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Panel recommends new cigarette tax
by Tom Scheck, Minnesota Public Radio
February 23, 2004

Gov. Pawlenty named former U.S. Sen. David Durenberger, shown, to lead the Minnesota Citizens Forum on Health Care Costs. (MPR Photo/Tom Scheck)

Gov. Pawlenty's health care task force is calling for a $1-a-pack tobacco tax in its final recommendations on improving health care quality and reducing costs. Pawlenty appointed the task force in September to come up with ways to slow the rising cost of health care. The panel, led by former U.S. Senator Dave Durenberger, says individual consumers need to have a better idea of the cost of health care. Panel members also want a Web site that would inform consumers how doctors and HMOs are performing. Critics say the plan doesn't offer any specifics and the tobacco tax isn't likely to pass.

St. Paul, Minn. — Sen. Durenberger has repeatedly said that citizens are ready for some changes to the health care system. He says employers and their workers can't manage the annual double-digit insurance increases. Durenberger says the committee is proposing that the state use its purchasing power to influence better performance from doctors and HMOs. He says there are tens of thousands of public employees and people on state subsidized insurance who can force the health care system to lower costs.

"The system works best if you don't operate on the "rising tide lifts all boats theory" but you encourage people within the system to get where we say we would like to go on a consumer focused system and then show the rest of us how to do that. And that's what Minnesota is really good at, showing everybody else the way," he said.

Durenberger also says the state should provide more information about the cost and performance at health care clincs, hospitals and doctor's offices. He says consumers could look at the report cards and determine if they'd get good care.

The report also recommends that the health care industry reduce administrative costs, encourage consumers to live healthy lives and work towards insurance for all. Besides the tobacco tax, it offers few specifics on how state lawmakers should move toward their goals.

Task force member Peter Benner, who's the executive director of the American Federation of State, County and Municpal Employees, says they didn't have enough time to address ideas on reaching their goals, but wants lawmakers to use the proposal as a starting point.

"Part of our challenge on health care is to come back to these core principals, repeat them, build concensus on them and then we have a snowball's chance of surviving what we know is going to happen in the private sector and legislatively as we actually try to gore some oxes," Benner said.

The task force says the governor doesn't need legislative approval to move forward with some of their ideas. They hope that the governor will include other task force recommendations when he announces next year's budget.

However, one proposal that's unlikely to be in the governor's budget proposal is the tobacco tax increase. Pawlenty says his no-new-taxes pledge stands.

	Michael Scandrett

"I have not been briefed on or have received the recommendations yet but I am familiar with the dollar-a-pack cigarette tax proposal. I don't support tax increases so if it's just a naked tax increase, I wouldn't be able to support that," Pawlenty said.

Sen. Linda Berglin, DFL-Minneapolis, says she's pleased that the task force called for a tobacco tax increase. Berglin, who chairs the Senate Health, Human Services and Corrections Budget Division, proposed a similar increase last year. She also says she's pleased with some of the other proposals, like introducing an electronic records system. But Berglin says the panel did the easy part by making the recommendations. She says the difficult part is working with lawmakers and all of the interest groups to pass the bill into law.

"If they think we should have universal health care access to health care for everyone than they should propose how we should do it. Otherwise it's just a nice sounding idea that collects dust on a shelf and gets sent off to the historical society," she said.

Berglin says she'd like to put an annual cap on health care premium increases and allow small businesses to enroll employees in MinnesotaCare, the state subsidized insurance program.

Others say the task force didn't listen to citizen testimony and recommend a single-payer health care system. Kip Sullivan, with Physicians for a National Health Program, says public testimony at task force hearings and e-mail responses to the Web site support the single-payer system as one of its top priorities.

"It was fairly clear to us, given the people he appointed to the commission including two former HMO lobbyists, that they were not going to look very seriously at single payer and government action to reduce drug prices," he said.

Rep. Fran Bradley, R-Rochester, says he couldn't comment on the report because he hadn't seen it. Bradley, the chair of the House Health and Human Services Finance Committee, is proposing a bill that would cap medical malpractice awards, cuts government regulations and allows for profit HMOs to offer insurance in Minnesota.

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