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Health Insurance Expansion through States in a Pluralistic System

Anna Aizer
UCLA

Barbara Lyons
Henry J. Kaiser Family Foundation

Cathy Schoen
Commonwealth Fund

Abstract.

The United States continues to stand almost alone among developed nations in its lack of universal health care coverage. In this essay, we argue that even though the debate over whether the federal government or states should lead the effort to expand health care coverage under the federal system is relevant in strategizing how to cover the uninsured; the more critical issues stem from the challenge of the mixed and fragmented mode of public-private financing of our pluralistic health care system.

We base this argument on (1) an in-depth review of Oregon's and Tennessee's five years of experience with broad coverage reform in the context of the United States health care system and on (2) a more abbreviated review of other state experiences in providing health care coverage.

We conclude from our review that when the will exists, states can substantially expand coverage. However, as one moves up the income scale, political support and resources are harder to come by. Further, concerns grow about the interface of public and private coverage, with issues of "crowd out" and other distributional questions dominating the discussion of coverage expansion as policy makers focus less on how to cover people than on how to make sure one kind of coverage doesn't preempt another. Concern for crowd out can then lead to policies that keep out some of the very people policy makers may want to cover. In this context the question whether states or the federal government is more likely to succeed in expanding coverage is eclipsed by the more fundamental challenges raised by pluralism. Neither federal norstate government is likely to be fully successful without first identifying ways of better coordinating public and private activities and resources to provide continuous and affordable coverage.

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