(Note: I am an online organizer with It’s OUR Healthcare!, a coalition of over 100 member organizations that includes the California Labor Federation, AFL-CIO.)
Art Pulaski, the Executive Secretary-Treasurer of the California Labor Federation, posted a statement featured on the California Progress Report outlining the labor organization’s “support if amended” stance on ABx1 1, the recently released healthcare proposal from Democratic leadership in the State Legislature.
In the statement, Pulaski voiced strong support for creating a baseline on employer contributions towards healthcare for all employees and the creation of a statewide purchasing pool which he says “allows millions of Californians to pool their risk and resources in order to negotiate for more affordable healthcare.” Pulaski also noted support for the expansion of public programs and accompanying tax credits under ABx1 1.
However, Pulaski writes that “[d]espite these important advances, ABx1 1 still falls short.” Find out where and his recommendations on how to fix it below the fold.
To meet the needs of California’s working families, ABx1 1 and its accompanying financing provisions should be amended to address the following issues:
First, the individual mandate:
An individual mandate to purchase health insurance must be predicated upon guaranteeing that affordable, quality health care coverage is available to individuals subject to the mandate. While this legislation takes a first step toward addressing affordability, it does not ensure the quality of the health care benefit and it does not address the entire affordability issue. To address this problem, we recommend tying the affordability standard to the total cost of a comprehensive (a benefit of at the least Knox-Keene standard plus prescription drugs), high quality (minimal deductible, low annual out-of-pocket limit) benchmark plan. The minimum creditable coverage necessary to meet the mandate should be set and defined as a separate standard.
If the comprehensive benchmark plan is available to an individual for a total cost (including premiums, deductibles, and out-of-pocket maximums) that is less than a specified percent of his or her income, that person would be subject to the mandate. If it is not, the individual should be exempted from the obligation.
If an individual is subject to the mandate, he or she should have the option to buy the comprehensive plan, or to buy a more or less* generous plan, so long as the plan meets the minimum creditable coverage standard. Separating the affordability standard from the minimum creditable coverage standard guarantees that individuals will not be subject to the mandate unless there is a high quality, affordable product available to them, but still leaves them the ability to choose a less expensive plan to meet the mandate. (Ed. Note: This was a little confusing, and IOH spoke with Anastasia Ordonez of the Cal Labor Fed to clarify. There cannot be a case where there is a less generous benefit than the minimum and still meets the minimal requirements. It was an error in wording. The sentence should read: “If an individual is subject to the mandate, he or she should have the option to buy the comprehensive plan [i.e., something like Knox-Keene Act + prescription drugs], or to buy a more generous plan, so long as the plan meets the minimum creditable coverage standard.” )
To ensure that these plans offer quality coverage, the benefits and cost sharing arrangements for these plans must be outlined in the legislation. Asking Californians to accept an undefined mandate is unreasonable and unwise.
Pulaski also expressed an uneasiness with the enforcement of an individual mandate in its current form.
We are also concerned about potential enforcement mechanisms for the individual mandate. First, the enforcement of the mandate should look prospectively at the ability of a family to afford coverage, but also include protections for serious life changing events.
While we appreciate the bill’s provision for future hardship exemptions, we believe it should list basic conditions that would qualify a family for exemptions. The language should explicitly exempt Californians facing serious financial setbacks such as job loss and natural disaster. MRMIB should have the discretion to add additional circumstances at a future date. Second, families should have protections, similar to those currently afforded the uninsured facing unmanageable hospital bills, that preclude the use of collections tactics such as wage garnishment and home liens.
Noting the continuously climbing cost of healthcare and the individual mandate in ABx1 1, Pulaski writes that it “makes cost containment an even more pressing concern.”
To that end, the provisions regarding prescription drug purchasing and the creation of a public insurance option must be strengthened and clarified. Specifically, MRMIB should be empowered to directly negotiate with pharmaceutical manufacturers to obtain the lowest possible price for Cal-CHIPP enrollees. Additionally, the existing language regarding the possibility that public entities and other purchasers, including union trust funds, could access bulk prescription drug rates through Cal-CHIPP should be strengthened to guarantee that access. Only by directly tackling high drug costs and other health care cost drivers will this proposal deliver the cost containment that California’s working families need.
Pulaski set his sights on employer fees, stating support for a sliding scale because “it addresses the needs of truly small businesses,” but warns against the Governor recently suggesting the cap be at 5.5%, instead of the proposed 6.5%.
[..] The aggregate amount of employer fee dollars, however, must raise enough funds to purchase a quality benefit. Additionally, the graduated fee schedule could exacerbate employer incentives to evade their obligation.
These are the concerns of Cal Labor Fed but are supporting the overall frame work.
