TOPICS > Health

Wal-Mart, Union Leaders Collaborate on Health Care

February 8, 2007 at 2:17 PM EDT

KWAME HOLMAN: Workers at one of the nation’s largest employers and members of one of the biggest U.S. unions became the latest voices behind a growing push for affordable and universal health care coverage.

The retailer Wal-Mart and the Service Employees International Union joined three other businesses and a second major union yesterday in calling for insurance for all Americans by 2012.

Businesses and unions often clash over issues such as employee benefits. Now, health coverage has drawn the two sides closer.

Yesterday’s announcement was part of a new wave of initiatives by industry, unions, state governments, and advocacy groups to address the widening gap in health coverage.

Nearly 47 million Americans now lack insurance, according to the most recent census. That’s up five million since 2001. And health care premiums have risen 87 percent over the last six years.

Last month, another coalition, including the U.S. Chamber of Commerce, AARP, and other health care advocates proposed expanding health protection for children and poorer Medicare recipients. Ron Pollack of Families USA spoke for the coalition.

RON POLLACK, Families USA: We decided to rise above our individual principles to achieve a much higher collective principle, so we could do something politically practical to cover America’s uninsured.

KWAME HOLMAN: Several states also have seized on the issue. Last month, California’s Republican governor, Arnold Schwarzenegger, launched the largest such effort. He proposed mandating coverage for every resident in the state and would require most businesses to provide it or pay a tax.

GOV. ARNOLD SCHWARZENEGGER (R), California: With our five-part plan, California will take the lead in what I call health promotion, prevention and wellness.

KWAME HOLMAN: In Massachusetts last April, then-Governor Mitt Romney enacted legislation to create near-universal coverage in that state. Romney now is a Republican candidate for president in 2008 and is campaigning to adopt a similar program on a national basis.

Health care also has become a key issue for Democrats running for president. At least three candidates have made health care reform centerpieces in their campaigns.

For his part, President Bush, in his State of the Union address, made health care a priority for his remaining two years in office and called on Congress to increase health care tax deductions and promised to work with states to expand coverage.

JIM LEHRER: And now, some perspective on why all of this is happening. Jeanne Lambrew is a senior fellow at the Center for American Progress, a liberal think-tank that is a member of the newest business-labor alliance announced yesterday. She also teaches health policy at George Washington University.

John Castellani is president of the Business Roundtable, an association of CEOs of leading companies that includes more than 10 million employees combined. His group is part of a different health care alliance that includes the AARP and the Service Workers Union.

A 'common ground'

Jeanne Lambrew
Center for American Progress
[A]t a time when the economy is beginning to grow, unemployment is relatively stable, average Americans are not feeling the benefits of this economy because health care costs are eroding their income.

Ms. Lambrew, what is driving this? What's behind all of this? Suddenly, everybody is now pushing or trying to do something about health care coverage.

JEANNE LAMBREW, Center for American Progress: Sure. Well, the truth is, we've had a health care crisis for a long period of time. This number of 47 million uninsured has been around, but has been growing rapidly, and it clearly is a health problem.

What is new is the fact that, at a time when the economy is beginning to grow, unemployment is relatively stable, average Americans are not feeling the benefits of this economy because health care costs are eroding their income.

The statistics are shocking. By next year, if health care costs continue to grow as they've been, that will eclipse the profits in Fortune 500 companies. Starbucks now spends more on health benefits than on coffee beans.

And I was talking to a business executive yesterday, who's part of our coalition, who said health benefits for a U.S. worker are more than the cost of an engineer in India. It's hurting our health care; it's hurting our economy; and it's hurting our global competitiveness.

JIM LEHRER: And this getting together is real, Mr. Castellani? I mean, it's not -- well...

JOHN CASTELLANI, Business Roundtable: It's very real.

JIM LEHRER: Very real? I mean, people that normally don't get together really are doing it this time?

JOHN CASTELLANI: You know, because we have a common problem. And the problem is now the turning point where we have now got years of unabated cost increases in health care and increased global competition.

We can't create jobs, we can't grow the economy here in the United States unless we can compete around the world. And we're competing against countries that either have a different model or against countries and companies that don't provide health care.

