Providing Universal and Affordable Health Care (1989)

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The States' Roles and Responsibilities for Providing Universal and Affordable Health Care to the American People Scott M. Matheson I believe that now is an appropriate time to carefully reexamine the cost- benefit issues and our priorities regarding health care matters in the United States. When examined within the context of our national budget, the added dollars do not appear to be overwhelming. The eligibility cost figures that I will give you on this point come through the efforts of the Health Policy Agenda (HPA)forthe American People, an effort begun in 1982 under the leadership of the American Medical Association (AMA) to reach a consensus on a comprehensive, long-term framework for the nation's health care policy. Representa- tives from 172 public and private organizations collaborated on the final document published in early 1987, which recommended 195 major reforms for the future of a United States Health Care system, including a non-mandatory benefits package for the American people and major improvements in the efficiency and equity of Medicare and Medicaid.1 In addressing Medicaid, the HPA recommended that national standards be established that would result in uniform eligibility benefits and payment mechanisms across state boundaries and that Medicaid be extended to Americans who live below the poverty line but are not covered by the present program. HPA's data (prepared in 1988) are constructed for the 11 million 10

uninsured and the 7 million privately insured under the poverty level and under 65 years of age. Coverage for the currently uninsured will cost about $9 billion, an increase of 35 percent over current Medicaid spending. This amount would increase by almost $6.7 billion if the privately insured with income under the poverty level dropped private coverage to enroll in Medicaid, fora total cost of $15.7 billion. Two billion dollars would be deducted for the replacement of current expenditures for uncompen- sated hospital care, or a final cost estimate for expansion of eligibility of about $13.7 billion.2 Developing cost estimates for the uninsured must be tempered by advice given by one of the actuaries doing the analysis, who said, "no one knows how much it costs to insure the uninsured—they have never been insured." In the overall scheme of national expenditures those increases in Medicaid coverage are dramatic but certainly feasible in a reshuffling of priorities and the use of political clout. Facing this need also brings us to the fundamental question of whether health care is a matter of right for all of our citizens. To address this and its related issues let me first summarize where I intend to take us. The question I've been asked to address, that is "the states' role in assuring access to health care for the presently uninsured," should not be the central health policy question to ask a former governor; it should not if times are normal and our federal system is operating well. But today it is a reasonable question. That's because the present condition of our federal system is such that states are being asked to do what they are not best at doing, that is to provide access to services for those not adequately covered by customary federal, state, or private- sector arrangements. That is a regrettable situation not only because it means that access will be incomplete, but also because it means that the states, loaded with the burden of access, cannot as effectively carry the burdens they are suited for carrying. It means that the states will less successfully carry the leadership needed, and will carry out less of the innovation necessary, to manage costs and to assure quality of health care in the United States. 11

As a result, states must in the short term carry extra burdens by playing primary roles regarding access as well as cost and quality of health care, and should for the long term build their own capacities to lead in managing costs and assuring quality, and help rebuild the federal government's capacity to assume its appropriate leadership in assuring access to health care. Why should access be primarily a federal responsibility and why should management of costs and assurance of quality be appropriate areas for the state to take the lead? The answer, in my opinion, lies in the proper understanding of our system of federalism.3 And what is federalism? Basically nothing more than a philo- sophical concept of how the federal system of government operates; an effort to determine the proper role of the federal and state governments. Adlai Stevenson argued that the power of the states to decide local affairs is "one of the great assets of our free society, making possible democratic participation at the grass roots of our human relations." Thus, one of the values of local government is its ability to respond to local concerns, to maintain our pluralistic society, and to diversify governmental policies. The experimentation arguments of Justices Brandeis and Holmes, that states are the real laboratories of democracy, lends further credence to states' unique value. This concept is particu- larly applicable to the states experimenting with health care access. Finally, it is historically true that most national domestic policy initially began as experiments at the state level. I believe, in general terms, that policies which should affect the entire society on a more or less equal basis are appropriately assigned to the federal government. Thus, policies protecting basic rights, such as anti-discrimination laws, and policies requiring burdens on some areas or groups in order to fairly protect or serve others, such as federal environmental goals and income distribution policies, are more appro- priately assigned to the national level. In contrast, policies in which we can afford to have differences across the country and provide opportu- nities for more effective local administration, or that affect only one lower unit of government, are clearly local responsibilities. In a 1980 study the Advisory Commission on Intergovernmental Relations (ACIR) suggested a three-part litmus test to unscramble 12

