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Congress Eyes Health Care Reform at State Level

Maya Schenwar

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"While we currently lack a consensus approach to ensure all Americans have access to adequate health services, a state-based model allows experimentation with both conservative and progressive solutions that could eventually be widely applied," the coalition wrote in an October 15 letter to the Congressional subcommittees on health care. Members of the coalition are promoting bipartisan state-based health care reform bills in both the House and Senate.

The largest obstacle to the transformation of the health care system in recent years has been a partisan deadlock, according to Senator Russ Feingold (D-Wisconsin), a member of the coalition, upon introducing his State-Based Health Care Reform Act, co-authored with Senator Lindsey Graham (R-S. Carolina) in April. Feingold and Graham stand at opposite ends of the political spectrum, as do Representatives Tammy Baldwin (D-Wisconsin) and Tom Price (R-Georgia), authors of a similar bill in the House. "Even though Senator Graham and I support different methods of health care reform, we both agree that this legislation presents a viable solution to the logjam preventing reform," Feingold said.

Accordingly, the state-based health care proposal is not so much a specific plan as it is an agreement to experiment. Under the legislation, Congress would grant funding to several states to implement the health care programs of their choice. Plans could range from single-payer systems to tax incentives to employer-mandated coverage. States would be encouraged to develop new and creative plans, according to Feingold.

All versions of the bill would require state proposals to pass Congress before being implemented, and all would establish a national task force to select, oversee and evaluate state projects. Participating states would be held accountable for decreasing the number of uninsured residents and keeping insurance affordable. Ideally, at the end of the grants' five-year duration, certain plans would noticeably rise to the top.

Congress members on both sides of the aisle have a stake in this legislation, according to a spokeswoman for Baldwin: It's a chance to show that they're right. "Congresswoman Baldwin believes that a single-payer plan is the best approach, but she understands that we may need to prove its effectiveness before we can adopt it nationally," she said. "Her bill allows us to test a variety of approaches to demonstrate what works and what doesn't."

Graham, too, cited the appeal of letting government-based and market-based health care programs "compete head to head," both vying for popular approval. "I believe the private sector model will offer the best approach in the long-run," Graham said in an April press release.

To some extent, state-based health care reform is already happening. The Massachusetts Legislature passed a law last year mandating that all residents purchase health insurance, with subsidies for low-income individuals and insurance assistance requirements for large employers. In California, Governor Arnold Schwarzenegger is pushing a universal health care package that would require residents to buy health coverage. Residents are by no means universally satisfied: Health care activists in both states say the programs are rife with flaws, including deductibles that cost families thousands of dollars per year.

However, though no one has perfected universal coverage yet, "states are leading the way," said Bernie Horn, policy director of the nonprofit Center for Policy Alternatives, in a press release. "And states would have a far easier time constructing universal health care programs with just a little help from the federal government."

Congressional advocates of state-based reform initiatives hope to harness the momentum of the states currently transforming their health care systems, in hopes that it will catch on - either prompting other states to mimic successful programs, or leading to a national-level program that would garner broad bipartisan support, according to Sarah Collins, assistant vice president for the Program on the Future of Health Insurance at The Commonwealth Fund, in an interview.

"It would be more incremental, a slower way to move toward universal coverage," Collins said, noting that motivation for policy change could vary widely among states. The type of changes that happen could also vary, seeing as both the progressive Brookings Institution and the conservative Heritage Foundation have endorsed state-based health care reform legislation.

Although Collins said that she believes state-based health care would ultimately move the country toward a simpler universal system, she noted that in the short term, it may complicate insurance matters for individuals. For example, residents of a universally insured state who move to a state with market-based incentives would not only have to go through the hassle of re-enrolling in a policy, they would lose a hefty list of benefits as well. Multi-state employers would need to insure their workers differently based on location.

The bills stand a good chance of passage, according to Collins, though she was unsure of how soon they would be voted on. Before the release of the bipartisan coalition's letter to the subcommittees on Monday, the bill already had 74 cosponsors, with almost as many Republican signers as Democrats.

"Some of my friends are 'single-payer purists,'" Baldwin said in a recent speech to the Machinists Union in Wisconsin. "They dig in their heels and say we're pushing for single-payer and nothing else will do. My response, after careful study, is that that day will not come until we can demonstrate in a few states that it actually works."

Maya Schenwar is a reporter for Truthout.org.