F.A.Q. About The Connecticut Health Care Security Act

John R. Battista, M.D. and Justine A. McCabe, Ph.D.
Connecticut Coalition For Universal Health Care (website)
January 01, 2001

1. What problems of our current health care system would be solved by the Connecticut Health Care Security Act?
2. How is it possible for the single payer, universal health care system proposed by this Act to expand benefits yet save money? What data do you have to support this claim?
3. How would the proposed health care insurance system be paid for?
4. It is often stated that the United States has the best health care system in the world. 
   Wouldn't quality of health care decrease in Connecticut under this Act?
5. Wouldn't there be waiting lines or rationing of medical care under this system, as there are lines in Canada under their single payer system?
6. Wouldn't the Connecticut Health Care Security Act create socialized medicine in Connecticut?
7. Wouldn't this Act create a government bureaucracy that is inefficient relative to the private insurance system and result in health care costs spiraling out of control?
8. Wouldn't this Act create a kind of "Medicare for all" that would experience the same kind of cost inflation that the federal government has experienced with Medicare?
9. I am young, healthy and choose not to have health insurance. How can this proposed health care system be advertised as democratic and ethical when it forces individuals to pay into a "one size fits all" health care insurance system?
10. When the Clinton administration proposed universal health care for the United States it was soundly defeated. Why should we enact it in Connecticut?
11. Would health care providers be forced to participate in this system? Do you believe that the proposed system would be acceptable to health care givers? What would be the impact of this Act on the income of health care givers?
12. Do you believe this health care system would be supported by the population of Connecticut?
13. How would this Act deal with the private insurance workers and state health care workers who would be displaced by this Act?
14. How would this Act stop Connecticut from becoming a magnet for the sick and disabled from other states in the United States?
15. How would this Act deal with issues of cost containment, quality assurance, and fraud?
16. Why do single payer advocates claim that it is irrational to believe for-profit insurance systems are more efficient than not for profit insurance systems? Isn't it true that for-profit managed care has controlled health care costs in our American health care system?
17. Wouldn't this Act return us to the old fee for service medicine in which costs spiraled out of control?
18. Isn't it inevitable that the proposed health care system would be less efficient because it would stifle the competitive, free market system?
19. Why should employers have to pay health care benefits? Why isn't health care paid for totally from state and federal taxes plus individual insurance premiums and user fees on activities detrimental to health?

1. What problems of our current health care system would be solved by the Connecticut Health Care Security Act?

It solves the problem of the 12% of our state population who are without health insurance. This group of predominantly working individuals and their families has increased by 74% since 1990 and is associated with both poorer health care and higher health care costs than the insured segment of our population. This Act would provide the uninsured comprehensive health insurance which would improve their health and lower health care costs.

It solves the problem of the underinsured, the 25% of those insured who would be bankrupted by a major medical illness, the number one cause of bankruptcy in the United States. This acts would protect them from medical bankruptcy.

It solves the problem of the 35% of moderate income workers who are locked in unwanted jobs because they would lose their health care benefits if they were to leave their job. This Act would allow these workers the freedom to choose their work without losing their health care benefits. 

It solves the problems of Medicare recipients who, on average, spend 25% of their incomes on health care. This Act would decrease out of pocket expenses for Medicare recipients. 

It solves the problem of quality health care for the poor who receive substandard medical care through Title 19 because the low reimbursement rates of Title 19 keep the best health care givers from participating in it. By providing the same quality medical care to all individuals, regardless of income, the quality of medical care for people currently insured through Title 19 would be greatly improved. 

It solves the problems of Connecticut small businesses who struggle to provide health insurance benefits for their employees. This Act makes health care affordable for small businesses. 

In addition is would assist the problems of all businesses in paying for workman's compensation medical expenses. This Act would decrease workman's compensation expenses because it takes away the need to adjudicate conflicts over whether a medical problem is job related or not, thereby saving time and money. 