governmental functions.4 The three suggested criteria for allocating responsibilities are: (1) the history of local versus national involvement; (2) the relative amount of federal financing; and (3) the effect of turning the responsibility over to the states, which could result in destructive competition among programs between states. If we apply these criteria to the question of health access the federal responsibility seems quite clear. In his 1982 State of the Union address, President Reagan pro- posed his famous swap: Washington would pick up all Medicaid costs and the states would assume the responsibility for Food Stamps and Aid to Families with Dependent Children (AFDC).5 As the debate began, most governors, including myself, felt philosophically that the federal government should be responsible for maintaining a minimum level of economic security. The states are not in a position to control poverty or unemployment, since federal tax, monetary, regulatory, fiscal, and foreign policy basically determine that climate. The governors argued, and I have continued to argue, for a comprehensive national policy for the sick and the poor. The Washington Post agreed with the governors that they were "right that the responsibility for meeting the basic needs of the nation's poor is properly a federal one. States have little control over the number of poor people in their jurisdictions. When they try to control case loads by limiting benefits, the result is to foster an unhealthy concentration of needy in more generous though not necessary affluent, areas." The New York Times asked "What are the proper roles for different levels of government?" They concluded that "despite the administration's evi- dent desire to unload... welfare and food stamps on the states, these are programs that common sense and human decency require be univer- sal."6 The swap proposal, as many of you know, went nowhere. My position is that the health care access question clearly and convincingly belongs at the federal level. And so, that's where we are going in this address, using the foregoing analysis of federalism as a sextant and taking our bearings not on just the single point of access, but on three points of health care policy—access, cost, and quality—in order to arrive at the proper roles for the "different levels of govern- ment." 13

Problems in Perceptions of the Role of the States in Health Care While Rashi Fein gave the states a pat on the back with respect to their present role in health care, recognition of the states as a full partner with the federal government under traditional concepts of federalism is usually disputed and often misunderstood. For example, the National Leadership Commission on Health Care, founded in 1986, with a former governor as cochairman, established a set of working principles for adequate health care, concluding that the federal government has the ultimate responsibility to act in the publ ic interest to ensure that ev- eryone has access, that rising costs are addressed, that the quality of care is maintained, and that the private sector should continue to provide benefits at an adequate level. The almost nonexistent role given the states is to be assisted by the federal government in increasing access to health services.7 My point is that the only way to ultimately ensure a reasonable access to health care for the uninsured and the underinsured is to recognize the need for, and to enter into, a public-private three-way partnership with the federal government, the state governments, and the private sector. The size of the task is simply too massive not to use all resources available. The states are there for the asking, and they should not be ignored or disenfranchised. An ongoing educational component in this entire process will obviously be necessary and useful. One piece of that overall agenda should be the nature and scope of the short-term as well as the long-term roles of the states. Health Care as a Matter of Right A critical factor in the debate about health care is the way the average American thinks about it and how that attitude came about. In March of 1983, the President's Commission for the Study of Ethical Problems in Medicine, covering the subject of "securing access to health care," pointed out that in 1952 an earlier commission con- cluded that "access to the means for the attainment and preservation of health is a basic human right."8 The 1983 commission, however, argued 14

that instead of speaking in terms of "rights," its conclusions would be better expressed in terms of "ethical and moral obligation." Often the question of access is framed in the language of a right. Some argue that society has a moral obligation to provide equitable care, but also that every individual has a moral right to such access. The commission chose to view the issue in terms of the special nature of health care, without taking a position on whether the term "obligation" should be read as entailing a moral right. The rationale for that approach is based on the following reasoning: (1) such a right is not legally nor constitutionally recognized, (2) it is not a logical corollary of an ethical obligation of the type the Constitution has enumerated, and (3) it is not necessary as a foundation for appropriate governmental actions to secure health care for all. From a strictly legal perspective, neither the Supreme Court nor any appellate court has found a constitutional right to health or health care. Rights that do exist are derived from statute in the form of entitlements or through civil rights enforcement. It was in the 1960s that the fundamental philosophy about health care in the United States became clearly established. In the Great Society days there was a mandate to provide easy accessibility to health care for all Americans. That mandate viewed health care as a right.9 But by the 1980s the mandate for health care was to reduce costs and to become more efficient. Health care often was viewed as a commodity to be bought, sold, and controlled by the laws of supply and demand. As a result of this new approach, the structure of the health care industry has changed. It is interesting to note that there are millions of Americans who are homeless, yet society does not require home builders and contractors to provide homes for the homeless free of charge or at prices below the costs of construction. Millions of Americans go to bed hungry every night, yet society does not require farmers or grocery-store chains to feed hungry Americans free of charge or at substantially discounted prices. But health care has a different position in our society, whether we consider it a legal right or not. Society believes that health providers, be they hospitals, doctors, or clinics, should provide care free or at less cost for those who cannot afford it. For the fiscal year 1986, hospitals in this 15

