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Oregon can make history by voting for Measure 23

Oregonians have the opportunity to profoundly affect American history when they cast their votes in the coming days. On the Nov. 5 ballot is Measure 23, an initiative that if passed, would make Oregon the first state in the country to offer its citizens universal or free for all health care.
Eugene Weekly
Oct. 24, 2002

A Healthy Debate
Measure 23 creates universal health care in Oregon.
By Aria Seligmann

Oregonians have the opportunity to profoundly affect American history when they cast their votes in the coming days. On the Nov. 5 ballot is Measure 23, an initiative that if passed, would make Oregon the first state in the country to offer its citizens universal or free for all health care.

The plan would kick in Jan. 1, 2005. To pay for it, individuals would pay increased income taxes and employers increased payroll taxes. During the next two years, an overseeing committee made up of 10 elected and five governor-appointed board representatives would map out a plan designed to offer every Oregon resident all medically necessary interventions by the provider of their choice and prescription drugs, free.

The reason Oregon, and many other states in the process of forming such initiatives, are taking health care matters into their own hands needs little explanation. Exorbitant health care costs (including large profits for insurance companies and high CEO salaries) have caused premiums to skyrocket. Overall, premiums went up 20 percent in Oregon last year; and for many businesses and individuals, the leaps were higher than that. While premiums have jumped, coverage has declined not just in Oregon, but nationally. The Kaiser Family Foundation surveyed more than 2,000 public and private firms in 2002 and found that, on national average, while monthly premiums rose upward of 17 percent and deductibles rose 37 percent, workers across the board experienced a decrease in benefits.

Deductibles and co-payment increases have caused individuals to fork over more of their dollars to doctors and hospitals. Meanwhile, the increase in prescription drug prices has caused some insurance companies to drop that coverage. A common scene is the shock on the face of a woman paying for her prescription medication at a drugstore when she realizes her insurance company either reduced its coverage or ended it, and she's stuck with an enormous receipt she must pay.

"We see this all the time," a pharmacy clerk tells her.

Everyone agrees the health care system is in tatters. But they disagree on what to do about it.

So far, Measure 23 is the only solution anyone has offered for universal health care. Other states have published studies and seven are working on putting similar measures on their ballots. Oregon has made some inroads in increasing benefits in other arenas. The Oregon Health Plan (OHP) made history in covering so many low-income Oregonians. But with the state facing budget woes, the waiting list for coverage has been growing, and until very recently, the number of uninsured Oregonians was estimated at 444,000.

Then just last week, at a politically advantageous time for 23 opponents, OHP received a federal mandate (OHP receives more than half its funding from the feds) allowing it to expand coverage to up to 60,000 additional Oregonians but with a high price: OHP-covered adults who don't qualify for Medicaid will lose their vision and dental coverage.

OHP still hopes to increase its coverage further in the coming years, but premiums and co-pays are increasing. The Family Health Insurance Assistance Program (FHIAP), which offers premium-paying assistance to low-income Oregonians, has also received federal dollars to help expand its program to more people beginning Nov. 1, but only a small percentage will benefit.

Not Quite Free

Under Measure 23, individuals would pay anywhere from zero to $25,000 per year in additional income taxes and employers would pay anywhere from 3 to 11.5 percent of total wages paid out to employees. Proponents argue that employers would save in premiums they would normally cover for the employee as well as in administrative costs. Because employers would save money, they might be able to hire more workers, especially full-time workers, who before would have cost extra money in benefits.

But at first, employers will lose a bit of cash.

For the next two years, if 23 passes, employers will pay an additional 1 percent of payroll taxes to cover start-up costs.

Measure 23 proponents estimate that the average Oregonian pays $4,637 per year for health care, including deductibles, co-pays, premiums, taxes, administration and other fees. Under 23, the average household, with income at $48,000, would save money paying only $2,160, an additional 4.5 percent in income taxes to cover everyone in the family. All care, including vision, dental and alternative therapies, are covered.

No specific tax schedule beyond the average has been determined, but 23's Campaign Manager Dan Isaacson says, "Those earning less would pay less, those more, would pay more," with no one paying more than $25,000 in additional income taxes.

Some would pay nothing. Individuals or families earning less than 150 percent of the federal poverty rate would pay no additional taxes. For an individual, that poverty cutoff is less than $13,290 and for a family of four, it's less than $27,150.

Costs

Projected costs of the plan are $19.9 billion in 2005, with $10.8 billion coming from the new taxes and the rest from federal health care programs and workers' compensation. But according to a recent study published by the American Association of Health Plans, an insurance industry group, that $19.9 billion figure is at least $3.5 billion short.

Isaacson, however, says that shortfall number was derived from what it would cost to insure all currently uninsured Oregonians, and does not take into account the 15 to 20 percent in administrative fees that will be saved under the single-payer plan (which caps administrative costs at 5 percent.)

Those worried about costs include Democratic gubernatorial candidate Ted Kulongoski, who agrees with some AFL-CIO union members (But not all, some are for 23.). "Some will be paying more than they are now," he says. As to the behemoth budget, Kulongoski wonders if the money will really be there, calling it "presumptuous" to assume it will be.

