Healthcare Collector Weighs in on Universal Coverage in California

Like many California business owners, collection agency president Robert Tavelli has some questions and concerns about the healthcare reform plan that the state’s House Assembly passed on Monday ("California House Approves Mandatory Health Plan," Dec. 18).

But Tavelli said he’s not worried that the plan, which mandates nearly every Californian have healthcare coverage by 2010, will significantly diminish the number of healthcare receivables in the market.

“I don’t see any indicator this will positively or negatively affect the recoveries on healthcare receivables for hospitals,” said Tavelli, president of North Coast Collections Service, a healthcare collections agency in Santa Rosa, Calif. “Receivables will continue to grow because people need healthcare and a bill still has to be paid. There’s still a portion that’s private pay.” 

California’s healthcare plan still must be approved by the Senate and signed by the governor before it goes to voters in November who will decide whether to approve funding for the plan. In addition to accessing a fee on hospitals and a tobacco tax of at least $1.50 a pack, the funding plan requires employers to spend between 1 and 6.5 percent of their payroll on health coverage or pay into a state pool to fund healthcare coverage.

Tavelli said his firm would be assessed 4 percent of his annual payroll if he didn’t provide coverage for his 18 employees. “I pay more than that now,” he said. But he fears the plan’s true cost would be greater than indicated and that some employers may stop providing coverage for their employees because an alternative state program would be available. He’s also concerned that Californians may end up with less quality care.

“People may be insured, but how well insured?” he asked. “I’d be more concerned about the level of care that the program provides and the false expectations put on people.”