A public option for Iowa

BY ART CULLEN

A confluence of events is leading Iowa to an inescapable conclusion: A single-payer option based on the private marketplace holds the potential to limit rising medical costs, solve our Medicaid mess, provide a universal plan for public employees (and legislators) and cover people who have been buying insurance in the individual marketplace that Wellmark just abandoned.

This could be Gov. Terry Branstad’s legacy project. He set the wheels in motion and has the opportunity to lay the groundwork for a practical, private-sector solution that could find support among Democrats, Republicans, labor, school boards and Farm Bureau.

Branstad tried to save the state money by shifting Medicaid administration to three insurance companies, which are said to be losing $100 million each because the pool is so fraught with risk and cost. Nursing homes are closing. Health care providers aren’t getting paid on time. Mental health services are being reduced.

Republicans infuriated working people when they stripped collective bargaining rights from public employees over health insurance. Branstad wants to create a single, universal plan for all public employees to save money. It created enough steam at legislative coffees that the Democrats might smell blood on the trail to Terrace Hill.

Wellmark, which takes in about 80% of the individual health insurance market in Iowa, announced this week that it intends to abandon the Iowa individual marketplace. Farm Bureau relies on Wellmark to serve this market.

Take all of them — Medicaid clients (primarily the disabled and poor), public employees (who tend to be younger and healthier) and the folks who don’t get their insurance through their job (such as farmers and the self-employed) — and throw them into the same pool. Take the resources currently devoted to each of these groups and direct it to a new state fund. Cover them all.

This could be more than 1 million Iowans. It is a pool too big to pollute. Add in negotiating drug prices with big pharma and you could be impacting even more lives.

The savings that Branstad claims, the subsidies that we already support through collective bargaining and the contributions from the individual consumers, buttressed by subsidies from the federal Affordable Care Act, should be able to float the boat. It is assisted by the state’s ability to negotiate contracts with health care providers and insurers to help keep costs down. A stake for patients is a sliding co-pay fee schedule which is already well established through Community Health Centers around the state. Medicaid clients in those CHC communities could be directed to those clinics to help save money, since they already enjoy federal subsidy. You could even explore federal waivers to use VA funds to better serve veterans in rural areas, which is a critical issue in Iowa. Caps on out-of-pocket expenses could be negotiated in the context of a public employee’s average income.

The idea conforms to Republican beliefs that health insurance should be based in the private sector (that the program would be administered by a private insurer under a negotiated contract), that the market should be the primary cost-control lever, and that people should be able to choose their own health care provider. This all can be accomplished. It is a state experiment, not a federal bureaucracy.

It embraces Democratic ideas of health care for all. It incorporates state oversight of cost control in health care. It can encourage Community Health Centers and support rural veterans. It would fix the terrible problems created with the Medicaid reform, and protect the most vulnerable among us. It would use the ACA more efficiently.

The public pool could invite anyone to join.

Choice is preserved. Employers may continue to offer coverage. Small businesses could finally get health care off their back, as employees would have better options than high-deductible, high co-pay plans they currently can afford.

This is what Gov. Branstad wanted: a universal public health insurance plan.

This is something Democrats have always wanted: a public option.

It is big. It is bold. If Branstad doesn’t pick up on it, Democrat Andy McGuire should. It’s right in her wheelhouse as a physician and insurance company founder.

Health costs are rising unchecked. Congress is not prepared to fix what’s wrong with the ACA. Let Iowa show the way: a public option based on a negotiated contract among the state’s insurers and health care providers. Everyone wants a solution. Everyone would rush to the table if Iowa has enough of an open mind to leave Branstad a true legacy while acknowledging the benefits of a single-payer system.