These days, no news cycle goes by without a story on health care. To be sure, this is the run-up " albeit an exceptionally long one " to a presidential election. But its not just the candidates and its not just all talk. Americans identify health care as one of their most pressing concerns. And a considerable majority say they are in favor of universal care, though exactly what they mean by that varies.

Two recent developments have added fuel to the fires. At the beginning of September, the Census Bureau released data that show the numbers of uninsured continuing to rise, from 44.8 million in 2005 to 47 million in 2006. The number of children without health insurance increased from 8 million to 8.7 million.

This last figure has particular relevance for the second development: the battle over SCHIP, the State Childrens Health Insurance Program. (For a full discussion, see the September 10 issue of Insurance Advocate.) The authorizing legislation expires on September 30, and The New York Times reported on September 17 that, according to the Congressional Research Service, 12 states would have no federal money available on October 1; another 23 states would run through their allocations within a year without additional money. Some in Washington remain optimistic that a compromise will be reached between Congress and President George W. Bush; others see a presidential veto as all but inevitable.

Once again, the states have reacted strongly. According to the Times, Sonny Perdue, Governor of Georgia and chair of the Republican Governors Association, and Kathleen Sibelius, Governor of Kansas and chair of the Democratic Governors Association, co-signed a letter saying that Congress must pass and the president must sign a reauthorization of the program by September 30, for health and moral reasons.

Closer to home, Governor Eliot Spitzer is said to be considering legal action to block the administrations efforts to restrain New Yorks Child Health Plus program. And on September 12, New Jersey Governor Jon Corzine sent a letter to President Bush stating that New Jersey will not obey the federal rules. As the Washington Post reported, Corzine predicted that the new rules, which he described as onerous, would deny coverage to up to 10,000 children in his state. He, too, indicated that he is prepared to file suit to challenge the new rules.

As significant as federal funding is to the states, it addresses only one part of the overall health care picture.

In its August 27 cover story, Insurance Advocate analyzed some of the bolder health care solutions in states around the country, such as Massachusetts, California, and Maine. New York, New Jersey, and Connecticut also have a number of bills, proposals, initiatives, and studies at various stages of development or implementation; the following examples serve, if nothing else, to illustrate just how vast and interrelated the issues are.

New Jersey: Rationales and Rationing

In New Jersey, many hospitals are beyond strained " theyre in fiscal crisis. That was the assessment of the states Commission on Rationalizing Health Care Resources, as articulated in June by its chair, Professor Uwe E. Reinhardt, expert in health care economics at Princeton University. The commission, established in October 2006, is charged with coming up for a plan to ensure that the states hospitals and other health care services respond appropriately to community needs for affordability, accessibility, and quality. The group is also working on means for oversight and accountability in relation to the allocation of public funds.

Although, as Reinhardt described the situation, hospitals across the country are straining under the burden of economic, technological, and other forces, most of which are beyond their control, and each state has its own particular problems. As the Press of Atlantic City reported on August 29 in its coverage of the third and final public hearing before the commission, there are significant differences between the northern and southern parts of New Jersey. Most of the states hospitals are in the north and face a highly competitive market; they are often in poor fiscal condition.

In contrast, the largest hospital system in the southwestern part of the state, South Jersey Healthcare, is a non-profit entity, almost entirely without competitors, and financially successful. But that very success " by some accounts, a 2006 profit of $14.2 million, three times its 2005 profit " has led to questions about its charges, estimated to be significantly higher than the state average, and about whether those profits are reinvested in such a way as to directly benefit its patients, particularly the poor.

The commissions report is due in December. But on June 29, it issued an interim report, analyzing the financial condition of New Jerseys acute care hospitals and outlining a methodology for identifying those institutions that are critical for maintaining access to health care in their respective communities. A summary, issued by the states Department of Health and Senior Services, outlines some of the commissions key findings and recommendations:

Nearly one-quarter of all hospital revenue, approximately $3.7 billion, comes from public money;

In deciding whether a particular hospital is essential to its community, policymakers must look at hospitals within their defined areas. The report identifies eight hospital market areas in the state, based on patterns of usage;

Two factors should be used in determining whether a hospital is a candidate for state support " how financially viable the institution is, and how essential it is to maintaining community access;

Financial viability should be established on the basis of the hospitals profitability, its capital structure, and its liquidity;

To determine how essential a hospital is, its occupancy rates, Medicaid and uninsured inpatients and emergency visits, trauma services designation, and other measures should be analyzed. Other issues, such as impact on travel time for hospital care and impact on racial and ethnic groups, for instance, should also be taken into account.