So we need a healthy work force -- we recognize that -- but we need it in a way that is affordable for us as companies and, more importantly, for our employees and their families, so that we can have good health care coverage and still be able to compete around the world. It's very real.

Moving toward a system

John Castellani
Business Roundtable
[T]here's an agreement on principles of what that system should look like, but it's a very complicated system, and it has a lot of different moving parts.

JIM LEHRER: Is there ideology behind this, or is it what Ron Pollack said in the taped piece, just practical politics?

JEANNE LAMBREW: Well, I would argue that we all like to talk about the political fights. The ideological fights are interesting and often get the coverage.

But the truth of the matter is, is that we all know there's a crisis, and there are lots of good ideas on the table. The problem is, we are not able to bring people together to that room to sit down and try to work that out.

The goal of this coalition that we're involved with at the Center for American Progress, the Better Health Care Coalition, is to try to take business leaders -- not just the associations that have been doing this work in Washington, but get leaders to get other leaders to get our political leadership to say, "The time is now."

This group is saying we need to improve the system by 2012. It's a specific goal. There are milestones in between, but the goal is to have a value-based, efficient, and, most importantly, accessible to all Americans health care system, so we end both this health care crisis and the economic crisis.

JIM LEHRER: Is there a consensus or a beginning of a consensus on what kind of system could be created or a combination of existing systems that could be created to do this?

JOHN CASTELLANI: Yes, there's an agreement on principles of what that system should look like, but it's a very complicated system, and it has a lot of different moving parts.

The uninsured that you mentioned, as well as the employer base, there are small businesses that have to be factored in. And there are people, young people, who choose not to have health care coverage. One of the fastest-growing groups of the uninsured are early retirees, people between 55 and 65 that are not yet Medicare-eligible.

The government's involved; private sector's involved; big and small business. There are practical solutions. There are places we can start and start now, and that's what we're trying to get the political bodies to do.

Employer-based systems

Jeanne Lambrew
Center for American Progress
There are lots of common agreements around trying to figure out how we just build on the employer system, but also create a new place for people to get accessible, accordable coverage.

JIM LEHRER: There are some folks who argue or are beginning to argue that the employer-based system is a goner, that that's not going to work anymore. Do you agree with that?

JOHN CASTELLANI: No, we want it to work. I mean, it is very important that the employer-based system be allowed to survive and be allowed to bring the kinds of efficiencies and improvements that result in better health care and more affordable health care.

The problem that we have is we have this mixed system of the government provides about half of the health care in this country. We've got a large chunk of people who are uninsured, a large number of people who are uninsured, and then we have those that are covered by employers in a context where it is becoming more and more difficult to be competitive in a global environment and still provide it.

JIM LEHRER: Because the employer system costs so much?

JOHN CASTELLANI: Employer systems are typically the ones that are the most expansive and the most generous, in terms of the benefits that they provide.

JIM LEHRER: What scenario do you see as a possible way to solve this?

JEANNE LAMBREW: Sure. Well, I think if you look at what Governor Romney passed last year, what Governor Schwarzenegger proposed, the truth is they don't look all that different than what, you know, Senator Clinton, then-First Lady Clinton talked about, about a decade ago.

There are lots of common agreements around trying to figure out how we just build on the employer system, but also create a new place for people to get accessible, accordable coverage, because the truth is, this new economy is not one where people stay in the same job for a long period of time.

We were talking yesterday about young workers who typically have a dozen jobs before the age of 40. We need to find something that's not -- the employer system is necessary, but not sufficient. We need to build alternative group places for people to get health insurance, so we need to kind of build on this, but find some place new.

JIM LEHRER: But as a practical matter, how do you extend the coverage to cover people who are not covered now and, at the same time, lower the cost of health coverage?

JEANNE LAMBREW: Well, the truth is, if we actually had a true health care system, where everybody was in, and we had kind of the tools, the information, the value-based purchasing that you can get when everybody is in a system with group health insurance, I think we would be able to drive down the cost of our health system.

But I should note that our coalition, you know, purportedly supports covering everybody, supports creating this alternative place for people to buy health insurance, but also supports trying to do those sorts of information technology investments, research, to kind of get the information out there, so we can actually be better purchasers of health care.

We spend the most money in the world on health care on a per capita basis. We need to figure out how to get people in, create the tools, and ratchet down.