Most importantly, it resolves the problems of managed care: the breach of patient confidentiality that comes from subjecting physician's treatment recommendations to insurance company pre-approval; the compromise of patient care that results from health care recommendations being micro-managed to minimize costs; the disruption of the doctor-patient relationship that results from insurance companies having limited provider networks; and the frustration that many patients and health care providers experience in accessing and providing health care through the managed care system. This Act provides free choice of provider, ensures the right of providers and patients to determine the most appropriate health care for them, ensures the continuity and confidentiality of care, and facilitates access to health care.

2. How is it possible for the single payer, universal health care system proposed by this Act to expand benefits yet save money? What data do you have to support this claim?

All studies on single payer, universal health care predict savings. No studies predict increased costs. For example, the State of Connecticut Office Of Health Care Access studied the impact of the health care insurance system this Act would create on Connecticut in 1992 and predicted this system would save over 2 billion dollars in total health care expenses in 1999 despite providing comprehensive health care benefits to the entire population. This finding was re-confirmed in both the 1995 report of the Connecticut Office of Health Care Access, and by the 1999 study of the Massachusetts Medical Society, which showed savings of 1.7 to 2.7 billion dollars per year if this system were enacted in Massachusetts. Studies (1990) of the Act's proposed health insurance system at the Federal level, conducted by the General Accounting Office and the Congressional Budget Office, both predict savings of 100 billion to 200 billion dollars if this system were to be enacted throughout the United States. 

The anticipated savings of these prospective studies is supported by data from other industrialized countries who have enacted single payer universal health insurance systems. Each of these countries spend at least 50% less than Connecticut per capita while providing comparable health care outcomes for acute illnesses, and superior outcomes for global health care data such as infant mortality, and longevity. 

These studies are based on decreased administrative expenses (around 50%) and decreased costs of purchasing medications and durable medical equipment in bulk. Depending on how much of these savings are off set by increased demand, savings from 0% to 10% are predicted.

In addition, there are many other savings under a single payer system that were not considered by these studies. First, because a single payer system would emphasize preventive health and encourage the early treatment of disease, health care costs would decline in the long run because illness would be prevented and treated early, when it is cheaper and more effective to treat. Second, health care givers would work with the insuring agency to find pragmatic ways of lowering costs while assuring quality, thereby cutting ineffective testing and treatments. Third, a single payer system would reduce health care costs by coordinating and consolidating medical services and medical equipment. Fourth, non-health insurance plans which have medical benefits attached to them, such as workman's compensation insurance, malpractice insurance and car insurance, would cost substantially less under a single payer system because conflicts over the cause of medical injury would no longer have to be adjudicated by legal proceedings. Finally, a single-payer universal health insurance plan could control costs by controlling the rate of reimbursement for medical services. Although, it is not the intention of this Act to reduce overall income to health care providers, health care providers will experience a substantial (28%) reduction in administrative costs, experience a reduction in malpractice insurance, save time by no longer having to have care pre-approved, and experience an increased demand for their services. All of these factors would allow reimbursement for health care procedures to be decreased while maintaining income.

3. How would the proposed health care insurance system be paid for?

The health care insurance of this Act would be paid for through existing state and federal programs, excise fees on activities detrimental to health, employer payroll premiums, and family health premiums.

The state and federal governments would transfer the funds which are currently being utilized to pay for Medicaid, Medicaid, and CHIPS programs into the Health Care Trust. Unlike the current system in which many eligible individuals are not enrolled, the health care trust would make sure that every eligible person in enrolled, thus maximizing the state and federal funding to the universal health insurance program.

Second, the Act calls for excise fees on activities detrimental to health to the extent that these activities can be shown to increase health care costs to residents of the state of Connecticut. For example, tobacco products would have an additional sales tax placed on them up to the extent that the funds generated from this sales tax equal the health care costs which can be reasonably shown to be attributable to their use.

Third, employers would pay for health care benefits on a sliding scale basis, depending on the number of their employees. Companies with the fewest employees would pay the lowest percentage of payroll. Companies with the largest number of employees would pay the highest percentage of payroll. However, the Act mandates that the payroll premium paid by the largest companies will not exceed the average rate that they are spending in the year in which this act is passed.

Fourth, families would pay a health insurance premium less than the average amount they would currently pay for the benefit package offered by the health care trust. There would be no costs for families whose income is less than 185% of the federal poverty guidelines.

