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Health Care Reform: Iowa Sen. Jack Hatch (D-Des Moines)

posted on June 12, 2009

Borg: Healing healthcare systemically. Nationally and in Iowa it's a top priority. A conversation with an Iowa healthcare reform leader, State Senator Jack Hatch on this edition of Iowa Press.

Funding for Iowa Press was provided by Friends, the Iowa Public Television Foundation. The Iowa Bankers Association ... for personal, business and commercial needs Iowa banks help Iowans reach their financial goals. And by ... the Associated General Contractors of Iowa ... the public's partner in building Iowa's highway, bridge and municipal utility infrastructure. By Iowa's Private Colleges and Universities ... enrolling 25% of the total Iowa higher education enrollment and conferring 44% of the baccalaureate and 40% of the graduate degrees in the state. More information is available at www.thinkindependently.com. The Iowa Hospital Association ... supporting the missions and visions of Iowa's 117 community hospitals. The Iowa Hospital Association ... we care about Iowa's health.

On statewide Iowa Public Television this is the Friday, June 12th edition of Iowa Press. Here is Dean Borg.

Borg: President Barack Obama is pushing Congress for big changes in the nation's healthcare system and he wants legislation within the next few weeks before Congress adjourns later this summer. That's a wake-up call for a reform that's been percolating for well over a decade. Whatever emerges is likely to have an Iowan's fingerprints and that is because State Senator Jack Hatch, at White House request, is now chairing a key reform committee advising state legislators nationwide. Senator Hatch is actively in Iowa pursuing state initiatives particularly in children's healthcare. Senator Hatch, welcome back to Iowa Press.

Hatch: Thank you very much, Dean, good to be here.

Borg: Congratulations on the appointment. We look forward to talking with you about that.

Hatch: Thank you, it's I think more of a symbol of the President understanding and knowing what Iowa has done and I'm joined by a lot of legislators and Governor Culver in pushing these initiatives.

Borg: We'll talk more about that. Across the table, Associated Press Senior Political Writer Mike Glover and Radio Iowa News Director Kay Henderson.

Glover: Senator, the legislature and Governor have just completed a fairly lengthy and expensive overhaul of the state's healthcare system. Give us an update on that, where it stands and more importantly what is the next step for Iowa?

Hatch: Well, you're right Mike, the last two years Governor Culver and the legislature along with my leaders, Senator Gronstal and Speaker Murphy, have made this the top priority of our legislature. It's been a bipartisan approach and it's been one in which we first recognize that we no longer can depend on our federal partners. We have been promising healthcare reform for 15 or 20 years as candidates for office. So, we took it to heart that when we went out there and said we need to have universal healthcare we have to do something about it because we weren't sure that the federal government was going to do it. As a result, last year's bill in 2008 we created a commitment that we were going to fund and have the system that every child would be covered under healthcare by the end of 2010. We then set up provisions in 11 advisory councils from medical home, electronic medical records, prevention and care, health and nutrition so that we could be prepared to offer that kind of new system for adults. It's going to take money so the first thing we did was we were going to commit to children and so this year we finished that commitment by making sure that through a mandate, a parental mandate that every parent whose children fits an economic guideline of 300% of poverty that they'd have to sign their child up for either Hawkeye or Medicaid.

Glover: What is the next step?

Hatch: So, as a result of that we now have to work on insuring adults because we virtually have almost every child insured by the end of 2010. The big step is insuring adults and that's going to be very expensive and we really can't do that without a federal partner and that's why we're excited that the Congress and the President are moving straight forward on reforming healthcare nationally and there has to be a major change. We know this is not sustainable so we have to work with our federal partners to ensure that we have a better system.

Glover: As Dean mentioned in his introduction you've been named to a federal committee advising state legislators. Tell me about that. What is your role there?