country provided approximately $7 billion in uncompensated care.10 Finally, protecting the health security of all Americans was very much a part of the 1988 presidential race. Michael Dukakis campaigned on this health theme: Today, the United States and South Africa are the only two industrialized nations in this world without national health care systems. I, for one, am not about to accept that as the measure of our nation.... Health care is a right, not a privilege. It is as basic to human life as food; and as essential to our society as good schools and good jobs. The first step is to make sure that every American family has basic health insurance.11 Is health care a matter of right? Should we spend 12,15, or even 20 percent of our gross national product (GNP) for health care? The answer, of course, is unresolved; however, the "right" to health care is a constant backdrop to the overall debate. Properly addressed it could be a major factor in achieving political consensus. Americans Lack Adequate Insurance Coverage and States Know It Americans do not have adequate insurance coverage, and the states know that. Look at the report entitled "Policy Options for the Unin- sured in New York State" issued in January 1988 by the committee chaired by James R. Tallon, Jr., majority leader for the New York State Assembly.12 It points out that: • Nationally, 37 million people underage 65 were uninsured in 1985 and that number has increased since 1977 at a rate of 6 to 9 percent each year. • Characteristics of the uninsured nationally include an 80 percent concentration among working adults and their children; two-thirds are poor or low income (below 200 percent of poverty); dramatic increases occur in single parent households and for persons employed in services and retail trade, where rates of insurance coverage are lower. A continu- ation of the present trend will expand the number and groups affected, further straining formal and informal means of ensuring minimal care. • The erosion of employment-based coverage has concentrated growth in the uninsured population, yet our tax policy—which exempts 16

employer contributions from federal tax—costs the U.S. Department of Treasury almost $40 billion each year. •- Income distribution and family structure patterns are distinct com- ponents of trends in coverage. There are more and more people with incomes below the poverty line because of concentration in low-wage employment. Insurance coverage has been the dominant means of financing health care, but the nature and organization of insurance systems have changed in recent years and more and more legal require- ments are shaping insurance programs. • Federal policies play a major role in health care financing and delivery, and gaps are national in their impact. The federal role should expand, but federal efforts have been restrained and states increasingly are assuming responsibility for addressing barriers to coverage and access.13 To meet the needs in New York, Tallon's committee recommends: • In the absence of substantial federal intervention, states must take the initiative to address the problems. • A comprehensive state-coverage strategy is required. • The foremost goal is to devise effective and efficient means to ensure adequate health access to all. Expanded coverage through insurance or similar mechanisms is the preferred vehicle to achieve the goal, both public and private. • All current policies relating to the medically indigent and health care financing must be reevaluated. • There must be better collaboration between the public and private sectors.14 We need broader coverage throughout the nation, even in the states that are relatively well off in terms of health, such as in Utah where still: • 1 in 8 is without insurance. • 1 in 4 in one nonurban region are without insurance. • The need for coverage or better coverage was the most common public concern expressed at hearings held last year by Utah's Task Force on Health Care Costs. This concern came in spite of Utah's enviable situation regarding health: its young population, healthy lifestyle, and 17

