With Michigan facing a $1.7 billion deficit next fiscal year, state House Speaker Andy Dillon (D-Redford)'s proposal for a single statewide health insurance plan for all public employees and retirees could offer considerable cost savings, but doesn't go far enough, for coverage would still be provided by private insurers.
Currently, health insurance coverage for the 400,000 state and local government employees, as well as thousands of retirees, is a hodgepodge, with separate plans for the state, colleges and universities, school districts and local governments, at an annual cost of $4.5 to $7 billion. Benefits vary considerably, frequently depending on the ability of unions to negotiate favorable terms during the collective bargaining process.
Dillon's proposal, with its large pool of employees and retirees, would create administrative efficiencies and give the state the leverage to negotiate more favorable terms with private insurers bidding for the huge contract. He has estimated yearly savings of $750 to $900 million, with the plan subsequently opened up to individuals and businesses.
But why give one insurance company such a potential windfall, as well as too much power over health care in Michigan? Why not save even more money by putting public employees and retirees into the beginning of a statewide Single Payer plan? We should note that Single Payer began in Canada at the provincial level, in Saskatchewan, before the federal government expanded it nationwide.
Dillon appears to mean well, but he has failed to think as far outside the box as his proposal looks at first blush. He fails to recognize that the insurance companies are the prime culprits for our broken health care system, with its out of control costs, and that the U.S. is the only country in the world that ties health insurance to employment. Single Payer, by separating health insurance from employment, would save enormous amounts of money for both governments and businesses, and cut health care costs by eliminating the insurance company middlemen who put profits before people.
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