Hatch: Well, the White House has set up a working group, State Legislators for Healthcare Reform, and we're going to meet in the White House June 17th and there are about 40 legislators across the country. I'll be joined by -- there may be some other Iowans on that work group and that will be announced next week. We are going to be advising the President's healthcare team on what's going on in our states and what the best practices are, what we've found. For example, how do you really get all children? Are mandates essential? What are the strategies for outreach? How do you get more working families involved? How do you use your state insurance pool to get more adults in? Is there a place for a public plan in healthcare reform? And not only will we be advising the President and his work team, we're going to have a meeting with Senator Harkin and half a dozen other legislators, national congressmen and senators, and presenting over 600 letters from legislators across the country asking for national reform that would have healthcare, that would have a public plan, make it affordable, a new system has to be engaged.

Borg: Is this an ongoing group or is it a one-time meeting?

Hatch: No, it's going to be ongoing until we have national healthcare reform so we'll be busy all summer and into the fall.

Henderson: Presumably one of the things you'll be doing is presenting a list of lessons learned. What did you learn through the process of expanding healthcare coverage to children that you think is applicable on a national level or in other states?

Hatch: Well, first of all we know that unless we have parental mandates, unless we have a mandate that children are covered you're going to have three to five percent that will always be uncovered and we think that's too high. So, we have to really have shared responsibility with the parents and the schools. We have to make it a lot easier for parents to sign their children up and so that when they move that care is portable. We also found out that there are many providers in this nation and certainly in this state, community health centers, hospitals, dental associations that are willing to provide healthcare if there is a reasonable access point in that you have to reduce a lot of the paperwork. And the best lesson we learned is that the insurance that provides this information is not available to everybody and unless we have a national public option then we'll never be able to have people insured that should be.

Henderson: What have you learned in regards to adults, providing coverage to adults, for example, those who have catastrophic conditions?

Hatch: Let me tell you a story about a woman who lost her job last fall, she's 31 years old, she bought catastrophic healthcare, she went through a major provider and four months later she was diagnosed with breast cancer, a very aggressive breast cancer. She is in treatment and they know that if it's treated early she'll do well, she'll have a very normal life. But her treatments are $10,000 a week and her healthcare policy ends the end of July because they will not renew it because of pre-existing conditions even though she got it while she had this policy, the policy was written that it would not be covered.

Borg: What's the lesson?

Hatch: The lesson is that you have to eliminate pre-existing conditions, you have to have insurance reform nationally so that everybody is in the same pool and treated the same.

Borg: Have you learned anything from Massachusetts which is further along?

Hatch: Yes.

Borg: What principally have you learned there?

Hatch: What states have learned from Massachusetts, they passed their universal healthcare bill in 2006, is that states can do it. States can go out and provide a better safety net for their citizens and not wait for the federal government. That's why Iowa, Vermont, Maine, New Mexico, Oregon, Washington, Minnesota, Illinois, all these states have established some sort of a ...

Borg: But don't you risk getting ahead of the federal government?

Hatch: Well, the federal government is nowhere right now so there's a big void and so states are moving forward as far as they can but there's a point in which we can't go any further and that's where Iowa, Massachusetts and other states are right now. We can't go any further. We really can't provide too much more care as a state initiative without our federal partners.

Glover: What have you done on a state level or what is being contemplated on the federal to deal with healthcare costs because it strikes me until somebody begins to deal with the cost of providing healthcare, true healthcare reform can't happen?

Hatch: That's right and that's why as a public policy the public option issue is so critical. And in Iowa it's kind of ironic that we're moving so close to a universal healthcare system and one of our senators who is in a critical position, Senator Grassley, in Washington is opposed to the one element that would really reduce the cost of healthcare and we really need Senator Grassley to take a look at the public options a little bit more carefully and he has to change his mind otherwise he's standing in the way of real reform.

Glover: Healthcare is about 18% of the nation's gross product. How bad do you upset the economy if you start overhauling the healthcare system?

Hatch: Let's remember one thing, when we talk about reforming health insurance industry we're not talking about reforming all of insurance industry. Property, casualty, retirement, that's not going to be affected and in Iowa we have one company that has 75% of the market which is Wellmark. So, we have a monopoly and that's kind of a repetitive nature all over the country. So, we're not going to be eliminating -- the issue here, the President is very clear, we are not eliminating the options for people to have private health insurance, we are adding an option so people can have more options and better care.

