Princeton Packet

DISPATCHES: National Fix Needed For Healthcare Mess

The Princeton Packet / Packet Online — Tuesday, April 28, 2009

By Hank Kalet, Online Editor

It wasn't all that long ago that states were taking the lead on healthcare reform — with New Jersey joining states like Vermont and Massachusetts in requiring some level of universal coverage.

New Jersey, which has offered health insurance to low-income children and families for several years through NJ FamilyCare, expanded its program in 2008 to cover a greater number of low-income families and added a mandate that all children in the state be covered.

The bill, which had bipartisan support, is considered the "first phase of a comprehensive reform of the health care system" that was designed to "ensure universal health care coverage."

The recession, however, has robbed states of much of their revenue, leading to sometimes painful budget cuts — including money for health care.

These cuts have underscored what should have been obvious from the beginning: Healthcare reform cannot happen in piecemeal fashion state by state; it has to be addressed by Congress and the president.

That was one of the points made Monday by Gov. Jon S. Corzine and state Health Commissioner Heather Howard during a telephone town hall event sponsored by AARP. The event drew more than two dozen members to the organization's Plainsboro office and more than 7,000 telephone participants. "Unfortunately," Ms. Howard said, "the state can't afford to do it and we need the federal government to do it."

New Jersey, under the governor's proposed budget, would scale back its coverage, reducing eligibility for the Kids First portion of FamilyCare from 200 percent of the family poverty line to 150 percent.

The governor told the AARP members that he expects "push back" from members of the state Legislature over the eligibility change and he's not opposed to keeping the income limit at 200 percent. But legislators are going to have to find other cuts — totaling about $15 million — if they want to make that happen. It is just one of a number of difficult choices in this year's budget — and an example of what states around the country are facing.

But this is not just a state budget issue. It is a human issue. One caller, Gail from Princeton, told the governor that she pays $25,000 a year in health insurance for a plan with a $2,000 deductible — an amount she called "devastating." She asked why New Jersey does not offer the opportunity for residents to "have the option offered state employees to buy into it at our own expense."

This, of course, is one of the models being discussed at the federal level — to extend Medicare or offer consumers access to the health plans available to members of Congress or federal employees. The idea, as the governor explained, is to create larger risk pools, which spreads the cost across a larger number of consumers and lowers prices.

The governor said his administration is working with the White House and the state's Congressional delegation to fashion a national health-insurance plan.

"It doesn't have to be a complete takeover of health-providing insurance by the federal government," he said. "But we have to have a backstop for people.

"The number of uninsured is growing dramatically as we go through this difficult economic recessionary period, and it is essential we put behind us the debate on this and actually get to a real program." Basically, the governor is talking about a compromise. Single-payer, which eliminates the insurance industry, would be more efficient and inclusive. But we have to acknowledge the political realities. It is unlikely that single-payer will make it through Congress given the number of conservative, so-called Blue Dog Democrats in the upper house. Universal coverage, however, seems achievable, possibly "some derivative of Medicare with Medicare Advantage-type characteristics," the governor said.

"It is our middle class that is getting deeply, deeply challenged with the cost of health insurance, and our businesses," he said. "And we need to make sure we have the federal government create a program where we get large enough pools so we can lower the cost to reasonable levels for every citizen."

I remain committed to a single-payer system. Done properly, a Medicare-style option that allows consumers to buy out of the private pools, thereby lessening the fear of government insurance and proving it can be more efficient, appears our best hope right now.

Hank Kalet is online editor for The Princeton Packet newspaper group

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