Politics of health care

John Castellani
Business Roundtable
The federal government has always had the political problem of, is it going to affect the next election?

JIM LEHRER: Why is it that the state governments seem to be taking the lead more so than the federal government at this point?

JOHN CASTELLANI: Well, the state governments see the cost most directly. It is a large portion of their budget. They are big payers and big providers, and there's where we're seeing a lot of innovation.

The federal government has always had the political problem of, is it going to affect the next election? And that's what we're trying to change, say, "Yes, it is going to affect the next election, if we don't start to address it." And there are things that can be done now.

JIM LEHRER: Like what?

JOHN CASTELLANI: Well, for example, the medical delivery system, not the diagnostics and the treatment, but the medical delivery system is the only part of our economy that hasn't benefited from the productivity improvements of information technology. The Rand Corporation says we could save $165 billion a year if we just put the same kind of I.T. in the health care delivery system that we have everywhere else in the economy.

JIM LEHRER: Like what? I mean, give me example.

JOHN CASTELLANI: Computerized medical records. You know, I have a wonderful situation where I'm allergic to a drug where, if I got a CT scan, it would kill me. And nobody knows that. But I have a brand new car that has an OnStar system that sends me every month the message about what's wrong with it.

JIM LEHRER: I got you. I got you.

JOHN CASTELLANI: It's that lack of that technology. There are other things we can do in the short term.

You know, we know that, if we can have healthy children, we can avoid costs later. So the state programs that deal with child access to health insurance should be reauthorized and expanded.

And we know that consumers are better when they have better information about cost and quality. They make the right choices. And we've got a lot of cost and quality data, but we don't release it to the consumers.

JIM LEHRER: Let's talk about the politics of this. You mentioned that -- and it was in Kwame's setup piece -- everybody's on board on this now, everybody, is that right?

JEANNE LAMBREW: I think there's no doubt that everybody agrees in principle that we need to do this.

JIM LEHRER: Is it going to drive the 2008 presidential election campaign?

JEANNE LAMBREW: Absolutely. Beyond Iraq, it is the number-one economic issue. You can ask the business leaders; they'll tell us that. We can look at the statistics; it will be there.

JIM LEHRER: Is the competition going to be over who's got the best plan? Or how are the candidates going to make points on this issue?

JOHN CASTELLANI: Well, the objective is that we may have the candidates talking about it, but we don't have to wait until 2008. As I said, there are things we can do now.


JOHN CASTELLANI: But what we want to do is change the political environment. That's why we banded together, and divided we fail, to say, "You must address these issues as part of the campaign. You must bring forward issues."

Right now, there are no bad issues, bad ideas. They're all good ideas, but you have to pull them all together and find out what works best in our economy.

JIM LEHRER: But isn't that going to begin to fall apart, once partisan politics and people start saying, "Hey, I've got a better plan than you," and et cetera, et cetera, et cetera?

JOHN CASTELLANI: We hope not. If we can stand up with Andy Stern and stand up with Bill Novelli, AARP, the SEIU, and the Business Roundtable, and we can say, "We're going to hold you accountable for bringing these ideas forward," that's the environment we're trying to drive.

JIM LEHRER: You're trying to tell people that this is not a political issue, but it's going to be the number-one political issue of 2008?

JEANNE LAMBREW: We think that it needs to be a common denominator, that every candidate needs to say that they're committed to the goal of health reform by the year 2012. Then the question becomes, how?

There's one set of, you know, fights that we can have over, is it a market-based solution or is it a Medicare-for-all solution? We could have the policy fights, but I honestly hope it's a process fight. How do we learn the lessons from the last time around?

I mean, if you go back a decade ago, one of the lessons that the Clinton administration learned -- and I was part of that -- was sometimes coming up with the perfect plan on paper doesn't yield a compromise. We all hope that we can figure out, locking our arms together, how to focus on, not the if, but when, and then not the how in the detail, but the how in the policy process we can do this, so we actually can, in the year 2009, achieve health reform.

JIM LEHRER: In a word, do each of you really believe that this is possible for the first time?

JOHN CASTELLANI: It has to be.

JIM LEHRER: Has to be?

JEANNE LAMBREW: Correct. The status quo is no longer an option.

JIM LEHRER: OK. Thank you both.