Henderson: Senator, you realize that republicans argue against this so-called public option saying that the ultimate goal is to get rid of private insurance. How do you answer that criticism from the other side?

Hatch: I think that's their political tongue talking. We need republicans who are going to really be serious about taking care of our citizens. We are not eliminating the insurance industry. What we're doing is providing options for citizens.

Glover: Talk a little about the politics of this, Iowa does have a huge insurance industry located largely here in Des Moines and Cedar Rapids. What are the politics of trying to overhaul that?

Hatch: Again, we do not have a large health insurance industry, we have a very small health insurance industry with one company having 75% of the market. AEGON in Cedar Rapids, Principal in Des Moines, Nationwide, they have very little health insurance business in this country.

Glover: So, it's not applicable to them?

Hatch: It's not applicable to them and Connecticut which is, of course, the other state that has a strong health insurance market is moving very fast and very furiously on healthcare reform as well.

Borg: How can you add, though, a government health insurance plan or one sponsored by the federal government and state governments without in some way dealing with costs already in the system because it doesn't seem that you're really reforming, all you're doing is providing an access to already costly healthcare?

Hatch: Well, you're absolutely right, if all we do is have another option that's going to put money into the same black hole. Without major insurance reform, medical provider reform and individual reform we won't do it. Everyone is focused on the healthcare option as if that's the only thing in these bills. There are major reforms all along. We have to control costs and reduce costs or the GMP that's going to be going into healthcare is going to get higher and it's going to drain more of our resources. The goal of the public option is not only to provide healthcare for those that don't have it but those that have their healthcare through a private insurance policy they can keep it if they like it and the public option just will not be at the same level as every other. And one of the things that I think Senator Grassley has to understand and maybe we don't even understand it that well here in Iowa, we already have a modified public plan, it's called Iowa Care. It was established by bipartisan legislature under Governor Vilsack four years ago, approved by every member of the Iowa delegation including Senator Grassley where you have your own plan, your own benefits and you have your premiums that are related directly to those people, those are adults that are in the Iowa Care program, and that is a public option that we have in this state and Senator Grassley I think is missing the point that we're talking about providing a public option that will plug the hole to those people who don't have insurance.

Glover: Let's talk a little bit of a timeframe here, it took you two years to do the children's healthcare initiative, President Obama has talked about having something on his desk in October. What is the timeframe in Iowa for expanding healthcare to adults?

Hatch: Well, one of the things we did this year with the help of our house members, Representative Heddens and Representative Mark Smith, is to create a healthcare commission and the healthcare coverage commission was just approved two days ago by legislative council and they will appoint the members. The responsibility of that healthcare commission is to provide a plan to Iowans by July 1, 2010 for them to purchase. It is in essence a public plan that we approved last year in a bipartisan vote of the legislature and signed by Governor Culver. So, that's going to be their first responsibility is to get something run and available for July 1st for an adult public plan for Iowans.

Glover: So, you're saying by 2010 insurance will be available to every adult in the state?

Hatch: We hope to be, that is the goal.

Glover: What is the eventual price tag there?

Hatch: Well, it's going to be affordable. If you're talking about what is affordability, we're saying in a statistical way it's 6.5% of a family income.

Borg: You've been extolling the virtues of Iowa Care -- patterned after Iowa Care which is an indigent care plan.

Hatch: That is a care for people who have a certain level of income and we will probably take the Iowa Care program and look at how we can expand it. That's how we can maybe get this ready by a year from now.

Glover: What will it cost the taxpayers?

Hatch: The taxpayers in the Iowa Care is also shared by the federal government and the state, it is going to be available -- whatever it is will be on a sliding scale and we hope that it's going to be affordable and that would be ...

Glover: But what would be the price tag for taxpayers?

Hatch: We don't know. There are 270,000 Iowans uninsured right now, adults. That will require adults to be part of the people that pay part of those premiums along with the state if necessary.

Borg: Will hospitals be able to afford that, though? What I'm hearing about Iowa Care right now is unemployed people in Iowa using Iowa Care, hospitals can't afford to serve them and they're beginning to lay off staff because they're not getting reimbursed for their own costs. How can you expand that plan? What's going to happen to rural Iowa hospitals?

