Gov candidates face hard choices on health, human services programs

Josh Blanc is not the stereotypical person on a public health insurance program. He owns a successful small business, Clay Squared to Infinity, that employs four people. But Blanc, his wife and his two daughters are enrolled in MinnesotaCare, a state-subsidized health insurance program for the low and middle income.

"We have been on and off MinnesotaCare for at least 10 years," said Blanc, of Minneapolis.

Whether Blanc has health insurance depends on whether the income he and his wife make from their tile business exceeds state limits to qualify for the taxpayer subsidized plan. If that happens, he said he and his wife go without coverage. He said his children continue to qualify for the program.

MinnesotaCare costs Blanc about $400 a month in premiums. Without it, Blanc said he and his wife would go without coverage, because private insurance costs roughly $600 more a month for his family.

"We would not have health insurance. The cost-benefit scenario doesn't work out for us to pay $1,000 a month."

Blanc is among a growing number of people who rely on state-subsidized health care. State projections say more people are enrolling in MinnesotaCare, Medical Assistance and General Assistance Medical Care.

Part of the problem is the economic downturn; people have lost jobs that provided insurance. The other factor is employers aren't offering coverage or the coverage is too expensive.

The rising cost of health care is a big drain on Minnesota's budget. Health and human services programs are projected to increase by $3 billion over the next two years.

Whoever is elected governor will have to deal with the expected increase in these programs, which cover medical needs of the poor and disabled; the elderly in nursing homes; and provide cash assistance for people without incomes.

EMMER: 'INDIVIDUAL-BASED SOLUTIONS'

Republican gubernatorial candidate Tom Emmer has been the most aggressive -- suggesting he would cut $2.2 billion from the expected $3 billion increase. He hasn't offered specifics on where he would cut. But he suggested all three state programs are targets.

"In the first 100 days we'll peel those back, and we'll start looking at how these social safety nets have developed within government and what they're delivering," Emmer said. "We will start making choices, getting away from these large government bureaucracy-operated social safety nets to more individual-based solutions."

Emmer said in April he'd like to shift MinnesotaCare from a program that administers private health insurance to a system where the state offers vouchers, so people can buy individual health insurance on the private market.

Emmer also said he wants to get government out of the business of providing what he calls charity. Instead of relying on MinnesotaCare, Medical Assistance and GAMC, he said the state should work to encourage hospitals and doctors to provide health care through tax breaks.

"You want to create a system where the doctors are told, 'We want you to treat as many people as you can treat. We want you to be as good as you can possibly be, and we want you to make as much money as you can possibly make. But now we also want to give you the incentive to keep more of the money of you make, by providing the charity care that is necessary for this population," said.

Neither Emmer nor his campaign have offered specifics on how his proposal would work. He has also suggested that allowing citizens to purchase insurance from HMOs that operate outside of Minnesota will lower costs. During his budget announcement this month, Emmer said he would protect children and the elderly from cuts.

But some medical providers are skeptical, saying most of the Health and Human Services budget goes to children, the disabled and the elderly.

"To simply underfund these programs, or abolish them without alternatives in place and something up and running would be a catastrophe," said Benjamin Whitten, president of the Minnesota Medical Association.

"It would be like jumping out of an ocean liner in the middle of an ocean without a life boat," Whitten said. "Maybe there's a plan to build a lifeboat, but unless it's there it's not going to do you much good."

HORNER: REDESIGN HEALTH CARE MANAGEMENT

The political arm of the Minnesota Medical Association has endorsed Independence Party candidate Tom Horner, in part because he supports the option of enrolling the state's poorest residents and some on MinnesotaCare into the federal Medicaid program. It's an option the state can exercise under the new federal health care law.

It would cost the state $188 million, but would deliver more than $1.4 billion in federal funds to the state. Democratic nominee Mark Dayton also supports the measure, while Emmer opposes it.

Horner said his health care plan focuses on redesigning the way the state manages health programs for the long term. He said the state can save money by rewarding doctors who do a good job.

"We are going to have to change how they get the care. Improve the quality, improve the outcomes," said Horner. "But we do it by changing the delivery of care as well as the reimbursement systems."

Horner also wants to spend more money on things like electronic medical records. He set aside money in his budget plan for those ideas. But Horner won't guarantee that his plan will preserve current levels of coverage.

"I wouldn't say that no one is going to have the same coverage or people might not lose coverage," Horner said. "What I am saying is that we will have a much better system, a more effective system that leverages both what we're doing in Minnesota and the federal health reform for lower-cost, higher-quality care in Minnesota."

Many health economists applaud Horner's proposal, but they say some of his plan has already been adopted. Julie Sonier, a health economist at the University of Minnesota, said it could be difficult for Horner to generate any real savings in the near term.

"These ideas are so new that it's not easily predicted how much money they would save, particularly whether you can book the savings in the state budget," Sonier said.

DAYTON: STUDY SINGLE-PAYER

Democrat Mark Dayton said he won't promise not to make cuts to subsidized health insurance, but he calls it one of his priorities.

"You take a butcher knife rather than a scalpel to an existing program and you just do more damage, and actually cost taxpayers more because all of these people flood to emergency rooms rather than neighborhood clinics," said Dayton.

Dayton said he wants the Legislature to implement a study to see how much a single-payer, government-run health care plan would cost in Minnesota. He argues the measure would reduce administrative costs. But when it comes to the near term, Dayton acknowledges he doesn't have a solution to handle the skyrocketing portion of the state budget.

"I don't have the answers and I'm not the leading expert. But I will bring the leading experts to a task force if I'm elected governor, and invite them to join them with my agency heads and say, 'Come back with a way to more efficiently finance these growing needs,'" he said.

Dayton's promise of a task force prompted several health care experts to scratch their heads. Among them is Michael Scandrett, who for 25 years has served on a variety of boards and commissions weighting health care changes in Minnesota.

"I haven't added up all of the commissions lately, but I know in the last 10 years of at least four major commissions that have been convened either by the governor or the Legislature to address this problem. And they all developed recommendations, and for the most part their recommendations weren't adopted," he said.

Scandrett, a former executive director of the Minnesota Council of Heath Plans who helped craft MinnesotaCare, said he's not surprised that the candidates are offering few solutions to fix the problem. He said the solutions are simple but the politics is hard.

"Any change that's needed will require sacrifices, tightening belts, reducing what is available to people," he said. "Because politicians aren't ready to have that honest conversation and make those difficult choices. By not acting they create greater pain, as more and more people lose coverage and are uninsured."

Scandrett said whoever is elected governor will have to get a handle on this budget item, because health and human services costs are rising so much faster than other areas of state spending.

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