relatively few persons in the categories of high risk (such as the poor). Also, Utah has recently completed an analysis of its situation, with proposals for legislation to establish a state risk pool for the presently uninsurable.15 Uninsurability is a particularly desperate problem. First, many persons have no option but to spend themselves into poverty to gain medical care through Medicaid. Second, it compounds bad luck with unfairness, creates barriers to employment, and adds uneconomic fric- tion to adjustments in the labor market. There are several options for furnishing health care that can reduce the problems: at the state level there are indigency programs, specific conditions programs, catastrophic expenses programs, and subsidization of services programs, such as holding those hospitals that enjoy public subsidies responsible for assisting the poor, which is being done by local governments in Utah while they reconsider property tax exemptions for nonprofit hospitals. Mixed public and private approaches include state risk-sharing pools, mandated employer-based insurance programs, in- surance regulation programs, and purchase of prepaid health plans. These are partial solutions, and the problem of uninsurability is only a subset of the larger problem of the uninsured: a seed bed forever growing desperate individual problems and public burdens. The larger problem can be approached through direct public care—that is actual services or payment for care—or through better insurance coverage by business and individuals. Should states be looked to for either approach? Are states the laboratories of democracy in assuring access to adequate health care? The Role of the States States can improve access by providing more direct care, for example through a major expansion of Medicaid eligibility.16 But here we ought to look again at the relative advantages and disadvantages of state and federal roles. Economic development takes place where there is a competitive advantage. A fundamental interest and responsibility of states is to facilitate economic development, to provide jobs for its people and support for its nstitutions. 18

States gain competitive advantage by providing quality services with low taxes. The constant struggle between low taxes and spending for services that support development tends to brush aside concerns for spending on income redistribution. A state sees itself as doubly penal- ized for spending for equity in access to health care and similar purposes: first by diverting resources away from economic development, and second by encouraging those needing the support services to stay in or move to the state and thus increase the state's economic burden.17 Politics exaggerate this concern well beyond its reality, compounding the problem with a political as well as an economic cost in providing such services. This places states at a competitive disadvantage in providing Medicaid and other forms of income redistribution—a disadvantage not nearly as strong at the federal level because international migration of industry, people, and taxable wealth is more constrained than is inter- state migration. The competitive disadvantage of direct spending might lead a state to look not at extending public coverage but at extending private coverage, as Massachusetts decided to do.18 But this increases the cost to the employer, and thus may also place a state at a competitive disadvantage. Still, states regularly pay these economic and political prices, either to gain compensating political rewards within their own bounda- ries or from a sense of responsibility. States actively engage in a broad range of programs and new experiments.19 But the costs, whether real or perceived, limit the extent to which the states respond to the needs for broader coverage. The federal government can remove or reduce the competitive disadvantage by mandating state coverage. In the first of these Rosen- thai Lectures, Senator George Mitchell suggested federal mandating of Medicaid coverage of maternity care, of care for chronic medical conditions, and of various other forms of medical care.20 But this creates a new danger: of one level of government (the federal) reaping the political benefits of assuring services while another level (the states) must pay the political costs of financing the benefits. Such a disconnec- tion between benefits and costs, especially where those providing the benefits may take the initiative (the reverse of the situation in revenue sharing, where those paying the bill at least had formal control of the 19

situation) is unfair (that is, politically), uneconomic (that is, benefits are not directly related to costs), and ultimately unstable (that is, in probably being carried too far, the costs ultimately prompt radical and unpredictable correction). All of these factors point to the federal government as being best positioned to assure access to health care. But the federal government has, unfortunately, been incapacitated by continuing deficits, by the financial burden of servicing its existing debt, and by a lack of clear thinking about principles of allocating responsibilities in our federal system.21 Besides, we remain uncertain about the best means to assure reasonable access to healthcare, irrespective of the level of government responsible. The states do have a temporary role as laboratories and to impro- vise coverage, while the federal government is repaired. And that is as it should be—states should be participating partners in the solution of the problem; they have historically done this type of experimentation and there are sound social and moral reasons for doing so. But under such conditions we should not expect complete or permanent solutions; states will serve better as laboratories than as ultimate producers. We can expect the states to be most successful where competitive disadvantages are least. For example, the states can encourage private- sector innovation, such as the experiment in Utah in which Intermoun- tain Health Care and the Robert Wood Johnson Foundation are fash- ioning a less expensive health maintenance organization (HMO) plan based on primary care at community health centers and on significant discounts from hospitals and physicians.22 And the states can be effective in more carefully rationing public resources, such as through the review in Utah of hospital tax exemptions. Finally, we should expect the states to include in their role a responsibility to critique and seek improvement in the capacity and performance of the federal government in fulfilling its appropriate roles. In other words, states should assist the federal government in finding ways for it to reassume its proper role in providing access to health care. However, the states have a broader role: to achieve efficiency and effectiveness in health care services. This includes efforts (1) to promote healthful lifestyles, (2) to manage cost, and (3) to assure quality of health care. In these three efforts the states are well positioned to make 20

