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Monday, June 23, 2008

Lawmakers Crunch Health Numbers

By Winthrop Quigley
Copyright © 2008 Albuquerque Journal; Journal Staff Writer
    The state Senate's budgeter-in-chief says there simply isn't enough money for the universal health care coverage plan the governor pushed and legislators rejected in this year's 30-day session.
    But Sen. John Arthur Smith, D-Deming, says some common ground has been found over several weeks of negotiations.
    During a break from Legislative Finance Committee hearings at the University of New Mexico last week, Smith said lawmakers and Richardson administration negotiators:
   

Agreed to find a way to help physicians adopt electronic medical record systems.
   

Agreed the state retirees' financially troubled health coverage pool must be reformed.
   

Found support for insurance reform, although it isn't clear what shape it will take.
    Smith said he doesn't know if Gov. Bill Richardson will call the Legislature into a special session late this summer despite his pronouncement during a news conference Thursday that he would.
    Smith said he didn't think a special session would get a health coverage program in place any faster than the Legislature could during the regular 60-day session, beginning in January.
    "I grew up in a home where there was a catastrophic health problem that almost bankrupted my folks," Smith said. "I am very concerned about people who are trying to pay their bills in that environment. At this stage, I don't know how we can fund it, unless the governor announces a health care tax."
    Smith ran down a list of new spending that the LFC, which he chairs, is being asked to approve:
   

$350 million a year for education.
   

$200 million a year to maintain the current Retiree Health Care Authority benefits.
   

$350 million a year extra for highways.
    On top of all of that, the Human Services Department estimates that it would cost $165 million a year beyond current Medicaid spending to provide universal health care coverage, Smith said.
    To pay for all of that would require state revenue to grow 20 percent per year, he said.
    "I can't limit myself to health care," Smith said. "I have to look at the other needs that are out there."
    As LFC director David Abbey put it, "Finance people can't think about just one thing."
    In the more immediate future, the Retiree Health Care Authority "has to be redone if it can be saved at all," Smith said.
    To make the plan actuarially sound, meaning enough money is in place to meet health care claims from members well into the future, would require an infusion of $4.2 billion.
    To simply keep services at current levels, without any cushion that actuaries require for soundness, would take $200 million a year "in perpetuity," Smith said.
    "It's an expensive fix," he said. "Everyone wants everyone else to pay higher rates."
    With the retiree plan so troubled, it's possible a consolidation of several publicly funded health care plans long sought by the governor could clear the Legislature, Smith said.
    The state might also trim back plan benefits, raise rates or change rates and benefits for younger retirees. Smith emphasized that no firm plan is ready.