Hatch: Well, Iowa Care actually you can only get care at Broadlawns in Polk County and at the University of Iowa. That's because it was the old state papers program and that was our attempt to try to provide healthcare to the very, very poor. We have now made that a much more broad perspective and provides care for more people. We were just in Cedar Rapids yesterday talking with the community free clinic in Cedar Rapids and they were unaware that what we did last year was allowed for non-participating hospitals and clinics to participate in Iowa Care. How that's going to look like we don't know. We're going to have a meeting with the Iowa Enterprise, Medicaid, medical enterprise here in Iowa with DHS, we're going to bring together people to try to figure out how we can expand Iowa care to more communities. And that is going to be the essence, though, of the challenge that we have. This is not going to be easy and we can't do it without a federal partner. If we don't have a federal partner we probably will do very little in the future.

Henderson: You have mentioned Senator Grassley a few times -- he has said healthcare reform, a bill will pass, he says it's inevitable. You have mentioned earlier also that for 15 years politicians have been promising healthcare reform and not delivering. Do you agree that it is inevitable at the federal level?

Hatch: I think it's very hopeful. That's one of the reasons the members of this working group, we've had a couple of phone conferences already with them, are really pleased to be involved and asked by the President. There were some significant differences between the last time we tried that -- in 1994 there were three committees in the house dealing with three separate bills. There were two committees in the senate working on two separate bills. Right now there is one bill in the house and one bill in the senate that everyone is working on and the President is creating the bridge between both of the chambers so that everyone is kind of singing out of the same hymnal so to speak.

Henderson: What about the driving force of business in this debate?

Hatch: That's the other thing that has changed. Last year business and health providers were opposed to any major plan. Right now business is probably the most aggressive advocate for some sort of change. They know that they're spending way too much on premiums, they're losing opportunities with providing better care for their employees and then small employers, those under 50 literally don't have any healthcare for their employees, they're trying to share it and that shared responsibility is not working as well as it should so there has to be, the employer market is very much in support of some sort of reform.

Glover: Step back for a second and take a look at the issue from a bigger perspective. We've been talking about healthcare and offering coverage, broadening coverage for a long time. This year it seems as though all sides are saying it's likely going to happen. What has been the one thing or the several things that have happened to make it inevitable this year?

Hatch: The most important thing is there are more uninsured people than there were 15 years ago and that is with more children being insured so there are more adults being uninsured than ever at any time before. That is hurting the middle class and the security, the economic security of mid-America. They have probably been hit more than anybody else. And the cost of healthcare has been increasing to the point where it's unaffordable and people are making choices. They're making choices on their medication, they're making choices on seeing the doctor, they're making choices on whether or not they go to the doctor at all. We have a system and Governor Branstad said this when he was chairing our public hearings with Senator Vilsack two years ago that we have a sick care system. We have to change our system. That's why it's unsustainable now. From a sick care system where you are only treated when you get ill to a healthcare system when you are treated to stay healthy, that is the system we want and that is where everyone -- that's why republicans and democrats agree we have to do something. Now, there are some changes and some differences that are pretty major that republicans have to help us with or we may fail.

Glover: I hear all kinds of warnings out there from businesses saying we're heading towards a government run healthcare system, we're running towards a single payer healthcare system. What is wrong with that? Most of the studies I've seen have shown that government health programs like Medicare have substantially less administrative costs than private insurance companies.

Hatch: You're absolutely right.

Glover: What's wrong with that?

Hatch: Well, nothing is wrong with it. We actually have not a single pay system right now but we have public options. Not only do we have Iowa Care but we have Hawkeye, Medicaid, Medicare, VA, those are government run programs that seem to be working pretty well. We do know, though, that the citizens of this state and this country are ahead of us on this and I think most people would want a single payer system. However, I think the practical nature of being a politician we realize that's unattainable right now. And this is really the best warning, if we don't have major reform now and do it substantially throughout the entire healthcare industry from health insurance reform to medical reform to payment reform then we will have a single payer system in 15 years.

