How is it that in Washington DC a bunch of really smart people will meet on Feb 25th in an effort to find solutions to the national health care problem, while at the very same time the small community of Muskegon Michigan will be teaching another community from Bend Oregon on how to operate a successful community-owned health plan for their uninsured? In one city health care is about politics, in another city, on the same day, health care is about real people getting the job done. How this happened is a fascinating tale.
When the good people of Muskegon MI began teaching others how to replicate the community health plan they pioneered ten years ago, they would caution about experts. Remember, they would say,"The Titanic was built by the experts, a bunch of amateurs built Noah's ark." It was a good laugh, and yet more true than we ever realized. Today our health system is increasingly looking more fragile than we care to admit. A lot of that has to do with the "experts" - much like the fragile state of banking due to the brilliance of its own experts. It's worth noting that, like banking, insurance is really a financial services business. Insurance does not provide health care, it only coordinates the payment for the services. The business model for insurance is NOT about health, it is about finance. Success is having financial success, not good health outcomes. As a result, the experts in Washington are trying to "fix" insurance and the cost of health care. Meanwhile, the amateurs in places like Muskegon chose to focus on improved health among the uninsured. In Muskegon the mantra became, lower costs follow good health - so focus on improved health and the cost savings will follow.
So on the very same day that the experts and policy makers will meet for a televised health care summit in Washington, a small group from Muskegon will host a delegation from Bend Oregon to show them how to run their own community health plan. Bend is just one of many communities learning how to take charge of its destiny when it comes to affordable health care for the uninsured. Believe it or not, the same government meeting in DC also recently awarded grants to Bend and more than a dozen other communities for the specific purpose of creating these community owned health plans. That's right, places like Houston, Galveston, Austin, Dallas, El Paso, Minneapolis, Duluth, Pueblo are all recipients of funds to create these plans. And not one of these community plans is "insurance." Yet every plan will offer a comprehensive benefit including hospital care. These are not the so-called mini-benefit plans the myopic policy wonks try to label them as being. In fact, these plans do not have exclusions on pre-existing conditions. Nor do they have deductibles. Co-pays are intentionally very low because the plans want members to seek health care - not avoid it because of out-of pocket costs. More and appropriate health care usually means healthier people, which translates to lower costs. Does this sound familiar? It should, because this is what the national health reforms want insurance companies to offer on an Exchange. And here we are, communities ahead of the government by at least ten years now.
Over the past year a group of communities have been advocating for inclusion in the health reform legislation. Absent universal health reform, it was apparent that the reform solution would be a blend of programs to expand access to the uninsured. Medicaid expansions on the bottom tier, and subsidized commercial or public insurance above that level. Insurance and Medicare reforms would theoretically reduce everyone else's cost. One problem with all this expansion and reform is the cost - nearly a trillion dollars over ten years. But, for low-income uninsured workers the affordability of the "solution" is also a big problem that the experts in DC just refuse to acknowledge.
How can any elected official honestly mandate that low-income workers pay 15% of their annual income for insurance. And yet that is what they've done. Low-income working Americans do not have 15% of their income to spend on health care. But according to the CBO score of the Senate bill, sponsored by Reid and passed with 60 Democrat votes, workers earning from 250% to 350% of federal poverty level will pay 15% of their annual income for mandated health insurance. Even with generous subsidies, someone earning 250% of the federal poverty level will have premiums costing 8.4% of income ($2,000 after subsidies). Add in the co-pays and deductibles ($1,900) and CBO says these plans offered through the exchange will cost 15% of the members income. A person making $27,075 will pay $3,900 a year for health coverage. That's $325 per month - pocket change to the folks in the summit on Feb 25th. That's what they have proposed as an individual mandate, and passed in the Senate. Very much the same figures in the House bill. And these are supposedly the friends of the working class!
Meanwhile, in the other city in this tale, amateurs have figured out how to offer the health coverage mentioned above for only $46 a month. In other places these plans cost from $60 to $70 per month for an individual employee. In all cases there are no deductibles or exclusions for pre-existing conditions . Premiums and co-pays for the plans typically cost about 3% to 5% of income for the person making 250% of the federal poverty level. You read this right - 3% to 5% of income for the work done by amateurs, compared to 15% by the experts. In every study done on affordability health economist have concluded that the upper boundary of affordability for low-income wage earners is 5%, and that needs to include all out-of-pocket expenses like co-pays and deductibles. Despite the evidence, the politics in DC actually mandated insurance costing 15% of income for this group. This is the clearest example ever of who's interest are being served by Congress.
Not everyone in DC is blind to the problem we are describing here. To be fair, Senators Stabenow, Levin, Wyden, Franken, and Klobuchar have all signed on to a letter to Reid supporting the expansion of these programs as part of the health reform legislation. In the House, Rep. John Dingell has been the most ardent and steadfast supporter of this solution. What these people have in common is that they ALL have these programs in their communities and they know how they work. So there is hope that the experts wll begin to listen more to their colleagues who have seen real innovation help those of us who are not the power elite.
What this all comes down to is understanding that Washington is about big institutions fighting over how to either preserve the status quo, or leverage an advantage in changing the status quo - power politics. Washington, too often, is not about what happens to families lacking health insurance. To the extent that any change in DC actually helps anyone uninsured, it is only coincidental to the power politics at play in that city. In other cities across America, communities eschew politics to solve their problems. In places like Muskegon MI, people came together across party lines - setting aside professional agendas, to solve a real difficult problem. Innovative solutions grew from partnerships at the community level.
On Feb 25th the tale of two cities will continue. In DC the powerful experts will capture the national spotlight to play a game of power. At the same time literally, in the small community of Muskegon MI, far from any spotlight, the amateurs will take one more step in getting more people covered. Anecdotally, in the wake of the failure of the Clinton health plan, a group of experts met in Washington to discuss what went wrong and what to do next. One of the experts had investigated the new program in Muskegon which had recently enrolled it's 1,000th member. His comment to the group was that it might be worth taking a look at these community coverage programs, since the one in Muskegon has actually helped more uninsured people than all the efforts of the Clinton Administration.
The amateurs built the ark - and saved a community. It still happens today. If you want to know more about the multi-share model in Muskegon, just google Access Health of Muskegon, or go to www.access-health.org.