Health Plan Law

Health care reform proposals typically find expression in blue-sky manifestos with political flavor and little practical foundation. The following is a list of problems that must be addressed for real improvement in the delivery of health care.

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I’m going to pass universal health care that lowers costs for Americans. Families and businesses are drowning in skyrocketing health care premiums. There’s a lot of wasted money in our health care system . . .

My goal is to have a health care system that provides quality, affordable care to every American. On way to achieve this goal is to have a national health care system where there is only one source of care and the government runs it . . .

While I haven’t proposed a specific health care plan this early in the campaign I have proposed two pieces of legislation in the Senate that would expand access and care for immigrants. from “ABCNews.com Exclusive: Sen. Hillary Clinton Answers Your E-Mails”

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The VA hospitals are not good either except for the staff who work so hard. It brings tears to my eyes when I see my brothers and sisters having to deal with these conditions. I am 70 years old, some say older than dirt but when I am with my brothers and sisters we become one and are made whole again. ‘It Is Just Not Walter Reed’, Washington Post (March 5, 2007)

The current scandal over military hospitals stands in stark contrast to the praise bestowed on the VA hospitals by a recent survey also reported in the Washington Post. For example, the Post has reported:

The Department of Veterans Affairs medical system once epitomized poor-quality care. But after a series of changes, the system has been hailed in recent years as a model for health care reform.

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Democratic lawmakers unveil a comprehensive health care proposal designed to provide coverage for virtually all uninsured in the State. Package price for universal care is set at $900 million. The program is called the Connecticut Healthy Steps Program. The idea is to address specific areas of the health care system rather than overhaul the entire system.

According to state House Deputy Majority Leader Michael Christ (D), the proposal would involve a combination of financing sources including a proposed 3% provider tax, a vanity tax for optional cosmetic surgery, increasing the state cigarette tax, tax subsidies to help workers pay for employer-based health coverage and tax incentives where employers provide coverage.

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Yes, we’ll have to raise taxes. The only way you can pay for a health care plan that costs anywhere from $90 [billion] to $120 billion is there has to be a revenue source.

“Edwards’s healthcare plan entails tax increase”, Boston Globe (Feb. 5, 2007) (boston.com)

According to the foregoing Associated Press article printed in the Boston Globe, John Edward’s health care reform proposal will entail higher taxes to fund his concept of universal health coverage. The article, based upon his appearance on Meet the Press [watch here], may be summarized as follows: (more…)

A Clinton spokesman, asked for details last night, would only say, “stay tuned,” followed by a smiley face emoticon. Mrs. Clinton said she wanted to “tackle problems of coverage” so everyone is insured for health care; has access to quality care; and can afford the insurance.

from The New York Times Blog

Senator Clinton’s rival, Sen. Barack Obama, stepped forward with his views during a speech at the annual Families USA Conference in Washington. (Long on charm, short on facts according to the WSJ)

Radioactive for more than a decade, universal health insurance emerged Thursday as a 2008 Democratic presidential primary issue for chief rivals Barack Obama and Hillary Rodham Clinton.

The Chicago Sun-Times (more…)

As promised, last night President Bush aired his proposals for making private health insurance more available and affordable. In his State of the Union address, the President emphasized his commitment to the private insurance systems as the best way to accomplish health care goals.

Highlights of the President’s views: (more…)

For balance, I have contacted Senator Clinton’s office for details on her proposal. The Albany office referred me to the D.C. office and there I was referred to the legislative department.  For the present, the Senator’s position consists of highlights on her website here. I do anticipate I will have a more comprehensive summary of her proposals very shortly. They will be posted as an article upon receipt.

President Bush outlined a proposal for improvement in the health care delivery system in his radio address this weekend. The proposal features a tax deduction for people who get health coverage either at work or on their own. On the other hand, employer-provided health insurance would be counted as income and thus would become taxable – constituting a tax increase for an estimated 20% of employees.

The President will add additional detail in his State of the Union address.

The text of the radio address is set forth below or available through a link to the White House website. (In the text, I supplied emphasis to those concepts which appear central to the proposal.)

