Wednesday, November 10, 2004
Governor releases health care proposal
[Dave Ranney, "Sebelius plan would pack on costs for smokers," The Lawrence Journal-World, 9 November 2004.]
While Governor Sebelius has fortunately chosen not to push for Dirigo-lite in Kansas, she is also not pushing for the type of fundamental change necessary to change the troubled course of Medicaid in the state. There is little in the proposal to change the underlying incentive structure:
Gov. Kathleen Sebelius on Tuesday unveiled a $50 million initiative aimed at extending health care benefits to more than 70,000 uninsured Kansans.
To pay for the plan, Sebelius proposed raising the state tax on cigarettes by 50 cents a pack.
"Raising taxes is always difficult," she said. "I think Kansans need to know how we're going to pay for it. You get nothing for free."
Sebelius, a Democrat, and Insurance Commissioner Sandy Praeger, a Republican, announced the plan at a morning news conference at Kansas University Medical Center. They later addressed the Kansas Hospital Assn.'s annual convention in Topeka.
Both the hospital association and the Kansas Medical Society have endorsed the "HealthyKansas" plan.
Under Sebelius' plan, the state's health insurance programs for employees and retirees would be combined with most of the state's Medicaid programs. Together, the two programs account for $1.6 billion in health care spending.
The newly created Kansas Health Care Authority would fall under the Department of Administration.
The authority would be the state's largest purchaser of health care services and, according to Sebelius, have a better shot at controlling costs.
Other elements of the initiative:
• An aggressive campaign aimed at adding 40,000 children to HealthWave, the state's health insurance program for children in low-income, working families.
• An expansion of the HealthWave coverage for "care-giving parents." Currently, parents whose incomes are less than 37 percent of the federal poverty guideline are eligible.
Sebelius has proposed adding 30,000 adults to the program by raising eligibility to 100 percent of the guideline, almost $19,000 a year for a family of four.
• Creation of a Web site to help Kansans stay informed of discounts on prescription drugs.
Praeger's office would oversee several projects aimed at using tax-funded subsidies to help small businesses insure low-wage workers.
"I believe we have a moral responsibility to find a way to provide coverage that's affordable and accessible to all," Praeger said. "Access to health care should be a basic right."
Asked how much each program would cost, Sebelius said about one-third of the $50 million would be set aside for the subsidies. The remaining two-thirds, she said, would finance increased access to HealthWave.
Under the plan, revenues from the proposed tax would be kept in a separate fund and could not be used to offset other demands within the budget.
Medicaid programs now administered by the Department of Social and Rehabilitation Services -- payments to doctors and hospitals, mostly -- would move to the Kansas Health Care Authority. Programs aimed at helping the disabled avoid institutional care would remain at SRS.
Asked if that meant doctors and hospitals would fare better than the disabled, Sebelius replied: "This is in no way a two-tiered system."
The intent, she said, is to separate the "insurance pieces, so they can be run like a business" without interfering with services for the disabled.
If approved, the state tax on cigarettes would increase to $1.29 a pack from 79 cents a pack.
Sebelius also proposed raising the tax on tobacco products -- cigars and chewing tobacco, for example -- to 15 percent from 10 percent.
In the state fiscal year that ended June 30, taxes on cigarettes and tobacco products netted the state almost $120 million. The year before, the taxes generated $133.8 million.
"The tax went to 79 cents a pack on Jan. 1, 2003. That's why it went up like that," said Department of Revenue Secretary Joan Wagnon. "Since then it's come down -- but that's what (cigarette taxes) do, they spike, they come down, and then they plateau."
At 79 cents a pack, the current tax is projected to raise $118 million this year.
House Speaker Doug Mays, R-Topeka, said Sebelius and Praeger likely would have a fight on their hands.
"A tax increase -- even if it's on cigarettes -- is going to be difficult to get through the Legislature," Mays said. "It won't be popular among Republicans because they're against raising taxes, and Democrats won't like it either because going after cigarettes is one of the most regressive taxes there is."
Sen. Steve Morris, R-Hugoton, shared Mays' skepticism.
"I commend the governor and the commissioner for their efforts, but it's going to be difficult to get the Legislature to go along with that much of an increase," said Morris, chairman of the Senate budget committee. "Maybe there's another way to fund this puzzle?"
[Matthew Hisrich, "A Backgrounder on Kansas Medicaid," The Flint Hills Center, 19 July 2004.]
