Gothamist: Universal Healthcare Looks Increasingly Possible In New York State

By David Colon, May 26052617hcare.jpg (Scott Lynch / Flickr)

As the debate rages in Washington, DC about whether to trade Trumpcare for Obamacare, a group of lawmakers in New York State see an opportunity for a progressive win here at home. Emboldened by an energized local left wing and operating in a political climate where millions of New Yorkers could wind up losing their health insurance under the American Health Care Act, advocates for single payer health insurance think this might be the ideal time for New York to establish the country’s first universal health program. But even as legislation to do so advances, a number of challenges can keep it from coming to pass.

“So many problems we face in health and health care are made worse and harder to solve because our health care system is so tied to health insurance companies,” Assembly Member Richard Gottfried of Manhattan, who’s been working on passing single payer in New York since 1992, told Gothamist.

Gottfried’s bill, the New York Health Act, passed in the Democratic-controlled Assembly earlier this month, like it has the past two years. The bill, if passed, would establish a single payer health care system that would replace the sprawling system relying on private companies, Medicare and Medicaid with a single system covering all 20 million New Yorkers.

The plan would be paid for with a combination of progressive payroll taxes and non-employment income like capital gains. An economic analysis of the bill authored by the University of Amherst’s Gerald Freidman suggested that New York State would save money with the establishment of a single payer system by cutting over $50 billion from drug and device prices and administration and overhead costs stemming from private insurance.

Rather than die a quiet death in committee this year though, the New York Health Act has picked up some steam in the State Senate, where it’s found 30 sponsors in addition to the bill’s primary sponsor, State Senator Gustavo Rivera of the Bronx. That leaves the bill one co-sponsor short of the 32 votes a bill needs for passage in the chamber. However, it’s the 32nd vote that will be the hardest one to find.

“We’ve never had the strong support we do [now] in the State Senate,” Gottfried told us. “Getting the 32nd sponsor is going to be an uphill effort, but there are groups all across the state who have been meeting with their Republican State Senators advocating for the bill,” and indeed a lobbying day in favor of the bill is set for just after Memorial Day weekend.

Gottfried attributes this spike in interest to the worrisome situation in Washington regarding access to health insurance, but he said that interest spiked in the bill even after the passage of the Obama’s Affordable Care Act, due to the fact that despite expanded coverage, the law “still leaves us in the hands of insurance companies.”

The bill could still easily fall prey to Albany’s internecine conflicts. State Senator Simcha Felder, who was elected as a Democrat but caucuses with Republicans, currently faces enormous pressure to endorse the bill. Felder did himself no favors by thrusting himself into the spotlight this week when he called on the breakaway Independent Democratic Conference to rejoin the mainline Democrats —without committing to come back to the main Democratic faction himself. Felder ducked the Village Voice in person earlier this week in Albany, making use of the skills he honed in the City Council to avoid making hard or controversial decisions.

As for the IDC, Senator Jeff Klein did promise the votes from his entire conference earlier this year. However, the conference has tied the fate of the New York Health Act to a series of bills in their “Call The Roll” challenge to the entire mainline Democratic conference, which include proposals that would never pass muster with the likes of Felder (were he to return) and State Senator Ruben Diaz.

Even without Felder though, Senator Rivera told Gothamist that he’s committed to finding that needed 32nd vote and is confident he can find it. “The reason I was able to get to 30 people on the bill from 22 is because I sat down with my colleagues personally, like I’m doing with Republicans right now, and told them that this is good policy and necessary policy. And they signed on.”

However, as long as Republicans are in control of the State Senate (something Klein recently promised will not change anytime soon), the bill still needs to make it through health and finance committees that are controlled by Republicans. Both Senator Kemp Hannon, the chair of the health committee, and Senator Catharine Young, the chair of the finance committee, declined to comment on the chances of the bill coming to a vote in either committee.

“The first step is having 32 Democratic votes and that’s what our campaign is about. We hope Democrats can unite on all seven issues,” IDC spokesperson Candice Giove said in a statement when asked if Senator Klein had been working to get the bill through the health and finance committees.

There’s also the question of whether Governor Andrew Cuomo, widely believed to be eyeing a centrist-tinged presidential run in 2020, would support the bill. Cuomo’s last stab at an item on the progressive wishlist, free college tuition, was a somewhat mixed affair. Taking a Bernie in the sheets and Hillary in the streets approach, the free tuition limited to families making less than $125,000 is the kind of means-tested approach that the bill has to avoid in order to work.

“If wealthy and powerful New Yorkers can be in a separate boat and don’t have a stake in the quality of the New York Health program, then it could easily degrade the program,” Gottfried said when asked about the bill possibly becoming means-tested. “To me, it’s not just a question of eligibility, it’s a question of whether we keep everybody in the same boat so that every New Yorker is fighting to make sure the program is top notch.”052517amb.jpg(Michael Dolan / Flickr)

However, the bill as presently constructed would cover any medically necessary procedure and would also “prohibit the sale of health insurance in New York that duplicates any benefit offered by the New York Health Act,” according to Gottfried, which would also reduce the ability of wealthy New Yorkers to separate themselves from the system.