Following the issuing of its interim report, the commission continued its work, examining such related issues as the application of information technology to health care delivery, regulatory and legal reforms, and access and equity for the medically underserved.

If anyone doubts the significance of the commissions work " or the likelihood of vehement debate over its final proposals " an article in the September 16 issue of the Courier-Post offers some very hard facts. Ten New Jersey hospitals have closed in the past eight years, and two more are currently in the process of closing; another three have declared bankruptcy. Until 1992, when the state deregulated specialized services, hospitals were required to obtain a certificate of need " that is, prior approval for establishing certain high-cost clinical services and for expansion.

But with deregulation came stiff competition, as hospitals vied with one another to expand services and build new facilities. In addition, according to former New Jersey deputy health commissioner David Knowlton, the growing number of suburban ambulatory care facilities began drawing privately insured patients away from hospitals that served urban populations, reducing their revenues. Added to concerns about viability are questions of quality and outcomes. Outpatient facilities are not subject to the same licensing scrutiny as are hospitals. And it is well-established in the medical community that the more experience a facility has with a particular procedure, the better the outcomes. Unfortunately, the converse is also true.

[Health care providers] go where the money is, Reinhardt noted at the release of the interim report. Can you enlist market forces without violating ethics?

Connecticut: A Modest Proposal

Connecticuts hospitals, too, are troubled. An April 18 press release from the office of Governor M. Jodi Rell announced the establishment of a task force to develop strategies to stabilize and chart the future course of hospitals in Connecticut, many of which are facing financial hardship. The Hospital Task Force, whose report is due December 31, is examining a number of issues in addition to hospitals financial health: access to care; emergency room utilization; affordability; and the certificate of need process.

But, as is the case around the country, the bigger picture in Connecticut " and the far tougher nut to crack " is universal health care. Speaking to Insurance Advocate in an extended interview on August 13, Insurance Commissioner Thomas Sullivan said that the uninsured population in the state is relatively low, and most of the insureds are covered by the private market.

Nonetheless, last December 27, Governor Rell released two proposals for universal coverage: the Charter Oak Health Plan, which aims to make coverage available to all uninsured adults, regardless of income, by means of a public-private partnership offering coverage at a group rate; and HUSKY Health 2007, whose goal is eliminating the coverage gap for children who are eligible for HUSKY " the states plan serving children in families of all incomes, using a sliding fee scale " but who are not enrolled.

The Charter Oak plan would be available to any state resident between the ages of 19 and 64 " the years, essentially, between parental coverage and Medicare " who has been uninsured for more than six months. According to the governors office, the plan involves no cost to the state, other than administrative and marketing support. Instead, the state would help connect uninsured adults with insurers participating in the Charter Oak Health Plan.

The proposed monthly premium would be $250 and would cover prescription medications with a three-level copay, no restrictions on pre-existing conditions, a lifetime benefit of up to $1 million rather than maximum annual benefits, and low copays for pre- and post-natal and preventive care.

The failure of parents to enroll their children in subsidized health care programs is a national issue. HUSKY Health 2007 proposes to address that problem by waiving the premium for newborns for the first two months following birth. This will be our gift to Connecticuts newborns, the governor said, and it will encourage parents to fulfill a basic parental responsibility by enrolling their children and keeping them enrolled.

Whether or not that gift is sufficient incentive remains to be seen. Recent reports have found that, at least in some states, the obstacle to the enrollment of children has more to do with lack of information and complicated and confusing procedures.

To address those issues, at least in part, the HUSKY Health 2007 plan would require that parents inform schools at the beginning of every school year about their childrens health insurance. At present, such notification is required only at the beginning of kindergarten and sixth grade. Schools would thus be able to refer students to the HUSKY plan.

