A Public Plan for Connecticut?

Connecticut could become the first state to offer its own public-plan option, even before most of national health reform unfolds.

After several years of debate about expanding coverage, a couple of gubernatorial vetoes, and assorted false starts, Connecticut in 2009 created "SustiNet" -- a framework for what could become a state insurance plan as early as 2012, two years before the state's insurance exchange is up and running as part of national reform. Once the exchange is in place, individuals and small businesses will be able to choose between SustiNet and one of the commercial health plans.

Though approved in concept by the state Legislature, SustiNet at this point is only a concept. It has a board, a cadre of volunteer analysts, and task forces as well as support from foundations, advocates, and Democratic legislators. But the commission must go back to the Legislature next year for final approval -- and funding -- in an environment that is fiscally challenging and politically uncertain. The race to succeed Gov. Jodi Rell, a moderate Republican who is not seeking re-election, is competitive, and the Legislature, which passed the SustiNet bill and then overrode Rell's veto, could have a different composition post-November. For political or economic reasons, SustiNet could be delayed or scaled down. But state Rep. Chris Donovan, the speaker of the Connecticut House, says the idea has broad public support. The message he has been relaying around the state, he says, is, "Better plan, costs less. Like that beer commercial: tastes great, less filling."

The vision is of a self -- insured public health -- insurance plan with an affordable sliding scale of premiums. It would bring in the state's active and retired employees, Medicaid, the children's health program, municipal workers, nonprofits, the uninsured, the underinsured, small businesses, and other programs for low-income adults, Donovan says. (Not all groups would have identical benefits; state employees, for instance, may have their own plan under the SustiNet umbrella.) The Legislature must decide whether to open the public plan to all these groups at once or to phase them in. One possibility is to start with groups already covered in state plans and wait for the federal subsidies that will become available in 2014 before bringing in other groups.

"We're building a public option, using in part resources we are already expending on health care," says Kevin Lembo, the Connecticut state health-care advocate and a co-chair of the SustiNet Health Partnership Board of Directors. But when asked how many political and economic potholes still lie in SustiNet's path, he replies: "A million."

Connecticut is a relatively affluent state with fairly generous health programs for the poor. Its 9.7 percent uninsured rate is below the national 15.4 percent 2008 rate. But unemployment has risen, and the state faces multibillion-dollar budget gaps. Nonetheless, in June Connecticut expanded its coverage of low-income childless adults by becoming the first state to tap into federal funds made available under an optional Medicaid expansion provision of the federal health-reform law. State officials estimate 45,000 people will gain coverage.

The SustiNet bill was tailored in 2009 with federal legislation in mind. The thinking was that if national reform collapsed in Washington, Connecticut could move on its own, like neighboring Massachusetts. If national reform passed, SustiNet could be tweaked to fit, says Janet Davenport of the Universal Health Care Foundation of Connecticut, which helped develop SustiNet. Tweaking has commenced, and the Legislature could take up board recommendations as early as January 2011.

Lembo and other advocates note that SustiNet is not just a coverage mechanism. It was conceived, too, as a catalyst for delivery-system reform, aiming to improve quality while restraining costs. Various task forces are working on creating or expanding medical homes and chronic -- disease management, electronic medical records, incentives for evidence-based medicine, and public-health initiatives on obesity and tobacco. Addressing racial and socioeconomic health disparities is also an explicit goal. Lembo said the public option could end up covering about 1 million people out of Connecticut's 3.5 million, meaning it could have a big ripple effect on health-care delivery and public health throughout the state.