Glover: Is that where we're headed inevitably?

Hatch: I think we could have a system that involves all stakeholders where we will have a substantial reduction in costs and a substantial increase in quality if we do it right. That's why this President in his approach anyway has let Congress create the bill, he has created his principles and the work group that I'm a part of is to provide direct input into the White House and their team and into Congress on what best practices we know are important. One of those best practices is that there has to be a role for the states and the states have the best opportunity to provide their investment which we give into Medicaid and others. If we're going to add more investment we want to be able to tailor our healthcare system and our needs to Iowans so that our doctors and our providers are getting reimbursed at a relatively higher level and yet we have insurance for everybody that is affordable.

Henderson: You have mentioned '94. What do you think is the single most important thing Barack Obama learned from the Bill Clinton exercise in 1994?

Hatch: Well, I think the most important thing is he's opened up the process, he's let Congress have a real engagement with him on healthcare reform. They are writing the bill. Senator Kennedy's bill and the house bill are being written by people who have ownership. President Clinton didn't allow the Congress to have ownership in a bill that was eventually produced. And this year Congress has ownership. That's why Senator Grassley believes that this is going to be a time in which we're going to have it. But he has to understand that we can't compromise on the piece of the bill just because we don't want to sacrifice a perceived problem with our health industry.

Glover: It wouldn't be an official Iowa Press show if we didn't talk about something other than an issue and talk about just politics for a second. You've had some dust ups in the past with the black community in your district. Have you put all of that behind you? Are you politically safe in your district?

Hatch: Absolutely, we just had a meeting last week with the NAACP, a workshop and it was very effective and I think that's one of the lessons we learned is that we always have to remember that what we say has meaning and the relationships are fine.

Glover: There's no lingering hangover there?

Hatch: No, I participated in -- actually there was no mention of the incident at all, it was what was happening about the necessity for us as a community to understand that there's meaning behind words and that there's also a growth in our neighborhoods, in our communities and there's a little disagreement within the African-American community about that word and how it is used and its context and it was a great kind of relationship and it was good.

Henderson: You live in Des Moines. Congressman Leonard Boswell represents the city. Do you ever intend to run for Congress?

Hatch: No.

Henderson: Why not?

Hatch: I'm very satisfied -- the most important thing is I'm a businessman and I have a business to run and right now it's doing well but the economy is not and you never know what's going to happen so I have a responsibility to my business.

Borg: Just in the few seconds that we have will the economy at all injure the progress on healthcare reform, impede?

Hatch: I think the conventional wisdom would say yes but I like to take the unconventional way and say because the economy is so bad this is a debate that's not like just healthcare, this is a debate on economic security. And you can not have economic security if you're paying double digit increases in your premiums. This is not economic security if our providers in our healthcare system is at risk.

Borg: Thank you for being with us today.

Hatch: Thank you very much.

Borg: On our next edition of Iowa Press we're looking ahead to the 2010 gubernatorial election talking with Sioux City State Representative Christopher Rants. After holding various legislative leadership roles including Speaker of the Iowa House of Representatives he is eyeing the republican gubernatorial nomination. If he succeeds he'd be running against democratic incumbent Governor Chet Culver. Christopher Rants at the usual Iowa Press air times, 7:30 Friday night, 11:30 Sunday morning. I'm Dean Borg, thanks for joining us today.

Funding for Iowa Press was provided by Friends, the Iowa Public Television Foundation. The Iowa Bankers Association ... for personal, business and commercial needs Iowa banks help Iowans reach their financial goals. And by ... the Associated General Contractors of Iowa ... the public's partner in building Iowa's highway, bridge and municipal utility infrastructure. By Iowa's Private Colleges and Universities ... enrolling 25% of the total Iowa higher education enrollment and conferring 44% of the baccalaureate and 40% of the graduate degrees in the state. More information is available at www.thinkindependently.com. The Iowa Hospital Association ... supporting the missions and visions of Iowa's 117 community hospitals. The Iowa Hospital Association ... we care about Iowa's health.


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