Though several bills intended to establish a universal health care system in Connecticut failed to be enacted in the last session, two others immediately related to the governors proposed initiatives did pass. Among its other provisions, House Bill 8002 establishes the Charter Oak Health Plan, requires reporting of students health insurance status, and calls for the state to pay the first two months premiums for newborns. In the Senate, SB 1484 enacts the changes to the HUSKY program. It also raises the age of coverage from 23 to 26 and eliminates the requirement that children be dependent or full-time students.

The Senate bill does not stop at present reforms. It establishes: the HealthFirst Connecticut Authority to evaluate alternatives and make recommendations for future changes to health care in the state, including single-payer and employer-sponsored insurance; cost containment and quality improvement; methods of financing health insurance; and increasing access.

New York: What Does Universal Coverage Mean?

As part of Governor Eliot Spitzers Partnership for Coverage initiative, the New York State Insurance Department and the Department of Health are in the process of conducting a series of six public hearings, the first of which was held in Glens Falls on September 5. According to deputy superintendent of insurance for health, Troy Oechsner, who attended that meeting, some 150 people turned up, of whom 34 testified.

Not one speaker said anything other than its time for universal coverage, Oechsner reported. There were speakers from business, labor, health plans, insurance companies, the whole range of providers, and consumer organizations. Everyone was unified on that point.

There was, he said, broad and uniform agreement that universal coverage is the desired goal and that New York State should be a leader in making that happen.

How that will be paid for is, of course, another matter entirely. Nor is it simply a question of single-payer vs. a mixed public-private approach. Oechsner indicated that there is enormous divergence, not only from one constituency to another, but even within any one stakeholder group.

Nevertheless, the two departments are forging ahead to develop proposals to reform the states health care system, increase access to insurance coverage, and determine how best to accomplish the goal of universal coverage. In an August press release from the Insurance and Health Departments, Spitzer put particular emphasis on issues of implementation, saying that the program will avoid the significant implementation problems that have plagued other states efforts in this area.

He added, This incremental effort will draw from the experiences of other states, but will ultimately result in a plan that is uniquely suited to New Yorks uninsured population and health-care challenges.

Oechsner pointed out that a number of measures have already been implemented, including the expanded eligibility for Child Health Plus to 400 percent of the federal poverty level. Everyone in the state should now be able to afford coverage for their kids, he said. The goal now is signing up eligible kids.

He added that there are also streamlining and simplification efforts related to Medicaid spending, which is higher in New York, both in total dollars and in dollars per capita, than in any other state. And the Family Health Plus buy-in was passed, allowing employers and union funds to buy into the program for all employees, regardless of income eligibility.

Cost-cutting is high on the agenda, as Spitzer made plain in his August 14 comments: [W]e cannot achieve this goal [of universal coverage] unless we first restructure our health care delivery system to lower health care costs.

One particular target, Oechsner explained, is the HICRA assessment, funds paid by insurance carriers for use, in theory, to pay for debts that hospitals incur in treating the un- or under-insured. Over time, he said, HICRA has become a vehicle for various add-ons and provisions unrelated to patient care.

We have to rationalize these insane payments were making to hospitals, he said, so that the money follows patient care, we can account for it, and its not just blank-check funding. Theres evidence that while we spend a lot on hospital care, the quality of care lags behind.

There are good, hard data showing that health care costs consistently outpace inflation, and New Yorks efforts are focused on a number of initiatives to address that imbalance. Not least among these, Oechsner said, is administrative inefficiency. Medicare spends somewhere in the range of three to four percent on administration; most other countries comparable to the U.S. spend between two and six percent. Private health care in the U.S., on the other hand, spends up to 12 percent on administration.

When I speak to medical society members, Oechsner said, doctors say that, where they used to have maybe two or three people to handle reception, scheduling, and billing, now they need 12, because each insurance plan has different forms, different barriers to payment, different rules. Its very complicated, and it sucks up a lot of resources.

Some degree of standardization within the industry, he suggested, would help, though he also acknowledged the potential burden on large, national carriers that understandably do not want different standards for each state.

There is still a long way to go. But the expectation is that Spitzer will announce a major health care reform proposal around the middle of 2008. Its probably a safe bet that the storm of debate will hit just about the time the hurricane season starts.