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CLINTON'S HEALTH PLAN : The States: How They're Tackling Reform


WASHINGTON — Not content to wait for President Clinton's plans to revamp the nation's health care system, many governors and state legislatures are moving to improve coverage on their own.

Health insurance for everyone has been a major White House goal. Yet Hawaii has been moving toward it since 1974, Vermont is aiming to achieve it by July, 1995, and Washington state wants it done by 1998. Oregon has started the process by expanding insurance coverage to many more of its indigent residents.

To help employees of small businesses obtain better insurance at more affordable rates, many states--including California and Washington--have moved to organize "purchasing cooperatives" that enable firms to join together to obtain coverage.

"State officials really don't have the luxury of sitting on their hands waiting for the White House and Congress to do something," says Richard E. Merritt, a state health reform authority at George Washington University. "The number of uninsured people is increasing, Medicaid costs are escalating and businesses in their states are concerned about the costs of health care."

It is not yet clear how the Clinton proposal would affect the state initiatives, but here is a more detailed look at what the states are doing.

States That Have Enacted Changes

California: Effective July 1, the state established a program to help small businesses provide health coverage for their employees. The insurance pool--available to firms employing between five and 50 people--aims to make it easier for companies to purchase health coverage by allowing them to bargain with carriers as a unit. The Department of Health Services also is pushing a plan to contain costs by expanding enrollment of Medi-Cal patients in managed care programs.

Florida: The state Legislature has created a system of universal coverage that by Dec. 31, 1994, is intended to allow government, individuals and businesses to pool their resources to purchase better quality care at affordable prices. The legislation effects major changes in the small employer insurance market, specifically requiring insurers to issue policies to small businesses without regard to employees' health status, pre-existing conditions or history of claims.

Hawaii: Beginning in 1974 with the passage of landmark health care reform legislation, Hawaii has moved toward providing universal coverage for its population, although about 5% of the islands' residents remain uninsured. The state aims to stabilize costs and improve efficiency through a program of managed care. Hawaii's law mandates employer-based health insurance for all employees not covered by collective bargaining or government employees with their own plans. Financing is shared equally by employees and employers. The state subsidizes insurance coverage for workers who are unable to pay.

Iowa: The state will allow experimentation, on a limited basis, with managed competition by establishing health insurance purchasing cooperatives and creating delivery systems. State officials say they hope to find out what works best in achieving the twin goals of cost containment and access to quality care.

Maryland: The small employer insurance market--defined as companies with two to 50 employees--is the target of Maryland reforms. Subscribers in the small-employer market must be notified in writing when a policy is canceled or not renewed, and pre-existing condition exclusions will be totally eliminated effective Jan. 1, 1995.

Oklahoma: Legislators have approved a plan to abandon the existing Medicaid fee-for-service system in favor of a mandatory statewide managed care program for indigent residents. Under the measure, Medicaid clients are to be folded into the managed care system on a four-year, phased-in basis.

Oregon: As far back as 1989, Oregon adopted a reform initiative to expand Medicaid coverage to all state residents with incomes up to 100% of the federal poverty level. Under a play-or-pay component of the plan, employers will be required to provide group insurance to their workers by July 1995 or pay into a state insurance pool. At tax on tobacco products is under consideration to provide supplemental financing.

Rhode Island: As a first step toward comprehensive, universal health coverage, the state legislature has approved a plan to provide coverage for all uninsured children under 6 years old and all pregnant women effective next April 1. In an effort to keep down costs, the program will be of the "managed care" variety with each enrollee to be assigned a primary care physician.

Texas: Gov. Ann Richards signed legislation this summer to make health insurance more affordable and more accessible to small businesses--firms having between three and 50 employees. The legislation created a statewide nonprofit purchasing cooperative to allow small companies to join together to buy health insurance at more affordable rates. The act also allows for creation of private nonprofit purchasing alliances.

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