Insuring the Indigent.

NEW POLITICAL EMPHASIS ON SOLVING HEALTH CARE CRISIS, BUT WHO PAYS?

IF you had to come up with a way to provide health insurance for L.A.'s nearly 3 million uninsured residents, would you:

a) Ask the federal government for money.

b) Ask the state government for money.

c) Talk about forcing employers to offer health insurance to all workers.

d) Do a study.

e) All of the above.

If you answered all of the above, you'd make a good politician.

Thanks to country's current economic prosperity, issues like health care that were formerly consigned to the political back burner are getting a great deal of attention this campaign season.

On the national level, politicians have been talking about drug coverage for the elderly and preserving Medicare. But in Los Angeles, the health issue boils down to one major question: How do you help the working poor get health insurance coverage?

Finding a feasible answer to the dilemma is crucial to L.A.'s economic future. Not only does illness increasingly threaten to devastate L.A.'s massive working poor population, but that illness, left untreated, threatens to spread to other sectors of the local workforce. It also is taking an increasingly large toll on L.A.'s public school population, which is heavily concentrated with uninsured children.

While California's uninsured rate is 33 percent higher than the rest of the nation, Los Angeles County's rate is even higher than that of the state as a whole. In California, 7.3 million residents have no health insurance; almost half of those people reside in Los Angeles County.

The problem of how to insure these people has bedeviled politicians for decades, though now that the state and federal governments are running a budget surplus, there seems to be more effort than ever to do something about it.

Proposals are numerous, but the most frequently discussed are measures that would essentially throw the problem to the private sector -- requiring all California businesses to provide their employees with health coverage.

Politicians tend to look to the private sector not only because it would avoid raising taxes, but because so many of the state's uninsured actually do have jobs. Most of them are working men and women in jobs that don't have many fringe benefits -- including, ironically, health care workers.

"Eighty percent of the uninsured in Los Angeles County are employed," said state Assemblyman Gil Cedillo, D-Los Angeles, who has fought to get low-wage earners health coverage.

These uninsured residents, most of them one or two rungs above the poverty level, can't afford to see a doctor. So when a medical emergency arises, they end up in the county's hospital emergency rooms, taxing the local health services budget.

Fleeing the state?

A recent study by the UCLA Center for Health Policy Research shows that it is small firms with fewer than 25 employees that don't provide health coverage. And 32 percent of those employed in Los Angeles County are working for these small firms, said Gerald Kominski, the center's associate director. Most of the employers are small manufacturers or service-oriented companies.

Though forcing these businesses to cover their employees is tempting for state legislators, politicians and economists are afraid that coming down hard on business would prompt companies to leave California for other states with less-stringent requirements.

"California is already considered a fairly heavily regulated state," said Glenn Melnick, a health care consultant at the Rand Institute in Santa Monica. "Companies might move east to Nevada or south to Mexico. If you mandate businesses to provide health coverage, in a sense you are trading jobs for fringe benefits."

Melnick figures that if businesses were required to provide health coverage for their low-wage employees, it would add at least 25 percent to the cost of the goods and services they provide. That would either be passed on to consumers or deducted from workers' wages.

"Frankly, as an economist, I don't see this being solved on a state-by-state basis," said Melnick, who thinks the most practical solutions will have to come from the federal level.

Presidential candidates Al Gore and George W. Bush have proposals to make it easier and more affordable for low-income workers to buy health insurance. Bush has called for a $2,000 tax credit for anyone who buys health insurance. The credit would be refundable, so people who make too little to pay taxes would get $2,000 back from the government to buy insurance.

Gore wants to lower the eligibility limits on a program offering coverage to children in low-income families. He also wants to extend the coverage to their parents.

In essence, the Democrats want a bigger role for government, and the Republicans want to help people buy private insurance.

The problem with California

While those solutions may help most of the nation, California has a slew of characteristics that defy easy answers. They include a high number of legal and illegal immigrants working in the state, a considerable number of small businesses, a major agriculture industry and relatively little union representation among workers.

"We've got it all," said Walter Zelman, president and chief executive of the California Association of Health Plans, a trade group that represents health maintenance organizations.

To help California and Los Angeles bridge the gap between insured and uninsured, the federal government several years ago created the Healthy Families program, which provides health care coverage for children up to the age of 18. The program covers families that make too much money to qualify for Medi-Cal but are too poor to afford private insurance. The federal government picks up part of the cost and the state provides the rest.

While this has helped children get better health care, it has left their parents outside the health care umbrella. Earlier this month, the California Legislature in the final hours of its session voted to extend the Healthy Families program to 600,000 low-income parents whose incomes are at 250 percent of the poverty level.

Gov. Gray Davis is considering how to pay for it; the most likely scenario calls for allocating $128 million of the state's annual $1 billion payment from a multi-state tobacco settlement and another $128 million in matching federal money.

In addition, studies show there are still as many as 639,000 children eligible for the Healthy Families program who haven't applied because they either don't know they are eligible or their parents don't want to fill out the paperwork for fear of being deported.

Similarly, the UCLA Center for Health Policy Research notes that there are as many as 830,000 children eligible to enroll in Medi-Cal, but their parents are not aware of their eligibility or don't know how to fill out the paperwork.

While the proposals to increase participation in such programs are all stop-gap measures aimed at getting more people health coverage, they still leave childless couples uninsured.

To be fair and help everyone, some economists still believe the federal government should phase in mandatory health coverage by all businesses. But that won't be happening soon, much to the dismay of many politicians.

Said state Assemblyman Martin Gallegos, D-Montebello, who chairs the Assembly Health Committee: "We as a society have to stop looking at health care as a cost and start looking at it as an investment (in the workforce)."