primary contributions because: success not only benefits a state's citizens but gives the state an economic advantage; the states are closer than the federal government to the institutions (hospitals, medical associations, etc.) which can affect change; and the states have the related responsibilities of provider licensing, public health services, and insurance regulation. Federal policy can facilitate, or it can impede, each of these efforts. State Interest in Reducing Costs and Improving Quality of Life by Promotion of Healthful Lifestyles Utah, like many states, has given new emphasis to the promotion of healthful lifestyles. When Utah gave its health care programs depart- mental status in 1979, its new director, Dr. James O. Mason, made lifestyle a primary emphasis, which he supported by developing a comprehensive plan and supporting programs.23 This emphasis has been continued and extended under the present director, Dr. Suzanne Dan- doy. For example, Utah's cigarette tax has been doubled, with much of the new revenues directed to health promotion. These state activities complement and are aided by federal efforts such as the emphasis on lifestyle issues in the programs of the Centers for Disease Control (CDC) (now directed by Dr. Mason*), the U.S. Food and Drug Admini- stration (FDA), the Federal Trade Commission (FTC), and the Office of the Surgeon General. Sometimes the federal government can exert useful leverage on the states, for example, in reducing highway speeds. The value of investing in healthful lifestyles now is broadly appreciated by political leaders at all levels, as is evidenced in the program of national priorities set forth two years ago by the national Democratic Policy Commission I chaired.24 States and their political leadership are well positioned to play vital roles in bringing together public health, health care providers, education, business, and the local community in general to campaign for more healthful lifestyles. *Editor's Note: In 1989, Dr. Mason became Assistant Secretary for Health of the Department of Health and Human Services. 21

State Interest in Improving Economic Competitiveness by Managing Health Care Costs Utah, like all states, is actively engaged in managing health costs. The need to responsibly manage health care costs was the primary reason why we gave departmental status to Utah's health care programs and closely joined public health and Medicaid in the new department. This was done to help assure that questions of health care costs and quality would be seriously and jointly addressed. And it was done to give our health agency the status and connections that would facilitate its leadership in joint dialogues, negotiations, and actions—of providers, purchasers, consumers, and public agencies—to control costs and im- prove quality of health care. It has helped focus the attention of state and private institutions.25 Perhaps partly because of this focus there have been significant changes in the delivery and reimbursement sys- tems in Utah. Over the past five years, health care costs in Utah appear to have increased at only two-thirds the rate of the rest of the country, perhaps partly because of the focus of attention and the changes in the health system.26 Still, the rate of growth in costs remains a major state concern in Utah and across the nation. These concerns inevitably return us to the questions of accessibility and whether health care is a right. The 1983 President's Commission for the Study of Ethical Problems in Medicine drew the significant conclusion that presumptions that patients should be offered "access to all beneficial care, to all care that others are receiving, or to all that they need—or want" created "impossible demands on society's resources for health care" and risked "negating the entire notion of a moral obligation to secure care for those who lack it. In their place, the commission propose[d] a standard of an adequate level of care ... as a floor below which no one ought to fall."27 While this conclusion establishes a substantial social responsibility, and also places important limitations on that responsibility, it still leaves an enormous field within which a society must exercise moral discretion. To decide what is an adequate level of care is a central issue in considering Senator Mitchell's proposed mandates regarding Medicaid. It was a central issue in preparing the report "The Health Policy Agenda for the American People"—and the central issue behind the establish- ment of my subcommittee that prepared the "Basic Benefits Package" as 22

