It was not too long ago that the United States was the best country in the world. Just 15 years ago we were No. 2, but we’re now No. 8. That is not a good trend. Out of the world’s 200 countries, Norway has been No. 1 since 1995. Says who? The U.N. Development Program. This program rates each country based on: (1) Education as measured by literacy, (2) Standard of Living as measured by per capita income, and (3) Living a long and healthy life as measured by life expectancy. These factors constitute the Human Development Index.
While the HDI does not include important factors such as respect for human rights, democracy and equality, it provides a broadened prism for viewing human progress and the relationship between income and well being. On the other hand, Nordic health and wealth build on high quality governance. The global corruption watchdog, Transparency International, ranks Norway near the top of the world’s “cleanest” governments. The U.S. is rated No. 20 (http://www.transparency.org/).
Why aren’t we the best? You know why. We are not properly educating our children, which has an enormous impact on our ability to be leaders in the world’s economy. Our policies reward the rich, penalize the middle class, and make it almost impossible for the poor to get out of poverty. And, we have the fewest number of residents who have access to health care yet we spend more on it per capita than any other industrialized nation.
Everybody knows our health-care system is broken. Health care costs have been a problem for decades. From 1960-2003: The share of the U.S. economy devoted to health care has tripled from 5.1 percent to 15.3 percent of GDP, and health-care costs have increased twice as fast as inflation (1,232 percent versus 515 percent).
California taxpayers have a very large problem: They pay for the health care of 37 percent of Californians under the age of 65 (21 percent have no insurance and 16 percent get MediCal assistance). And, California is the sixth largest economy in the world. By the way, public retirees constitute less than 3 percent of Californians and are postponing their retirement because of exorbitant health-care costs. That affects counties who want to hire younger, more technologically savvy and cheaper employees.
But wait, there’s more! Medicare provides health care primarily to those who are 65 years and older. Medicare will not have enough money to cover all expenses starting in 2019, which is only 12 years away. What year will you turn 65 years old? While Medicare is a federal program, if our citizens do not have health insurance, California’s counties must provide them health-care services at taxpayers’ expense.
While the governor created a commission tasked with recommending a plan to address unfunded retirement health care and pension obligations for public employees and retirees, both the governor and Legislature should approve a bill that solves the health-care problem for all Californians, whether it is AB8, SB840 or another bill.
As former U.S. Supreme Court Justice Sandra Day O’Connor said, “I don’t know that there are any short cuts to doing a good job.” There are no short cuts to resolving California’s health-care problem.
About SACRS. SACRS is a nonprofit association established in 1954. Its membership consists of 20 counties in California whose retirement plan is governed by the 1937 Act. Those 20 counties provide retirement benefits to 400,000 county employees and retirees, which accounts for over 75 percent of California’s county employees and retirees. SACRS’ membership’s assets total $100 billion, which is larger than 46 of 50 state retirement systems. Retiree health care varies among the SACRS’ systems: A) Benefits vary from no coverage to 100 percent coverage, B) Sponsor of those benefits varies from the County, Retirement System and/or the Retiree, C) Funding ratio varies from 0 percent to 100 percent funded. On average, SACRS’ pensions are 86 percent funded as of June 30, 2006.