Rivera too, stressed his commitment to a bill that would be a true universal program. “Everyone will have access to this system, whether you are Donald Trump or Dona Juana from my district on 187th and Grand Concourse,” he told Gothamist. Hillary Clinton, who Andrew Cuomo endorsed in the 2016 presidential race, also brought up the idea of Donald Trump benefiting from a universal program last year, but did so in order to oppose one.

A spokesperson for Cuomo would only tell Gothamist that “the Governor has been and remains committed to ensuring access to high-quality healthcare for all New Yorkers and we will review this legislation in that context” when asked about the bill and if he would support it.

The congestion in front of the bill has also led to a somewhat one-sided campaign in favor of it at the moment. The city’s emerging Democratic Socialists of America chapter has rallied support for the bill, as have the Campaign for New York Health and the New York State Nurses Association. But the voices in favor of the bill aren’t going to be the only ones in the room forever.

“Remember that the worst people in the world are going to come out against a single payer program,” especially in regards to the higher tax rates it would require, warned Tim Faust, the Chapo Trap House health correspondent and a national single-payer advocate currently working as a data scientist in the health care field.

That low-level opposition has been growing recently. Reclaim New York, a group funded by the Trump supporting Mercer family, recently came out against the bill, as did think tank the Empire Center with an editorial that was then reprinted in the New York Post.

Gottfried suggested that while the state’s business community might initially balk at higher payroll taxes, companies would save money by being freed from having to pay for employees’ health care costs. For wealthier New Yorkers, the taxes “would replace what they spend on premiums, deductibles and out-of-network charges,” according to Gottfried. He also pointed to property taxes in New York’s wealthy suburbs, which fund those suburbs’ school systems and therefore “makes those communities very attractive to wealthy people.”

Faust also told Gothamist that he worried about even a wealthy state like New York being able to pay for the program in a less than ideal economy, as states aren’t ideal vessels to handle a single payer system.

“What happens when you hit a recession and fewer people have jobs, and less money is being paid into a state public health option? An economic downturn means there’s a higher demand for public services. In that kind of crisis you have less revenue coming in from higher taxes and greater need, so you’ve entered into a zone where you’re making less money but you need more of it. States can’t deficit spend like the federal government, and we don’t have budgets we can cut from, like an F-35 program that’s soaking up $200 million we can reroute into health care,” Faust explained.

This was also a potential trouble spot for California’s current attempt at a single-payer system, highlighted by policy researcher Matt Bruenig, who, in a Jacobin piece that was otherwise supportive of the measure, wrote that “states have to worry about what will happen during a recession when the state’s budget contracts in ways the federal government’s budget does not.”

“To put this on the states is the federal actor shirking its own responsibility,” Faust told Gothamist.

Gottfried suggested that “enacting a single payer system is really the only way to protect everyone’s health care in a downturn. It is possible in a downturn the tax rates might have to be raised a notch, but under the current system, taxes would probably have to be raised to keep the Medicaid system afloat, and a lot of people would be losing their employment based coverage and would have to pay [for insurance] out of pocket.”

Finally, there are a pair of federalism issues that the state would have to deal with to institute a single payer system. ERISA (Employee Retirement Income Security Act), a federal law that originally set certain standards for private pensions, also keeps states from regulating self-insurance plans, or insurance plans in which employers agree to bear the cost of insurance payments. In theory, that would get in the way of the legislation’s ban on selling insurance.

Gottfried told us that while self-insured plans could still exist, the NYHA benefits would be better due to the lack of deductibles, co-pays and out-of-network charges. Companies also wouldn’t be allowed to pay doctors and hospital systems extra under the bill. Therefore, “there would be no sense in an employer continuing to have a self-insured plan.”

The other federal issue that’s waiting for the NYHA is the matter of the money New York gets from Washington to administer Medicare and Medicaid. In Friedman’s economic analysis of the bill, New York would be relying on billions of dollars in Medicare and Medicaid funding. In order to create a true single payer system, the state would have to apply for waivers from the federal government to pool the money with the rest of the state’s health insurance funds to create a new single payer system, and it’s not guaranteed to get them.

According to Faust, putting this much of the program’s fate and funding in the hands of Tom Price and a Department of Health and Human Services that’s opposed to single payer could ruin things. “It’s entirely conceivable that reforms to Medicaid or Medicare or waiver programs give them a lot of leverage over how we conduct single payer,” he said.

For Gottfried, the funding issue is a concern no matter what, much like the scenario of an economic downturn. “If the federal government cuts Medicaid, that’s going to devastate health care in New York and we’ll either have to shrug our shoulders and let a lot of people die or we’re going to have to find the money to fill those gaps. It’s going to be a lot more expensive to try to fill those gaps without creating a single payer system.”

“If I could wave a magic wand and dramatically change the politics of Washington and get a national single payer system enacted, I would certainly do that, but that’s not happening in the near future. And fortunately, New York is one state whose politics are much more progressive than Washington,” Gottfried said.