CalPERS a big dog -- but a worried one
There's no doubt about it. CalPERS, the giant California pension plan, is a big dog. And when it's tail isn't wagging, its good to ask what's wrong. That's why we listened closely when Sean Harrigan, CalPERS' president, came to vist us Wednesday, and he sounded frustrated.
CalPERS is one of the largest investors in public and private companies in the world. It has $163.5 billion in assets invested. It has clout. When it decides it wants this policy or that reform, usually other investors seem agree -- and CalPERS often gets its way. But Harrigan's concerns Wednesday were not about the financial world, they were about healthcare. CalPERS is the nation's third largest provider of healthcare, its 1.2 million beneficiaries behind only the Federal Government and General Motors in number. And Harrigan says things are out of control. The nation's healthcare costs have sky-rocketed 57 percent in three years. Healthcare makes up 15 percent of our gross domestic product (GDP), and will be 19 percent by the end of 2012, Harrigan said. CalPERS has done everything it can do to keep costs down. It has run out of options. The average family is forking out $10,000 a year on healthcare, and their backs are breaking. "It's not sustainable," Harrigan told us. "We need comprehensive national reform."
Problem is, CalPERS doesn't have the clout in healthcare that it enjoys in the investment world. As CalPERS warns about our crumbling healthcare system, few seem to be listening. Harrigan says the insurance and legal industries are formidable obstacles to serious federal-level attention, with too much at stake in the status-quo. Harrigan says he'll keep sounding the alarm in trips up and down the State, making visits to various constituents. We hope he succeeds in waking people up to the problem, and that they use their voting power force politicians to confront the issue. True, there are no quicky solutions to this. But right now, it seems Washington isn't even trying. Neither Bush nor Kerry have an adequate health care proposal, Harrigan says.