Establishes New York Health Plus to provide comprehensive health coverage to all New Yorkers

Summary of specific provisions

The new plan - called New York Health Plus - builds on the Family Health Plus and Child Health Plus programs to provide a full benefit package that is more comprehensive than most commercial health insurance programs. All New Yorkers would be eligible, regardless wealth. Individuals would choose from among participating health plans, as is now done under Family Health Plus and Child Health Plus. The state would also run a fee-for-service option. No one would have to give up the doctors or other providers they use. Instead of individuals and employers paying premiums, the state would set and pay the premium under New York Health Plus. Deductibles would also be eliminated and co-payments would be non-existent or nominal, as they are under Family Health Plus.

New York State would pay for the coverage (plus Federal matching funds where eligible), using revenue based on ability to pay, from an assessment modeled on the Medicare payroll assessment, plus a surcharge on upper-bracket non-wage-and-salary taxable income.

Premiums and deductibles are a regressive "tax" we wouldn't have to pay anymore. New York State would pay for the coverage (plus Federal matching funds where eligible), using revenue based on ability to pay.

Justification

New York employers and individuals now spend over $100 billion a year for premiums, deductibles and co-payments, plus more for care for the uninsured. New York Health Plus would save us $20-30 billion. New York Health Plus would more effectively control costs while also assuring better quality care and more preventive care.

Health plans today are accountable mainly to cost-conscious employers, so they are under extraordinary pressure to refuse to pay for care and to pay as little as possible. The pressure from employers is almost entirely "downward." Under New York Health Plus, there would certainly be pressure from taxpayers and elected officials to control costs. And the state as purchaser would be able to do that.

There would also be "upward" pressure on our elected government from millions of vocal voting customers to make sure that the state uses its power - as sponsor and purchaser of the coverage -to make sure that participating health plans deliver quality care and deal fairly with patients and providers.

All patients who choose to join the plan - rich and poor - and health care providers would be in the same boat. That is the best guarantee that the Governor and the Legislature (not insurance companies) would make sure that the balancing of downward and upward pressure makes it the best possible coverage. This is what has made traditional Medicare such a successful and popular program.

Family Health Plus and Child Health Plus now provide comprehensive coverage at lower cost than anything employers or individuals can buy. New York sets the premium it pays. And unlike privately-sponsored coverage, New York has kept its premiums virtually flat for the last several years.

New York Health Plus would have standards and incentives to improve the quality of care. But under privately-sponsored coverage, health plans have little incentive to promote quality or preventive care, because an individual patient is likely to have moved on to another employer or another health plan by the time any savings are seen.

New York Health Plus does not require complex new programs or bureaucracies, because it is based on Family Health Plus and Child Health Plus.

Today, we pay premiums and deductibles set by insurance companies. It's a regressive "tax" - without regard to whether the person being covered is a receptionist, assistant manager, or company president, or whether an employer is a huge prosperous company or a small business struggling to get by.

New York Health Plus would replace that regressive tax and also save $20-30 billion a year. The state would pay for the coverage, using revenue based on ability to pay (plus Federal matching funds where eligible), without deductibles or co-pays. The revenue would come from an assessment modeled on the Medicare payroll assessment, plus a surcharge on upper-bracket nonwage-and-salary taxable income. Individuals or employers who choose to opt out and buy private coverage would receive a credit against most of the assessment.

Compare health care with education. Educating children is a parent's responsibility. But we don't ask parents to pay a premium or deductible to send their children to school. We insist that New York provide free quality education for every child.

Universal health coverage is a major issue not just because a minority of the population lacks coverage. It's also because the overwhelming majority is fed up with our current system and wants it changed. Any serious plan for universal coverage will be attacked by powerful special interests. To overcome those attacks and win public support, a plan should offer real change that people want: universal access, ability to control costs, ability to promote preventive care and quality care, fairness and equity. That's what New York Health Plus will do.

Prior legislative history

New bill.

Fiscal implications

The program would be funded by its own revenue stream. Public employers, like other employers, would see savings from the improved efficiency of New York Health Plus versus traditional employment-based coverage.

Effective date

Immediately, with phased-in implementation.