Think Again •
EE
R
F
By Tim Nesbitt
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The ABCs of our health care crisis
W
e have more jobs in Oregon
than ever before. We also have
more Oregonians without health in-
surance than ever before.
Maybe this is why pollsters report
that health care has supplanted jobs
and education as the Number One
concern of Oregonians.
Our health care crisis is two-fold.
Too many people don’t have insur-
ance, and those who have it are pay-
ing more than they can afford in pre-
miums, co-pays and deductibles.
These two problems are connected,
and they’re both problems that our
government is going to have to solve.
The jobs problem was different.
Three years ago, politicians argued
over the best ways to grow jobs and
help Oregon climb out of the reces-
sion, even though there was not a lot
that the state could do to accelerate
the pace of economic recovery in the
short term. Some efforts helped at the
margins. Gov. Kulongoski’s trans-
portation package is producing the
jobs that he promised. But, we gained
jobs largely because of forces beyond
the control of state government.
Yet, the same market forces that
produced most of the new jobs during
the past three years encouraged em-
ployers to strip those jobs of health
benefits or shift more of their health
care costs to their workers. Employ-
ers like Wal-Mart gain an economic
advantage over their competitors, like
Fred Meyer and Safeway, by chisel-
ing on health benefits. The market is
rewarding bad employers for doing
the wrong thing and penalizing good
employers for doing the right thing.
This is why, for the almost two mil-
lion Oregonians who get their health
care from a job, the trends are not our
friends. And this is why we need our
government to step in.
Look at how our population is di-
vided by health care coverage. For
every 100 Oregonians:
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PAGE 10
52 get their health care coverage
from their jobs or a family member’s
job.
17 have no health insurance.
11 are disabled or poor enough to
qualify for the Oregon Health Plan.
15 are seniors covered by
Medicare.
5 pay for their own health insur-
ance.
Category A is shrinking and Cate-
gory B is growing as employers aban-
don or reduce their support for health
insurance. More than half of all Ore-
gonians without health insurance
come from households with a full-
time worker. But Category C is
shrinking too, because government is
running out of money. And, as we
pour more of our tax dollars into Cat-
egory C, we tend to create more in-
centives for employers to abandon
their health plans and tell their work-
ers to sign up for government bene-
fits. This is why some Category C so-
lutions are not sustainable. Gov-
ernment pays more, employers pay
less, and then government has to pay
more again to make up for declining
employer support.
Given this scenario, we need to fo-
cus on boosting employer coverage in
Category A, which could potentially
cut in half the number of uninsured in
Category B. One way to do that is to
require that all employers above a cer-
tain size provide health care for their
workers or pay into a state fund for
health care. Another way: Govern-
ment can help employers who provide
good benefits by offering re-insurance
against extraordinary catastrophic
costs.
But government needs to supple-
ment employer efforts as well. We
just need to be smarter about how we
use our tax dollars in Category C. We
could expand coverage for children,
more than 100,000 of whom are with-
out insurance from their working par-
ents, by raising cigarette taxes to
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broaden the Oregon Health Plan.
Still, this idea, embraced by Kulon-
goski and a number of state lawmak-
ers, could encourage more employers
and workers to abandon health insur-
ance for children, which is why it’s at
best a temporary safety net.
California Congressman Pete
Stark has a better idea: Expand
Medicare (Category D, above) to
cover all children. We could do this by
increasing the Medicare payroll tax
paid by employers and workers by
one percent each. This would also
help good employers who pay for full
family coverage and reduce costs for
working families who have to pay
high premiums to cover their kids. If
the federal government doesn’t do
this, states can do it on their own.
The Oregon AFL-CIO drafted
such a plan three years ago, estimat-
ing that a payroll tax of less two per-
cent shared by employers and work-
ers could guarantee health coverage
for every child in Oregon.
These are just steps on the road to
universal health care. But they are fea-
sible and effective in the short term,
and they will prove that government
can help solve our health care crisis.
Plus, these steps lead logically to a
more sustainable health care system
in which employers finance health
care for all working people and gov-
ernment provides health care through
Medicare-style programs for the non-
working population of seniors, chil-
dren, the disabled and the unem-
ployed. Such a system will be cheaper
(by reducing administrative costs),
fairer (by requiring equal support
from all employers) and better (by
covering everyone).
The only other alternative is Cate-
gory E above: Pay for your own
health insurance.
Tim Nesbitt is a former president of
the Oregon AFL-CIO.
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