Because the act is anticipated to reduce the total costs for health care, these savings can be spread out among employers and workers.

4. It is often stated that the United States has the best health care system in the world. Wouldn't quality of health care decrease in Connecticut under this Act?

No. The best health care in the world is available in the United States if you can pay for it. However, the United States does not have the best health care system in the world. To evaluate the health care system of the United States, the health care statistics of American citizens must be compared with the health care statistics of the citizens in other industrialized countries that utilize a different health care system. The United States is the only industrialized country that does not insure access to health care as a right of citizenship. All of the industrialized countries, except Germany, utilize a single payer system, as this Act proposes. Germany utilizes a multipayer system, somewhat similar to the health care system proposed by President Clinton in 1992. 

Among the 29 industrialized nations, the United States ranks 20th and 21st in life expectancy among males and females respectively, 23rd in infant mortality, and last with regard to most immunizations. These statistics are accounted for by the universal availability of health insurance in other industrialized countries. It is well known that health insurance increases longevity by encouraging individuals to seek medical attention early in the course of a disease when it is easier to treat and less costly. Furthermore, many individuals without health insurance, or because of limited financial means, avoid health care visits and treatments, shortening their survival.

When comparisons among patients are made between the United States and Canada, the country whose population and culture is most similar to the United States, in terms of survival from cancer, coronary artery disease, kidney failure and a wide variety of other illnesses, Canada is equal to or superior to the United States although spending less than half of what the United States does per capita.

This Act would improve the quality of care, not just for the poor and uninsured, but for the general population, by replacing the for-profit, managed care portion of our health care delivery system with private, fee-for-service medicine in which health care decisions are made by the health care provider in conjunction with the patient. For-profit, managed health care has been shown to provide poorer quality care, and to be less satisfying to the public as per a comprehensive July, 1999 review in the Journal of the America Medical Association by Himmelstein, Woolhandler, Hellander and Wolfe. 

To summarize, this Act should increase the quality of care by minimizing the negative impact of for-profit, managed care and can be expected to increase the health and longevity of the population as a result of providing universal health insurance coverage that will encourage preventive health care and early intervention in medical illness.

5. Wouldn't there be waiting lines or rationing of medical care under this system, as there are lines in Canada under their single payer system?

No. Canada is a poorer country than the United States. As a result Canada has a much less developed medical infrastructure than the United States. Canada has a limited supply of expensive medical diagnostic equipment such as CT Scanners. The United States has an oversupply of health care givers, hospital beds and medical equipment. For example, the United States is estimated to have two to three times as many mammography machines as is needed to provide all the necessary mammograms for the United States population (Ann Int Med 1990; 113:547). Demand for medical care in the United States could be increased by up to 40% from the current levels before demand would equal the capacity of American medical infrastructure. It is estimated that single payer, universal health care would increase demand up to 15%. Thus, this demand could be easily met by our current infrastructure without lines. Put the other way around, Canada would have no waiting lines if its health care system were to be funded at the levels of current Connecticut per capita spending.

6. Wouldn't the Connecticut Health Care Security Act create socialized medicine in Connecticut?

No. This Act would alter the health care payment system in Connecticut, it would not alter the health care delivery system in Connecticut. Health care practitioners would remain in fee for service private practice and continue to compete with one another for business. In fact the private health care system would be strengthened by this Act because health care services currently delivered by the state would be transferred to the private sector and health care givers would be provided with a meaningful voice in determining rates and benefits, something they are deprived of under the managed care part of our current health care system.

7. Wouldn't this Act create a government bureaucracy that is inefficient relative to the private insurance system and result in health care costs spiraling out of control?

