirement Boomer group and that my polling, (unscientific), indicates they are 1) very bitter about the amount they pay in taxes now and 2) at a tipping point where imposition of higher taxes will push them out of the system altogether. If asked, (and I seriously doubt anyone will), I’d caution policy makers they’d best take this into account when considering changes to the health care system.
Thanks,
Glide —
I understand what you’re saying. The aging of the Boomers is going to hit all sorts of industries, too. But I have a question for you: are your health care benefits above the $15,000 family limit?
I’m out here in No Man’s Land — meaning my family isn’t part of a large company. Because We have a small management consulting company,we’re in the Happy Target Zone for Bush’s tax proposal…. so I’ve got something to gain here, making me a tad biased.
However, purchasing our own family policy privately is much more expensive than was COBRA when we left our respective companies, and COBRA runs at 105% of the full employer premium. So I keep wondering whether people aren’t over-reading the impact of this.
Would you actually be affected by a tax increase?
I may be misreading, but if you’re talking about the Bush proposal, (which of course is DOA), as I understand it, I would be hit with a tax by the taxation of my Employers contribution to the cost of my health care policy. However, my point was directed more to the thought of the establishment of some universal health care program as proposed by Barak Hussein Obama today. I may have posted on this before, but the scheme that truly troubles me is the Mass. program where everyone is required to buy a policy? How does that work? So, you get pulled over and the cop demands to see a copy of your health coverage policy? O.k., if Americans want socialized medical, go for it, but don’t expect a lot of us to keep on working 365 to pay for it. We aren’t exactly having a blast out here; I don’t work for the love of it. As I type this, my wife is consulting with our accountant re: last years tax bill to determine if I should accept a raise offered by my employer yesterday. Somehow, (I’m not getting any smarter with the passing of time), this ties into the Atlanta story in that those who pay the bulk of the tax bill receive the least in benefits and services from the government to which we pay taxes. Worse, to a very real, and I mean painfully real extent, we feel for all practical puposes disenfranchised in that we no longer feel that our interests are represented in the government machinery. Think about that for a moment and the reality of it conjurs up some scary images. To the extent that we continue down this “socialist’ road, I would submit, “the center will not hold”, i.e., this country will come apart. And we’re already beginning to see it happen at the edges. For example I noted a bill in the Texas Legislature to end the state tuition treatment for “illegal” aliens going to university here. It won’t pass or will be found unconstitutional if it does. But the “significance” of this bill lies in the idea that those who pay the taxes, who aren’t represented or are virtually unrepresented because of the shabby quality of the representation, are fed up with paying for benefits doled out to “the others”. And by the “others” I don’t mean to imply a racial significance but rather, those who play for the most part in the underground “cash” economy. BTW, I know a number of college educated “white” gen x’ers who have never paid a dime in fed income tax because they wile away their days making their money on ebay. (I’m not making that up; my wife and I discovered this a couple of years ago and were truly stunned). We know a couple this day who are getting married next fall; he’s a lawyer, she’s got an accounting degree. How have they been supporting themselves the last 5 years? Ebay, and a lucrative suburban recreational pharmaceutical drug sales business. All cash, no tax.
There’s another aspect to this Universal health care that should truly trouble people if they were to think it through. Overweight? Gov’t doctor is going to put you on a diet! Your monthly “visits” will come to more resemble mandatory reporting to a probation officer. Profess “religious” beliefs? Hmmmm, you need therapy, some meds and monitoring and oh, by the way, we’re suspending your drivers license until you demonstrate a greater understanding and appreciation for “reality”. Female, overweight, pregnant? Hmmmm, well come back next month and we’ll be better able to determine if we’ll carry this to term or terminate the pregnancy.
Thanks and think!