WHEREAS:
The U.S. is now spending $322 billion, 10.5% of the gross national product, on health care. While we maintain one of the best health care systems in the world, it is also the most expensive and, therefore, deprives many of needed care. Health care costs increased 11.6% in 1982 and 8.7% in 1983, more than twice the national rate of inflation; and
WHEREAS:
The major causes of inflated medical expenditures are the fee-for-service payment system which provides incentives for hospitals and doctors to provide unnecessary services; inadequate utilization review of hospitals and insurance companies; and unnecessary and duplicative capital expansion. The wages and benefits of health care workers are not driving health cost inflation. Payroll costs have decreased as a percentage of hospital costs from 58% in 1970 to 40% in 1981, in spite of more than a 50% increase in the number of employees per patient day; and
WHEREAS:
Health care coverage has always been an important part of our compensation package. Recently, the issue of health care coverage has dominated collective bargaining negotiations in many jurisdictions. The cost of coverage has been increasing at rates far in excess of inflation, and much greater than the rates of salary increases, with many plans experiencing increases of 20 to 40 percent per year; and
WHEREAS:
In the past, health insurance negotiations have tended to focus oil the level of employer contributions, or on adding new benefit coverages. Cost containment and more cost-effective delivery of health care was often ignored except for the introduction of optional participation in health maintenance organizations; and
WHEREAS:
The Reagan Administration approach to health care cost containment has been to impose increased out-of-pocket costs on the elderly and the poor and to limit Federal health expenditures while shifting the burden onto the states and private insurers to make up the losses; and
WHEREAS:
The new Medicare flat-rate payment system based on diagnosis applies only to Medicare, but not other purchasers of health care. It, therefore, permits hospitals to continue their practice of shifting costs onto other payers, to turn away Medicare beneficiaries and to penalize inner city and public hospitals which treat a disproportionate number of elderly and poor people whose illness is often more severe. Although we support the concept of prospective payment, the system should include all payers, extend to physician services as well as hospital care and not jeopardize access to treatment for those unable to pay, including jobless workers; and
WHEREAS:
The U.S. is the only industrialized country in the world that does not have a national health program; and
WHEREAS:
Most employers are looking for an easy solution to reduce costs by shifting costs from the plan to the employees. The typical employer proposals to increase or add new deductibles, reduce plan reimbursement levels, or increase the employee's share of the monthly cost, do not attempt to address the causes of health care cost increases. We cannot accept the employer's short-sighted, band-aid approach to cost containment; and
WHEREAS:
There are effective approaches to holding down health care costs without sacrificing benefits or increasing out-of-pocket costs. These include state-wide hospital rate setting programs which have held hospital costs 2 to 6% below the national average; improved health insurance administration; more appropriate utilization of resources stimulated by mandatory second opinion programs and emphasis on outpatient care; use of cost effective alternative delivery systems like health maintenance organizations (HMOs); use of negotiated fee schedules; and emphasis on preventive care. Combined, the above approaches can hold down health insurance premium increases.
THEREFORE BE IT RESOLVED:
That AFSCME councils and locals support efforts through legislation, collective bargaining, and coalitions of community groups and other labor organizations, to fight cutbacks, control costs, and improve health services for all Americans. Legislative approaches can include all-payer hospital rate setting with indigent care coverage; regulation of insurance carriers, both commercial and non-profit, to make them more cost conscious; and legislation requiring the government and insurance companies to disclose price and quality information so that consumers can make informed decisions on selecting providers, and so that physicians and other providers can improve their practices. Such legislation must protect the collective bargaining rights of hospital and health workers, and give them input into how health resources are allocated; and
BE IT FURTHER RESOLVED:
That AFSCME should encourage legislation at the Federal level to restrain health care inflation and control Medicare spending without cutting benefits. The legislation should provide financial incentives to the states for establishing flexible cost containment plans for all-payers, and must protect non-supervisory health care workers and provide for indigent care; and
BE IT FURTHER RESOLVED:
That AFSCME continue its support of the health planning system, which is responsible for monitoring costly capital expenditures by hospitals, nursing homes, and other health delivery families. Furthermore, Congress should restore the $100 million in funding cots to the special state and local health planning agencies; and
BE IT FURTHER RESOLVED:
That AFSCME councils and locals participate, through collective bargaining or labor-management committees, in health care cost containment discussions that are keyed to controlling future cost increases by improving delivery and utilization patterns while maintaining the quality of health care. These measures should not hold the patient responsible for inappropriate or medically unnecessary care provided by doctors and hospitals. Such cost containment programs should provide for a continuing study of plan utilization data, plan financing, claims administration and auditing procedures to review carrier performance for potential cost savings; and
BE IT FURTHER RESOLVED:
That AFSCME promote alternative delivery systems such as health maintenance organizations (HMOs) which have a proven track record of providing cost-effective, quality care. AFSCME should react cautiously to alternatives such as preferred provider organizations (PPOs) and strive to ensure that any PPO options offered will result in no reduction in benefits to the membership and will include key consumer protections. AFSCME members who work for hospitals may be able to reduce the amount of money spent for hospital care and to improve their own job security. Preferred provider arrangements with positive incentives for AFSCME members to use AFSCME represented hospitals can be negotiated; and
BE IT FURTHER RESOLVED:
That AFSCME councils and locals recognize the special role of public hospitals in serving everyone, regardless of ability to pay, and will work to ensure that any cost containment efforts include adequate provisions to ensure the fiscal viability of public hospitals; and
BE IT FURTHER RESOLVED:
That the problem of adequate health care for the American People can only be ultimately resolved through a national health care system; and
BE IT FINALLY RESOLVED:
That the International Union continue to develop strategies for containing health care costs and improving the health care available to AFSCME members and their families.
SUBMITTED BY:
International Executive BoardRonald C. Alexander, President-Elect, Delegate and
International Vice President
OCSEA/AFSCME Local 11
Columbus, Ohio