Candidates for governor promise health care changes

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A doctor examines a young patient.
File Photo: Getty Images/Joe Raedle

Mike Hatch has campaigned on the issue of health care since his first run for attorney general in 1998. During his two terms as AG, Hatch audited HMOs, sued pharmaceutical companies, pushed for better mental health coverage by insurance companies, and got the state's hospitals to agree to give uninsured patients the same discounts health plans get.

When he officially launched his bid for governor, at a meeting of the Minnesota Nurses Association, Hatch declared health care a right, not a privilege.

"And access to health care will be my No. 1 priority," Hatch said at the time.

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Minnesota can find the money to pay for universal health care coverage by squeezing costs out of the system, Hatch says. He's criticized highly-paid industry executives and HMO administrative costs, and says he wants to be governor to have more tools to take on the industry.

"As attorney general, I get to play two keys on the piano. I can do these audits of nonprofits and I can sue people," Hatch says. "But as governor, I've got 88 keys on the piano. I can go tell the commissioner of commerce, you know, you don't approve rate increases for Blue Cross/Blue Shield when they have the highest net worth in the country."

Hatch says if he's elected, his commissioners would scrutinize the spending of hospitals, clinics and nursing homes. He wants to give workers with high insurance costs access to a special state insurance program, in an effort to save their employers money. Hatch is also proposing a pilot project of school-based clinics to improve children's access to health care.

Health care expert Roger Feldman of the University of Minnesota says Hatch's strategy of targeting health plan administrative costs will create more problems than it solves. Feldman says those costs include health plan programs to improve quality and manage care.

Proposals to pay for our health care bills by going after fraud, waste, abuse, high salaries and administrative costs are at best, window dressing, and at worst, self-defeating.

"Proposals to pay for our health care bills by going after fraud, waste, abuse, high salaries and administrative costs are at best, window dressing, and at worst, self-defeating."

Hatch is also sharply critical of Gov. Pawlenty for bumping more than 30,000 low-income people from Minnesota, the state's subsidized health insurance program, during the state's budget crunch three years ago.

Pawlenty has resisted DFL attempts to expand eligibility for the program since then, and has consistently argued that the state must rein in the rising cost of government health care programs.

One-quarter of the state budget is spent on health and human services programs, and Pawlenty says those programs will eventually dwarf education spending if the trends don't change.

Pawlenty unveiled his health care initiative, called QCare, last week. It would set quality standards for four major cost factors -- diabetes, hospital stays, cardiac care, and preventive care. Pawlenty says providers that meet those standards would receive higher payments from the state.

"We think it's going to save money and save lives, but more importantly, it's going to improve the quality of health care in our state," Pawlenty said. "We think just on the state's portion of it alone, you're going to be looking at savings of over $150 million annually from these changes."

That's less than 4 percent of the $4 billion state government spends on health care programs such as MinnesotaCare and state employee coverage.

Professor Feldman says Pawlenty's QCare is a good idea, similar to an approach that's becoming common in the private sector. But Feldman says it doesn't do much to change the state's health care system.

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"This program is not a health care reform proposal," Feldman says. "It's simply a way for the state to buy health care in a more informed and sensitive manner, and as such it will save a small amount of money."

Feldman says the plan proposed by DFLer Becky Lourey is much more far-reaching, and would likely cost the state money.

Lourey wants to expand MinnesotaCare to include more uninsured people, and allow businesses to buy MinnesotaCare coverage for their workers. She also wants to expand the state employee health plan to include cities and counties, and is calling for a ceiling on administrative costs for insurance companies that receive public dollars.

Her 5 percent limit is dramatically lower than what many plans currently spend on administrative costs. Lourey says her plan would achieve universal health coverage by the year 2010.

"And you don't do it by -- as policymakers or as governor -- by demanding. You don't do by dictating, you don't do it by threatening lawsuits," Lourey says. "You do it by working together, by looking at the common good."

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Lourey, who's challenging Hatch in the September primary, says she has a better track record than Hatch on health care. Lourey chairs the Senate Health and Family Security Committee, and co-authored the legislation creating MinnesotaCare in the 1990s.

Lourey doesn't know how much her plan would cost, but is the only candidate to call for increasing corporate and upper-income taxes to raise more money for state programs.

Feldman says Lourey needs to fill in the details on her plan, and says her -percent limit on administrative costs would likely eliminate cost-saving programs and add more to costs than it would save.

Feldman says none of the plans proposed so far are as bold as what the state of Massachusetts is doing. Starting next July, Massachusetts will require residents to have health insurance, and will charge a fee to employers who don't provide coverage for their workers. State health care programs will be expanded to cover more low-income residents.

Independence Party candidate Peter Hutchinson says he'll announce a comprehensive health care plan later this week. Hutchinson has developed the plan with his running mate, Dr. Maureen Reed, a former medical director for HealthPartners. Hutchinson says rising health care costs are the biggest economic threat facing Minnesota.

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Peter Hutchinson and his running mate, Dr. Maureen Reed.
MPR Photo/Laura McCallum

"We have to get to universal coverage," Hutchinson says. "We have to make sure that every citizen in Minnesota has access to health care that's affordable, absolutely. That's part of the economic package that makes us a much more competitive state."

Hutchinson says if the state doesn't control health care costs, there won't be enough money left for education, public safety and other priorities.

As the candidates outline their proposals, political experts says it's unclear how politically potent the issue of health care will be this campaign.

Political scientist Larry Jacobs of the University of Minnesota's Humphrey Institute says health care is a major concern for voters getting squeezed out of health coverage. He says the issue is directly tied to taxes, since expanding state health care programs will cost money.

"I think the question in the governor's race in terms of health care is, do we want to raise taxes to pay for those programs or not," Jacobs says.

And the opinion polls, Jacobs says, are "ambiguous." Voters tend to support the idea of programs like MinnesotaCare, Jacobs says, but are divided on whether to raise taxes to pay for them.

He says the issue of health coverage is very important to low-income Minnesotans, who are less likely to vote and be politically active than wealthy residents.

However, Jacobs says the issue is starting to affect more and more middle-class voters, a group that could determine the outcome of the governor's race.