The remarks begin with an affirmation of commitment to the present Medicare and Medicaid programs, and specifically the State Children’s Health Insurance Program. (Speaking yesterday at the Ryan Chelsea-Clinton Community Health Center on Manhattan’s West Side, Senator Clinton also claimed the latter issue, stating “it is simply wrong for any child in America to go without health insurance.” (more…)

The “Medicare for All” plan will make health care coverage available to every American by expanding the Medicare program to the under 65 population. To promote competition and choice, enrollees will also have the option of choosing any of the plans offered to members of Congress, the President, and Federal employees.

from Senator Kennedy’s “Medicare For All” proposal

Ted Kennedy drew attention to his proposal for universal medical verage in his first hearing Wednesday as chairman of the Senate Health, Education, Labor and Pensions Committee. With some obvious exultation, Kennedy opened with praise for the Democratic legislators in his home state who worked with Republican Gov. Mitt Romney in crafting a universal coverage plan. Kennedy now joins the Democratic ranks seeking universal coverage by setting forth a national plan. (more…)

Gov. Schwarzenegger presented his plan to provide universal health coverage yesterday. The proposal can be reviewed at the governor’s website. There you can view a live video Q & A session on the proposal or just read the proposal text.

The highlights, as presented: (more…)

Massachusetts hospitals and community health centers are joining a major campaign to enroll residents with low and moderate incomes in subsidized insurance plans that are a key part of the state’s sweeping healthcare initiative . . . But even as they take to the radio waves, prepare to distribute brochures written in multiple languages, and mail out flyers, hospital executives are finding their jobs complicated by a major problem: Few uninsured residents know anything about the landmark initiative, and fewer still understand that the new law requires them to purchase health coverage beginning July 1. The Boston Globe, January 4, 2007

The success of the enrollment will depend largely on provider efforts and particularly hospitals according to observers. One of the biggest hurdles appears to be getting the people that need the program to identify themselves and actually apply.

For more information on the status of the enrollment (a little over 28,000 as of year-end), visit the website of the Commonwealth Health Insurance Connector Authority, “an independent authority created, under c. 58 of the Acts of 2006, as part of the sweeping reform designed to increase access to health care in Massachusetts.” The site contains an insurance broker presentation in Power Point, health care quality and cost information (such as mortality rates by institution), and other items that are simply interesting to read through.

Critical view of the program can be found on several sites including the Heritage Foundation website, NPR’s website, and several articles in the Boston Globe. A Kaiser Foundation factsheet is available for a quick overview. For a larger collection of articles, visit the News search tool on BenefitsLink and simply type “Massachusetts”.

Within days of convening, the new Congress will return to some of the biggest battles of the last decade as House Democrats try to rush through legislation requiring the government to negotiate lower drug prices for Medicare beneficiaries and overturning President Bush’s restrictions on embryonic stem cell research. The Medicare proposal highlights the profound differences between Democrats and Republicans over the future of the nation’s health care system, the proper role of government and the role of private markets in securing the best value for the huge sums spent on health care. “Power Shift in Congress Revives Health Debate”, The New York Times, 1/1/2007

The new year brings vows of attention to the working poor and expanded health care in a “mainstream” agenda according to Iowa Democrats. Democratic presidential contender John Edwards is quoted as saying that it is more important to invest in universal health care and lifting people out of poverty than to reduce the budget deficit. Not to be outdone, Republicans such as Charles Crist, the newly-elected governor of Florida, vow to make health insurance more affordable.

Oregon is among the States looking to increase access to health care through legislation. “The goal is to design a new system that provides health care to all Oregonians and use current funding more effectively”. According to one policymaker, “it absolutely is the year for reform. Meanwhile, after “an extraordinary year for health care in Massachusetts”, the citizens of that State contemplate what they are supposed to do under the new legislation. (Boston Globe article, registration required).

Mandating that individuals and employers buy into the existing health insurance structure forces people into a broken and inefficient system, according to Jerry Flanagan, health policy director of the Foundation for Taxpayer and Consumer Rights in Santa Monica. With Massachusetts, Maine and Vermont now in the nascent stages of their universal care legislation, New Jersey is giving the idea consideration.

State lawmakers expect to introduce legislation in the spring that would require all New Jersey residents to have health insurance. The projected first-year cost of covering the 1.4 million uninsured: $1.7 billion.

Newly-elected governor Eliot Spitzer weighed in on the issue at his inauguration yesterday, declaring an end to the “Rip Van Winkle” era in New York. Noting that “some may feel threatened by health-care reforms”, he promised a sometimes “bumpy ride” on the path to reform.