More Arguments Against

It's not surprising that the insurance industry would be balking at this measure. If passed, 23 means a lot of insurance company employees will lose their jobs, and a lot of insurance businesses will vanish. They've got lobbying power and have created a vortex of negative spin around 23's campaign.

To those who argue premiums have spiraled out of control, Dean Kortge, president-elect of Oregon Association of Insurance and Financial Advisors says, "We need to debate issues of health care costs, not premiums. The premiums are related to the costs."

Another issue of concern is the 15-member board that would oversee the plan. The board will negotiate fees with providers and purchase bulk prescription medication that will curb costs.

"There's too much power on that board," says Kortge. Yet powermongering issues have been addressed within the text of the measure, which states, "Standards and criteria shall be established by the Secretary of State to: (a) Prevent a person from serving as an elected member of The Oregon Comprehensive Health Care Finance Board who has a financial interest in any provider, practitioner or supplier doing business with the Board ... and (b) Assure that providers shall not have a financial interest in facilities ... "

The measure also gives the governor leeway to dismiss any appointed board member who is guilty of any "misconduct."

Kortge is also concerned that if the plan's funds fall short, the board has the power to pass revenue bonds to pay for it. He points out that even school funding must be debated publicly in the Legislature and then referred to the voters.

Another argument against the measure is that retirees and others would flock to Oregon for the free health care.

But Isaacson says "That's what they said about the Oregon Health Plan, and it didn't happen." If that were human nature, he says, "Everyone in Mississippi would move to New York or California where the benefits are better."

Opponents also fear an exodus of doctors from the state. But many doctors are for 23, including members of Physicians for Social Responsibility and members of the Oregon Mental Health Association, many of whom felt the squeeze when HMOs limited or eliminated coverage for their services.

Kortge's argument getting the most media play involves his comments regarding massage. Under 23, he told the R-G, massage could be considered a "medically necessary" procedure, and Oregonians would end up paying for "Californians to come to Oregon to get massages."

But a system of controls in place within the measure's text would oversee any abuses. Plus, an hour of massage costs from $45 to $60, compared to an hour of often-covered physical therapy, which can run $105 to $125 for similar services.

On the Fence

Leaping into the unknown is a scary thing. While most agree the idea of 23 is great, many fear how the as-yet-unknown details would play out.

In a letter dated July 30, 2002, Congressman Peter DeFazio wrote to a constituent, "The ballot initiative proposed by 'Health Care for all Oregon' is a noble and bold step toward addressing Oregon's health care deficiencies. I do have concerns about some of the details... " he adds, pointing specifically toward the taxes, lack of price controls on prescription drugs and "potential drain on resources needed for other state priorities like education."

That theme was raised again in a Sept. 26 letter mailed to individual homes from measure opponent and registered nurse Deana Altman-Nelson. She writes that 23 threatens "the funding needed to keep our schools from even deeper budget cuts."

But when asked the number one reason to vote for 23, Isaacson replies "schools." The amount of money paid by school districts for faculty and staff health care is exorbitant. Projections are that Eugene 4J would save in its current budget $2,272,481 in such costs, freeing up those dollars for teachers, services and supplies.

Even so, the Oregon Education Association opposes the measure, stating "many unanswered questions are left to the Health Care Board to determine." Some of those questions, says 4-J Superintendent George Russell, are what impact the measure will have on collective bargaining. "Will bargaining units be able to negotiate for other health coverage? Will it become like PERS?" With so many unanswered questions, he says, "To say we're going to benefit is hard to imagine."

While the unknowns are scary to many, especially employers who don't know exactly where they fall on the 3 to 11.5 percent payroll tax scale, "I admit, that one's a leap of faith" says Isaacson the idea is indeed a bold one.

Yet unknowns in health care are commonplace. Currently, employers and employees don't know what their premiums will be from one year to the next, what plans will be affordable, or what co-payments, deductibles and services will be. Like the woman at the pharmacy stunned to realize her necessary meds weren't covered any longer, Oregonians don't know from one moment to the next what coverage will suddenly be dropped by their HMOs.

Oregon led the way with the Oregon Health Plan, and now voters who a recent Portland Tribune poll showed were evenly divided on Measure 23 have a chance to brave new territory once again.

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If it's so bad... 28.Oct.2002 17:54

s.m.

...then why are people from outside Oregon going to be clamoring for it?

It's simple, really. Does society have a responsibility to help take care of the sick? Only the most heartless would disagree.

look a little deeper 29.Oct.2002 14:27

just some overtaxed dupe

This just cuts right to the core, doesn't it ?

The people clamoring for this are the politicians who will buy the votes of the non-tax-paying poor, and those same poor, who have everything to gain from free healthcare awarded to them out of money seized from the tax-payers, under threat of force.

The people opposed to this are the people who will see their taxes rise dramatically, and the small business owners who will see their payroll taxes rise dramatically, and those people worried about their jobs (like me), considering that many large employers will very likely leave Oregon if this measure is passed, in the middle of a severe recession.

Where do you stand ?

It just comes down to whether you will be feeding from the public trough, for free, or whether you will be forced to pay for this by the State.

It has everything to do with "Logical Argument vs. Emotional Argument", not "Heartlessness."

Think about it.