State lawmakers face a crisis this year: how to address the health care issue without breaking the bank.
States are dealing with a double whammy of public outrage over health care prices and massive federal cuts to health care programs such as Medicaid. In response, states should consider health care mandate bills requiring big employers to provide a minimum level of medical coverage to their workers, just as they are required to pay workers a minimum wage.
The fight on this issue has been predictable. Politicians such as Republican Maryland Gov. Robert L. Ehrlich Jr., for whom big corporations like Wal-Mart have raised huge amounts of money, say health care mandates will hurt business. But this simplistic view misses a critical point: Mandates, when written properly, do not hurt the economy. They channel the energies of the free market and economic growth into addressing society's pressing problems.
Clearly, this country must find a way to curb the ceaseless increases in health care costs. Our current policy of pretending a health care crisis doesn't exist will end in one of two ways: Most Americans will be forced to go without health insurance because of the cost - a politically unacceptable solution - or the government will pick up the tab and increase taxes to pay for it - a policy that polls show the public supports but is unrealistic in today's political environment.
Health care mandates, then, represent the critical "third way" out of this polarized debate.
These mandates are simple: The state government would set the minimum benefits that companies must provide and companies must find ways to meet those standards on their own. That means all of corporate America's talents for innovation, cost savings and streamlining suddenly will be focused on driving down the overall cost of health care rather than eliminating workers' medical coverage.
The best way to get an idea of what this would mean is to think of Wal-Mart because the company has become the world's biggest corporation specifically by using cost-cutting to drive down its overhead. So far, that has resulted largely in lower wages and increased outsourcing.
But if Wal-Mart were forced to provide health care to its workers, it could apply its size and bargaining power to pound down prices charged by health maintenance organizations because those prices would mean new overhead costs for the company.
