Canadian-Type Health Care May Win Out in Some States

A Canadian-style, one-plan-fits-all health-care system is unlikely to prevail in Washington, at least in the next few years.

But the Clinton overhaul of health care may allow for single-payer, single-plan systems at the state level.

In some rural states, covering up to a quarter of the United States population, single-plan systems may even be difficult to avoid, according to some health-care analysts.

States like Nebraska, Wyoming, and the Dakotas, for example, have medical facilities spread so thinly that the competition envisioned in the Clinton plan is impractical.

So even though these states tend toward conservative political views, notes Henry Aaron, director of economic studies at the Brookings Institution, "they might be surprised to find themselves looking more like Saskatchewan than California."

The health-care system that Hillary Rodham Clinton's task force has designed - and currently plans to take public in September - relies on competition between health-insurance plans to control costs.

It creates large purchasing groups, set up as independent state agencies, to broker insurance plans for everyone except large corporate employers, who can opt to purchase their own plans directly. The Clinton plan also hands every American a health-insurance card that guarantees a generous basic benefit level, provided by an individual's chosen insurer.

By contrast, a single-payer system would automatically cover everyone under the same insurance plan, without exceptions for big companies, and costs would be controlled directly by a state-sponsored agency.

According to advocates of a single-payer system, Mrs. Clinton has assured them that the federal plan would allow states the leeway to adopt single-payer systems if they choose. "I think we've got about the strongest assurances we can get short of reading the language" of the legislation itself, says Rep. Jim McDermott (D) of Washington, who met with Mrs. Clinton in late June.

The only state that is actively considering a Canadian-type single-payer system now is Vermont, which combines a rural population with a highly regulatory, left-leaning political culture.

A new state Health Care Authority is developing two models, to be completed by November, for the state legislature to choose from. One is a single-payer system. The other is a regulated multipayer system.

Interest in single-payer systems has been growing. Most states have seen single-payer bills introduced into their legislatures, notes Joy Wilson, director of the health committee of the National Council of State Legislators. Such bills are making progress, even passing one legislative chamber or the other in some states.

At the national level, single-payer supporters in the US House now number 85, up from 56 in March. That remains far from the 218 votes needed for a majority, but members note that they are already the biggest single health-care reform bloc in Congress.

Advocates of the single-payer system tout its administrative efficiency, its proven track record in Canada and much of the rest of the industrialized world, and the decision power it rests with doctors instead of insurers or other cost-conscious parties. The key statistic: Canadians spend 9 percent of their gross domestic product on health care; Americans spend almost 14 percent.

The counterarguments are captured in American public opinion. While about two-thirds of Americans recently have told pollsters they would favor a national health program, that support drops by half when the pollster points out that, by definition, the government would run it.

The biggest political obstacle at the state level to single-payer is funding it. Costs now paid as medical fees or insurance premiums would be converted to tax dollars, a difficult political step.

Some states may arrive at single-payer systems out of necessity. In regions with sparse populations, the managed competition that the Clinton plan uses to control costs becomes impractical. Without any meaningful choice between medical-service providers, the only way states could control their costs would be to regulate them directly.

"We think that's likely in many areas," says John Weiser of Marmor, Brody & Weiser, a private health-care policy consulting firm. A study published in the New England Journal of Medicine in January estimated that a quarter of the US population lives in areas where meaningful competition is not feasible.

Even in states or parts of states with only one health plan serving all, states are likely to allow people to pay extra for more, or faster, medical services, says Mr. Weiser, because of the American demand for choice. Few analysts foresee populous states moving to a single-payer system.