Constitutional Amendment:
Making Health Care a Right

Issue

Should the state amend its Constitution to make affordable health care a right for all Minnesotans?

Policy

Although the Chamber supports the goal of universal health care coverage, the Chamber opposes a constitutional amendment to make affordable health care a right for all Minnesotans. We do so for the following reasons:

Amending the state's Constitution will do nothing to address the underlying problems with our health care system. Real health care reform should control underlying cost drivers in the health care system and improve quality of care.
The amendment is silent on how the state is going to make affordable health care available to everyone, what it will cost, and who is going to pay for it. It is also silent on the definition of affordable health care. Minnesotans should be given this information prior to any vote. For example, this could be a first step to a government-run health care system which would lead to socialized medicine, rationing and an underinvestment in lifesaving technologies. Or it could be the first step to an employer mandate that would make Minnesota business uncompetitive and would threaten jobs and our economy.
Minnesota statutes already acknowledge that "it is necessary to ensure basic and affordable health care to all Minnesotans" (62J.01). Minnesota also already has a statute committing the state to universal health coverage (62Q.165). The federal Emergency Medical Treatment and Labor Act (EMTALA) requires that all Medicare-participating hospitals provide any patient requesting emergency care with an appropriate medical screening to determine if the person has an emergency medical condition. If the person has an emergency medical condition, the hospital must provide stabilizing care within its capabilities without regard to ability to pay.
Minnesota should not become an island with unworkable laws that would disadvantage the Minnesota economy.

A better solution:

A better solution: Health care isn't immune from the laws of economics. Politicians can't wave a wand and provide equal, affordable coverage for all merely by declaring medical care to be a "right."

It is important to understand what we are trying to fix. Minnesota has the second highest rate of employer-sponsored coverage in the country - 11 percent higher than the national average. We also have the lowest uninsured rate in the country at 7.4 percent.

Minnesota's problem is that underlying health care costs are rising significantly higher than inflation. Giving individuals a right to health care does nothing to address those underlying health care cost-drivers. The Chamber has proposed several health care reforms that it believes will provide more immediate and long-term improvements to the health care system's quality and affordability. Both of these results will make care more accessible. Our reform proposals address these issues by focusing on:

1) Driving down state-imposed costs.
2) Recreating a market in health care by eliminating the disconnection between the consumer and provider and giving consumers the information they need to make value comparisons and choices.

3) Moving health care into the 21st century when it comes to information technology.

4) Realigning incentives in the health care system to reward value rather than volume.

(See Minnesota Chamber policies on State-Imposed Costs, Competition and Product Options and Health Care Reform.)

Business Impact

In the late 1980s and early 1990s high health care costs and rising numbers of uninsured were affecting the Minnesota health care market. Minnesotans were concerned about access to health care for low-income working individuals and their children. At the time, policymakers debated the idea of a single-payer health care system as well as an employer-mandated health care system. These were rejected in favor of the creation of MinnesotaCare.

Today, rising health care costs once again are placing a significant burden on both private sector and public sector budgets. The proponents of the constitutional amendment again are offering the same solutions to "make health care affordable for all Minnesotans": a single-payer health care system and an employer-mandated "pay or play" system. Both could have significant negative impacts on the Minnesota marketplace if they were part of the solution and both should be rejected again.

Impacts of a single-payer health care system: Single-payer systems make government, through increased taxes, responsible for providing coverage. Most single-payer proposals have been financed with a tax equivalent of 6 percent to 9 percent of wages.

Every existing government-run health care system rations care, with bureaucrats and elected officials deciding who gets what and when. Single-payer health care systems promise universal coverage, but they do not guarantee access to treatment. Because the government funds health care, access is limited by budget constraints. A recent Canadian Supreme Court decision acknowledges Canada's single-payer system is not providing quality and timely care, stating "access to a waiting list is not access to care." Between 1993 and 2003, the median waiting time in Canada from referral by a general practitioner to treatment increased by 90 percent, from 9.3 weeks to 17.7 weeks, according to an annual survey of physicians by the Vancouver-based Fraser Institute. For cancer patients, the waiting time for medical oncology more than doubled from 2.5 weeks to 6.1 weeks, and the waiting time for radiation oncology increased from 5.3 weeks to 8.1 weeks.

Sometimes the rationing of care is even more explicit: care is denied to the elderly or to patients whose prognosis is poor. For example, in Britain, kidney dialysis is generally denied to patients over age 55.

Single-payer systems are also costly to run because they do not reward those who reduce costs by increasing their profits. With all costs included, the overhead of the Canadian system is about 45 percent of claims -- compared to 7.6 percent of claims for private insurers in the United States.

Impacts of an employer-mandated health care system:

Under a "pay or play" plan, employers would be required either to provide health insurance for all workers or pay a tax that would fund health insurance for those who remained uninsured. It essentially states that business is responsible for ensuring that individuals have access to affordable health care coverage.

Mandating an increase in compensation by requiring the employer to provide health insurance does nothing to increase productivity. Thus, one of two things happens: Either consumers will pay more in higher prices of products and services or, more likely in a competitive economy, employers are forced to reduce payroll costs either by reducing compensation or reducing the number of employees to offset the cost of health care.

The California Legislature passed a "pay or play" employer mandate in 2003 that was since repealed by voter referendum. It was estimated that this legislation would have cost California employers between $12.4 billion and $12.9 billion per year and would have eliminated between 67,000 and 150,000 jobs. A survey of National Federation of Independent Businesses members found that 23 percent would be forced to lay off employees if a "pay or play" system imposed additional cost of only $100 per employee per month, and nearly 22 percent indicated that they may be forced out of business altogether. Under a "pay or play" system, lower-skilled workers are more likely to lose their jobs than higher skilled workers.

"Pay or play" systems are likely to degenerate into a national health care system. As government assumes more responsibility for providing health care, the "pay or play" system would likely transform into a single-payer system as employers will likely find it easier to pay the cost rather than continue to bear the expense of administering a health care plan through their company.

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Constitutional Amendment:Making Health Care a Right