<p>Unable to wait any longer for federal reform, states and companies
are launching their own programs to cut costs and extend coverage
to more of those now uninsured
</p>
<p>By GEORGE J. CHURCH--With reporting by Scott Norvell/Atlanta, Dick Thompson/Washington
and Leslie Whitaker/Chicago, with other bureaus
</p>
<p> Why wait for Bill Clinton, or Hillary either? They are taking
what seems like forever to come up with a national health-care
plan. And when they do, Congress may stall some more and change
the plan beyond recognition. So states, companies and even the
medical profession are pushing ahead with their own plans to
cut costs, streamline care and extend coverage to more of the
uninsured. "If anyone believes we are waiting for the Administration's
final package or for congressional action on that package, he's
wrong," says Roger Tracy, director of community-based programs
at the University of Iowa College of Medicine. "Reform is alive
and well and moving very swiftly."
</p>
<p> To patients, the reforms may mean a more restricted choice of
doctors, or else paying a greater portion of the bill. Many
corporate plans seek to steer patients to physicians who join
a health-maintenance organization (HMO) or so-called preferred-provider
organization (PPO) by cutting reimbursements to employees who
insist on consulting "outside" doctors. But this is supposed
to be offset by other benefits: fewer and simpler (or maybe
no) maddening reimbursement-claim forms to fill out, to cite
one. To the uninsured, the reforms provide a chance to buy policies
now unavailable. Many states, for example, are sharply restricting
the ability of insurance companies to turn down applicants because
of a "pre-existing condition" (insurance jargon meaning they
already have an ailment that is expensive to treat, perhaps
kidney disease or multiple sclerosis). And for everybody--patients, taxpayers, state officials, business executives--the reforms promise, eventually at least, a slowdown in the
relentless rise of medical costs that keeps kiting up insurance
premiums and patients' bills and biting into state budgets and
company profits.
</p>
<p> The grass-roots efforts, however, form a crazy quilt of programs
varying widely in generosity and effectiveness. There are companies
whose idea of "reform" consists of slashing, or even denying,
health benefits to retired employees (companies must now show
the estimated cost of those benefits on their balance sheets
as a liability, sometimes of embarrassing size). Some states
have enacted only timid reforms, and others are being forced
by a budget squeeze to pare down reforms put on the books in
more prosperous times. Massachusetts, to take one prominent
example, has delayed until 1995 some important steps in a comprehensive
reform plan, enacted in 1988, that were originally supposed
to be phased in over four years. Some companies worry about
having eventually to deal with 50 different sets of health benefits,
regulations and taxes. And some legislators fear they could
penalize their states by enacting comprehensive medical reforms
if taxes rise enough to push some businesses to relocate.
</p>
<p> Even so, states and companies are in no mood--or position--to wait for the feds to enforce uniformity. State budgets
were squeezed all through the 1980s as aid from Washington became
less generous. Medical inflation has tightened the tourniquet.
Spending on Medicaid assistance to the poor jumped from 13%
of the average state's budget in 1986 to 17% according to the
National Governors' Association. Add in health-insurance premiums
for state employees, and medical bills account for 1 of every
4 dollars that some states spend. State reform programs, which
began back in 1974 in Hawaii, have grown ever since. Of the
state legislatures that met last year, only two (Illinois and
Michigan) did not consider some sort of health-care reform.
</p>
<p> Businesses have been prodded by a rise in medical premiums that
has eaten away at profits and competitive position. Doctors,
hospital administrators and other professionals have responded
to the pressure with reforms of their own. One result: almost
any reform suggested as part of a national plan is already being
tested by someone somewhere:
</p>
<p> MANAGED CARE. As the Clintonites intend to do nationally, many
companies are luring or pushing their employees away from traditional
fee-for-service doctors and into HMOs or PPOs. Chevron, the
oil giant, has gone further than most: on July 1 it will drop
its traditional freedom-of-choice plan entirely and offer its
18,000 employees in California a choice between the Kaiser Permanente
HMO and HealthNet, a PPO that has signed up 19,000 doctors in
the state. Chevron's contributions have jumped from $223 per
California worker per month in 1989 to $375 now, but Tanya Bednarski,
the company's chief adviser on health insurance, hopes the efficiencies
of managed care will hold them steady now.
</p>
<p> Companies often figure they can nag the networks into cost-cutting
moves. "We have enough clout that we can tell insurance companies
what we want in terms of plan design," says Jim Bronson, an
executive of Sears Roebuck and Co., which has persuaded nearly
87% of its 315,000 employees, retirees and dependents to enroll
in networks put together by three insurance companies. One benefit
to employees: only a $10 copayment for a routine office visit
and no claim forms to fill out. Managed-care networks also make
more use of mail-order firms that buy drugs--mostly generic--in bulk and dispense them at discount prices. Instead of
taking a doctor's prescription form into a local drugstore,
more and more patients are getting "maintenance medications"--those, like blood-pressure drugs, that must be taken regularly
for long periods of time to control chronic conditions--delivered
monthly to their door.
</p>
<p> HEALTH-CARE ALLIANCES. The Clinton plan envisions huge groupings
of buyers--patients, companies, insurers--organizing to
bargain with networks of sellers--doctors, hospitals, nursing
homes--over service and prices. In four years of existence,
the Central Florida Health Care Coalition, a grouping of major
employers including Walt Disney, Martin Marietta and General
Mills, has nagged local hospitals into many cost-cutting procedures.
A newly enacted Minnesota law extends the idea by encouraging
formation of integrated service networks. ISNs will be nonprofit
organizations set up by groups of doctors and hospitals, or
insurance companies, or employers, or governmental subdivisions,
or just about anybody able and willing to provide medical services
to people who enroll and pay a fixed fee for a particular time
period. The state will license ISNs, beginning July 1, 1994,
and regulate their charges.
</p>
<p> COVERING THE UNINSURED. Twenty-seven states have established