No. First, this Act would not create a government bureaucracy. This Act does not create a government system. It creates a not for profit public trust that is under the control of a board composed of citizen health care advocates, health care givers, health care organizations, businesses, and public officials, who will be in a decided minority. Although the Trust is accountable to state government in the sense that it must obtain legislative approval for the insurance premiums which are collected through the state revenue system, its operations are not directly controlled by state government, and its employees are not state employees. Second, this system will be much more efficient than the private insurance industry by law. The Act limits the administrative costs of paying insurance claims to 3%. The 3% figure is realistic and in line with the administrative expenses of Medicare, which is the most administratively efficient health care insurance payment system in the world. The private insurance industry spends between 15 and 30% of the health care dollar in administrative expenses and profit. This is the result of managing care, high executive salaries, large marketing costs, and profit. It is the administrative efficiency of the proposed health care trust relative to the for profit health care insurance industry that would allow this Trust to expand health insurance benefits while decreasing costs.

8. Wouldn't this Act create a kind of "Medicare for all" that would experience the same kind of cost inflation that the federal government has experienced with Medicare?

In a sense, this Act would create a cradle to grave "Medicare For All" because everyone in Connecticut would have health insurance, as all elderly and disabled Americans currently do. However, the analogy stops there. There is no relationship between the single payer, public health insurance program this Act would create and the Federal Medicare program. Medicare is a prospective payment system in which you pay in to the federal health care system over your working life in order to be covered after age 65. Costs under this system have increased dramatically due to the impact of new technology and medications on life expectancy. The single payer insurance program this Act would create is paid for year to year. Any failure to balance the budget in a particular year would lead to alterations of taxes, benefits or professional fees for the next. Decisions about the health care system would be given year to year consideration in negotiations between the insurer, the public and health care givers. The Act insists on a year-to-year balanced budget, something not part of Medicare's prospective system. Additionally, the Act insists that any budgetary increases on a year-to-year basis be less than the rate of health care inflation in the country at large. Thus, increases in health care costs under this system would be less than any increases in the country as a whole.

9. I am young, healthy and choose not to have health insurance. How can this proposed health care system be advertised as democratic and ethical when it forces individuals to pay into a "one size fits all" health care insurance system?

This is an interesting question. This young person equates democracy and ethics with free choice, and perceives any mandated universal program as non-democratic and unethical. From this perspective, any taxes to provide funds for needs such as national defense and fire protection would all be considered undemocratic and unethical. In short, this person implies that the only good government is one that allows its citizens to do what they want and does not interfere with their acting in accord with their own perceived self interest. We disagree with this position and wish to articulate why.

Democracy does not refer only to freedom to do what you want and freedom to operate in what you think to be your own self-interest. Democracy, in this context refers to the right to influence and participate in the decisions that are made which affect both your life and the life of society. This Act is democratic precisely because it returns the right of influence and participation to those very individuals and groups, health care givers, health care organizations, health care recipients, and businesses, which are directly affected by health care insurance. Under our current system, decisions about health care are made by politicians, federal and state health care administrators, and increasingly by executives of corporations, without input from health care givers or health care recipients, who have become increasingly powerless. This Act would allow these groups to be fairly represented on a board and to be empowered to make decisions about costs and benefits, subject to legislative approval. This Act expands democratic control to our current health care system, and would constitute an improvement over the single payer systems which exist throughout the world, which are commonly bureaucratic government systems rather than democratic, participatory systems.

The questioner implies that it is unethical to pass an Act that make citizens do something they don't want to do, in this case pay for health care insurance they don't think they need. The questioner makes individual freedom and choice the highest ethical value. This Act is rooted in a different set of ethics. This Act is considered ethical because it makes access to health care a right of state residency regardless of income or health. Under our current health care system, access to health care is limited by ability to pay. The poor receive second class health care under the state Medicaid system, while low paid hourly workers are most likely to forgo health care access because of cost. Moreover because of the relationship between ethnicity and class, African Americans and Hispanic Americans are the most likely to be without access to health and not surprisingly, have the poorest health care statistics. Additionally, our system denies access of health care based on illness. If you are ill, and require health care, health insurance either will cost you more, or be denied to you for your preexisting conditions. Having this kind of financially motivated health care system is what we consider to be immoral. In accord with this position a wide variety of church leaders, such as the Reverend Martin Luther King, Cardinal Bernadin, and the Connecticut Council of Bishops have all endorsed universal health care insurance as the ethical basis for health care in the United States. This Act is based on the ideal that health care, like education, is a right of all citizens of our country, regardless of income. We all share the risk and benefits of this system. We all have a vested interest in making it work, and keeping one another healthy.