A recent news article takes stock of various State initiatives, including the once-ebullient, now-flagging Tennessee healthcare program (described as currently in “meltdown”). In 2005, Gov. Phil Bredesen (D) had to cut 170,000 enrollees from the TennCare program because of “perennial budget overruns”. Bredesen is quoted as describing the program as “too expensive, too rigid, too hard to control.” Oregon’s present program is in similar straits. Jonathan Oberlander, PhD, associate professor of health policy at the University of North Carolina, is quoted as stating that “for states like Massachusetts, the real challenges have just begun” with cost containment constituting the most difficult hurdle.

So, as the politicians air their lofty goals, we must recall that their agendas are frequently revised and compromised. In such matters their plans for the funding of campaign promises present troublesome details that give rise to obscure observations. For example, with regard to his various benevolent proposals, Senator Edwards opines that he wants to get the country “out of this ditch we’re in fiscally” but acknowledges his plan “means you cannot do about the deficit what you’d like to do, that’s true.”

See also, Bush signs tax bill with mental health parity and HSA provisions (CCH), Congress’ New Priorities (Business Week); :: Healthcare Reform: Agenda of the New Congress; :: Election 2006 – Implications For ERISA

“While we acknowledge that insurance regulation should be streamlined, we believe establishing another federal office to do so is not the answer . . .  Taking power away from the states and centralizing it in Washington will only complicate issues for insurance companies, agents and brokers and, most important, consumers of insurance services ”

Greg Wren, Alabama state legislator, quoted in National Underwriter article (October 5, 2006)

This initiative comes at a time when Senate Majority Leader Bill Frist (R-Tenn.) has already thrown in his support for legislation (S 1995) that would allow small businesses and trade associations to form association health plans across state lines. Under the bill, health insurers could offer AHPs to small businesses and individuals that do not meet current state benefits requirements. Opposed by State regulators, the AHP legislation would curtail State regulation, while enhancing federal jurisdiction (without any appropriate of funds for the purpose).

The strong Republican support for suppression of State regulation in favor of federal jurisdiction over life and health insurance, traditional areas of State concern, must at least raise some question as to ideological coherence.  Whether motiviated by a need to answer the push for health care reform, small business constituencies or some other factor, the preference for federal regulation may backfire in any event if the proposals carry only to find that the promised federal regulatory supervision is unfunded and inadequate.

The National Insurance Act of 2006 (S.2509) would radically restructure the current system of state insurance regulation by establishing a federal insurance regulatory authority. Both the National Governors Association (NGA) and the National Conference of State Legislatures (NCSL) oppose the legislation. The National Association of Insurance Commissioners has weighed in against the proposed federal legislation as well.

“The nation’s insurance officials strongly believe that a coordinated, national system of state-based insurance supervision has and will continue to meet the needs of the modern financial marketplace, while enhancing individual and commercial policyholder protections,”, stated the NAIC president, Alessandro Iuppa. Leonard C. Brevik, executive vice president and CEO of the National Association of Professional Insurance Agents, also expressed opposition to the legislation. In an interview before the National Conference of Insurance Legislators, Brevik stated that “[t]he National Insurance Act of 2006 would undermine key insurance consumer protections, constrict the availability of insurance, create market instability and prompt a flood of litigation”.

At issue is the ability of insurer to avoid regulation by the various States. For example, a provision of the proposed legislation provides:

(c) Activities of Federally Licensed Insurance Producers- No State may–

(1) by statute, regulation, order, interpretation, or otherwise, prevent or restrict a federally licensed insurance producer from selling, soliciting, or negotiating insurance in such State on behalf of a National Insurer, State insurer, or United States branch of a non-United States Insurer; or

(2) require such producer to be licensed by reason of engaging in such acts on behalf of a National Insurer, State insurer, or a United States branch of a non-United States Insurer.

Another provision of the proposed legislation relating to reinsurance provides:

No State may prevent a State insurer from–

(1) ceding insurance to a National Insurer or a federally licensed reinsurer; or

(2) establishing an asset or reducing its liabilities as a result of such reinsurance to the same extent as the State would allow such insurer if the insurance were ceded to another State insurer.

The bill is sponsored by Senator John Sununu (R-NH) who claims that:

“Streamlining an overwhelming and tangled web of state rules for financial regulation, licensing, policy forms, rates, and market conduct exams under an ‘optional federal charter’ system will encourage greater competition. Moreover, new and innovative insurance products will become available to the consumer more quickly.”

See, Sununu Press Release.