Governor's Health Plan: Scripps CEO Weighs In

By Chris Van Gorder

Gov. Schwarzenegger has successfully called attention to California’s ongoing health care crisis by proposing a comprehensive plan that calls for shared responsibility in finding a solution to our state’s broken health care system.

And make no mistake, it is a broken system. Hospitals and physicians have been living with the effects of this crisis for some time now demonstrated by hospital closures and relocation of providers. For example, in the past decade, more than 65 emergency rooms and more than 70 acute-care hospitals have closed statewide. San Diego County has lost seven hospitals since 1996.

The hidden tax the governor refers to as a result of cost-shifting is real as are the effects of consistent and growing unfunded mandates. As the governor accurately indicates in his plan, care for the uninsured and underinsured comes at a price to all of us. When medical bills go unpaid, hospitals must shift the costs onto those who can – those with health insurance. This hidden tax – in the form of higher-priced premiums, deductibles and co-pays – costs each insured Californian $455 a year, according to a study released in December by the New America Foundation.

To prevent the further loss of hospitals and emergency rooms, any solution to our health care crisis must:

  • Address the uninsured problem, most of whom are working poor who do not have access to health insurance benefits through their employers. According the New America study, three in five uninsured Californians work full time.
  • Put more money into the state Medi-Cal system – California’s Medicaid program – which ranks dead last in the nation in reimbursement to hospitals and physicians. On average, California hospitals lose 40 cents for every dollar of care we provide to Medi-Cal patients.
  • Provide relief from the unfunded mandates, the most costly being the seismic requirements – a $110 billion price tag statewide, a cost many hospitals cannot currently fund.

For too long, the problems facing our health care system have been ignored or handled piecemeal because they are complex and not easily solved, and we are pleased that the governor is dedicating himself to developing a comprehensive public-private solution.

A complex problem requires a thoughtful and well-studied solution. Despite all the legislation passed in recent years that attempts to address this problem, we still have no better health care system. This is legislation by body part – akin to a surgeon operating on one part of the body without considering the patient’s overall health.

The unintended consequences have been significant. Some have already spoken out against the plan in favor of a government-sponsored, single-payer system at the expense of patient choice. While Scripps shares the goal of covering all Californians, a single-payer system would add a huge government bureaucracy and could lead to rationing of care for economic reasons while eliminating patient choice.

If history is any guide, government-funded insurance programs – Medicare and Medi-Cal – have never sufficiently covered the total cost of care for their beneficiaries, which is one of the reasons we are where we are today. A public-private solution is required. And individual patients should be given some level of control and responsibility for their own health care.

It would be a shame for any one group to focus too narrowly on certain elements of the plan at the expense of an overall solution. In the coming months, our hope is that discussions remain constructive, that all voices are fairly heard, and that these conversations lead to positive results. With committed leadership, we believe that working together we can solve this problem. Now is the time.

Certainly, hospitals and physicians are not enthusiastic about all elements of the proposal. We recognize there is a crisis, and we are more than willing to be a leader in finding solutions. Rather than draw a line in the sand, we recognize that the negotiations ahead will be tough. We expect a lively debate. The debate is welcome after decades of piecemeal legislation, false starts and silence on this issue.

Congratulations governor for your recognition of the problem and willingness to bring all parties to the table to solve it.

Chris Van Gorder is president and chief executive officer of Scripps Health, which operates five hospital campuses and 13 outpatient centers in San Diego County, and a member of the state Commission on Emergency Medical Services, which advises the California Emergency Medical Services Authority.