(for those that don’t know I attended California Speaks on August 11. It brought almost 3500 people from across
Governor Schwarzenegger,
I was fortunate enough to participate in California Speaks where I was heartened to hear both you and the legislative leadership promise healthcare reform this year. After taking part in California Speaks and talking with many friends and family I feel confident that I can present to you a number of the ideas that we favor as well as some that we are against.
First we believe that all Californians should have healthcare and that all Californians should pay at least some small portion of the costs of their own healthcare. In this regard either your own proposal or SB 840 would be acceptable. AB 8 is not acceptable because it does not provide for all Californians or require that everyone have healthcare. In the same token whatever program is passed should make sure that insurance is affordable for all Californians. We believe that your current proposal could be too costly for some moderate income people. For example, an individual making $40,000 a year would have a hard time paying $7500 per year in medical expenses. A limit of say 5-10% of income combined with a total limit of $7500 would prevent this problem. In conjunction of course with everyone being required to have coverage, insurers would no longer be able to deny people coverage or charge exorbitant rates for pre-existing conditions.
Next, as mentioned in many of the proposals, prevention and wellness programs are key to reducing future costs. I propose the following program to provide plenty of incentives to get Californians in shape while at the same time cutting overall healthcare costs. Insurers or the state would provide a refundable rebate program to people that were determined to be “fit” by their doctors. This designation would have to be made at least once a year during a yearly checkup and it could include such measures as being a non smoker, being reasonably in shape given age etc, and not being obese. The amount of the rebate would be a percentage of the savings that are realized by the person being fit and therefore not developing a chronic disease such as diabetes or hypertension. For example, if it costs $2400 a year to provide healthcare for the average person but on average $6000 to treat someone with a chronic disease then people that stayed fit could be refunded 2/3 of the cost savings or $2400 a year ($200 a month) while the insurer or the state would save 1/3 of the cost or $1200 a year by the person staying fit. This would provide strong incentives for people to stay fit while simultaneously reducing total healthcare costs. This rebate could still be given to people enrolled in the states program and would be refundable for people who in this example paid less than $2400 a year in premiums. The logic being in this case the state would be better off paying people to stay fit then treating them for their health problems for being unhealthy. In similar fashion, as mentioned in your proposals, all preventive healthcare should be free to encourage people to use it. This will reduce overall healthcare expenditures.
We also believe that in order to control costs it is important for people to always pay a small co-pay. One of the main problems with SB 840 is that it does not require people to make a co-pay. We believe this will encourage excessive and in most cases unnecessary use of healthcare resources. A small co-pay would discourage that while not preventing people from getting needed medical care.
We are also very concerned with 25% of all healthcare dollars being spent on administration. We support proposals that would require capping monies spent on administration to 15% or less of total premiums. We also believe that the state should also offer competitive polices for people of all income levels to ensure competition in the private market. We believe that would also help prevent a bloated or inefficient bureaucracy from developing because it would be competing against private insurance companies. In fact it is for this prime reason that we are distrustful of SB 840 because we are not convinced that the resulting state bureaucracy would remain effective and efficient. As always, a bit of competition ensures a better product for all.
We also believe that no matter which system we end up with all hospitals and providers should be reimbursed by the state for at least cost plus a small premium for their services. Providers should be paid for their work. Moreover, we all recognize the hidden tax that is passed on to the rest of us in the form of higher insurance premiums if they are not paid the full cost of services.
Finally we agree with your assessment that illegal immigrants should only be provided the most basic emergency care. We do not believe people who enter illegally should be rewarded for their illegal acts, and that all state policies should discourage their presence as much as possible.
We encourage you to be bold in taking on these challenges in
Thanks,
Mathew
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