a checklist of the minimum benefits that should be provided in private and public benefits plans.28 The HPA Ad Hoc Committee on Basic Benefits estimates that the uninsured could be covered for a pure premium cost of $1,500 per person if universal enrollment is assumed. To arrive at that estimate, the actuaries assumed that the uninsured would have a 25 percent greater risk than the average population. In linking the questions of access and cost, this moral issue assures a continuing connection between the roles that the federal government and those that the state governments should be expected to play. State Interest in Serving the Public and the Economy with Quality Care Regarding the assurance of quality in our health care, there is a special, and largely unmet, need for prompt and vigorous action by the states. The concern for cost controls and the shift in incentives to cost reduction demand new concerns for quality assurance. Yet we do not have reliable systems of quality assessment. The needs for quality assessment are at two levels: the particular provider and the overall system. A governmental role seems essential at each level. At the individual provider level, the Health Care Finance Ad- ministration reports of hospital mortality rates and the recent Office of Technology Assessment report on The Quality of Medical Care: Informa- tionfor Consumers29 attempt to provide information and to show the way to better information for consumers and buyers of health care. But a major contribution of both reports is to make evident the difficulties to the buyer, and even more to the individual consumer, in obtaining and interpreting such complex information. Public and private institutions at the state level have crucial roles in interpreting such information, as in the experiments in Pennsylvania and other states to apply measures of severity of cases in comparing hospital mortality rates. At the system level we need not and cannot responsibly wait for the severity studies before using hospital mortality and other data to measure how we are doing. The states should now begin assessing whether cost control pressures are becoming dangerous, what types of care in each state appear to be of low quality when compared with the record of similar states, and which parts of the system are showing the most improvement or decline in quality over time. There is no complete 23

and reliable measure of the quality of care within a region. But states can estimate their situations by a sort of triangulation, using information from licensing and accreditation reports regarding the structure and process of the health delivery system, aggregating outcome measures such as the mortality rates (aggregated data for a region or state suffer fewer of the problems which the severity studies attempt to correct), and using measures of health status and "sentinel events"30 as markers of the quality of care. The concern for quality, just as the concern for cost, ties directly to the concern for access and requires a connection of federal and state activities. For example, the federal interest in sentinel events largely builds on a concern for access in looking at sentinel events as indicators of "medical underservice." And, for example, in developing state meas- ures of quality, the federal government—even in its present disability— can be of enormous help by assembling and refining data, by providing guidance such as I hope will come from the Institute of Medicine's new study of quality review and quality assurance in Medicare,31 and by developing standards for data collection and reporting, to facilitate comparability across states and time. Conclusions This interconnection of state and federal roles and of concerns of access with concerns for cost and quality is an appropriate note on which to conclude with a summary of my primary points. Health care is raising ethical, political, and administrative issues of enormous importance to this country. To determine, justly, what care is a right and to manage, effectively, health care that reasonably and efficiently meets these rights are major tasks facing our federal system. The states are playing, and must for at least the immediate future continue to play, a leading role in improving access to health care. But the redistributive aspects of this task are better fitted to the circumstances of the federal government and should eventually be shifted to that level. On the other hand, the states are well positioned, in ability, in interest, and in commitment, to take principal and continuing roles in improving lifestyles and in managing the costs and quality of health care—as well as in helping to share appropriate federal policies and programs. How well we meet the 24

challenges of health access, costs, and quality will in large part depend on how quickly and how well we understand and improve the partner- ship between state, federal, and private efforts. Notes 1. American Medical Association.The Health Policy Agenda far the American People (Chicago: American Medical Association, 1987) and The Heakh Policy Agenda for the American People, Basic Benefits Package (Chicago: American Medical Association, 1988). 2. Letter to Scott M. Matheson from Linda Diamond, Director, Health Policy Agenda, September 22, 1988. 3. Scott M. Matheson and James Edwin Kee, Out of Balance (Salt Lake City: Peregrine Smith Books, 1986). 4- "An Agenda for the Eighties: ACIR's Recommendations to Restore Balance and Discipline," Intergovernmental Perspective 7(Winter, 1981 ):46. 5. Matheson and Kee, Out of Balance, p. 29. 6. Matheson and Kee, Out of Balance, pp. 25-26. 7. For a summary of the Com mission's position see Michele L. Robinson, "National Leadership Commission on Health Care Statement," HeahhSpan 4 (December, 1987):3-7. 8. President's Commission for the Study of Ethical Problems in Medicine and Biomedical and Behavioral Research, Securing Access to Health Care, Vol. 1 (Wash- ington, D.C.: U.S. Government Printing Office, 1983). 9. "Health Care 1987: Current Issues and Future Directions," Town Hall Journal, November 3, 1987:157-160. 10. Congressional Research Service. Health Insurance and the Uninsured: Background Data and Analysis. Report prepared for the Committee on Education and Labor, House Committee on Energy and Commerce, and the Senate Special Committee on Aging. Washington, D.C.: U.S. Government Printing Office, 1988, p. 150. 11. Michael Dukakis, speech before the Coalition for Wisconsin Health, Madison, Wisconsin, March 26, 1988. 12. Subcommittee on Health Insurance, New York State Council on Health Care Financing, "Policy Options for the Uninsured in New York State" (Albany: State of New York, January, 1988). 13. Ibid., pp. 1-3. 14. Ibid., pp. 46-49. 15. Utah Department of Health, "Report of the Governor's Task Force on Cata- strophic Medical Expenses; Analysis and Recommendations for Development of a State Risk Pool for Medically Uninsurable Individuals" (Salt Lake City: Utah Depart- ment of Health, March, 1988). 25

