Governor Details Plan for Affordable, Universal Health Care

May 11, 2006

Says Michigan First Health Care Plan will expand coverage, reduce costs

LANSING – Governor Jennifer M. Granholm today discussed details of the Michigan First Health Care Plan, first announced in her 2006 State of the State Address.  Following a conversation with medical professionals at Sparrow Hospital in Lansing, the Governor said that her plan will expand affordable health care to all Michigan citizens.  The plan will attack the factors that are driving health care costs up, make affordable insurance products available to individuals, and help make insurance more affordable for small businesses to provide to their employees.

“The Michigan First Health Care Plan will provide affordable health care coverage to every citizen in Michigan,” said Granholm.  “This plan will provide a quality product at an affordable cost, create incentives for business, and help bring down health care costs for everyone.”

The Michigan First Health Care Plan will provide access to affordable insurance products for individuals and small businesses, and strengthen and support employer-sponsored insurance (ESI) while building upon the steps already taken to expand coverage and reduce costs.

This plan will extend affordable health care to all Michigan citizens by:

• creating an affordable private market health care product for individuals and businesses;
• subsidizing care for those who can least afford it;
• creating incentives for businesses to offer coverage to their employees;
• reducing the overall cost of health care delivery by expanding technology and promoting healthy lifestyles.

To implement this plan, the state will apply for a federal Medicaid waiver.  This waiver will provide Michigan with the flexibility necessary to redirect existing state resources and new federal dollars to provide premium assistance for private health insurance products for uninsured individuals who do not currently have access to affordable health care coverage.  In addition, significantly reducing the number of uninsured will help alleviate the financial burden currently placed on individuals and businesses that provide health coverage and are subsidizing the cost of caring for a large uninsured population.

Individuals without insurance will have access to private sector insurance plans offered by a newly-created “Exchange” which will administer the plan.  Premium assistance will be provided on a sliding scale based on income.  Health insurance products offered by the Exchange will rely on private sector approaches, including managed care with defined networks, benefits that are more comparable to ESI and small group market plans, higher cost sharing than Medicaid, and the pre-tax treatment of contributions to reduce cost. 

The Michigan First Healthcare Plan will also provide a platform to extend access to affordable insurance products to small businesses with uninsured employees.  By purchasing through the Exchange, these businesses will be able to offer affordable coverage to their employees, enable employees to use pre-tax dollars to save even more, and benefit from tax savings as well. 

“This program will benefit every citizen in Michigan,” said Granholm.  “Those without access to traditional insurance will have affordable options, employers will be able to provide insurance at more manageable rates, and those already in the market will enjoy the cost savings.”

The Michigan First Healthcare Plan builds upon the Granholm Administration’s efforts to reduce costs and expand access through:

• expanding county health plans;
• the MiRx prescription drug card;
• a first in the nation bulk purchasing program for prescription drugs;
• creation of a Michigan Health Information Network to make health care records portable and reduce redundancy and cost; and
• encouraging healthy behaviors and personal responsibility to lower overall health care costs by cutting down on preventable conditions.

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