An answer for the uninsured
Blagojevich's new plan even has help for struggling insured
Sunday, March 4, 2007
SPRINGFIELD - All 1.4 million uninsured adults in Illinois would have access to a range of public, private and subsidized expansions of health insurance under a $2.1 billion plan that Gov. Rod Blagojevich pledges would be affordable for citizens but would place heavier cost burdens on many businesses."Illinois Covered," the second-term Democratic governor's attempt to put Illinois among several states attempting to solve the growing problem of skyrocketing insurance costs, wouldn't stop with the uninsured.
As many as 3.6 million of the state's insured adults and children would qualify for proposed state-subsidized rebates - potentially amounting to thousands of dollars a year - for adults and children in families already insured but having a hard time paying their premiums.
Families earning up to $80,000 a year for a family of four potentially would be eligible for the rebates.
"Lots of people that are currently insured aren't feeling very secure or feeling very good about the options that they have," said Anne Marie Murphy, the governor's adviser for health-care programs. "Our plan seeks to address both of these issues, and it also seeks to address the underlying cost trends in health care ... so as to make the overall system improved."
The $2.1 billion annually that the state would need to pay for Illinois Covered's subsidies and rebates - as well as an expansion of state-paid coverage for poor adults and the state's FamilyCare program by the time the programs are fully ramped up in 2010 - would come from a "new and sustainable revenue source," according to Blagojevich spokeswoman Abby Ottenhoff.
She said the governor will reveal that source - which she wouldn't identify - when he outlines his fiscal 2008 budget Wednesday in a speech to the Illinois General Assembly.
That revenue source is expected to be a controversial "gross-receipts tax" that would replace the state's corporate income tax.
When asked about the revenue source's potential effect, Ottenhoff said, "I'm not aware of any evidence that it would have a negative effect on the state's economy."
Blagojevich is expected to formally announce his proposal - which will include mandatory state "assessments" on all but the smallest employers who don't offer health insurance - during an appearance today in Chicago. The governor already has received nationwide acclaim for the state's attempts to cover all uninsured children through the "All Kids" program.
Because Illinois Covered doesn't include a mandate that all uninsured people apply for insurance - a provision of Massachusetts' insurance-expansion plan that kicks in this July - Murphy estimated that only about a third of Illinois' uninsured, or 515,000 adults, would apply for coverage.
She said the governor is willing to consider an individual mandate but wants to look at how well Massachusetts' plan works.
Illinois Covered would create a statewide pool of affordable and comprehensive private insurance policies - provided by insurers and partially subsidized by state government for all except the most wealthy - that would be offered to businesses and individuals who can't afford insurance or are looking for a better deal.
Under the proposal, a number of plans are outlined that would offer annual premiums for individuals, families and employers that may be lower than what is available at market rates.
To assist insurers in offering coverage in the pool, the state would cover 80 percent the cost of any medical bills that exceed $40,000 a year, Murphy said.
The amount a qualifying family would pay for premiums in the pool ranges from a low of $50 a month to a high of $470.
Any health insurer that does business in Illinois would be required to participate in the pool, which is modeled somewhat on a program in New York.
Uninsured families earning up to $80,000 a year for a family of four potentially could qualify for subsidies to help them pay for insurance. Businesses could buy insurance from the pool but would have to pay an unspecified portion of the cost for their employees.
Several states, including Massachusetts, Vermont, Maine, Pennsylvania and California, have either passed or are considering comprehensive health-care plans in the absence of major reform at the federal level.
But Illinois' proposal would amount to the biggest attempt at the state level to offer universal coverage with such a major change in tax policy, said Jennifer Tolbert, a principal policy analyst at the Kaiser Commission on Medicaid and the Uninsured in Washington, D.C.
Ottenhoff noted that the total cost doesn't include assessments on employers, which hasn't been calculated yet.
Nick Sarraf, 56, who is uninsured and operates Nick's Deli in Peoria, said he probably couldn't afford to buy health insurance - even at the cheaper rates promised in Blagojevich's plan - but would take a look at the details.
He said he uses Peoria's federally subsidized Heartland Community Health Clinic for his care.
But Peorian Carol Holford, 63, a homemaker who has been insured for 13 years and uses the Heartland clinic, said the governor's plan "would be really nice." She said she appreciates Blagojevich's attempt to assist "the middle income who are really struggling to make ends meet."
Murphy said the program would reduce the cost of uncompensated care that hospitals and others provide. Many of those costs are shifted to the rates that employers and individuals currently pay for health insurance.
To prevent employers from dropping their own insurance and leaving workers uninsured, the plan would require an 18-month waiting period in most cases before newly uninsured workers could get insurance from Illinois Covered's statewide pool.
But she said state officials expect some in the insurance industry to oppose the pooling, as well as the governor's interest in considering caps on profits that insurers could earn when insuring people in the pool.
She added that the governor wants to boost the rates it pays doctors and other health-care providers through the state's publicly funded insurance programs, including All Kids, FamilyCare and Medicaid. Those programs together already cover 2.2 million people and cost $11 billion a year in state and federal funds.
If the General Assembly approves the plan, Illinois Covered's expansion of coverage for poor and disabled adults, and adults through the FamilyCare program, could begin in January 2008. Rebates could begin in July 2008, and the first of two phased-in enrollments in the insurance pool could start in January 2009.