16. Irene Fraser, Medicaid Options: State Opportunities and Strategies for Expanding Eligibility (Chicago: American Hospital Association, 1987). 17. Matheson and Kee, Out of Balance, pp. 3-52. For further development of the economic equity versus economic development difficulty, with a focus upon the more extreme situation of city versus federal government, see Paul E. Peterson, City Limits (Chicago: University of Chicago Press, 1981). Also see the discussions of federalism published by the U.S. Advisory Commission on Intergovernmental Relations, such as its Fall 1988 issue of Perspective. 18. Irene Fraser, Promoting Health Insurance in the Workplace: State and Local Initiatives to Increase Private Coverage (Chicago: American Hospital Association, 1988), p. 119. 19. A recent inventory is provided by Irene Fraser, Promoting Health Insurance in the Workplace. 20. Senator George J. Mitchell, "Health Care for the, Uninsured: The Federal Role," address to the Institute of Medicine, Washington, D.C., April 18, 1988. 21. This too is more fully discussed in Matheson and Kee, Out of Balance, pp. 3-52, although the burden of debt service has continued to increase and aggravate the situation since the writing of the book. 22. Irene Fraser, Promoting Health Insurance in the Workplace, pp. 144-145. 23. Utah Department of Health, "A Statement of Health Policy: A Prescription to Improve the Health Status of Utahns" (Salt Lake City: Utah Department of Health, September, 1984). 24. Democratic Policy Commission, New Choices in a Changing American (Washing- ton, D.C.: Democratic National Committee, 1986), pp. 21-23. 25. Utah Department of Health, "A Statement of Health Policy: A Prescription for Health Care Costs in Utah" (Salt Lake City: Utah Department of Health, February, 1983). 26. Utah Department of Health, "Report of the Governor's Task Force on Health Care Costs" (Salt Lake City: Utah Department of Health, September, 1988), Appen- dix B, Table 3. 27. President's Commission, Securing Access to Health Care, p. 4. 28. American Medical Association,The Health Policy Agenda for the American People and The Health Policy Agenda for the American People, Basic Benefits Package. 29. U.S. Congress, Office of Technology Assessment, The Quality of Medical Care: In/ormotion/orConsumers,OTA-H-386 (Washington, D.C.: U.S. Government Print- ing Office, June, 1988). 30. "Sentinel events" refer to the incidence of such undesirable and presumably unnecessary events as the occurrence of hospitalization for uncontrolled diabetes. The events presumably indicate poor quality of health care. The Health Resources and Services Administration of the U.S. Department of Health and Human Services is presently exploring the use of sentinel events. See Judith Arnold, Ann Zuvekas, Jack Needleman, and Pamela Hochberg, "Incorporating Health Status Indicators into the Measurement of Medical Underservice" (Washington, D.C.: Lewin and 26

Associates, 1987). 31. A study mandated by Congress, entitled "Designing a Strategy for Quality Review and Assurance in Medicare," directed by a study committee chaired by Dr. Steven A. Schroeder and staffed by Kathleen N. Lohr. See Kathleen N. Lohr, "Outcome Measurement: Concepts and Questions," Inquiry 25(Spring 1988):37-50. 27