A variety of health care initiatives have been cropping up all around the country, all attempting to deal with the uninsured, estimated by most experts as somewhere around 45 million people.

Around the country is the operative phrase: in Washington, the only major health care-related legislation still alive is SCHIP, the State Childrens Health Insurance Program. The House and Senate have each produced a bill, but coming up with a final version on which the entire Congress can agree will be, as National Underwriter put it in an August 13th article, a daunting task.

That should surprise no one. A report by the Commonwealth Fund, released in June 2007, notes that no major reform of the employer-driven health insurance system has survived on the federal level for a decade. An earlier report, State Strategies to Expand Health Insurance Coverage, published this past February, noted that [n]ational solutions are unlikely to emerge in the foreseeable future.

The states do not have the luxury of waiting for Washington to act. States are facing a perfect storm with health care, and that has provided governors and state legislators with the political will necessary to tackle the problem, said Enrique Martinez-Vidal, director of State Coverage Initiatives, a program of the Robert Wood Johnson Foundation.

A report issued by State Coverage Initiatives in January found that more than a dozen states have enacted policies to expand coverage: comprehensive health care reform in Massachusetts, Vermont, and Maine; public-private partnerships in Arkansas, Montana, New Mexico, Oklahoma, Rhode Island, Tennessee, and Utah; and initiatives to cover all children in Illinois and Pennsylvania. And since the report was issued, California governor Arnold Schwarzenegger has been alternately lauded and excoriated for his proposal for universal health care. And in late June, the Wisconsin State Senate ratified Healthy Wisconsin.

[Other] states are looking at those reforms, at what the actual details were, Martinez-Vidal told Insurance Advocate. A lot is playing out during implementation. I think theres still a lot of energy around compromises and bringing stakeholders together, he added, noting that his organization has created a technical assistance program, the Coverage Institute, and is currently working with some 14 states.

Neva Kaye, senior program director at the National Academy for State Health Policy, suggests that the various state initiatives currently in place or under consideration [have] the potential for growing into something big, because [they] have changed the conversation.

Individual mandate is absolutely a change and a new tool, she said, but more significant is the way the reforms look at an entire system: access, cost, and quality. Part of the reform, she noted, is to address all three simultaneously " this is the first time thats been expressed so clearly.

The Massachusetts Miracle?

In 2006, Massachusetts made headlines as the first state to mandate health insurance for all of its residents. The new law was hailed as a potential model for other states, certainly something to be watched closely as it went through regulatory refinement and implementation. While The New York Times pointed out on July 1 that the Massachusetts model may not work everywhere " the state has neither a scarcity of large employers, nor an enormous immigrant population " its struggles and its progress are enlightening.

The plan has, so far, proven that bipartisan cooperation is not impossible. It had its origins at least as far back as 2004, when Mitt Romney, then governor and now Republican presidential candidate, proposed an individual mandate for insurance coverage. In June of this year, Jon Kingsdale, executive director of the Commonwealth Health Care Connector Authority, which oversees the law, told The New York Times, Weve had extraordinary support and cooperation from the local health plans and, frankly, from everyone else, the hospitals and the doctors. The Times notes that the measure passed because it found a common ground among employers, the government, and individuals, appealing to those who feel it is fairer to require everyone to participate than to ask those with coverage to pick up the costs of those who choose not to buy insurance. And it is evident that, since the law was passed in April 2006, health insurers, advocates, medical providers, and taxpayers continue to support it and to work on resolving problems.

In broad terms, the plan requires that about half a million people, most of the states uninsured, obtain coverage. The mandate took effect July 1, but residents have until December 31 before facing penalties for non-compliance. Premiums for those making up to three times the federal poverty level are subsidized. The Connector is charged with issuing recommendations defining what it means to be insured in Massachusetts and with setting rules to help carriers create health plans that are affordable for people with lower-middle incomes.

But, as always, the devil is in the details. As of July 2, more than 130,000 people " roughly one-third of those who were uninsured a year ago " had signed up. Most of these have incomes low enough to qualify them for free or subsidized insurance. The challenge is the balance of the uninsured. To be fair, the moderately priced plans did not become available until May 2007, and many experts anticipate a stronger uptake in the last months of the year.

However, The New York Times reported in June that some 400,000 of the states uninsured are young, single males who, nationwide, tend not to purchase health care insurance. Their participation in the Massachusetts program is vital, since they are least likely to require costly medical care, and adding them to the pool of the insured would reduce the average cost of coverage overall.

Other problems remain, including affordability. Many considered the preliminary bids from private health insurers too costly. The Foundation for Taxpayer and Consumer Rights claimed in January that these policies cost an average of $380 a month, with deductibles, co-payments, and other uncovered expenses adding to the burden. Judy Dugan, research director for the foundation, argued in a press release that [a] family of four in Boston with just over $60,000 in before-tax income " the upper limit for access to a subsidized policy " would have to pay about $10,000 a year for the minimal private policies being considered in Massachusetts, and then would face a $4,000 yearly deductible.

The cost of unsubsidized plans is also a concern. In Massachusetts, insurers are allowed to charge up to twice as much for older people as for younger residents, according to the Boston Globe. Although those with employer-subsidized coverage are typically protected from the age-based difference, estimates suggest that there remain 36,000 people over 50 but not yet qualified for Medicare for whom health insurance is barely affordable.

The Foundation for Taxpayer and Consumer Rights has also been pressing for the Commonwealth Health Care Connector Authority to direct the Legislature to require HMOs and insurance companies to justify their pricing. It is important to rein in the waste, inefficiency, and excess of private health insurers and HMOs that make worthwhile health coverage unaffordable, said Carmen Balber, consumer advocate. And the authority itself has been criticized for agency salaries that exceed those of the governor and his cabinet.

