Merging Ammiano legislation with health care access an act of desperation

Nathan Nayman

By Nathan Nayman

July 6, 2006

The proponents of the Ammiano plan are desperate. The merger of the Ammiano legislation with the Newsom Health Care Access Plan is evidence of this desperation.

The Ammiano plan cannot stand on its own. How can you merge the Mayor's non-insurance program with one that is based upon employer paid health insurance?

The Ammiano plan is nothing more than a mandates that a sets an amount of money to be spent by San Francisco employers on their employees' for healthcare insurance whether the employee wants health care insurance coverage or not.

The Newsom Plan promotes a new product -- not an insurance product but one that offers all San Francisco residents access to defined health care services - in fact, providing everyone a "medical home' of their choosing.

This new product's innovative approach was designed by a task force called the Universal Health Care Council comprised of experts in the field of healthcare policy.

But rather than go into further details of the program, there is one issue that is missing from this debate -- the link between health insurance and the workplace.

The workplace acts as the central entry point to the American healthcare system and it is broken. It has been sputtering along for decades. There have been scores of articles about this phenomenon in newspapers and journals, but yet we all continue to blindly follow this flawed approach for paying for our healthcare.

It was during World War II when wage and price controls were imposed and the only way companies could compete for employees was through richer "fringe" benefits, including health insurance. Finally, big unions began to bargain for "health packages" in their contracts with these major employers.

It is an old model….old and in the way.

With growing healthcare costs, costs for health insurance continues to escalate resulting in fewer small and medium sized companies able to offer it.

For the last few years medical costs have been increasing for the employer by about 11%.

With greater demand for the newest and most advanced medical care, costs will only continue to rise under the current health insurance framework.

Recently, the President of the Service Employees International Union, (known as SEIU) Andrew Stern testified that, "We have to recognize that employer-based health care is ending; it is dying before our very eyes."

United Auto Workers President Ron Gettelfinger wrote in a commentary in the Detroit News that the nation's system of employer-based coverage is faltering, while health costs are rising.

"Members of our union have learned through hard experience that relying on individual employers to provide health care is inefficient and a drag on our ability to compete in the global economy," he said. "Does it make any sense for the United States to continue on a policy course -- employer-based health care -- which gives foreign manufacturers a cost advantage worth tens of billions of dollars over U.S. companies that employ U.S. workers?

So we have two leading labor leaders claiming in public that the employer based health insurance system is tragically flawed- and yet here we are today calling for a new mandatory health spending requirement on businesses to fund a broken system… to send more money to health insurance companies.

What is wrong with this picture?

The Newsom Health Access Program is not a health insurance program - it is not an employer mandate requiring minimum spending by employers.

If San Francisco prides itself on being on the leading edge of innovative ideas… maybe now is the time to stop funding an idea that does nothing to fix our system, but rather cause job loss and unrelenting pain to San Francisco businesses.

Nathan Nayman serves as executive director to the Committee on Jobs, a coalition of San Francisco's largest employers dedicated to improving the City's economic vitality.

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