Prescription for a system in crisis.

• Author: Williams, Walter F.
• Position: US health care system - Chairman's Agenda: Managing Health Care Costs

Here are a set of principles that address cost, access, and quality in reforming the American health care system.

The health care crisis facing our nation is an issue far broader than steel industry concerns. It is an issue affecting both the public and private sector, an issue affecting everyone in some way in our country.

We all must face the fact that our nation's fragmented health care system is simply not working. It is not meeting the needs of the American people by providing affordable, quality, and efficient care to all of our citizens.

Simply put, can our society afford the out-of-control health care costs that are double and triple the rate of inflation year after year? The answer is "no"!

The facts speak for themselves: * Health care costs in 1990 were 12.4% of GNP -- more than $675 billion, or about $2,500 for each and every American. * If current rates cost increases continue, these costs could represent 25% of GNP by the year 2000. * In spite of all this spending, we still have over 30 million people uninsured.

As to the business sector, 1990 was a disaster, with health care costs for private employers increasing an average of 21.6%. Worse yet, smaller companies experienced increases exceeding 30%.

And, finally, getting closer to home for me, the health care cost charge to the hourly payroll in January 1991 was $4.12 per hour for the steel industry. That was 15.4% of total employment costs. A decade earlier, in 1981, the charge was $1.49 per hour, or 7.4% of total employment costs. That is an increase of 176% for health care compared to only a 21% increase in all other employment costs for this 10-year period.

The bottom line is that our industry's health care costs are now two to three times higher than those for the rest of the world's steel industries. For example, in 1990, each active hourly steelworker in Canada supported health care costs for active and retired steelworkers of approximately $3,200 per year. By comparison, each American steelworker is burdened with an annual cost of $7,000 for health care costs covering the same group. This is a staggering difference when you recognize that steelworkers in the United States and Canada have essentially the same benefit package. The Canadian example is not unique, and the difference is even greater in many countries -- and, unfortunately, the gap keeps widening.

Steel is now an international commodity, and we must complete in the global market -- and the global market now...