Seemed Like A Good Idea At The Time

The boldest reform proposals, demonstrating the capacity for breaking ground in a bipartisan manner, have come from the Northeast, the Commonwealth Fund noted in its February 2007 report. Bold, however, is not necessary part of the formula for success. If Massachusetts " problems notwithstanding " seems to be making steady and applause-worthy progress, Maine has stalled.

Two years ago, Maine was the first state to enact a law requiring universal health care coverage; its goals were to control hospital costs, improve the quality of health care, and to subsidize health insurance for low-income people so as to cover all the states 130,000 uninsured by 2009. As of April, 2007, The New York Times reported, only 18,800 people had signed up, and many already had insurance. Unlike Massachusetts program and the California proposal, Maines program is voluntary; that, and relatively expensive premiums, most likely account for the low take-up.

Even more problematic is the funding formula, which rested largely on the assumption that there would be significant savings because an increase, thus far unrealized, in insureds would mean that hospitals would need to deliver less charity care; that, combined with cost-cutting measures, would lower the costs to insurers.

It has not. Some of those who signed up for the plan have significant and costly medical problems; there are not enough enrollees overall; and those most likely not to have enrolled are among the states healthiest residents, whose participation in the pool was expected to lower costs. Moreover, premiums, far from declining, have risen, in part because of the plans unusually generous benefits.

Under the law, the state is allowed to charge insurers for any savings, rather than allowing carriers to hold them as profit. But when the state presented its bill, the carriers cried foul, arguing that they owed far less than the state was charging. The carriers and the Chamber of Commerce sued, and though the judge found for the state, the case is under appeal.

In fairness, Maine faces singular obstacles: as the Times points out, the population is largely rural, poor, and elderly; many of its businesses are very small affairs, and few employers are large enough to offer insurance to employees; and many workers are part-time or seasonal. Selling individual coverage in Maine is unprofitable, and a single carrier, Anthem Blue Cross Blue Shield, holds most of the market.

In April, Governor John E. Baldacci proposed a series of changes to address the issues: requiring that people have health care coverage and that employers offer it, with financial penalties for both for non-compliance; making DirigoChoice more affordable for small businesses; creating a separate pool for high-risk patients; instituting more Medicaid cost controls; and having the state administer DirigoChoice, now sold by Anthem Blue Cross. The proposal would also phase out the controversial funding scheme, imposing lower-cost surcharges instead.

The Embattled Governator

On January 9, 2007, CBS Evening News reported that Governor Arnold Schwarzeneggers proposal to require every Californian to have health insurance and to provide coverage for every child in the state sent shock waves reverberating across the country. It also opened up political fault-lines to rival San Andreas.

California has a population of 36 million; it would be charitable to call its huge health care system troubled; and one-fifth of the states population is without health insurance, far more than any other state. National Underwriter pointed out in January that Californias uninsured population is larger than the entire population of Massachusetts, and of all but 10 or so other states.

The essence of the California plan includes:

Increasing state Medicaid payments to providers;

Creating a health insurance purchasing pool for moderate-income residents;

Expanding access to wellness incentive programs;

Requiring that carriers, HMOs, and hospitals spend 85 percent of every premium dollar on patient care;

Taxing physicians fee income two percent and hospital revenues four percent to subsidize the state Medicaid program;

Mandating the provision of employee coverage for employers of more than 10 people or the payment of a four percent payroll fee;

Encouraging employers to set up plans enabling employees to make tax-sheltered contributions to health insurance;

Requiring all state residents to have health insurance;

Requiring insurers to issue individual insurance and limiting rate differentials for insureds with health problems.

In other words, theres something for everyone, and for everyone to hate. Doctors and hospitals would see a $4 billion increase in annual reimbursement. Then again, theres that fee, or tax, on income and revenues. For once, thats a distinction that does have a difference: in California, fees require only a simple majority vote of the Legislature; taxes require a two-thirds majority.

The plan would cover the estimated one million illegal immigrants, making the state a magnet for them coming here rather than staying there, Robert Huff, chairman of the Assemblys Republican caucus, told The New York Times. Then again, many argue that illegal immigrants, already here, are treated in emergency rooms around the state; the cost of their care coming indirectly from the pockets of taxpayers. Insurance companies, prohibited under the plan from denying coverage on the basis of age or health status and required to offer individual coverage on a guaranteed issue basis, have largely stayed away from the battles, declining to criticize the governor or the overall plan.

But as of Tuesday, August 21, California legislators had still not passed a budget, placing the whole legislative agenda in jeopardy, including health care reform. Lawmakers adjourn their 2007 session in mid-September.

Once Again: State vs. Federal

Some argue that these state-by-state reforms are no substitute for comprehensive, national reforms, at least in part because of the disparities among states. In its June report, the Commonwealth Fund ranked the states according to their provision of safe and affordable medical care. In the top five " Hawaii, Iowa, New Hampshire, Vermont, and Maine " on average nearly 90 percent of working-age adults have insurance coverage, compared with approximately 75 percent in the bottom five, Oklahoma, Mississippi, Texas, Arkansas, and Nevada. And each state has its own particular demographics, economic conditions, even culture.

Neva Kaye said that reform at the national level, while not absolutely necessary, could go a long way toward fostering movement. What happens at the federal level, she said, sets the playing field and makes state-level reforms possible. But, she added, I dont think the states will ever stop asking What next? The states are laboratories for change.

For his part, Martinez-Vidal said that though he agrees that, in the long run, there will need to be some sort of reform at the national level, he believes that such reform will be a framework or guidelines. It will probably not be really detail-oriented, he said, because there is so much variation across the states. The states, he added, can try things out, see if they work, until it comes to a tipping point where the feds are ready to do something.