10. When the Clinton administration proposed universal health care for the United States it was soundly defeated. Why should we enact it in Connecticut?

The Clinton health care plan provided universal health insurance through a multi-payer system. This plan was complex, cumbersome, costly and inefficient, because it did not resolve the problems and costs associated with managed care and the multi-payer system. It is a completely different system and should have been defeated because it would have been ineffective in containing health care costs. This Act provides universal health care through a single payer, public health system. This system saves money despite increasing benefits and utilization. It is democratic, ethical, fiscally conservative, and would resolve the problems associated with our current multi-payer system. For those reasons it is a vast improvement over the Clinton plan and should be enacted.

11. Would health care providers be forced to participate in this system? Do you believe that the proposed system would be acceptable to health care givers? What would be the impact of this Act on the income of health care givers?

Health care givers would have a choice of participating in the health care system or not. Those that participate in the system would accept the negotiated fee determined by the Connecticut Health Care Trust as full payment for their services. Those that do not participate in the system would be free to charge whatever rates they would like for their services.
There is little doubt that health care givers would find this system acceptable. Health care givers are very unhappy under managed care, a system that increases their overhead and hassle, reduces their income, and takes decision making away from them. They will readily accept an unmanaged health care system with less administrative hassle as long as their overall income is not significantly reduced, which this Act would not do. In addition, health care professionals would be given a meaningful voice in determining fees, covered benefits, and quality care standards, something they are precluded from under managed care. Finally, health care professionals will have the opportunity to serve the entire population of CT without consideration of ability to pay. When the medical staff of New Milford Hospital was asked if they support this system they voted over 4 to 1 in favor of it. Discussions with the Connecticut State Medical Society have shown an openness to this model. A 1999 article in the New England Journal of Medicine showed the majority of academic physicians, residents and medical students support public health insurance systems for the United States, and favor this system three to one over private, managed care insurance systems.

12. Do you believe this health care system would be supported by the population of Connecticut?

Yes. National Polls taken by NBC, the LA Times, CBS, Gallop, Roper and the Associated Press conducted in 1989 and 1990 showed support for a tax-financed national health program to vary from 62% to 72%. A 1990 Hartford Courant poll of CT residents showed 60% in favor of a tax-financed health insurance program for Connecticut. Those percentages should be higher now due to increased frustration and dissatisfaction with our managed care system and the increasing problem of the uninsured.

13. How would this Act deal with the private insurance workers and state health care workers who would be displaced by this Act?

The Act puts aside 1% of the health care system's assets to retrain workers displaced by it for the first three years. Many of these workers would be employed by the Connecticut Health Care Trust which would administer the health care system in Connecticut. Many of the remaining displaced workers could be retrained as health care workers. Since the demand for health care will be increased by this system, there will be many openings for health care workers in Connecticut. This is a much fairer situation than the common one in the private insurance industry where insurance workers lose their jobs due mergers of insurance companies, without any concern given to their future well-being.

14. How would this Act stop Connecticut from becoming a magnet for the sick and disabled from other states in the United States?

Unemployed individuals would not be eligible for health care benefits under this Act until they have been legal residents of Connecticut for at least one year. If this is not a sufficient time period to discourage such individuals from moving to the state, this eligibility period could be increased. However, we do believe that Connecticut will experience an increase in its population under this system, because businesses will come to Connecticut in order to save substantial amounts of money in their payments for health care under this system. This will be good for the state, and not hurt the health care system, because these newly employed workers will pay their fair share into our public health system and be eligible for benefits under this Act after six months of employment.

15. How would this Act deal with issues of cost containment, quality assurance, and fraud?

Cost containment, quality assurance and fraud issues would be handled through a Quality Assurance Division of the Connecticut Health Care Trust. The Quality Assurance Division would work with a health care giver advisory board to determine pragmatic and cost-effective quality standards which it would use to educate providers on cost containment issues. The system educates providers through quality of care standards, rather than managing individual cases.
Quality assurance would be handled in two ways. First, by investigating complaints from patients about their health care givers or health care organizations. Second, by investigating those situations in which the pattern of utilization of a particular health care giver differs significantly from the patterns expected under the quality of care standards established by the state with the input of health care giver and health care organizations. 
Fraud would be investigated through a system similar to Medicare. Caregivers whose patterns of care significantly differ from their colleagues in the state would be investigated to determine if the basis for these discrepancies represents fraud. Furthermore, consumers would receive copies of all billing done by their caregivers and be encouraged to report discrepancies between what the trust was billed for and what services their caregiver provided.

