The Michigan Universal Health Care Access Network (MichUHCAN)–an advocacy group working for comprehensive health care–has responded to proposals to reform the individual health insurance market in Michigan. In a blog post, the group says that the proposals are a “pretty good idea” and that they have the potential to be great. It states in part:
This plan would apply to anyone with health insurance, and would completely cover all expenses above $25,000. In other words Michigan would have a single-payer health care system for all expenses above $25,000.
In theory an insurance company could offer a plan with a $25,000 deductable and never pay a cent in medical bills. Their only costs would be administrative, so they could probably charge $100 a year and still make money. Unfortunately for us universal-care advocates this program is funded by a small tax on health care premiums, so if the entire state actually enrolled in plans like that there’d be no money to pay Doctors.
But even without that stealth universal plan this would help a lot.
For one thing the 80-90% of the state that currently has health insurance would be less likely to go bankrupt when they get sick because out of pocket expenses would be capped. As is even with a UAW plan somebody whose care costs $300,000 has a $60,000 co-pay. $25,000 is still a whole lot for a family on a UAW salary to pay, but it’s a lot more doable than $60,000.
Then there’s the fact that it will make more people insurable. People with expensive pre-existing conditions can’t get insurance at al because the insurance company isn’t stupid. They know that if you sign up a guy likely to have an expensive heart attack for $6,000 a year you’re gonna go out of business. With total medical expenses capped at $25,000 minus co-pays insuring that guy makes a lot more business sense.
Altogether the Legislature estimates this program will insure half of Michigan’s current uninsured population. Depending on how things go in DC it’s theoretically possible Michigan could end up with true universal coverage. That’s unlikely, but if both plans pass we’ll have more than 95% of Michigan covered. I’d guess it would be more like 97-98%.
Note that under this system the new plan would be a single payer. Let me repeat that: under this new system 97% of Michiganders would be covered by a single payer. They’d only be covered after paying huge medical bills, but I have the feeling convincing politicians to lower that $25,000 threshold will be a lot easier than convincing them to create a new system from scratch.
This plan is far from MichUHCAN’s ideal health plan. It won’t cover everybody, and those it does cover are still on the hook for $25,000, but it’s a good starting point. And a lot better than the current mess we’re dealing with.”