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Horse-and-Buggy Health Coverage
Wall Street Journal
July 17, 2006; Page A10

THERE IS NO SUBJECT that gets more discussion, analysis and lament than
health care in America. Enough already. It's time to assert one simple
fact: The employer-based system of health coverage is over. This may
sound shocking, coming from a union leader whose members bargain
constantly with employers for health-care benefits. But the system is
collapsing, crushed by out-of-control costs, a revolutionary global
economy and masses of uninsured.

CEOs know this best: They dread the meeting with HR managers who tell
them, once again, that their health-care costs are through the roof. So
they look for any way to control costs. Co-pays go up, subsidies go
down, coverage is dropped all together. In the last five years alone,
the percentage of businesses offering health benefits has plummeted to
60% from 69%. Here's how bad it will continue to get: McKinsey &
Company projects that by 2008, the average Fortune 500 company will
spend as much on health care as they make in profit. How can we
possibly compete in the global economy with that kind of burden?

I understand why CEOs are afraid of health-care costs. What I don't
understand is why they are so timid about doing something about them.
These are the people who revolutionized medicine, communication,
technology, entertainment and investing. And yet when it comes to
addressing the biggest economic issue their companies and their country
face, they resort to bookkeeping. Where are the visionaries? The
tough-minded magnates who make billions for shareholders? Stuck in the
20th century, that's where.

To fix health care in America, we have to accept that we're living
through the most profound transformative economic revolution in the
history of the world. It's happening so fast we can barely keep track
of it. Intense global competition. Contingent work. The explosive
economies of China and India. Technology in the workplace. Outsourcing.
By the time they are 35, young people entering the job market today
will already have worked in eight to 12 jobs. Employers will be pit
stops for them, not permanent homes. In other words, we are rapidly
moving from employer-managed work lives to self-managed work lives, in
which workers must figure out on their own how to maintain things like
health insurance and retirement.

A new national policy framework is the easy part. There seems to be
broad consensus that we need a universal system that provides
affordable coverage, choice of doctors and insurance plans, core
benefits, and shared financing among employers, employees and
government. There are a couple of thousand position papers out there to
choose from. The problem isn't policy, it's leadership. And I don't
mean Washington, D.C. The political class in both parties is full of
words and bereft of action. They are not going to provide the answers
until they are forced to. That force must come from the business community.

Today I sent a letter to every CEO in the Fortune 500 asking them to
make health care their national priority. I urge corporate leaders to
come forward. Our union members -- your employees -- will work with
you. The old idea that business and labor can't work together for the
common good is as outdated as lifetime jobs. The Service Employees
International Union is the largest health-care union in the country.
Our membership includes nearly one million nurses, doctors, hospital
staff, nursing home and home care workers. We know health care. You
know business. Together, let's build a new 21st-century American economy.

Mr. Stern, president of the Service Employees International Union, is
author of "A Country That Works," forthcoming from Free Press.

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