16. Why do single payer advocates claim that it is irrational to believe for-profit insurance systems are more efficient than not for profit insurance systems? Isn't it true that for-profit managed care has controlled health care costs in our American health care system?

Private, for profit insurers spend 15% to 30% of insurance premiums on administrative costs. Medicare spends 3%. Single payer systems spend 8 to 10% on administration, but that includes educating the public about preventive health care, researching the system, and providing quality assurance functions. Private, for-profit insurers are more expensive because they must market their programs, constantly enroll and reenroll members, micro-manage care, and make a profit. All of these costs are eliminated in a single payer system.

It is true that managed care systems tamed the inflation in American health care by reducing caregiver fees and reducing hospital stays. However, the costs of the American health care system continue to rise, both as a percentage of American GDP and in terms of cost per capita. In the period from 1990 to 1997 the percentage of cost of health care in the United States rose from 13.2 to 14.7 %. During the same period, the cost of health care in Canada remained the same at 9.5% of GDP without managed care. Furthermore, most health care experts expect health care costs in the United States to rise significantly in the years. When the costs of medical care in for-profit dominated markets is compared with not-for-profit markets, for profits cost significantly more. Single payer systems control costs better than managed care systems without the problems of the latter: breaches of patient confidentiality and continuity of care; compromise of patient care. 

Thirty years ago when Canada enacted a public health care system both Canada and the United States spent the same percentage of their GDP on health care, 7.5%. Now thirty years later Canada spends 9.7 per cent of its GDP on health care and the United States spends 15% on health care, despite "managing" care for the majority of our citizens.

17. Wouldn't this Act return us to the old fee for service medicine in which costs spiraled out of control?

No. This would not be a return to unregulated fee for service medicine in which there was a great escalation of costs. Cost for medical services would be negotiated in this system between the insurance trust, health care givers, and representatives of the general public and businesses in open discussions in which the cost of raising fees on insurance premiums would be apparent. Over 80% of medical costs are fixed under our current health care system. The only costs that are not fixed are those paid by self-insured or uninsured individuals. The state and federal governments and health maintenance organizations all establish prices for medical services. Under the proposed system costs would be negotiated and would be utilized as one means of costs control. This would constitute an advantage both for health care givers and those insured by health care, as each would have an opportunity to engage in the negotiating process.

18. Isn't it inevitable that the proposed health care system would be less efficient because it would stifle the competitive, free market system?

There is nothing in this act that would stifle competition in health care. Health care givers and health care organizations would still compete with one another for patients. In fact the system would become more competitive because everyone in the state would be free to see any health care giver. There would be no limitations on care giver choice as there is under the current health care system, all licensed willing care givers would be allowed to participate in the system. However, as per our current system, there would be little or no competition among providers on the basis of cost. Currently, 80 to 90% of health care costs are fixed by the insurer, without input from caregivers or health care organizations. Under the proposed system, these costs would be established by negotiations among care givers, health care organizations, health care advocates, taxpayers and the insurer.

19. Why should employers have to pay health care benefits? Why isn't health care paid for totally from state and federal taxes plus individual insurance premiums and user fees on activities detrimental to health?

There is no good philosophical justification for employers paying a share of medical insurance premiums. Because health insurance is a major expense, labor unions have sought this benefit as part of their employment. To take this away would mean that employees would have to win back this compensation in the form of increased wages. Instead of taking this approach, this Act made health care insurance benefits a mandated aspect of all employment, although taxing employers at different rates depending on the number of their employees. Passing this act without employer payroll taxes would mean that health care premiums for individuals and families would have to be increased and workers would have to negotiate increased wages to compensate for this lost benefit.

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