Forum's focus is health

Session explores high cost of care

Staff WriterFebruary 8, 2005 

As some of the state's most influential leaders pledged Monday to cover more of the working poor with Medicaid and improve health care in North Carolina, a splash of cold water came down from Washington.

President Bush's proposed federal budget, released Monday, would cut $45 billion from Medicaid, the state and federal health insurance program for the poor, over the next 10 years.

North Carolina would lose about $1.4 billion, according to an analysis by Families USA, a consumer group.

But even without cuts, the state would be challenged to keep Medicaid intact, let alone expand it, Gov. Mike Easley told academics, health advocates, business leaders and others at the annual Emerging Issues Forum at N.C. State University. Health care is the forum's topic this year.

The state will need to find an additional $265 million this year just to continue providing Medicaid to everyone who already has it, Easley said. That would bring the annual state share of Medicaid to nearly $3 billion.

And that amount will grow if federal money is cut. Easley seemed to warn that any new budget priorities would suffer.

"The state budget is not bottomless," he said.

Earlier, keynote speaker Newt Gingrich, a former speaker of the U.S. House, told participants that the country's health-care system can't be fixed. It's a bureaucratic system where the government, employers and insurance companies pay most medical bills, he said, and that needs to change.

High-deductible health plans with savings accounts that let consumers build a health-care nest egg -- a hot trend -- are one way to give people the incentive to be better health-care consumers, he said.

"Unless we migrate back to a buyer-seller system, we'll never fix this," said Gingrich, whose company, The Gingrich Group, was paid $40,000 for his appearance.

Despite the gloomy budget outlook, some participants said it was better to be talking about solutions than doing nothing.

"You get good minds thinking on this big topic, you're going to make some progress," said Davy Davidson, chief executive of Engineered Plastics, a small maker of custom plastic products in Gibsonville in western Alamance County. Davidson said the company's insurance premiums have risen by 15 percent to 20 percent each of the past several years.

He's wary of health savings accounts, which he doubted many of his employees could afford to build.

"For a guy who's making $9 an hour, it's going to take every penny just to live on," Davidson said.

Still, he's hopeful the forum will generate other ideas that may help small businesses.

Today the forum wraps up with more talks and a detailed recommendation. Groups of health-care policy and industry experts met for months leading up to the conference to craft specific proposals.

Recommendations will include:

* Helping the state's smallest hospitals and doctors' practices buy sophisticated information technology to reduce errors and improve efficiency, possibly through state-sponsored low-interest loans or debt guarantees.

* Having the state act as a clearing house for health-care "best practices" to help providers treat illnesses most effectively.

* Expanding Medicaid to cover low-income working parents.

* Expanding enrollment of children in public health insurance, including Medicaid and NC Health Choice, a program for children in families that make slightly more than the Medicaid limit.

* Helping small businesses pool resources to buy insurance. The state could keep premiums affordable by creating a high-risk insurance pool that would help cover workers with very high medical costs.

The issue of finding the money to achieve these objectives was a recurrent theme Monday.

"Talk is cheap," said Jon Oberlander, an associate professor of social medicine at UNC-Chapel Hill. "Health-care reform, I'm sorry to report, is not. There's no way to do this without putting more money into the system."

Some focused on what can be done without government help.

Today Keith Crisco, chief executive of Asheboro Elastics, will talk about changes his 230-employee manufacturing company has made to improve workers' health and cut medical costs.

In 2000, worried by year after year of double-digit increases in health-care costs, Crisco had all employees screened to determine their risk for heart disease, diabetes and stroke. Then he hired a nurse practitioner to review the results with employees and deliver on-site medical care.

Now, workers can see the nurse practitioner for primary care -- at no charge -- on company time.

"Before this, 50 percent of our employees never went to the doctor; they used the emergency room for primary care," Crisco said.

The change has paid off. Before, Asheboro Elastics was spending about $3,800 per worker yearly on health care, including premiums and medical expenses, Crisco said. In 2004, the average was $2,700 per worker. That's a savings of more than $250,000 last year alone.

Since 2000, the average amount employers spend on health benefits nationally has increased nearly 40 percent.

Crisco said other companies can change their situations, if they're willing to be creative.

"We made a change, and it's working," he said. "We've got to do it one Asheboro Elastics at a time."

Staff writer Jean P. Fisher can be reached at 829-4753 or jfisher@newsobserver.com.

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