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Alaska would be better off with its own single-payer health care system

As the year comes to an end, many of the headlines predict hard economic times ahead for many Alaskans, given the anticipated $3.4 billion state budget gap, the cost of health care in Alaska being the highest of any state, property taxes going up, new taxes and user fees being proposed, and talk of limiting the Permanent Fund dividend. What are Alaskans to do? And may we look to government and/or the private sector for answers to this dilemma?

The citizens of Colorado have developed one proposal that is predicted to save individuals and businesses $4.5 billion, if a ballot initiative is passed in their November 2016 election. It is called ColoradoCare, and according to its campaign website, "It is a resident-owned, non-governmental health care financing system designed to ensure comprehensive, quality, accessible, lifetime health care for every Colorado resident. The benefit package would enhance the comprehensive health care services required by Medicaid and the Affordable Care Act. Premiums would be collected from Coloradans based on income, securing health care regardless of financial circumstance. This efficient, universal system would operate in the interests of Coloradans. By eliminating layers of bureaucracy and reducing administrative and other nonmedical costs, ColoradoCare would cover all residents and cost less than the current system."

The sponsors of this initiative recognized that it would be folly to ask their Legislature to create this program because of the divisiveness not only in the Legislature but also the heavy lobbying that would occur from all those who benefit from the existing health care system. The initiative process was effective in legalizing recreational marijuana in 2012, and the best chance of ColoradoCare becoming a constitutional amendment is believed to be through the initiative process.

The present health care climate in Alaska represents soaring costs, with now, only two insurance companies -- Moda and Premera -- operating in the state. Yearly increases in premium costs are a given. And that doesn't include co-pay and deductibles when health care is required. Obamacare, while beneficial to many, is reviled by others, including Alaska's congressional delegation, who recently voted to end it. Gov. Bill Walker and the Republican-led Legislature continue to battle over Medicaid expansion and proposing major reform next year. According to the Henry J. Kaiser Foundation, the cost of Medicaid in Alaska was $1.4 billion in fiscal year 2014. In September, 125,616 Alaskans were enrolled in Medicaid.

What may one expect if Alaska residents were to select the initiative process -- as Colorado has done -- and create a single-payer health care system, Alaska-style? Public Citizen, a non-partisan, nonprofit organization in Washington, D.C., which advocates for all citizens, has listed some characteristics of a single-payer system:

• Comprehensive: Covers everyone under a single, publicly financed insurance plan that provides comprehensive health care.
• Access to Prevention: Gives everyone access to primary care without cost barriers that reduces how many people get sick in the first place.
• Early Intervention: Allows everyone to have a regular source of care, without cost barriers, catching illness and injury before it becomes serious and expensive to treat.
• Reducing Insurance Overhead: Private insurance companies spend from 10 percent to 30 percent of every health care dollar on overhead: public insurance less than 5 percent. Single-payer plans don’t need to advertise or compete on a market.
• Reducing Provider Overhead: When hospitals and physicians send all their bills to one payer (the public insurance plan), they don’t need a billing department to juggle different forms for hundreds of insurance companies, and each doctor and each health care practitioner wastes less of their time on paperwork and devotes more time to actual care.
• Bulk Purchasing Power: When there is only one payer for basic medical services and goods, that payer can bargain the best possible prices, and make sure that middle-men aren’t overcharging patients. This in particular drives down the cost of prescription drugs.
• Power of Health Insurance Companies Disappears: No longer in charge of setting prices and life-and-death treatment decisions. Millions saved in administrative costs, waste and profit.
• Money Saved: Drug prices cut by 40 percent or more. Single record data base. Prevention emphasized. No more personal bankruptcy.
• Cost: Rather than paying premiums and deductibles, citizens will pay taxes, which will be less than the premiums and deductibles now paid.

The Affordable Health Care Act has a provision where states may opt out of the program if it ensures that residents receive insurance that is at least as comprehensive and affordable; ensures that at least as many people are covered; and does not increase the federal deficit in doing so. Alaska opting out would end the debate and complaint of federal overreach and provide Alaska with the opportunity of creating a health care plan that is "locally grown."

In 1997, Sens. Jim Duncan and Johnny Ellis introduced a bill to create the Alaska Health Insurance Corporation and in 2009, Sens. Hollis French and Ellis submitted a bill to establish universal health insurance in Alaska. Although admirable, neither proposal saw any movement in the Legislature. Given the political stalemate that has occurred in the Alaska Legislature in the past few years, any progressive changes have occurred because of the initiative process. Good examples are the minimum wage and marijuana initiatives. Thus, if Alaskans wish to reap the benefits of a single-payer health insurance program for all Alaskans, it will best come from the initiative process. Use Google to find an example of how ColoradoCare will be implemented when it passes as an initiative in November 2016. It is far less complicated than the Affordable Health Care Act.

Patrick M. Cunningham is an associate professor of social work at the University of Alaska Anchorage.

The views expressed here are the writer's own and are not necessarily endorsed by Alaska Dispatch News, which welcomes a broad range of viewpoints. To submit a piece for consideration, email commentary(at)alaskadispatch.com. Send submissions shorter than 200 words to letters@alaskadispatch.com or click here to submit via any web browser.

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