April 1998 Home   Newsletters

May 1998

June-July 1998

Did Yesterday's Dream Come True? (Dee Jay Mailer)
President's Message (Grace Furukawa)
Decisions on Tax Changes Near (Astrid Monson)
L.A. Rail Project Stalled (Arlene Ellis)
Voter Service
VAWA Planning Committee Meets (Suzanne Meisenzahl)
Title IX Today

"Did Yesterday's Dream Come True?"

Excerpts from speech by Dee Jay Mailer


While most of us would agree that healthcare needed reform back in the early '90's, I would guess that few would have predicted a revolution of the magnitude we are seeing today, clearly on the mainland and growing here today.

The League of Women Voters, back in 1992 and 1993, was very much a part of discussions on healthcare reform. And today, you remain an important part of today's debates on managed care. Having reviewed your position on healthcare reform drafted in 1992 and completed in 1993, I am impressed with your community focus and insight into the important elements of a sustainable model of quality healthcare. And now, only 5 years later, I am struck by how far we have not progressed towards your vision.

What has arrived today on the mainland as well as in Hawaii is a highly commercial and competitive healthcare market with a smattering of government programs. Even the government programs are exploring commercial and competitive marketplace tactics to address ever-present cost challenges.

This marketplace is characterized by practices like market segmentation (e.g. market skimming), advertising and promotion, loss-leader pricing and competitive bidding. And just as every commercial and competitive industry attracts competitors focused on profit, so has healthcare with its proliferation of for-profit players.

It's ironic that, at the beginning of healthcare reform, many Americans shunned programs (Clinton and League's support of a single payer system as examples) that were financed and administered by agencies or organizations for social benefit. They labeled them as socialistic.

Instead, we allowed the free market to take over and almost overnight, healthcare became on of the most attractive business opportunities around. Instead of the label "socialistic", healthcare now donned the label of "commercial or corporate" and the new for-profit companies entering the market used a very old and traditional practice of managed care as their new product label. It is not surprising that managed care, then, has gained the reputation of being about profits vs. people.

Managed care really is simply the discipline that the League outlined in 1993 when they presented their position on healthcare reform. But when you hang out with a crowd like corporate healthcare, you also gain its reputation.

Increasing premiums and Health plan insolvency

And now the came competitive marketplace that brought purchasers significant cost savings is now raising premiums to double-digits again, a growing trend on the mainland and if Hawaii lags by a few years, premiums will begin to climb again in the next few years.

Why? Pricing vs. costs – healthcare costs continue to rise with aging America and increasing technology.

Drug inflation alone in 1996 increased by 10-14%.

Without premium increases (and even with) – you have growing insolvency problems in the market.


Anti-managed care. Market conduct and Solvency Bills – HB 3613 – Revolving fund for the Insurance Commissioner to audit and do surveillance.

So as you can see, there is tremendous variation as to how far we've come in realizing the League's dream for healthcare reform. We've progressed in some ways (greater consumer involvement and health plan accountability for quality) and regressed in others (increasing uninsured, growing mistrust in the fairness of healthcare and rebounding costs).

Where does Kaiser Permanente stand in this history?

Where we stood years ago when Dr. Sidney Garfield and Henry J. Kaiser established a partnership in healthcare. Dr. Sydney Garfield saw the wisdom in prepayment for care with low out-of-pocket costs when care was needed. He saw the value of

  1. easy access to

  2. appropriate and integrated, multispeciality care,

  3. without having money as the barrier to care.

He saw how such a system of financing and care encouraged:

  1. prevention and health promotion

  2. providing the right treatment to the right patient by the right provider at the right time.

  3. and finally, he saw the value of partnerships between the providers and the businesses they served (be they a health plan or purchaser).

Henry J. Kaiser said, "Doctor, don't you worry. You won't have to do the job yourself. If you're any good, you're going to have a great deal of competition, and that'll help you do your job. You're going to be copied. Therefore, your particular job must be to make sure your model is the very best in the whole country and remains worthy of being copied."

Dee Jay Mailer

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