HEALTH CARE                   8-9-1997

PROBLEM 1

Many companies pay health care benefits to full time workers but no
benefits to part time workers.  To save money, they fire their full
time workers and hire part time workers.

This practice costs all of us money.  More and more people do not
have health insurance.  So fewer and fewer people who go to the
hospital can pay their bill.  The hospital charges the people who
can pay more to make up the loss from the people who cannot pay.
Then insurance rates go up for everyone.

SOLUTION 1 A

Put a health care tax on workers who are not provided with health
care benefits.  With a tax, companies would not have a monitary
incentive to replace full time workers with part time workers.
Charge the tax per hour worked.  The business should pay the tax.
Workers still make minimum wage or more.

Single health care costs from $250 to $350 per month.  If a person works
160 hours per month, that is $1.56 to $2.18 per hour.  To prevent many
labor intensive business from having a dramatic jump in costs, phase
in the tax.  Have it $.50 the first year, and $1.00 the second year,
$1.50 the third year, and $2.00 per hour the fourth year.  Then raise it
pennies a year with inflation.

The money could be collected by the state income tax division.
Businesses file a monthly or quarterly state income tax form.
Just add three blanks to the tax form:

1.  number of employees
2.  number of hours worked by employees without health benefits
3.  health care tax - multiply line 2 by tax rate

Randomly audit business and have a $5000 or $10,000 fine for cheaters.

The money should be dispersed by a small commission which answers to
the governor and legislature.

All the money should go into a state health care pool.  The money
should go to:

1.  Medicaid.  This program provides health care for the poor.
    Hospitals get paid more often and there is less pressure to raise
    rates.  More poor people could get Medicaid coverage.

2.  Fund state hospitals more.  With grants to cover fixed building
    costs, rates can be lower.

3.  Give grants to county health care programs such as health care
    centers and ambulance services.

4.  Give all business in the state who pay health insurance a rebate
    for the health insurance they currently pay.  There should be no
    monitary incentive to fire full time workers and hire part time
    workers.  So the part time worker health care tax should be
    reduced by the same amount per hour as the rebate of full time
    workers.  A 1 to 10 percent reduction in insurance costs for
    everyone would be good.

5.  The fairest place for the money to go is to the workers who are
    taxed.  The state should pay part of the health care costs for
    part time workers who need it.

6.  A person working two part time jobs totaling 40 hours per week
    should have health insurance as if they had a full time job.

A person working a full time job and a part time job will just be
contributing to the system.  The advantage is better health care
for everyone at a lower cost.

The admisistration of any government program should take only a small
fraction of the money flowing through it.  This health care tax should
have administration costs of well under 5 percent.

With hundreds of thousands of part time workers in a state, say 20 hours
per week, the income to a state health care fund would be millions of
dollars per week.  That is over one hundred million dollars a year.

There would some marginal businesses which would have to close as a
result of increased labor costs.  Would it be that bad if there were
a couple of fewer fast food places?  We could eat elsewhere.

There would be more money going to doctors and hospitals.  They would
have to hire more doctors and nurses, more janitors and maintenance
personel, more clerks and food service workers.  Jobs would be created.

SOLUTION 1 B

Offer partial insurance to part time workers.  Some insurance policies
pay all of a bill and some policies pay only 80 percent.  The patient
is responsible for the other 20 percent.  With partial insurance, a
person who works only 20 hours a week would get insurance which pays
40 percent instead of 80 percent.  For the hospital, 40% is better
than nothing.  For a hospital which doubles it's rates to cover a
low collection rate, 40% will almost cover costs.  This will allow
the hospital to reduce its rates for everyone.