Health Costs Give the Guvs Fiscal Migraine

SEATTLE — Seattle. - Rarely have the nation's governors exhibited the collective outrage, frustration and resolve to rouse a somnolent federal government as they did in debating health care at their annual meeting here recently.

"What you saw . . . was a controlled explosion of anger," said Washington's Booth Gardner, the National Governors' Association's outgoing chairman. "Now," he predicted, "you'll see a chain reaction throughout the states as we mobilize to address health reform. And we believe this will translate into action at the federal level."


The crisis that has the governors' dander up is this: constant double-digit health-care inflation, ballooned by an unending flow of congressional mandates increasing Medicaid benefits. The resulting pressures have bedeviled nearly every budget-balancing struggle from Florida to Alaska.

"There's not a state, county or city without budgetary problems related to health-care financing," said Wisconsin's Republican Gov. Tommy Thompson. "The reason I haven't been able to do more for education, infrastructure or health care is the $100 million that federal mandates took out of my budget."


Florida's Democratic Gov. Lawton Chiles agonized: "We're not doing what we should for education, transportation, the environment, public safety -- because all our money is being taken now by Medicaid."

Health care now absorbs 12 percent of America's gross national product -- the world's highest level. At its present rate of increase the figure will likely reach 17 percent in 2000, a paralyzing 37 percent by 2030.

Lack of insurance is burdening millions of Americans -- especially the "working poor" who don't earn enough to buy health insurance, but aren't impoverished enough to qualify for Medicaid.

Another poignant example: people who've had a serious medical problem and find they can't shift jobs, or even find employment, because firms fear fast-rising health-insurance costs.

The governors got into a partisan quarrel here over whether they should ask the president and Congress to make an "immediate" start on a national health-care reform package, or pledge some resolution by 1994.

But their agreement was more compelling: They want to make guaranteed access to health care a national goal (some 34 million Americans are now uninsured), and have Washington stop imposing new health-care mandates and agree to waive many that are in effect. That way, they said, states can act as health-care laboratories.

"In my wildest dreams," said Governor Gardner, "I didn't expect to see such unanimity, such passion among governors on the health-care issue."

What the governors didn't provide, however, was a precise blueprint for a national health-care plan. They agreed rapid national action is critical. They agreed President Bush and congressional leaders have to get off the dime on the issue. But they didn't and couldn't identify a workable, affordable national health-care formula.


What's tough for state or federal politicians to acknowledge is that a major chunk of the fortunes now spent on "repair and resurrection medicine" -- the mega-billions to cure grave illnesses and postpone death for aged and terminally ill persons -- needs to be diverted to prevention and primary care.

If we turn seriously to prevention, a significant segment of today's massive medical establishment would be superfluous. And we'd be healthier than we are now.

Gov. James Florio, D-N.J., noted he'd just signed legislation to rechannel some funds from hospital emergency rooms to community centers for primary and preventive care to serve the indigent. It's silly to wait for a national health-care consensus, he said, the providers will resist so vigorously. "You need to punch your way through" to new solutions, whatever the opposition.

California's Republican Gov. Pete Wilson said major long-term savings were possible if state health investments were focused on prevention-oriented, community- and school-based programs tied into supportive social services.

Governor Wilson praised San Diego's "New Beginnings" program, which focuses on a 1,400-pupil elementary school that's 40 percent Hispanic, 25 percent black and 25 percent Indochinese. Case managers try to assist poor families on every front from food to shelter to health.

"The model," said Ohio's Republican Gov. George Voinovich, should be Head Start, "which involves both child and parent, and brings in the needed human services." His budget, said Mr. Voinovich, "focuses on early education and health care for kids."


Preventive care won't work well, however, until all families have access to health care. And the problem of universality (which only Hawaii has, and Massachusetts has postponed) is its potentially sky-high costs.

Some 30 state legislatures are studying some form of universal health care. What's been missing have been cost-containment formulas that reduce prices or take preventive care seriously.

So the import of the Seattle meeting may not be the governors' newfound interest in health -- driven by their pounding budget headaches. It may be the dawning recognition that until they put their first rather than their last dollars into prevention, health care will keep spinning toward one non-stop migraine.

Neal R. Peirce writes a column on state and urban affairs.