[Dave Ranney, "Sebelius plan would pack on costs for smokers," The Lawrence Journal-World, 9 November 2004.]
While Governor Sebelius has fortunately chosen not to push for Dirigo-lite in Kansas, she is also not pushing for the type of fundamental change necessary to change the troubled course of Medicaid in the state. There is little in the proposal to change the underlying incentive structure:
Gov. Kathleen Sebelius on Tuesday unveiled a $50 million initiative aimed at extending health care benefits to more than 70,000 uninsured Kansans.
To pay for the plan, Sebelius proposed raising the state tax on cigarettes by 50 cents a pack.
"Raising taxes is always difficult," she said. "I think Kansans need to know how we're going to pay for it. You get nothing for free."
Sebelius, a Democrat, and Insurance Commissioner Sandy Praeger, a Republican, announced the plan at a morning news conference at Kansas University Medical Center. They later addressed the Kansas Hospital Assn.'s annual convention in Topeka.
Both the hospital association and the Kansas Medical Society have endorsed the "HealthyKansas" plan.
Under Sebelius' plan, the state's health insurance programs for employees and retirees would be combined with most of the state's Medicaid programs. Together, the two programs account for $1.6 billion in health care spending.
The newly created Kansas Health Care Authority would fall under the Department of Administration.
The authority would be the state's largest purchaser of health care services and, according to Sebelius, have a better shot at controlling costs.
Other elements of the initiative:
• An aggressive campaign aimed at adding 40,000 children to HealthWave, the state's health insurance program for children in low-income, working families.
• An expansion of the HealthWave coverage for "care-giving parents." Currently, parents whose incomes are less than 37 percent of the federal poverty guideline are eligible.
Sebelius has proposed adding 30,000 adults to the program by raising eligibility to 100 percent of the guideline, almost $19,000 a year for a family of four.
• Creation of a Web site to help Kansans stay informed of discounts on prescription drugs.
Praeger's office would oversee several projects aimed at using tax-funded subsidies to help small businesses insure low-wage workers.
"I believe we have a moral responsibility to find a way to provide coverage that's affordable and accessible to all," Praeger said. "Access to health care should be a basic right."
Asked how much each program would cost, Sebelius said about one-third of the $50 million would be set aside for the subsidies. The remaining two-thirds, she said, would finance increased access to HealthWave.
Under the plan, revenues from the proposed tax would be kept in a separate fund and could not be used to offset other demands within the budget.
Medicaid programs now administered by the Department of Social and Rehabilitation Services -- payments to doctors and hospitals, mostly -- would move to the Kansas Health Care Authority. Programs aimed at helping the disabled avoid institutional care would remain at SRS.
Asked if that meant doctors and hospitals would fare better than the disabled, Sebelius replied: "This is in no way a two-tiered system."
The intent, she said, is to separate the "insurance pieces, so they can be run like a business" without interfering with services for the disabled.
If approved, the state tax on cigarettes would increase to $1.29 a pack from 79 cents a pack.
Sebelius also proposed raising the tax on tobacco products -- cigars and chewing tobacco, for example -- to 15 percent from 10 percent.
In the state fiscal year that ended June 30, taxes on cigarettes and tobacco products netted the state almost $120 million. The year before, the taxes generated $133.8 million.
"The tax went to 79 cents a pack on Jan. 1, 2003. That's why it went up like that," said Department of Revenue Secretary Joan Wagnon. "Since then it's come down -- but that's what (cigarette taxes) do, they spike, they come down, and then they plateau."
At 79 cents a pack, the current tax is projected to raise $118 million this year.
House Speaker Doug Mays, R-Topeka, said Sebelius and Praeger likely would have a fight on their hands.
"A tax increase -- even if it's on cigarettes -- is going to be difficult to get through the Legislature," Mays said. "It won't be popular among Republicans because they're against raising taxes, and Democrats won't like it either because going after cigarettes is one of the most regressive taxes there is."
Sen. Steve Morris, R-Hugoton, shared Mays' skepticism.
"I commend the governor and the commissioner for their efforts, but it's going to be difficult to get the Legislature to go along with that much of an increase," said Morris, chairman of the Senate budget committee. "Maybe there's another way to fund this puzzle?"
[Matthew Hisrich, "A Backgrounder on Kansas Medicaid," The Flint Hills Center, 19 July 2004.]
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