Commentary: How to bolster public health funding we need

A reinvestment of insurance nonprofits’ excess surpluses can provide funding needed for the health of all.

By Stephanie Wright / For The Herald

As we learned last week with the 2019 novel coronavirus, new and emerging disease threats can become a reality here in a matter of hours. We are fortunate to have such knowledgeable and dedicated public health professionals here in Snohomish County. They responded immediately, nimbly adapting to a continuously evolving investigation.

What’s at stake: Many may not know that the small but mighty team at the Snohomish Health District is also juggling a hepatitis A outbreak and monitoring a particularly rough flu season. Public health is still expected to continue issuing birth and death certificates, inspecting restaurants, treating tuberculosis patients, stopping the spread of countless other diseases, and so much more.

Unfortunately, funding for public health in our state has decreased by roughly 40 percent since 2000. During that same time, Washington has grown by more than 1 million people. Recession-era budget cuts made, and never fully restored, have left public health agencies like the Snohomish Health District with no other option but to make deep cuts year-over-year. These program cuts and service reductions make it harder to protect and serve Snohomish County.

Multiple, complex disease outbreaks such as coronavirus and hepatitis A have quickly taxed our agency, and many critical public health activities are on hold or delayed while we’re activated. This affects our clients, schools, hospitals and businesses on a daily basis.

When people are safe and healthy and live in clean environments, businesses are attracted to the area and bring growth and jobs. These communities are more resilient, ready to face emergencies, and better able to take care of our most vulnerable.

Forward momentum: The governmental public health system in Washington has been working with partners and legislative champions to secure sufficient and stable funding to keep our communities safe and healthy. The legislature asked for a detailed study to determine the gap to fully fund communicable disease control and environmental public health programs, as well as critical capabilities like assessment. The result: a $450 million gap in state funding per biennium.

The Legislature took steps last year to increase funding for public health, including establishing a tax on vapor products with half of the revenues dedicated to public health. That was expected to generate $10 million to $12 million per biennium. Since then, smart policy changes to ban flavored vapor products have left public health without the critical funding increase we needed.

The next step for Washington: Snohomish County’s own Rep. June Robinson, D-Everett, is the prime sponsor of House Bill 2679. Sen. David Frockt, D-Seattle, of the 46th District, has introduced a companion bill in the Senate with Senate Bill 6451. These bills propose a relatively simple concept: taking a small percentage of the excess surplus dollars held by non-profit health insurance companies. Those dollars would be collected by the state and re-directed into helping Washingtonians buy health insurance coverage and funding our state’s public health system.

The financial assistance for purchasing insurance coverage will come in the form of premium subsidies for people who are not otherwise eligible for federal subsidies. Dollars directed toward our public health system will improve the state and local health jurisdictions’ ability to adequately track, respond to, and prevent costly food and water contamination, disease outbreaks, and other public health crises. By bolstering funding for public health and helping more people buy insurance, we can dramatically improve the health of people throughout Washington.

Reinvesting a more-than-ample excess: Non-profit health insurance companies in Washington such as Premera, Regence and Kaiser Permanente have been amassing huge excess surpluses over the past 10 years. Back in 2012, Insurance Commissioner Mike Kreidler expressed alarm about the $2.4 billion excess surplus. Since then, the excess surplus totals of non-profit insurance companies have nearly doubled to $4.4 billion.

These surplus dollars are not just the cost of doing business, but rather premium dollars that were not spent on claims or revenue that comes from investments. Insurance carriers are required to carry a certain amount of surplus in case of emergencies, but the surplus amounts we are seeing in the nonprofit health insurance plans are in significant excess of that buffer.

At the same time the carriers’ surplus buckets have been growing, the cost to buy insurance has been increasing. Since 2009, average family premiums have increased 54 percent and workers’ contribution have increased 71 percent nationwide. So families are paying more for health insurance plans while the coffers of nonprofit carriers are getting deeper.

Partners for a community benefit: By creating a community benefit fund with dollars from a fee assessed on excess surplus dollars at nonprofit health carriers, we can help break down barriers to coverage and ensure our state has a strong public health system.

Rebuilding our public health services means we can better monitor and coordinate emergency response: keeping our communities safe, reducing costs for taxpayers, and protecting our local economy. This also means public health can do our job of providing insurers a healthy population, which reduces their expenses in the long run.

Put simply, we can’t put off investing in a reliable public health system any longer. Non-profit health insurance companies have a responsibility to contribute to the improvement of the overall health status of the residents where they operate. It is time for them to meet that responsibility, and they have the dollars needed to do that.

Investing those dollars in public health will pay dividends. For all of us.

Stephanie Wright is a Snohomish County Council member representing Edmonds, Lynnwood and Woodway. She was recently re-elected as chairwoman of the Snohomish Health District’s Board of Health.

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